Best Western International Incorporated v. PVV LLC ( 2021 )

1 WO 2 3 4 5 6 IN THE UNITED STATES DISTRICT COURT 7 FOR THE DISTRICT OF ARIZONA 8 Best W estern International ) No. CV-20-01578-PHX-SPL ) 9 Incorporated, ) 10 ) O R D E R Plaintiff, ) ) 11 vs. ) ) 12 PVV LLC, et al., ) 13 ) ) 14 Defendants. ) 15 I. BACKGROUND 16 On August 10, 2020, Plaintiff filed a Complaint in this Court alleging Defendants 17 failed to pay certain fees and charges pursuant to a Membership Agreement and seeking to 18 recover those fees for a total of $76,948.49. (Doc. 1 at 5-6). Service was executed against 19 all Defendants on September 1, 2020. (Doc 11). Defendants did not file an answer or 20 otherwise appear in this case. On October 2, 2020, this Court issued an Order to Show 21 Cause why the action shouldn’t be dismissed in its entirety for failure to prosecute. 22 (Doc. 12). Defendants did not respond, and on October 12, 2020 Plaintiffs filed an 23 Application for Entry of Default. (Doc. 13). The Clerk’s office granted the Application and 24 entered default against all Defendants. (Doc. 14). Before the Court is Plaintiff Best Wester 25 Incorporated’s Motion for Default Judgment (Doc. 16). 26 II. DISCUSSION 27 Once a party’s default has been entered, the district court has discretion to grant 28 default judgment. See Fed. R. Civ. P. 55(b)(2); Aldabe v. Aldabe, 616 F.2d 1089, 1092 (9th 1 Cir. 1980). Factors the court may consider include (1) the possibility of prejudice to the 2 plaintiff, (2) the merits of the claim, (3) the sufficiency of the complaint, (4) the amount of 3 money at stake, (5) the possibility of a dispute concerning material facts, (6) whether 4 default was due to excusable neglect, and (7) the policy favoring a decision on the merits. 5 See Eitel v.McCool, 782 F.2d 1470, 1471-72 (9th Cir. 1986). In applying the Eitel factors, 6 “the factual allegations of the complaint, except those relating to the amount of damages, 7 will be taken as true.” Geddes v. United Fin. Group, 559 F.2d 557, 560 (9th Cir. 1977). 8 A. Possible Prejudice to Plaintiff 9 The first Eitel factor weighs in favor of granting Plaintiff’s motion. Plaintiff served 10 Defendant PVV LLC on August 14, 2020 (Doc. 7) and Defendants Kishori Patel and Ketan 11 Patel on September 2, 2021 (Docs. 10 & 11). Defendants have not answered the Complaint 12 or otherwise appeared in this action. Further, Defendants repeatedly failed to answer 13 Plaintiff’s demands for payment even before this lawsuit. (Doc. 1 at 5-7). If Plaintiff’s 14 Motion for Entry of Default Judgment is not granted, Plaintiff will likely be without other 15 recourse for recovery. 16 B. Merits of Plaintiff’s Claims and the Sufficiency of the Complaint 17 The second and third Eitel factors also weigh in favor of granting the Motion. These 18 factors favor a default judgment where the complaint sufficiently states a claim for relief. 19 See Danning v. Lavine, 572 F.2d 1386, 1388-89 (9th Cir. 1978). The allegations in 20 Plaintiff’s Complaint, taken as true, state valid claims for breach of contract and breach of 21 the duty of good faith and fair dealing. 22 C. Amount of Money at Stake 23 Under the fourth Eitel factor, the Court considers the amount of money at stake in 24 relation to the seriousness of the defendant’s conduct. Plaintiff requests a total of 25 $76,948.49 in unpaid fees. (Doc. 16 at 6). The damages requested stem from several 26 months of unpaid fees, dues, charges, and assessments pursuant to a membership 27 agreement. The Court finds that $76,948.49 is an appropriate amount of damages in this 28 case because the amount is ascertainable and verified by supporting documentation. 1 D. Possible Dispute Concerning Material Facts 2 Given the sufficiency of the Complaint and Defendants’ default, no genuine dispute 3 of material facts would preclude granting Plaintiff’s motion. See Geddes, 559 F.2d at 560. 4 E. Whether Default Was Due to Excusable Neglect 5 Defendants were properly served with the summons and the Complaint pursuant to 6 Rule 4 of the Federal Rules of Civil Procedure. (Docs. 7, 10, & 11). It therefore is unlikely 7 that Defendants’ failure to answer and the resulting default was the result of excusable 8 neglect. 9 F. The Policy Favoring a Decision on the Merits 10 “Cases should be decided upon their merits whenever reasonably possible.” Eitel, 11 782 F.2d at 1472. But the very existence of Rule 55(b) indicates that this preference, 12 standing alone, is not dispositive. Moreover, Defendants’ failure to litigate this case impairs 13 the progression of the case and renders a decision on the merits impractical, if not 14 impossible. The Court therefore is not precluded from entering default judgment against 15 Defendants. 16 III. CONCLUSION 17 Having reviewed Plaintiff’s motion and supporting documents, and having 18 considered the Eitel factors as a whole, the Court concludes that the entry of default 19 judgment is appropriate. The Court finds that Plaintiff’s Complaint and supporting 20 documentation, as well as the affidavit in support of the Motion, sufficiently establish the 21 amount of damages suffered by Plaintiff and the interest due on that amount. Accordingly, 22 IT IS ORDERED: 23 1. Plaintiff’s Motion for Default Judgment (Doc. 16) is granted; 24 2. Default Judgment is entered in favor of Plaintiff Best Western International 25 Incorporated and against Defendants PVV, LLC; Ketan Patel; and Kishori Patel in 26 the amount of $76,948.49, plus post-judgment interest pursuant to 28 U.S.C. § 1961; 27 /// 28 /// 1 3. Plaintiff is directed to file any motion for attorneys’ fees and/or costs in accordance 2 with Federal Rule of Civil Procedure 54(d), LRCiv 54.2, and LRCiv 54.1; and 3 4. The Clerk of Court shall enter judgment and terminate this action. 4 Dated this 19th day of January, 2021. 5 7 United States District kadge 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28