Meridian PO Finance LLC v. OTR Tire Group Incorporated ( 2022 )

1 WO 2 3 4 5 6 IN THE UNITED STATES DISTRICT COURT 7 FOR THE DISTRICT OF ARIZONA 8 9 Meridian PO Finance LLC, No. CV-20-00446-PHX-MTL 10 Plaintiff, ORDER 11 v. 12 OTR Tire Group Incorporated, et al., 13 Defendants. 14 15 Plaintiff Meridian PO Finance, LLC (“Meridian”) moves for default judgment 16 against Defendant Roadmaster Trucking (“Roadmaster”) with respect to Count XVI of 17 Meridian’s Complaint, pursuant to Rule 55 of the Federal Rules of Civil Procedure. 18 (Doc. 72, the “Motion.”) Defendant Roadmaster has not filed a response or appeared in 19 this case. The motion for default judgment is denied without prejudice. 20 On February 28, 2020, Meridian filed the Complaint (Doc. 1) claiming that all 21 named defendants in this case are jointly and severally liable for $23,532,951 for their roles 22 in an alleged fraudulent scheme.1 (Id. at ¶ 5.) Additionally, the Complaint seeks to 23 disregard corporate formalities and hold the “the principals of those entities, the entities 24 themselves, and the Defendants who utilized and worked with those entities to perpetuate 25 the fraudulent scheme set forth in this complaint, jointly and severally liable for the 26 damages alleged.”2 (Doc. 1 at ¶ 413.) 27 1 The First Amended Complaint (Doc. 70) adjusts this number to $21,407,584 but still 28 maintains the defendants are jointly and severally liable. 2 This language is left unchanged in the First Amended Complaint. (See Doc. 70 at ¶ 413.) 1 Roadmaster was served on August 10, 2020. (Doc. 35.) Roadmaster never 2 responded to the Complaint (Doc. 1). Meridian filed for entry of default on November 25, 3 2020. (Doc. 52.) Meridian then filed the First Amended Complaint (Doc. 70) on July 6, 4 2021. As of the date of this order, Roadmaster has not responded to the Amended 5 Complaint. Next, Meridian filed the Motion requesting this Court to enter default judgment 6 in Count XVI of the Amended Complaint, Roadmaster’s negligence, against Roadmaster 7 in the amount of $1,837,442. (Doc. 72.) 8 Once default has been entered, the district court has discretion to grant default 9 judgment. See Fed. R. Civ. P. 55(b)(2); Aldabe v. Aldabe, 616 F.2d 1089, 1092 (9th Cir. 10 1980). The court may consider several factors, including (1) the possibility of prejudice to 11 the plaintiff; (2) the merits of the claims; (3) the sufficiency of the complaint; (4) the 12 amount of money at stake; (5) the possibility of a dispute concerning material facts; 13 (6) whether default was due to excusable neglect; and (7) the strong policy favoring a 14 decision on the merits. See Eitel v. McCool, 782 F.2d 1470, 1471‒72 (9th Cir. 1986). In 15 applying the Eitel factors, the factual allegations of a complaint, apart from damages, are 16 taken as true. TeleVideo Sys., Inc. v. Heidenthal, 826 F.2d 915, 917‒18 (9th Cir. 1987). 17 The moving party has the burden to prove all damages. Philip Morris USA, Inc. v. 18 Castworld Prod., Inc., 219 F.R.D. 494, 498 (C.D. Cal. 2003). 19 But “where a complaint alleges that defendants are jointly liable and one of them 20 defaults, judgment should not be entered against the defaulting defendant until the matter 21 has been adjudicated with regard to all defendants.” In re First T.D. & Invest., Inc., 253 22 F.3d 520, 532 (9th Cir. 2001) (citing Frow v. De La Vega, 82 U.S. 552, 554 (1872)). “It 23 follows that if an action against the answering defendants is decided in their favor, then the 24 action should be dismissed against both answering and defaulting defendants.” Id. Because 25 Meridian seeks to hold all defendants jointly and severally liable and this matter has not 26 been adjudicated with regard to all defendants, entering default judgment at this time is 27 inappropriate. (Doc. 70 ¶ 5.) 28 / / / 1 Accordingly, 2 IT IS ORDERED denying Plaintiff's Motion for Default Judgment (Doc. 72) 3 || without prejudice. 4 Dated this 22nd day of March, 2022. 5 ° Wichal T. Fburde Michael T. Liburdi 8 United States District Judge 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 _3-