Villoldo v. The Republic of Cuba

• Decision Date: 07 March 2023
• Docket Number: Civil Action 21-cv-02497-NYW-NRN
• Parties: ALFREDO VILLOLDO, and GUSTAVO E. VILLOLDO, individually, and as Administrator, Executor, and Personal Representative of the Estate of Gustavo Villoldo Argilagos, Plaintiffs, v. THE REPUBLIC OF CUBA, Defendant.
• Court: U.S. District Court — District of Colorado

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ALFREDO VILLOLDO, and GUSTAVO E. VILLOLDO, individually, and as Administrator, Executor, and Personal Representative of the Estate of Gustavo Villoldo Argilagos, Plaintiffs, v. THE REPUBLIC OF CUBA, Defendant.

Civil Action No. 21-cv-02497-NYW-NRN

United States District Court, D. Colorado

March 7, 2023

ORDER ON MOTION FOR DEFAULT JUDGMENT

Nina Y. Wang, United States District Judge

This matter comes before the Court on Plaintiffs' Motion for Entry of Default Judgment (the “Motion” or “Motion for Default Judgment”) [Doc. 33, filed June 30, 2022]. Upon review of the Motion, the record before the Court, and the applicable case law, the Motion for Default Judgment is GRANTED in part and DENIED in part.

BACKGROUND

In this civil action, Plaintiffs Alfredo Villoldo and Gustavo E Villoldo “seek the recognition, confirmation, and enforcement of a money judgment award rendered in their favor against” the Republic of Cuba (“Defendant” or “Cuba”) entered in a Florida state court in 2021, effective nunc pro tunc August 22, 2011. [Doc 1 at ¶ 1]. In their Complaint, Plaintiffs allege the following:^[1] Plaintiffs are the sons of Gustavo Villoldo Argilagos (“Mr Villoldo”), a United States citizen who resided in Cuba until his death in February 1959. [Id. at ¶ 4]. Plaintiffs allege that Cuba's “acts of terrorism and torture against Plaintiffs and their father, which started in January 1959 and continued through mid-2003, led to Mr. Vollildo's death on February 16, 1959, the confiscation of [Mr. Villoldo's] property, and extreme emotional distress to his family, including Plaintiffs.” [Id. at ¶ 5].

In March 2011, Plaintiffs filed an amended complaint in Florida state court against Cuba, alleging economic loss, intentional infliction of emotional distress, and wrongful death of their father pursuant to the Foreign Sovereign Immunities Act (“FSIA”). [Id. at ¶ 6].^[2] Plaintiffs allege that Defendant was served with process and translations thereof in accordance with FSIA requirements, but failed to answer or otherwise appear in the case. [Id.]. Default was entered against Defendant in state court on June 29, 2011. [Id.]. After Defendant was served with a notice of hearing with respect to Plaintiffs' motion for entry of a final judgment, a bench trial was held on August 19, 2011. [Id. at ¶¶ 6-7]. The Florida court entered a judgment on August 22, 2011, “setting forth detailed findings of fact and conclusions of law establishing Plaintiffs' entitlement to judgment against Defendant[].” [Id. at ¶ 7].^[3]

Nearly ten years later, Plaintiffs moved to reopen the Florida case; this motion was served on Defendant. [Id. at ¶ 8]. The state court reopened the case on May 19, 2021 and received additional evidence with respect to its subject matter jurisdiction over Plaintiffs' claims. [Id.]. On May 24, 2021, the Florida court entered a Second Amended Final Judgment, which reaffirmed the court's “prior findings on jurisdiction, liability and damages and incorporate[ed] additional findings confirming its subject matter jurisdiction over the Plaintiffs' claims.” [Id. at ¶ 9]. The next day, the Florida court entered a Corrected Second Amended Final Judgment (the “state-court judgment”) to correct a clerical error. [Id. at ¶¶ 10-11]; see also [Doc. 33-2].

On July 14, 2021, Defendant was served with a notice of the default judgment and the state court judgment, alongside Spanish translations thereof. [Doc. 1 at ¶ 12]. They were served, pursuant to 28 U.S.C. § 1608(e) and 22 C.F.R. § 93.2, at the Cuban Ministry of Foreign Affairs in Havana, Cuba. [Id.].

Thereafter, on September 14, 2021, Plaintiffs initiated this civil action in the District of Colorado. See generally [id.]. They seek recognition, confirmation, and enforcement of the Florida state-court judgment pursuant to the Full Faith and Credit Clause in Article IV, Section 1 of the United States Constitution. [Id. at ¶ 15].^[4] This case was originally assigned to the Honorable N. Reid Neureiter. [Doc. 2]. After the Parties declined to consent to the jurisdiction of a United States Magistrate Judge, see [Doc. 18], the case was reassigned to the Honorable Regina M. Rodriguez. [Doc. 20]. The case was reassigned to the undersigned on August 8, 2022 upon her appointment as a United States District Judge. [Doc. 34].

Defendant failed to appear in this matter, which caused Plaintiffs to move for entry of default, see [Doc. 31], and default was entered on June 30, 2022. [Doc. 32]. That same day, Plaintiffs filed the instant Motion for Default Judgment. [Doc. 33]. On December 5, 2022, this Court entered a Minute Order identifying some concerns it had as to this Court's subject matter jurisdiction over this case. See [Doc. 36]. In the interest of judicial economy, see Fed.R.Civ.P. 1, the Court ordered Plaintiffs to file a supplemental brief addressing the Court's subject matter jurisdiction over this case. [Id. at 1]. Plaintiffs filed their thorough supplemental brief on January 9, 2023. [Doc. 37].

LEGAL STANDARD

To obtain a judgment by default, a party must follow the two-step process set out in Rule 55. First, the party must seek an entry of default from the Clerk of the Court under Rule 55(a), which provides for the entry of default against any party who “has failed to plead or otherwise defend” against an affirmative request for relief. Fed.R.Civ.P. 55(a). Then, after the Clerk of Court has entered default, the party must move for default judgment under Rule 55(b).

“[T]he entry of a default judgment is committed to the sound discretion of the district court.” Tripodi v. Welch, 810 F.3d 761, 764 (10th Cir. 2016). The first step in determining whether to enter default judgment requires the Court to resolve whether it has jurisdiction over the case, and if it does, whether the well-pleaded factual allegations in the Complaint and any attendant affidavits or exhibits support judgment on the claims against the defendant. Bixler v. Foster, 596 F.3d 751, 762 (10th Cir. 2010); see also Magic Carpet Ski Lifts, Inc. v. S&A Co., Ltd, No. 14-cv-02133-REB-KLM, 2015 WL 4237950, at *5 (D. Colo. 2015) (“There must be a sufficient basis in the pleadings for the judgment entered.” (internal quotation marks omitted)). If the Court lacks jurisdiction, either subject matter over the action or personal over the defendant, default judgment cannot enter. See Marcus Food Co. v. DiPanfilo, 671 F.3d 1159, 1166 (10th Cir. 2011).

By its default, the defendant admits the plaintiff's well-pleaded allegations of fact, is precluded from challenging those facts by the judgment, and is barred from contesting on appeal the facts established. CrossFit, Inc. v. Jenkins, 69 F.Supp.3d 1088, 1093 (D. Colo. 2014); see also Fed.R.Civ.P. 8(b)(6) (“An allegation-other than one relating to the amount of damages- is admitted if a responsive pleading is required and the allegation is not denied.”). The facts alleged in the Complaint which are deemed admitted upon default may form the basis for the Court's entry of a default judgment. See, e.g., Salba Corp. v. X Factor Holdings, LLC, No. 12-cv-01306-REB-KLM, 2015 WL 5676690, at *1 (D. Colo. 2015). But a party in default does not admit conclusions of law, only allegations of fact, and so the factual allegations must be enough to establish substantive liability. Bixler, 596 F.3d at 762; Big O Tires, LLC v. C&S Tires, Inc., No. 16-cv-00725-MSK-NYW, 2017 WL 2263079, at *3 (D. Colo. May 24, 2017).

ANALYSIS

The Full Faith and Credit Clause provides that “Full Faith and Credit shall be given in each State to the public Acts Records, and judicial Proceedings of every other State,” U.S. Const., art. IV, § 1, and is implemented and applied to federal courts through 28 U.S.C. § 1738. See Kremer v. Chemical Constr. Corp., 456 U.S. 461, 483 n. 24 (1982) (“Section 1738 was enacted to implement the Full Faith and Credit Clause, . . . and specifically to insure that federal courts, not included within the constitutional provision, would be bound by state judgments.”); Elliott, 478 U.S. at 799. The statute provides that

[s]uch Acts, records and judicial proceedings or copies thereof, so authenticated, shall have the same full faith and credit in every court within the United States and its Territories and Possessions as they have by law or usage in the courts of such State, Territory or Possession from which they are taken.

28 U.S.C. § 1738. “[I]t is well settled that federal courts must give full faith and credit to the judgments of state and territorial courts.” Galahad v. Weinshienk, 555 F.Supp. 1201, 1205 (D. Colo. 1983) (citing Huron Holding Corp. v. Lincoln Mine Operating Co., 312 U.S. 183 (1941) and Davis v. Davis, 305 U.S. 32 (1938)). “A final judgment in one State, if rendered by a court with adjudicatory authority over the subject matter and persons governed by the judgment, qualifies for recognition throughout the land.” Baker by Thomas v. Gen. Motors Corp., 522 U.S. 222, 223 (1998).

“[A] federal court must give to a state-court judgment the same preclusive effect as would be given that judgment under the law of the State in which the judgment was rendered.” Migra v. Warren City Sch. Dist. Bd. of Educ., 465 U.S. 75, 80 (1984). However, “a judgment of a court in one State is conclusive upon the merits in a court in another State only if the court in the first State had power to pass on the merits-had jurisdiction, that is, to render the judgment.” Underwriters Nat'l Assurance Co. v. N.C. Life & Acc. & Health Ins. Guar. Ass'n, 455 U.S. 691, 704 (1982).

Section 1738 “commands a federal court to accept the rules chosen by the State from which the judgment is taken.” Kremer, 456 U.S. at 482. “Florida law, like federal law, calls for a de novo examination of the Florida state court's...