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Jimenez v. Rosenbaum-Cunningham

March 31, 2010

BEATRIZ JIMENEZ ET AL.
v.
ROSENBAUM-CUNNINGHAM, INC. ET AL.



The opinion of the court was delivered by: Surrick, J.

MEMORANDUM

Presently before the Court are Plaintiffs' Motion for a Default Judgment against Defendants Rosenbaum-Cunningham, Inc., Richard Rosenbaum, and Christina Flocken (Doc. No. 95); Motion of Defendant Dave & Buster's, Inc. for Default Judgment Against Defendants Richard Rosenbaum, Edward Scott Cunningham, Christina Flocken, and Rosenbaum-Cunningham, Inc. (Doc. No. 98); and Plaintiffs' Motion for a Default Judgment against Defendant Edward Cunningham (Doc. No. 99). For the following reasons, the Motions will be granted in part and denied in part.

I. BACKGROUND

Plaintiffs, most of whom are immigrant workers from Mexico, are former employees of Rosenbaum-Cunningham, Inc. ("RCI"). (Am. Compl. ¶¶ 11-77, 80.) RCI provided janitorial services to theme restaurants throughout the United States. (Id. ¶ 79.) Richard Rosenbaum, Edward Cunningham, and Christina Flocken owned and operated RCI and actively participated in its business. (Id. ¶¶ 5-7.) On March 19, 2007, Plaintiffs filed a Complaint alleging that RCI paid them less than the minimum wage and failed to pay them overtime under the applicable federal and state wage and hour laws. (See generally Compl.; Am. Compl. ¶¶ 105, 121, 127.)

Plaintiffs also named Dave & Busters, Inc. ("D&B") as a defendant. D&B owns and operates restaurant and entertainment establishments throughout the United States. (Am. Compl. ¶¶ 88-90.) In 2004, RCI contracted with D&B to provide janitorial services at some of D&B's establishments. (Id. ¶ 91; Doc. No. 62 ¶ 91, at 22, ¶¶ 2-3, at 30-31.) Plaintiffs alleged that D&B was liable with the other Defendants for the underpayment to those Plaintiffs who were employed by RCI and performed janitorial work at D&B restaurants. (Am. Compl. ¶¶ 92-98, 107-14.) On June 18, 2008, Plaintiffs filed an Amended Complaint with the same factual allegations as the original Complaint. (See Doc. No. 61.)

Plaintiffs effected timely personal service of the Amended Complaint on RCI, Rosenbaum, Flocken, and Cunningham.*fn1 (See Doc. Nos. 63-66.) RCI filed an Answer on August 4, 2008. (Doc. No. 70.) The Answer was signed by RCI's president and was not filed by an attorney. Plaintiffs filed a motion to strike RCI's Answer on the basis that a corporate entity cannot represent itself pro se. (Doc. No. 91.) On June 10, 2009, we granted Plaintiffs' motion and RCI's Answer was stricken. (Doc. No. 92.) RCI has not filed a subsequent responsive pleading. Rosenbaum and Flocken have not filed any responsive pleadings,*fn2 and no attorney has entered an appearance on their behalf or on behalf of RCI.

Cunningham did not file an Answer to the Complaint. He did file an Answer to the Amended Complaint on July 31, 2009. (Doc. No. 69.) The four-paragraph Answer included no affirmative defenses or counterclaims. Plaintiffs attempted to engage in discovery with Cunningham, serving interrogatories and document requests in December of 2008 and following up with correspondence. Cunningham did not respond to the discovery requests. (See Doc.

No. 93 at 1-2.) On June 11, 2009, Plaintiffs filed a motion seeking to compel Cunningham to respond to their discovery requests. (Doc. No. 93.) No response was filed. By Order dated June 29, 2009, we directed Cunningham to respond to Plaintiffs' discovery requests no later than July 6, 2009. (Doc. No. 96.) Cunningham has continued to ignore Plaintiffs' discovery requests and our June 29, 2009, Order. (See Doc. No. 99 ¶¶ 4-6.) Since filing his Answer to the Amended Complaint, Cunningham has not participated in this litigation in any manner.

D&B was timely served with the Amended Complaint and filed an Answer on July 2, 2008. (Doc. No. 62.) In its Answer, D&B asserted cross-claims against all of the co-defendants. The cross-claims allege in part that RCI breached the contract between D&B and RCI, that pursuant to the terms of that contract the cross-defendants are obligated to indemnify D&B against Plaintiffs' allegations, and that the cross-defendants are liable to D&B for contribution. (Id. at 30-34.) The cross-defendants have not filed any responsive pleadings or otherwise defended against D&B's cross-claims. On April 17, 2009, we approved a settlement between Plaintiffs and D&B. (Doc. No. 89.)

On January 23, 2009, D&B requested that the Clerk of Court enter a default against RCI, Rosenbaum, Flocken, and Cunningham pursuant to Rule 55(a) for failure to plead or otherwise defend against D&B's cross-claims. (Doc. No. 81.) The Clerk entered the default the same day. On June 17, 2009, Plaintiffs also asked the Clerk of Court to enter a default against RCI, Rosenbaum, and Flocken under Rule 55(a). (Doc. No. 94.) On June 18, 2009, the Clerk entered the default. Plaintiffs and D&B subsequently filed the instant Motions.

II. LEGAL STANDARD

Federal Rule of Civil Procedure 55 outlines a two-step process for obtaining a default judgment. See Fed. R. Civ. P. 55. The first step is an entry of default. See id. The entry of default is a ministerial task performed by the clerk. No motion is needed and no order is involved. Rather, "[w]hen a party against whom a judgment for affirmative relief is sought has failed to plead or otherwise defend, and that failure is shown by affidavit or otherwise, the clerk must enter the party's default." Fed. R. Civ. P. 55(a); see also Farnese v. Bagnasco, 687 F.2d 761, 763 (3d Cir. 1982)(noting that Rule 55(a) "allows the clerk to enter a default" under the conditions stated in the Rule).

The second step is the entry of a default judgment for damages and costs. See Fed. R. Civ. P. 55(b). If the default judgment is properly requested and the claim is for a sum certain, the clerk will perform this step. Such situations are rare, however, and "in the vast majority of cases, a judicial determination is necessary to decide the extent of the injury or the valuation of the plaintiff's loss." Nationwide Prop. & Cas. Ins. Co. v. Janis, No. 08-0153, 2008 WL 2762375, at *1 (M.D. Pa. July 11, 2008) (citation omitted); see also Flaks v. Koegel, 504 F.2d 702, 707 (2d Cir. 1974) ("While a default judgment constitutes an admission of liability, the quantum of damages remains to be established by proof unless the amount is liquidated or susceptible of mathematical computation."). Rule 55 therefore provides that in those cases, "the party must apply to the court for a default judgment." Fed. R. Civ. P. 55(b)(2). The court should accept as true the well-pleaded factual allegations of the complaint when considering a motion for a default judgment, but it need not accept the moving party's legal conclusions or factual allegations related to the amount of damages. Comdyne I, Inc. v. Corbin, 908 F.2d 1142, 1149 (3d Cir. 1990); Tancredi v. Cooper, No. 02-1125, 2003 WL 22213699, at *3 (E.D. Pa. Sept. 4, 2003) (noting that "all factual allegations of the complaint other than those pertaining to the amount of damages are to be taken as true" once a court determines that a defendant is in default). The court "may conduct hearings or make referrals... when, to enter or effectuate judgment, it needs to: (A) conduct an accounting; (B) determine the amount of damages; (C) establish the truth of any allegation by evidence; or (D) investigate any other matter." Fed. R. Civ. P. 55(b)(2). The decision as to whether to enter a default judgment is left to the sound discretion of the court. Hritz v. Woma Corp., 732 F.2d 1178, 1180 (3d Cir. 1984). Nevertheless, the discretion of the district court in this area is circumscribed by the following standards.

On a motion for a default judgment against a defendant who has filed an answer or a responsive pleading but has then failed to properly participate in the litigation, a court must consider the so-called Poulis factors. Named for the case of Poulis v. State Farm ...


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