United States District Court, E.D. Kentucky, Central Division, Lexington
MEMORANDUM OPINION AND ORDER
matter is before the Court on Plaintiff HMP Automotive
Consultants, LLC's motion for an entry of default and for
default judgment against Defendants Pierce Property Group,
Lie and Anthony Pierce. (DE 20.) For the reasons set forth
below, the Court orders Defendants to show cause why default
should not be entered within seven days. If Defendants do not
show cause, the Clerk of the Court is directed to enter their
default. HMP's motion for default judgment is denied with
leave to refile.
initiated this breach of contract matter in Fayette Circuit
Court on February 24, 2017. (Compl., DE 1-1.) Defendants
removed this matter to this Court on May 17, 2017, (DE 1),
and filed their answer to the Plaintiffs complaint the same
day, (DE 3). The Court entered a Scheduling Order, requiring
the parties to complete all fact discovery on or before
January 31, 2018. (DE 10 ¶ 1.)
alleges that the Defendants have failed to respond to
discovery requests. HMP served its First Set of Requests for
Admission, Interrogatories, and Requests for Production of
Documents on Defendants on September 29, 2017. (DE 14.) HMP
claims that Defendants served their response to the requests
for admission on HMP on November 14, 2017, the agreed
deadline for a response, but failed to respond to the
remainder of the requests.
same day, Pierce Property's counsel moved to withdraw
because Pierce Property "failed or refused to timely or
adequately communicate and cooperate with undersigned
counsel, and have not paid any legal fees or costs for
services rendered." (DE 16.) The Court granted this
motion and ordered Pierce Property to retain replacement
counsel within thirty days. It also directed Pierce to file a
notice with the Court within thirty days if he intended to
proceed pro se. (DE 17.) New counsel has not
appeared on behalf of either Pierce Property or Pierce, and
Pierce has not filed a notice that he will proceed pro
se. HMP states that, as of the date of their motion,
they had not received any further discovery from the
Defendants. Nor have the Defendants responded to HMP's
motion for entry of default and default judgment.
clerk of the court must enter the default of a party when the
party "has failed to plead or otherwise defend, and that
failure is shown by affidavit or otherwise." Fed R. Civ.
P. 55(a). Default judgment must be entered "on the
plaintiffs request, with an affidavit showing the amount due
. . . against a defendant who has been defaulted for not
appearing and who is neither a minor nor an incompetent
person" if the amount is for a sum certain. Fed R. Civ.
P. 55(b)(1). Where the defaulting party has appeared, the
plaintiff "must apply to the court for a default
judgment" and "that party or its representative
must be served with written notice of the application at
least 7 days before the hearing" on the default
judgment. Fed R. Civ. P. 55(b)(2). Default judgment may also
be entered as a sanction for not obeying a scheduling or
other pretrial order. Fed.R.Civ.P. 16(f)(1)(C).
Entry of default
of default against Pierce Property is warranted because the
corporate entity has been unrepresented by counsel since its
original counsel was permitted to withdraw in November 2017.
Pierce Property was ordered by the Court to retain
replacement counsel by December 18, 2017 and has failed to do
so. Entry of default is appropriate both under Rule 55(a) for
failure to defend this action and under Rule 16(f) as a
sanction. It is well settled "that a corporation may
appear in the federal courts only through licensed
counsel." Rowland u. Cal. Men's Colony, Unit
IIMen's Advisory Council, 506 U.S. 194, 202 (1993)
(citing Osborn v. President of Bank of United
States, 9 Wheat. 738, 829 (1824)). Pierce Property has
therefore "failed to . . . otherwise defend" this
action by not retaining licensed counsel. Fed.R.Civ.P. 55(a);
see Sony/ATV Music Publ'g LLC u. 1729172 Ontario,
Inc., No. 3:14-1929, 2017 WL 4411054, at *5 (M.D. Tenn.
July 28, 2017), report and recommendation adopted,
No. 3:14-CV-1929, 2017 WL 4351069 (M.D. Tenn. Oct 2, 2017)
(holding a corporate defendant had failed to "otherwise
defend, " warranting entry of default, by not retaining
counsel); Dow Corning Corp. v. Jie Xiao, No.
11-10008, 2013 WL 4039371, at *6 (E.D. Mich. Aug. 7, 2013)
(same). Moreover, Pierce Property's failure to retain
counsel defied this Court's previous Order, warranting
entry of default as a sanction under Rule 16(f)(1)(c).
similarly failed to comply with the Court's previous
order that he file a notice if he intends to proceed pro
se by December 18, 2017. Pierce has also not had counsel
appear on his behalf. Pierce's failure to comply with
HMP's discovery requests further evinces his intent not
to defend this action. See, e.g., Ndabishuriye v. Albert
Schweitzer Soc'y, USA, Inc., 136 Fed.Appx. 795, 802
(6th Cir. 2005) (affirming default judgment for failure to
participate in discovery). Accordingly, Pierce's failure
to defend this action and his noncompliance with Court orders
warrants entry of default as a sanction under Rule
16(f)(1)(c) and for otherwise failing to defend under Rule
Property and Pierce have both appeared in this litigation.
Accordingly, to protect their interests, the Court will delay
issuance of the entry of default and permit the Defendants
seven days to show cause why default should not be entered.
of a default judgment is a two-step process. See Sheppard
Claims Svc, Inc. v. William Darrah & Assocs., 796
F.2d 190, 193 (6th Cir. 1986) ("[E]ntry of default is
just the first procedural step on the road to obtaining a
default judgment . . . .")• Default judgment cannot
be entered until the clerk has entered the Defendants'
default. Moreover, HMP has not submitted an affidavit showing
the amount due, if for a sum certain, or otherwise requested
a hearing for the court to determine the amount of damages.
Fed.R.Civ.P. 55(b). Accordingly, while entry of default is
appropriate, default judgment is not yet warranted.