United States v. Shirley A. Varnado

[DO NOT PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
________________________ FILED
U.S. COURT OF APPEALS
No. 11-10813 ELEVENTH CIRCUIT
NOVEMBER 3, 2011
Non-Argument Calendar
JOHN LEY
________________________
CLERK
D.C. Docket No. 0:07-cv-61257-JAL
UNITED STATES OF AMERICA,
llllllllllllllllllllllllllllllllllllllll Plaintiff-Appellee,
versus
SHIRLEY A. VARNADO,
llllllllllllllllllllllllllllllllllllllll Defendant-Appellant.
________________________
Appeal from the United States District Court
for the Southern District of Florida
________________________
(November 3, 2011)
Before CARNES, PRYOR, and KRAVITCH, Circuit Judges.
PER CURIAM:
The United States filed a lawsuit against Shirley Varnado, seeking judgment
against her based on an overdue student loan. Varnado appeals pro se from the
district court’s entry of a final default judgment against her as a result of her
repeated failure to comply with court orders to participate in discovery. Varnado
contends that the district court abused its discretion because: (1) she did not
consent to have a magistrate judge exercise jurisdiction; (2) she had no duty to
participate in discovery because the government did not first obtain a money
judgment; and (3) the circumstances did not warrant the severe sanction of a
default judgment.
We review for an abuse of discretion a district court’s grant of a default
judgment. Sanderford v. Prudential Ins. Co., 902 F.2d 897, 898 (11th Cir. 1990).
A district court’s findings of fact are reviewed only for clear error. Mitchell v.
Hillsborough Cnty., 468 F.3d 1276, 1282 (11th Cir. 2006). Although pro se
pleadings are held to a less stringent standard than pleadings drafted by attorneys
and are liberally construed, Tannenbaum v. United States, 148 F.3d 1262, 1263
(11th Cir. 1998), pro se litigants still have to comply with procedural rules. Moton
v. Cowart, 631 F.3d 1337, 1341 n.2 (11th Cir. 2011).
I.
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Varnado contends that the magistrate judge exceeded his authority by
entering an order to compel discovery, an order of contempt, and a report
recommending default judgment. Varnado argues that all of the magistrate judge’s
actions after she withheld consent to his jurisdiction over dispositive matters under
28 U.S.C. § 636(c) are void for lack of personal and subject matter jurisdiction.
The jurisdiction and powers of magistrate judges are set forth primarily by
28 U.S.C. § 636. Thomas v. Whitworth, 136 F.3d 756, 758 (11th Cir. 1998). A
district court “may designate a magistrate judge to hear and determine any pretrial
matter pending before the court,” with certain listed exceptions that do not apply
here. 28 U.S.C. § 636(b)(1)(A). A district court also may authorize a magistrate
judge to conduct hearings and submit proposed findings of fact and
recommendations for the disposition of a case. Id. § 636(b)(1)(B). Although
consent of the parties is required for a magistrate judge to enter judgment in a
case, id. § 636(c)(1), it is not required for actions taken under § 636(b). See id.
§ 636(b); Thomas, 136 F.3d at 758.
Varnado’s consent was not required because the magistrate judge’s actions
were within the scope of § 636(b), and his orders to compel discovery addressed
pre-trial, non-dispositive matters contemplated by the statute. As for the
dispositive matter of default judgment, the magistrate judge issued a report and
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recommendation, which was also within his statutory authority. After conducting
a de novo review, the district court—not the magistrate judge— entered judgment
in this case.
II.
Varnado also contends that under Fed.R.Civ.P. 69 the government had no
right to request discovery until a money judgment was entered against her. She
argues that, because a money judgment had not been entered against her, the order
to compel discovery responses and the order finding her in contempt were
improper, making the default judgment that followed improper. Alternatively, she
argues that if the government sought discovery under Fed.R.Civ.P. 26, then Rule
26(f) required the parties to confer before any discovery was sought. She also
asserts that she was entitled to a hearing on her opposition to discovery requests
and that the government was required to cooperate with her before filing a motion
to compel.
The relevant practices and procedures for discovery in a civil action are
contained in Fed.R.Civ.P. 26 through 37. “Parties may obtain discovery regarding
any nonprivileged matter that is relevant to any party’s claim or defense . . . .”
Fed.R.Civ.P. 26(b)(1). Parties seeking discovery are normally required to confer
before a scheduling conference is held or scheduling order is issued, but actions
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brought by the United States to collect on a student loan that it has guaranteed are
exempted from the conferral requirement. Fed.R.Civ.P. 26(a)(1)(B)(vii) & (f)(1)
(exempting from the conferral requirement those actions that are exempted from
the initial disclosures requirement).
Varnado’s argument that Fed.R.Civ.P. 69 applies to the present dispute is
without merit. That rule applies to execution on a money judgment, and in order
for it to apply a “money judgment” must exist. Ziino v. Baker, 613 F.3d 1326,
1328 (11th Cir. 2010). The government did not seek enforcement of a money
judgment, so the discovery procedures contained in Rule 69 are inapplicable.
The government properly moved for an order compelling discovery
responses under Rule 37. See Fed.R.Civ.P. 37(a)(1). Because the underlying
action was brought by the United States to recover on a student loan, the conferral
requirement was inapplicable. See Fed.R.Civ.P. 26(a)(1)(B)(vii) & (f)(1). The
record shows that the government made numerous attempts to obtain discovery
from Varnado before it filed motions to compel and for contempt. Because
Varnado failed to obey orders compelling discovery, the court had the authority to
issue sanctions, including treating the failure to obey as contempt of court and
rendering a default judgment against Varnado. See Fed.R.Civ.P. 37(b)(2)(A)(vi)
& (vii). Nothing in Rule 37 required the district court to conduct a hearing before
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imposing a sanction for failure to provide discovery. The discovery procedure
here complied with Rules 26 and 37.
III.
Finally, Varnado contends that the sanction of default judgment is
inappropriate under the circumstances of her case. She argues that because she is
pro se, default judgment should be imposed only as a last resort, and she had a
right to a hearing regarding whether her conduct was willful.
We have held that pro se litigants are subject to the Federal Rules of Civil
Procedure, including sanctions for misconduct and for failure to comply with court
orders. See Moon v. Newsome, 863 F.2d 835, 837 (11th Cir. 1989). A default
judgment is a drastic sanction that should be used only in extreme situations
because it is preferable for cases to be heard on the merits. Wahl v. McIver, 773
F.2d 1169, 1174 (11th Cir. 1985). As we have already discussed, however, Rule
37 permits the district court to render a default judgment against a party who fails
to comply with court orders regarding discovery. See Fed.R.Civ.P.
37(b)(2)(A)(vi). In imposing that sanction, the district court must make a finding
of willful or bad faith failure to comply with court orders. Malautea v. Suzuki
Motor Co., 987 F.2d 1536, 1542 (11th Cir. 1993). The district court must also
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determine that lesser sanctions would not serve the interests of justice. Cohen v.
Carnival Cruise Lines, Inc., 782 F.2d 923, 925 (11th Cir. 1986).
Because pro se litigants are subject to sanctions for noncompliance with
court orders, Varnado’s pro se status did not preclude the default judgment. The
district court properly conducted a de novo review before adopting the magistrate
judge’s report and recommendation and entering default judgment, finding that
“[t]he record in this case provides overwhelming evidence of [Varnado’s] bad
faith and willful failure to obey the Court’s orders.” In addition, the magistrate
judge’s report expressly found that a lesser sanction would be ineffective. The
judge reasoned that “[t]he Court has been generous in granting this pro se
defendant multiple opportunities to comply but she has repeatedly and flagrantly
failed to cooperate, even after having attorneys’ fees assessed against her.”
Furthermore, a hearing is not required before default judgment is entered. See
Fed.R.Civ.P. 37(b)(2)(A)(vi) & 55(b).
The magistrate judge acted within his statutory authority, the government
properly sought discovery, and Varnado’s repeated failure to comply with
discovery orders supported the drastic sanction of a default judgment. The district
court did not abuse its discretion by entering that judgment.
AFFIRMED.
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