United States District Court, D. Nevada
J. DAWSON UNITED STATES DISTRICT JUDGE.
the Court is Defendant SFR Investments Pool 1, LLC's
Motion for Default Judgment against Laurey Powers (ECF No.
70). Powers has not responded. This is an action to quiet
title in a residential property located at 1356 Dream Valley
Street, in Henderson, Nevada. On March 1, 2019, the parties
notified the Court that they had reached a settlement on each
of JP Morgan's claims and on SFR Investments'
counterclaims against the bank. See ECF No. 63. The
Court granted the parties' stipulation of dismissal three
days later. ECF No. 65. The only claim that the settlement
did not resolve was SFR Investments' quiet title
crossclaim against former owner Laurey Powers, who has not
participated in the case in any meaningful way. The Clerk of
the Court entered default judgment against Powers in February
of 2019. ECF No. 62.
October 17, 2019, the Court ordered SFR Investments to move
for default judgment against Powers or otherwise advise the
Court of its plan for its pending crossclaim. SFR Investments
timely moved for default judgment under that order. SFR
Investments argues that Powers-and her successors and
assigns-have no right, title or interest in the property.
Powers has not disputed this. Given Powers failure to respond
or participate in this suit, the Court grants SFR
Investments' motion, enters a default judgment against
Powers, and declares that neither Powers nor her successors
or assigns own any right, title, or interest in the property.
judgments are generally disfavored due to the judicial
interest in deciding cases on their merits. Eitel v.
McCool, 782 F.2d, 1472 (9th Cir. 1986). However, the
Court may exercise its discretion to enter default judgment
against a non-participating party. Id. at 1471. The
Federal Rules of Civil Procedure outline a two-step process
to obtain a default judgment. First, the party seeking
judgment must request entry of default from the court clerk.
Fed.R.Civ.P. 55(a). If the plaintiff's claim is for sum
certain, the clerk may then enter a final judgment in the
plaintiff's favor without involving the Court.
Fed.R.Civ.P. 55(b)(1). In all other cases, the plaintiff
proceeds to step two and must move the Court for default
judgment. Fed.R.Civ.P. 55(b)(2).
Court considers seven factors to determine whether a
plaintiff's request for default judgment overcomes the
Court's interest in deciding the case on its merits. They
are: (1) the possibility of prejudice to the plaintiff if it
does not receive the default judgment; (2) the merits of the
plaintiff's substantive claim; (3) the sufficiency of the
complaint; (4) the sum of money at stake; (5) the possibility
of a dispute concerning material facts; (6) whether the
default was a product of excusable neglect; and (7) the
strong policy in favor of deciding cases on their merits.
Eitel, 782 F.2d at 1471-72.
first Eitel factor asks if the plaintiff would
suffer prejudice if it did not receive a default judgment.
Here, the Court finds that SFR would suffer prejudice without
a default judgment because it could be forced to re-litigate
its property interest against Powers. If Powers later decided
to assert an interest in the property, SFR Investments would
incur additional attorney fees and court costs to defend a
claim Powers could have-and should have-brought during this
proceeding. Forcing SFR Investments to litigate that question
again would be wholly unnecessary. Therefore, this factor
supports default judgment.
second and third Eitel factors examine whether the
allegations in plaintiff's complaint are sufficiently
pleaded to warrant a judgment in its favor. Although the
parties settled most of their claims before the Court made
definitive factual and legal findings, the issues this case
presented are familiar to the Court. The primary question
here was whether JP Morgan's deed of trust survived a
homeowner association's nonjudicial foreclosure. Whether
that foreclosure also extinguished Powers's interest is
simpler. The association's foreclosure almost certainly
extinguished any interest Powers could claim. SFR Investments
pleaded as much in its crossclaim. Therefore, the second and
third Eitel factors support default judgment.
fourth factor turns on the amount of money at stake in the
dispute. Here, this factor is not applicable. SFR does not
seek damages from Powers. It seeks a declaration that its
interest in the property is superior to Powers's
interest. Therefore, this factor is neutral.
the possibility of a dispute over the material facts of
SFR's claims. Although the timing of the parties'
settlement prevented the Court from evaluating the evidence
supporting their claims, the Court finds little risk of a
future factual dispute between Powers and SFR Investments.
Therefore, this factor supports default judgment.
next Eitel factor considers whether Powers's
lack of participation in this suit is excusable. The Court
finds no evidence that it is. Powers was properly served in
May of 2017, but she did not answer. Summons, ECF No. 31.
Then, the Clerk of the Court entered default against Powers.
ECF No. 62. Like many other quiet title cases in this
district, this case was prolonged while the state and federal
appeals courts tried to settle the law surrounding NRS §
116. In all, the case spanned nearly three years before the
parties settled. It was stayed for a time, and multiple
docket entries include Powers on the certificate of service.
This is all to say that Powers had ample notice of the
pending action against her and an opportunity to participate
after being properly served. There is no evidence that
Powers's neglect would be excusable. Therefore, this
factor favors default judgment.
final Eitel factor considers the public policy of
adjudicating cases on their merits. The Court appreciates the
public benefit in reaching the merits of each case. Here
however, every other factor either favors default judgment or
is neutral. Accordingly, the Court is justified to exercise
its discretion to enter default judgment against Powers.
IT IS HEREBY ORDERED that SFR Investments Pool 1, LLC's
Motion for Default Judgment (ECF No. 70) is
GRANTED. Neither Cross-defendant Laurey
Powers, nor her successors and assigns, shall have any right,
title, or interest in the property located at 1356 Dream
Valley Street, in Henderson, Nevada.
Clerk of the Court shall ENTER JUDGMENT in
favor of SFR Investments Pool 1, LLC and against Laurey
adjudicated each outstanding claim, the Clerk of the Court is