United States District Court, E.D. Pennsylvania
J. PAPPERT, J.
Flowers sued Remington Lodging and Hospitality, LLC, a hotel
management company, for wrongful termination under Title VII
of the Civil Rights Act of 1964. When Flowers served
Remington's agent with the Complaint on March 21, 2017,
the agent mistakenly assumed it was part of an unrelated
lawsuit between Flowers and the owner of a hotel Remington
managed, not Remington itself. As a result of this and other
errors, Remington failed to respond to the Complaint and on
May 23, 2017, the Clerk of Court entered default. Remington
now moves to set aside the entry of default. For the reasons
stated below, the Court grants the motion.
worked as the Director of Food and Beverage for an Embassy
Suites Hotel in Philadelphia. (Compl. ¶¶ 13 &
19.) The Hotel is managed by Remington and owned by Ashford
Philly LP. (Def.'s Mot., at 2, ECF No. 4-1.) In July of
2016, Flowers sued Ashford and others in the Philadelphia
County Court of Common Pleas to recover for injuries he
allegedly suffered in a March 2015 fall at the Hotel.
See (Compl. ¶ 21- 22); (Def.'s Mem., at 2).
Remington was not named as a defendant in that lawsuit, but
received a copy of the Complaint, which it delivered to
Ashford. (Def.'s Mem., at 2.) That suit remains pending.
See generally Docket, Flowers v. Ashford Philly
LP, et al., No. 160700805 (Phila. Ct. Comm. Pleas 2016).
March 10, 2017, Flowers sued Remington in federal court for
wrongful termination. (Compl. ¶ 2.) On March 21, Flowers
properly served a supervisor at the Hotel with the Complaint.
(Def.'s Mem., at 2.) The supervisor emailed a copy of the
Complaint to Remington's paralegal, Brandon Stewart, who
mistakenly believed the Complaint was related to
Flowers's already-pending lawsuit against Ashford.
(Id.) Stewart thus forwarded the Complaint to
Ashford, which responded that it had not been named in the
Complaint. Stewart nevertheless failed to recognize that
further action was required from Remington. (Stewart Decl.
¶ 10, ECF No. 4-2.) As a result Remington never
responded to the Complaint.
23, 2017, Flowers filed a Request for Entry of Default, and
the Clerk of Court entered default the same day. See
(ECF No. 3); (Def.'s Mem., at 3). Three days later,
Remington moved to set aside the entry of default.
See (ECF No. 4). Flowers has not responded to
Rule of Civil Procedure 55(c) permits the court to set aside
the entry of default “for good cause.”
Fed.R.Civ.P. 55(c). “That determination is made in the
sound discretion of the court.” Dizzley v. Friends
Rehab. Program, Inc., 202 F.R.D. 146, 147 (E.D. Pa.
2001) (citing U.S. v. $55, 518.05 in U.S. Currency,
728 F.2d 192, 194-95 (3d Cir. 1984)). Whether good cause
exists depends on three factors: (1) whether the plaintiff
will be prejudiced if the default is set aside; (2) whether
the defendant has a meritorious defense; and (3) whether
“the default was a product of the defendant's
culpable or inexcusable conduct.” Id.
(citation omitted). In evaluating these factors, all doubts
are to be resolved in favor of the defaulting party. See
Maaco Enters., Inc. v. Beckstead, No. 02-853, 2002 WL
31757608, at *2 (E.D. Pa. Dec. 9, 2002); see also
Dizzley, 202 F.R.D. at 147 (noting that “the entry
of a default is not favored”).
contends that Flowers will not be prejudiced if the entry of
default is set aside, that it has at least one meritorious
defense to Flowers's action against him and that its
failure to respond to the Complaint was not the result of
willful bad-faith conduct. (Def.'s Mot., at 3.)
aside the entry of default will not prejudice Flowers.
Prejudice exists when setting aside an entry of default would
impair a plaintiff's ability to pursue his claim. See
Feliciano v. Reliant Tooling Co., Ltd., 691 F.2d 653,
656-57 (3d Cir. 1982). The “loss of available evidence,
the increased potential for fraud or collusion, and the
plaintiff's substantial reliance on the default”
support a finding of prejudice. Choice Hotels Int'l,
Inc. v. Pennave Assocs. Inc., 192 F.R.D. 171, 174 (E.D.
Pa. 2000). Being forced to “litigate an action on the
merits rather than proceed by default does not, ”
however, “constitute prejudice.” Id.
has not responded to Remington's motion to set aside the
entry of default and therefore has not shown the loss of any
available evidence since the entry of default against
Remington. And given the relatively short time between entry
of default and the Court's decision on this motion, it is
doubtful that any available evidence will ultimately be lost.
Cf. Braverman Kaskey, P.C. v. Toidze, 599 F.
App'x 448, 453 (3d Cir. 2015) (finding potential for
prejudice against plaintiff given that the case had been
pending for six years). Nor does the record suggest an
increased potential for fraud or ...