Juarez v. Villafan, Case No. 1:16-cv-00688-DAD-SAB
| Decision Date | 29 December 2017 |
| Docket Number | Case No. 1:16-cv-00688-DAD-SAB |
| Court | U.S. District Court — Eastern District of California |
| Parties | OCTAVIANO JUAREZ, et al., Plaintiffs, v. RAFAEL VILLAFAN, et al., Defendants. |
FINDINGS AND RECOMMENDATIONS RECOMMENDING GRANTING IN PART PLAINTIFFS' MOTION FOR DEFAULT JUDGMENT
Currently before the Court is Plaintiffs' motion for default judgment against Defendants Rafael Villafan ("Defendant Villafan") and Demi Ag, Inc. ("Defendant Demi Ag"). The matter has been referred to the undersigned pursuant to 28 U.S.C. § 636(b)(1)(B) and Local Rule 302. (ECF No. 40.)
On November 22, 2017, the Court held a hearing on the motion. Estella Cisneros appeared on behalf of Plaintiffs. Defendants did not appear.1 Having considered the moving papers, the declarations and exhibits attached thereto, arguments presented at the November 22, 2017 hearing, Plaintiffs' December 8, 2017 supplemental briefing, as well as the Court's file, the Court issues the following findings and recommendations.
Plaintiffs are a group of workers who were employed by Defendants pursuant to an oral contract of employment in Fresno County. (First Amended Complaint ("FAC") ¶ 29, ECF No. 20-2.) Plaintiffs were hired to pick grapes from September 11, 2015 through September 15, 2015. (FAC at ¶¶ 9-23.)
Defendant Demi Ag is a California corporation. (Id. ¶ 25.) Defendants Villafan and Demi Ag were operating as farm labor contractors without a license as required by Cal. Labor Code § 1683(a) and/or as labor contractors under Cal. Labor Code § 2810.3(b). (Id. ¶¶ 30, 32-33.) Plaintiffs allege that Defendant Sangha Sundip Singh ("Defendant Singh") contracted with Defendant Villafan, Defendant Demi Ag, and/or Defendant Rafael Villafan DBA Demi Ag, Inc. to supply workers to perform agricultural work on his vineyards in Selma. (Id. ¶¶ 27, 34.)
Plaintiffs filed this action on May 13, 2016, alleging violation of the Fair Labor Standards Act ("the FLSA"); violation of the Migrant and Seasonal Agricultural Worker Protection Act ("the AWPA"); and California labor law; California's Unfair Competition Law; and the Private Attorney General Act ("PAGA"). (ECF No. 1.)
Defendant Villafan has not answered the complaint. Defendant Demi Ag answered the complaint on June 3, 2016. (ECF No. 4.) However, the answer was filed by the owner of the business, Margarita Ortega, and not a lawyer. On June 7, 2016, the Court issued an order requiring Defendant Demi Ag to retain counsel and have said counsel appear in the matter. (ECF No. 5.) When Defendant Demi Ag did not respond to the June 7, 2016 order, the Court issued an order requiring Defendant Demi Ag to show cause why its answer should not be stricken for its failure to comply with the Court's June 7, 2016 order. (ECF No. 12.) Defendant Demi Ag did not respond to the Court's order to show cause. Therefore, on August 23, 2016, the Court struck Defendant Demi Ag's answer from the record. (ECF No. 14.)
On September 27, 2016, Plaintiffs filed an amended request to enter default against Defendants Villafan and Demi Ag ("defaulting defendants"). (ECF No. 16.) On that same day, the Court entered default against these defendants. (ECF Nos. 17, 18.) On October 6, 2016,Plaintiffs filed a first amended complaint against Defendants Villafan, Demi Ag and Singh. (ECF No. 20.) On May 4, 2017, Plaintiffs settled with Defendant Singh. (ECF No. 28.)
On October 6, 2017, Plaintiffs filed a motion for default judgment against Defendants Villafan and Demi Ag. (ECF No. 37-39.) Plaintiffs are not seeking recovery for the fifteenth claim in the motion for default judgment as they concede the claim under California's Unfair Competition Law. (ECF No. 37-2 at 27.)2 The motion was served on Defendant Demi Ag, who has appeared, but not on Defendant Villafan, who has not appeared.
During the November 22, 2017 hearing on the motion for default judgment, Plaintiffs requested that they be allowed to file supplemental briefing to address some of the Court's questions. On November 22, 2017, the Court directed Plaintiffs to file supplemental briefing regarding the motion for default judgment. (ECF No. 45.) After receiving an extension of time, Plaintiffs filed their supplemental briefing on December 8, 2017. (ECF No. 50.)
Pursuant to Rule 55 of the Federal Rules of Civil Procedure, unless a claim is for a sum certain or a sum that can be made certain by computation, a party must apply to the court for a default judgment. Fed. R. Civ. P. 55(b). Upon entry of default, the complaint's factual allegations regarding liability are taken as true. Geddes v. United Financial Group, 559 F.2d 557, 560 (9th Cir. 1977); Garamendi v. Henin, 683 F.3d 1069, 1080 (9th Cir. 2012). However, the complaint's factual allegations relating to the amount of damages are not taken as true. Geddes, 559 F.2d at 560. Accordingly, the amount of damages must be proven at an evidentiary hearing or through other means. Microsoft Corp. v. Nop, 549 F.Supp.2d 1233, 1236 (E.D. Cal. 2008). "[N]ecessary facts not contained in the pleadings, and claims which are legally insufficient, are not established by default." Cripps v. Life Ins. Co. of North America, 980 F.2d 1261, 1267 (9th Cir. 1992). Pursuant to Federal Rule of Civil Procedure 54(c), "[a] default judgment must not differ in kind from, or exceed in amount, what is demanded in the pleadings."
Entry of default judgment is not a matter of right and it is within the discretion of the court whether default judgment should be entered. Shanghai Automation Instrument Co. v. Kuei, 194 F. Supp. 2d 995, 999 (N.D. Cal. 2001); Eitel v. McCool, 782 F.2d 1470, 1471 (9th Cir. 1986). The Ninth Circuit has set forth the following factors for the court to consider in exercising its discretion:
(1) the possibility of prejudice to the plaintiff, (2) the merits of plaintiff's substantive claim, (3) the sufficiency of the complaint, (4) the sum of money at stake in the action; (5) the possibility of a dispute concerning material facts; (6) whether the default was due to excusable neglect, and (7) the strong policy underlying the Federal Rules of Civil Procedure favoring decisions on the merits.
In the current application, Plaintiffs seek default judgment and request monetary damages, attorneys' fees, and costs.3
Federal courts are courts of limited jurisdiction and their power to adjudicate is limited to that granted by Congress. U.S v. Sumner, 226 F.3d 1005, 1009 (9th Cir. 2000). Pursuant to 28 U.S. C. § 1331, federal courts have original jurisdiction over "all civil actions arising under the Constitution, laws, or treaties of the United States. "A case 'arises under' federal law either where federal law creates the cause of action or where the vindication of a right under state law necessarily turns on some construction of federal law." Republican Party of Guam v. Gutierrez, 277 F.3d 1086, 1088 (9th Cir. 2002) (internal punctuation omitted) (quoting Franchise Tax Bd. v. Construction Laborers Vacation Trust, 463 U.S. 1, 8-9 (1983) (citations omitted)). "[T]he presence or absence of federal-question jurisdiction is governed by the 'well-pleaded complaint rule,' which provides that federal jurisdiction exists only when a federal question is presented on the face of the plaintiff's properly pleaded complaint." Republican Party of Guam, 277 F.3d at1089 (citations omitted).
Plaintiff brings this action alleging violations of the FLSA, 29 U.S.C. § 201 et seq. and the AWPA, 29 U.S.C. § 1801 et seq. Therefore, the Court has original jurisdiction under 28 U.S.C. § 1331. In addition, the Court has supplemental jurisdiction under 28 U.S.C. § 1367 for Plaintiff's related state law claims under the California Labor Code.
Rule 4 of the Federal Rules of Civil Procedure sets forth the requirements for the manner of service on an individual. Rule 4(e) states that an individual may be served by following state law for service of the summons in the state where the court is located or by personally delivering a copy of the summons and a complaint, leaving a copy of each at the individual's usual place of abode, or delivering a copy of each to an agent authorized to receive service. Fed. R. Civ. P. 4(e)(2).
Here, Defendant Villafan was personally served with the complaint and summons. (ECF No. 8.) The Court finds that service on Defendant Villafan was proper under federal law.
The Federal Rules of Civil Procedure provide for two ways to effectuate service on a corporation. Pursuant to Federal Rule of Civil Procedure 4(h), a corporation must be served "in a manner prescribed by Rule 4(e)(1) for serving an individual; or . . . by delivering a copy of the summons and of the complaint to an officer, a managing or general agent or any agent, authorized by appointment or by law to receive service of process. . . ." Rule 4(e)(1) provides that service may be effectuated by following the law of the state in which the service is to be made. Rule 4 is flexible and should be liberally construed so long as it gives the party to be served sufficient notice of the complaint. Direct Mail Specialists, Inc. v. Eclat Computerized Technologies, Inc., 840 F.2d 685, 688 (9th Cir. 1988).
Under California law, service of a corporation may be made by service on the person designated as agent for service of process or "the president, chief executive officer, or other head of the corporation, a vice president, a secretary or assistant secretary, a treasurer orassistant treasurer, a controller or chief financial officer, a general manager or a person authorized by the corporation to receive service of process." Cal. Code. Civ. P. §§ 416.10(a) and (b).
California Code of Civil Procedure 415.20(a) states:
In lieu of personal delivery of a copy of the summons and...
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