United States District Court, D. New Mexico
PROPOSED FINDINGS AND RECOMMENDED
HONORABLE GREGORY J. FOURATT UNITED STATES MAGISTRATE JUDGE
MATTER is before the Court on Plaintiff's “Motion for
Default Judgment” [ECF 11], filed August 23, 2019.
Plaintiff requests that, pursuant to Federal Rule of Civil
Procedure 55(b)(1), the Clerk of Court enter judgment against
Defendants in the amount of $210, 929.40. For the reasons
that follow, the Court RECOMMENDS that the
Clerk be directed to enter judgment in that amount.
15, 2019, Plaintiff filed a complaint for damages, which
alleged that Defendants breached a General Agreement of
Indemnity (“GAI”) contract. See ECF 2.
On June 21, 2019, summons was duly issued, and on June 29,
2019, Plaintiff effectuated service on both Defendants.
See ECFs 5, 6. Defendants, however, failed to answer
or otherwise file a responsive pleading in accordance with
Federal Rule of Civil Procedure 12. Therefore-and with the
support of two affidavits attesting that service was properly
made-Plaintiff requested that the Clerk of Court enter
default judgment against Defendants pursuant to Federal Rule
of Civil Procedure 55(a). See ECFs 7-9. The Clerk
entered default against both Defendants on August 13, 2019.
See ECF 10. In response, Plaintiff filed the instant
Motion requesting that the Clerk enter default judgment under
Rule 55(b)(1) in the sum certain amount of $210, 929.40. Mot.
to Rule 55, Plaintiff must overcome several hurdles to obtain
a default judgment. See Williams v. Smithson, 57
F.3d 1081 (10th Cir. 1995) (unpublished) (“Rule 55
mandates a two-step process for a party who seeks a default
judgment in his favor.”). To begin, the Clerk must
“enter default under Rule 55(a), a[s] [a]
prerequisite for the entry of a default judgment under Rule
55(b)(1).” Garrett v. Seymour, 217 Fed.Appx.
835, 838 (10th Cir. 2007) (unpublished). Here, the clerk
entered default on August 13, 2019. See ECF 10.
moving on to step two, however, three ancillary requirements
must first be met. To begin, a court must ensure that it has
jurisdiction over the parties to the action and the subject
matter. See Bixler v. Foster, 596 F.3d 751, 761
(10th Cir. 2010) (“Personal jurisdiction over the
defendant is required before a default judgment in a civil
case may be entered.”) (citation omitted); see also
Williams v. Life Sav. & Loan, 802 F.2d 1200, 1202-03
(10th Cir.1986) (“before entering default judgment, a
court has an affirmative duty to look into its jurisdiction
both over the subject matter and the parties”). A court
must also determine whether the facts alleged in the
complaint, taken as true, constitute a proper cause of action
before it can proceed to step two. Bixler, 596 F.3d
at 762 (noting that “it remains for the court to
consider whether the unchallenged facts constitute a
legitimate cause of action, since a party in default does not
admit mere conclusions of law” quoting 10A C. Wright
& A. Miller, Fed. Prac. & Proc. Civ. § 2683 at
63 (3d ed. 1998)).
respect to personal jurisdiction, “[P]laintiff need
only make a prima facie showing [of personal
jurisdiction] if the motion [for default judgment] is decided
only on the basis of the parties' affidavits and other
written materials.” Dennis Garberg & Assocs.,
Inc. v. Pack-Tech International Corp., 115 F.3d 767, 773
(10th Cir. 1997). In determining whether personal
jurisdiction exists, the Court must also address the adequacy
of the service of process on Defendants. Venable v.
Haislip, 721 F.2d 297, 300 (10th Cir.1983) (per curiam)
(stating “default judgment [is] subject to attack as
void for failure to serve the defendant” (citation
addressing these ancillary requirements, the Court first
finds that it has personal jurisdiction over Defendants.
Plaintiff alleges that both Defendants are citizens of New
Mexico and that they reside in Dona Ana County. Compl.
¶¶ 11-12. Defendants were personally served with
process at 505 Lucerne Ct., Las Cruces, NM 88005, which
appears to be their residence. See ECFs 5-6. With
the Complaint having been properly served within this
district, Plaintiff has satisfied the personal jurisdiction
requirement necessary to obtain a default judgment.
See Fed. R. Civ. P. 4(e)(A) (“An individual
... may be served . . . by . . . delivering a copy of the
summons and of the complaint to the individually
Court also finds that it has subject matter jurisdiction over
the instant dispute. Under 28 U.S.C. § 1332(a),
“district courts shall have original jurisdiction of
all civil actions where the matter in controversy exceeds the
sum or value of $75, 000, exclusive of interest and costs,
and is between . . . citizens of different states.”
Consequently, because the complaint alleges (1) breach of the
GAI contract with damages easily exceeding $75,
and (2) that Plaintiff is a Connecticut corporation with its
principal place of business in Connecticut and that
Defendants are citizens of and reside in New Mexico, Compl.
¶¶ 10-12, 36-43, the Court has subject matter
jurisdiction over this dispute.
the Court finds that the facts alleged in Plaintiff's
complaint constitute a legitimate cause of action. Defendants
executed the GAI contract in favor of Plaintiff as a
condition to the issuance of performance and payment bonds.
Compl. ¶ 14. Pursuant to the GAI, Defendants agreed to
indemnify Plaintiff and hold it harmless from and against all
losses and expenses incurred with the issuance of the
performance and payment bonds. Id. ¶ 6.
Defendants then failed to make payments on the bonded
contracts, thus requiring Plaintiff to pay claims on the
bonds. Id. ¶ 7. Defendants have refused to
indemnify Plaintiff pursuant to the GAI. Id. ¶
8. These facts, if taken as true, clearly establish a valid
breach of contract claim.
on to step two of the Rule 55 analysis, if a claim is for a
“sum certain or sum that can be made certain by
computation, the clerk-on the plaintiff's request, with
an affidavit showing the amount due-must enter judgment for
that amount” against a defendant whom an entry of
default has already been entered against. Fed.R.Civ.P.
55(b)(1). And this may be done without a hearing if
“the amount claimed is a liquidated sum or one capable
of mathematical calculation.” Hunt v. Inter-Globe
Energy, Inc., 770 F.2d 145, 148 (10th Cir. 1985).
Plaintiff demands a sum certain of damages. To support the
sum demanded, Plaintiff provided documentation regarding the
bonds paid before and after the filing of the complaint, as
well as invoices for professional services and attorney's
incurred in enforcing the GAI. See Compl., Exs. 1-7;
Mot. Exs. A, B, C. Importantly, Plaintiff also included an
affidavit executed by Bryce Holzer, claim counsel for
Plaintiff, itemizing and attesting to each sum demanded. Mot.
Ex. 4. These materials validate the sum demanded and
demonstrate how it was calculated.