Graham v. Nat'l Web Design LLC

• Decision Date: 21 January 2022
• Docket Number: 20-cv-1575 (KMM/BRT)
• Parties: Chester C. Graham, Plaintiff, v. National Web Design LLC, Defendant.
• Court: U.S. District Court — District of Minnesota

Chester C. Graham, Plaintiff, v. National Web Design LLC, Defendant.

No. 20-cv-1575 (KMM/BRT)

United States District Court, D. Minnesota

January 21, 2022

ORDER

Katherine Menendez United States District Judge

This matter is before the Court on Chester C. Graham's Motion for Default Judgment. [ECF 10]. For the reasons that follow the motion is denied without prejudice.

I. BACKGROUND

Mr Graham filed his complaint on July 14, 2020, along with an application to proceed in forma pauperis. His IFP application was granted and Mr. Graham returned a completed form to have the U.S. Marshals Service complete service of process on National Web Design LLC (“NWD”).^[1] On August 5, 2020, the Clerk of Court sent a notice of lawsuit and request for waiver of service to NWD at the address Mr. Graham provided. No. executed waiver was returned by NWD, and United States Magistrate Judge Becky R Thorson issued an Order directing the Clerk's Office to issue a summons and for the U.S. Marshals to serve NWD. [Order (Nov. 24, 2020), ECF 6].

On February 10, 2021, the summons was returned executed. The February 10th Process Receipt and Return indicates that a Deputy U.S. Marshal handed a copy of the summons and complaint to Ashley Haroda, a legal assistant for Dion Custis, at the address Mr. Graham provided for NWD's registered agent for service of process. NWD's agent for process is a company known as Registered Agents of Wyoming, LLC. [Proof of Service, ECF 8].

NWD did not file an answer or otherwise respond to the complaint within 21 days as required by Rule 12(a) of the Federal Rules of Civil Procedure. Indeed, no response was forthcoming for several months. On July 21, 2021, Judge Thorson issued an Order requiring NWD to either appear and defend the case, and if NWD did not do so, directing Mr. Graham to apply for entry of default. [Order (Jul. 21, 2021), ECF 9]. In addition, Judge Thorson directed the Clerk of Court to mail a copy of her Order, the summons and complaint, and a request for waiver of service to NWD at the following address: National Web Design, LLC, c/o Registered Agents of Wyoming, 400 E. 20th Street, Cheyenne, Wyoming 82001. [Id.] This address is the same address Mr. Graham provided to the Marshals for NWD's registered agent. [Proof of Service].

On July 31, 2021, Mr. Graham filed a letter requesting entry of default judgment and enclosed a document entitled “Affidavit Default Judgment.” [Default Mot., ECF 10; Pl.'s First Default Aff., ECF 10-1]. Mr. Graham seeks entry of default judgment in the amount of $24, 000. Separately, on August 1, 2021, Mr. Graham sent a “Request for Default” and an “Affidavit in Support of Request for Default and Affidavit of Amount Due.” [Request for Default, ECF 11; Pl.'s Second Default Aff., ECF 12]. In support of his request for default judgment, Mr. Graham supplied a copy of the Process Receipt and Return dated February10, 2021, indicating that Registered Agents of Wyoming had been personally served by a Deputy U.S. Marshal. However, on August 13, 2021, a text entry on the docket indicates that the documents which had been mailed to Registered Agents of Wyoming pursuant to Judge Thorson's July 21st Order were returned undeliverable.

On November 2, 2021, the Clerk of Court sent Mr. Graham a letter informing him that a default judgment could not be entered until he files an application for entry of default and the Clerk enters a default. [Clerk's Letter (Nov. 2, 2021), ECF 13]. On November 8, 2021, Mr. Graham filed an application for entry of default and a supporting affidavit. [Default Application, ECF 15; Pl.'s Third Default Aff., ECF 16]. In this affidavit, Mr. Graham again referenced the February 10, 2021 process receipt and return, suggesting that NWD had been served. [ECF 16]. The Clerk entered default against National Web Design LLC on November 12, 2021.

11. DISCUSSION

Mr. Graham's motion or default judgment is denied without prejudice for the reasons explained below. However, this disposition does not foreclose Mr. Graham from re-filing his motion in the future and making an appropriate showing to indicate that he is entitled to a default judgment.

A. Premature Motion

First, Mr. Graham's motion was filed prematurely. The entry of default and default judgment are governed by Rule 55 of the Federal Rules of Civil Procedure. The clerk is required to enter default when a party fails to defend against another party's claims, and that failure is shown by affidavit. Fed.R.Civ.P. 55(a). Such an entry of default is a prerequisite to obtaining a default judgment. E.g., Johnson v. Dayton Elec. Mfg. Co., 140 F.3d 781, 783 (8th Cir. 1998) (explaining that “entry of default under Rule 55(a) must precede grant of a default judgment under Rule 55(b)”). Mr. Graham filed his motion for default judgment on August 2, 2021, but the Clerk of Court did not enter default as to NWD until November 12, 2021. Therefore, Mr. Graham's motion for default judgment was premature. See Precinct, Inc. v. MWS, LLC, No. 4:13CV2391 SNLJ, 2014 WL 3734276, at *1 (E.D. Mo. July 28, 2014) (“Plaintiff's motion for default judgment must be denied on the basis that an entry of default from the Clerk of the Court pursuant to Rule 55(a) is a prerequisite to and must precede the grant of a default judgment under Rule 55(b).”).

This procedural error alone might not require denial of the motion, particularly because default has now been entered. However, other flaws exist with Mr. Graham's motion, and the Court finds it most efficient to address them all at once so that, if Mr. Graham chooses to re-file his motion, he can correct them all.

B. Failure to File Memorandum of Law

Although the Court recognizes Mr. Graham is pursuing this action pro se and is not an attorney, he has failed to comply in a meaningful way with Local Rule 7.1(c), which governs civil motion practice in this District. Specifically, Mr. Graham did not file a memorandum of law in support of his motion for default judgment. D. Minn. LR 7.1(c)(1). Absent a memorandum of law, Mr. Graham essentially asks the Court to review his motion and affidavits, and any other papers of record that may be relevant to his request for default judgment, and determine why Mr. Graham believes he is entitled to default judgment against NWD for $24, 000. It is Mr. Graham's responsibility, not the Court's, to present an argument in favor of entry of default judgment. If Mr. Graham seeks to file a renewed motion, it must be accompanied by a memorandum of law supporting his request for default judgment.

C. Uncertainty as to Service of Process

Third, and most importantly, the Court cannot conclude from the record that it has acquired jurisdiction over NWD through proper service of process. “[T]he entry of default by the Clerk does not entitle the non-defaulting party to a default judgment as a matter of right.” United States v. $345, 510.00 in U.S. Currency, No. 01-cv-497 (PAM/JGL), 2002 WL 22040, at *2 (D. Minn. Jan. 2, 2002) (citations omitted). “To enter a default judgment, a court must have jurisdiction over the defaulting party, and the defendant must have been made party to the action by proper service of process.” Burns v. Office of Attorney Gen., No. 08-cv-858 (PJS/RLE), 2007 WL 2247600, at *5 (D. Minn. Aug. 2, 2007); see also Barry v. Islamic Republic of Iran, 410 F.Supp.3d 161, 171 (D.D.C. 2019) (explaining that a court must “satisfy itself that it has personal jurisdiction before entering judgment against an absent defendant”) (internal quotation marks omitted).

Under Rule 4 of the Federal Rules of Civil Procedure, an unincorporated association may be served by delivering a copy of the summons and complaint to an officer, a managing agent or general agent, or any other agent authorized by appointment or by law to receive service of process. Fed.R.Civ.P. 4(h)(1)(B). Such a business may also be served by following state law for service on an individual in the state where the district is located or where service is made. Fed.R.Civ.P. 4(h)(1)(A). Minnesota is the state where this District is located, and Minnesota law allows a limited liability company to be served by delivering the summons and complaint to the company's registered agent, a member, or a managing agent. Minn. Stat. § 322C.0116, subd. 1; Minn. R. Civ. P. 4.03(b). Wyoming is the state where service on NWD was purportedly made. “Wyoming's Rules of Civil Procedure provide service upon a partnership or other unincorporated association shall be made ‘(A) by delivery of copies to one or more of the partners or associates, or a managing or general agent thereof, or agent for process, or (B) by leaving same at the usual place of business of such defendant with any employee then in charge thereof.” Carter v. Genesis Alkali, LLC, No. 20-CV-216, 2021 WL 973448, at *2 (D. Wyo. Feb. 16, 2021) (quoting Wyo. R. Civ. P. 4(h)(1)) (emphasis added in Carter).

Looking at these sources, the question is whether the delivery of the summons and complaint on February 10, 2021 was effective service of process on NWD under the Federal Rules or either state's law. At best, the record is inconclusive as to the answer. Jon D. Goodman, a Deputy Marshal in the District of Wyoming completed the Proof of Service form. Deputy Goodman states that he handed the summons and complaint to Ashley Harada. Ms. Harada is a Legal Assistant for attorney Dion Custis. And Deputy Goodman indicates that Dion Custis is designated by law to accept service of process on behalf of NWD's registered agent-Registered Agents of Wyoming (“RAW”). [Proof of Service at 3].

According to documents available on the Wyoming Secretary of State's website, ^[2]RAW was the registered agent for NWD, which is consistent with the information that Mr. Graham provided on ...