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Pennsylvania Land Holdings Corp. v. Mason

August 6, 2008


The opinion of the court was delivered by: David Stewart Cercone United States District Judge

Electronic Filing


AND NOW, this 6th day of August, 2008, upon due consideration of Defendant Nicole Gas Production, Ltd.'s Motion to Set Aside Default Judgment and the parties' submissions in conjunction therewith,

IT IS ORDERED that the motion [61] be, and the same hereby is, DENIED.


Pennsylvania Land Holdings Corporation ("PLHC") filed an amended complaint against Nicole Gas Production, Ltd. ("Nicole Gas"), on October 4, 2006, alleging PLHC was denied the opportunity to exercise its right of first refusal to purchase ten (10) natural gas wells ("the Wells") owned by Nicole Gas. Pursuant to an Option Agreement that became effective on March 15, 2000 ("Option Agreement"), PLHC received the exclusive right to purchase certain oil and natural gas wells and leases - including the Wells. In the event of a third party offer to purchase the Wells, PLHC was granted the right to purchase them on the same terms and conditions. PLHC recorded the option agreement.

On January 29, 2004, Nicole Gas sold the Wells to Debbie J. Mason ("Mason"), through the assistance of her husband and agent of Nicole Gas, C.R. Coleman ("Coleman"). Nicole Gas did not notify PLHC of the sale. PLHC learned of the sale in July of 2006 when Coleman contacted PLHC to obtain a written release from the Option Agreement in conjunction with a loan he and his wife were attempting to secure.

PLHC commenced this action in August of 2006 seeking to compel Manson and Coleman to convey the Wells to PLHC. Nicole Gas was served with subpoenas directing it to produce various documents relevant to PLHC's claims. Nicole Gas did not comply with the subpoenas.

On October 4, 2006, PLHC filed an Amended Complaint against Nicole Gas seeking injunctive relief and monetary damages against all parties. The Court issued an Amended Scheduling Order directing defendants to respond to the Amended Complaint by October 23, 2006. Nicole Gas was served with the Amended Complaint on or about October 12, 2006. Freddie Fulson, president of Nicole Gas, signed for the documents provided upon service of process, as well as numerous others during the course of the litigation, including an order voluntarily dismissing defendants Mason and Coleman.

On October 26, 2006, PLHC, moved for an entry of default judgment based on Nicole Gas' failure to respond by the October 23, 2006, answer deadline set by the Court. PLHC sent the Request for Entry of Default to Nicole Gas, which was sent via certified mail by and received by Fulson. On November 2, 2006, the Court held a conference call between counsel for the parties for the purpose of scheduling pretrial deadlines and a date for trial. Although unrepresented by counsel, Fulson participated in this call on behalf of Nicole Gas. On December 14, 2006, more than six weeks after the default had been entered against Nicole Gas, Fulson, who is not an attorney, filed a "Response to the Complaint by PLHC Against Nicole Gas." After filing this Response, Nicole Gas made no recorded effort to ascertain if its request to dismiss the claims had been granted. The response was stricken by the Court on December 20, 2006. In January, 2007, Fulson agreed to appear for deposition on behalf of Nicole Gas and produce certain documents responsive to the PLHC's Discovery Requests pursuant to the Court's order granting PLHC's Motion to Compel. At the deposition Fulson indicated that Nicole Gas chose not to hire counsel because Fulson believed PLHC's suit to be "frivolous."

On August 14, 2007, PLHC filed a Motion for Default Judgment Against Nicole Gas, and duly served the motion on Nicole Gas. On August 20, 2007, PLHC moved to continue the default judgment hearing and served the motion to Nicole Gas. Fulson received a copy of the motion by certified mail on August 23, 2008. On August 27, 2007, the Court granted PLHC's Motion to Continue and rescheduled the hearing for October 5, 2007. Nicole Gas was sent a copy of the court's order at Nicole Gas' business address, 6264 Sunbury Rd, Westerville, Ohio, 43081.

Nicole Gas did not enter an appearance upon receiving the notices of the scheduled hearing, nor did Nicole Gas seek to set aside the entry of default prior to the default judgment hearing. The hearing commenced on October 5, 2007, and the Court entered a default judgment in the amount of $1,122,000 against Nicole Gas. Two weeks after the issuance of the default judgment Nicole Gas retained counsel and moved to set it aside.


The entry of default may be set aside for "good cause." Fed. R. Civ. P. 55(c). A default judgment may be ...

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