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Channon v. Tavangar

United States District Court, D. New Mexico

March 20, 2019

MATTHEW J. CHANNON, Plaintiff,
v.
JEFF TAVANGAR, SHELLEY BACA, JENNIFER IRELAND, ARMADA GROUP, INC., NATALIE GANN, and TP-LINK RESEARCH AMERICA CORPORATION, Defendants.

          MEMORANDUM OPINION AND ORDER GRANTING DEFENDANT TPRA'S MOTION TO SET ASIDE CLERK'S ENTRY OF DEFAULT JUDGMENT [DOC. 34], AND DENYING AS MOOT REQUEST FOR ENTRY OF DEFAULT JUDGMENT FOR SUM CERTAIN [DOC. 33]

          WILLIAM P. JOHNSON CHIEF UNITED STATES DISTRICT JUDGE.

         THIS MATTER comes before the Court on Defendant TPRA's Motion to Set Aside Clerk's Entry of Default Judgment and Brief in Support Thereof, [Doc. 34, filed January 24, 2019], and Plaintiffs Request for Entry of Default Judgment for Sum Certain. [Doc. 33, filed January 24, 2019]. Upon reviewing the parties' briefs and applicable law, Defendant TPRA's Motion is GRANTED, and Plaintiffs Request is DENIED AS MOOT.

         BACKGROUND

         On June 26, 2018, Plaintiff Matthew J. Channon filed his Complaint. [Doc. 1]. Plaintiff makes numerous claims against several defendants, including Defendant TP-Link Research America Corporation ("Defendant") in his Complaint. Plaintiff filed his Complaint pro se and was granted leave to proceed in forma pauperis. Plaintiff attempted to serve a waiver of service upon Defendant, but it was returned unexecuted because it was returned unsigned. [Doc. 8]. The Court thereafter ordered that personal service of the summons and complaint be imposed on Defendant. [Doc. 11]. The Complaint was served on Sharada Chikkahanumantha, Defendant's technical recruiter, by the United States Marshals Service on September 18, 2018. [Doc. 31]. An answer to the Complaint from Defendant was due to the Court on October 9, 2018. [Id.]. On January 16, 2019, the Court was notified that the Complaint had been served and no answer had been filed. [Id.]. On January 22, 2019, the Clerk of the Court entered default on Defendant. [Doc. 32]. Two days after the Clerk of the Court entered default on Defendant, Plaintiff moved the Court to enter default judgment on Defendant. [Doc. 33]. That same day, Defendant moved the Court to set aside the Clerk of the Court's entry of default alleging that the Complaint was improperly served by Plaintiff through the United States Marshals Service. [Doc. 34].

         STANDARD

         The Court may set aside an entry of default for good cause. See Fed.R.Civ.P. 55(c). The good cause standard is a less demanding standard than the excusable neglect which must be shown for relief from judgment under Federal Rule of Civil Procedure 60(b). Dennis Garberg & Assocs., Inc. v. Pack-Tech Int'l Corp., 115 F.3d 767, 775 n.6 (10th Cir. 1997). The good cause standard is liberal because "the preferred disposition of any case is upon its merits and not by default judgment." Gomes v. Williams, 420 F.2d 1364, 1366 (10th Cir. 1970).

         When determining whether to vacate a clerk's entry of default, the court may consider the following factors: (1) whether the defendant's culpable conduct led to the default; (2) whether plaintiff will be prejudiced by setting aside the entry of default; and (3) whether defendant has a meritorious defense. Gilmore v. Carlson, 72 Fed.Appx. 798, 801 (10th Cir. 2003). The decision to set aside an entry of default lies within the discretion of the Court. Ashby v. McKenna, 331 F.3d 1148, 1152 (10th Cir. 2003).

         DISCUSSION

         I. Improper Service of Process

         The Court emphasizes that "[h]e who proceeds pro se with full knowledge and understanding of the risks does so with no greater rights than a litigant represented by a lawyer, and the trial court is under no obligation to become an 'advocate' for or to assist and guide the pro se layman [. . . .]" United States v. Pinkey, 548 F.2d 305, 311 (10th Cir. 1977) (citations omitted); see also Hall v. Bellmon, 935 F.2d 1106, 1110 (10th Cir. 1991) (holding that it is not "the proper function of the district court to assume the role of advocate for the pro se litigant.'").

         Defendant has demonstrated good cause to set aside the entry of default because it was improperly served. "Effectuation of service is a precondition to suit." Jenkins v. City of Topeka, 136 F.3d 1274, 1275 (10th Cir. 1998). The burden of establishing the validity of service is on the plaintiff. See Fed. Deposit Ins. Corp. v. Oaklawn Apts., 959 F.2d 170, 174 (10th Cir. 1992). Plaintiff failed to respond to this Motion, and thus, he has not satisfied his burden. D.N.M.LR-Civ. 7.1(b) ("The failure of a party to file and serve a response in opposition to a motion within the time prescribed for doing so constitutes consent to grant the motion."). Nevertheless, the Court will analyze the issue before it.

         Under the Federal Rules of Civil Procedure, service of process upon a business entity may be effected "by delivering a copy of the summons and of the complaint to an officer, a managing or general agent, or to any other agent authorized by appointment or by law to receive service or process and-if the agent is one authorized by statute to receive service and the statute so requires-by also mailing a copy of each to the defendant. . . ." Fed.R.Civ.P. 4(h)(1)(B). Rule 4(h)(1)(A) also provides that service may be done by following state law for serving a summons in an action brought in courts of general jurisdiction in the state where the district court is located. See Fed.R.Civ.P. 4(h)(1)(A) (citing Rule 4(e)(1)). New Mexico's procedural rules for effectuating service on a corporation are similar to the Federal Rules, providing that service may be made upon a business entity "by serving a copy of the process to an officer, a managing or a general agent or to any other agent authorized by appointment, by law or by this rule to receive service of process. If the agent is one authorized by statute to receive service and the statute so requires, by also mailing a copy to the defendant[.]" NMRA Rule 1-004(G)(1)(a). Additionally, under New Mexico law, if none of the above are available, "service may be made by delivering a copy of the process or other papers to be served at the principal office or place of business during regular business hours to the person in charge.". Rule 1-004(G)(2).

         Here, Ms. Chikkahanumantha was the technical recruiter for Defendant. She is not a managing or general agent and was not appointed to receive service of process for Defendant, and thus, could not be served process under these terms of the rules. Moreover, Ms. Chikkahanumantha is not a "person in charge" because she reported to the Head of People Operations, while the Head of People Operations reported to the Chief Executive Officer, meaning that Ms. Chikkahanumantha is a lower-level employee. See Sommervold v. Wal-Mart, Inc., 709 F.3d 1234, 1236 (8th Cir. 2013) (holding that service of process on a store's assistant manager did not comply with state statute requiring that service of process be served on "the person in charge" of a business entity because assistant manager reported to a shift manager who in turn reported to the store manager, who was the person in charge, but who was never served).[1]Therefore, the service of process was improper when the United States Marshals Service served process on Ms. Chikkahanumantha, because she is not a managing or general agent, she was not appointed to receive service of process for Defendant, and is not a person in charge.

         II. Defendant's ...


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