Lotenero v. Everett Financial Inc., dba Supreme Lending, a Texas Corporation et al

Filing 40

ORDER Denying Plaintiff's Motion for Default Judgment Without Prejudice 38 , signed by Magistrate Judge Barbara A. McAuliffe on 2/15/2012. (Herman, H)

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IN THE UNITED STATES DISTRICT COURT FOR THE

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EASTERN DISTRICT OF CALIFORNIA

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DORTHY LOTENERO,

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Plaintiff,
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vs.
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JESSE ALVIN CRIPPS, SR
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Defendant.
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___________________________________ )

1: 11-cv-00200-AWI-BAM
ORDER DENYING PLAINTIFF’S MOTION
FOR DEFAULT JUDGMENT WITHOUT
PREJUDICE

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I.

INTRODUCTION

On February 2, 2012, Plaintiff Dorthy Lotenero (“Plaintiff”) filed the present motion for

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default judgment against Defendant Jesse Alvin Cripps, Sr. (“Defendant”) (Doc. 38.) The motion

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was referred to this Court for decision pursuant to 28 U.S.C. § 636(b)(1)(B) and Local Rule

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302(c)(19). The Court deemed the matter suitable for decision without oral argument pursuant to

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Local Rule 230(g), and vacated the hearing scheduled for March 9, 2012. For the reasons that follow,

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the Court DENIES Plaintiff’s motion without prejudice.

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II.

FACTUAL AND PROCEDURAL BACKGROUND

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On April 14, 2011, Plaintiff filed a Second Amended Complaint (“SAC”) against Defendant,

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Everett Financial, Inc., dba Supreme Lending (“Everett”) and Great American Insurance Co. (“Great

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American”).1 (Doc. 16.) Plaintiff alleges, inter alia, that Defendant fraudulently induced Plaintiff to

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execute an unfavorable mortgage refinancing plan and unlawfully converted the resulting proceeds.2

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(Pl.’s SAC, ¶¶ 8-10, Doc. 16.) Defendant has not filed an answer to Plaintiff’s SAC or otherwise

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made an appearance in this action.

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On November 22, 2011, Plaintiff requested an entry of default against Defendant, which was

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entered by the Clerk that same day. (Doc. 30, 33.) On February 2, 2012, Plaintiff moved this Court

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for an entry of default judgment against Defendant (“Plaintiff’s Motion”). (Doc. 38.) Plaintiff’s

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Motion requests a total judgment in the amount of $2,483,842.29, broken down as follows:

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•Special damages in the amount of $54,648.00;

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•General damages in the amount of $218,592.00;

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•Treble damages in the amount of $819, 720.00;

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•Punitive damages in the amount of $1,366,200.00;

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•Attorneys fees in the amount of $24,000.00;

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•Costs in the amount of $682.29.

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(Pl.’s Mot., Attach. 1, 2: 9-14, Doc. 38.)

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III.
A.

DISCUSSION

Legal Standard
Whether to grant or deny default judgment is within the discretion of the court. See Aldabe v.

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Aldabe, 616 F.2d 1089, 1092 (9th Cir. 1980). In exercising this discretion, the court considers the

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following factors: (1) the possibility of prejudice to the plaintiff if relief is denied; (2) the substantive

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merits of plaintiff's claims; (3) the sufficiency of the claims raised in the complaint; (4) the sum of

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money at stake; (5) the possibility of a dispute concerning material facts; (6) whether the default was

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due to excusable neglect; and (7) the strong policy favoring decisions on the merits when reasonably

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On November 10, 2011, the claims against Everett and Great American were dismissed. (Doc. 29.)

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Plaintiff’s alleges Defendant converted $48,278.00 which was received after the refinancing. (Pl.’s SAC, ¶18, Doc.
16.) Plaintiff claims additional damages in the form of fees paid to Everett in the amount of $6,370.00, as well as monthly
mortgage payments which otherwise would not have been due under the terms of Plaintiff’s previous reverse mortgage. (Pl.’s
SAC, ¶18, Doc. 16.)

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possible. See Eitel v. McCool, 782 F.2d 1470, 1471-72 (9th Cir. 1986). Regarding the last factor, a

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decisions on the merits is impractical, if not impossible, where defendants refuse to defend.

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Where a defendant has failed to respond to the complaint, the court presumes that all

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well-pleaded factual allegations relating to liability are true. See Geddes v. United Financial Group,

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559 F.2d 557, 560 (9th Cir. 1977); Televideo Systems, Inc. v. Heidenthal, 826 F.2d 915, 917-18 (9th

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Cir. 1987). Therefore, when determining liability, a defendant's default functions as an admission of

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the plaintiff's well-pleaded allegations of fact. See Panning v. Lavine, 572 F.2d 1386 (9th Cir. 1978).

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While factual allegations concerning liability are deemed admitted upon a defendant's default, the

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court does not presume that any factual allegations relating to the amount of damages suffered are

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true. See Geddes, 559 F.2d at 560; TeleVideo Sys., Inc., 826 F.2d at 917-18. The court must ensure

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that the amount of damages awarded is reasonable and demonstrated by the evidence. Fed. R. Civ.

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P. 55(b)(2)(C); Geddes, 559 F.2d at 560; TeleVideo Sys., Inc., 826 F.2d at 917-18.

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B.

Plaintiff Has Failed To Demonstrate the Requested Damages Are Supported By the

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Evidence

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Plaintiff is required to prove all damages sought in the complaint. Additionally, “[a]

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judgment by default shall not be different in kind [or] exceed in amount that prayed for in the

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[complaint].” Fed. R. Civ. P. 54(c); Philip Morris USA Inc. v. Banh, No. 03-cv-4043 GAF (PJWx),

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2005 WL 5758392, at *3 (C.D. Cal. Jan. 14, 2005). In determining damages, a court can rely on the

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declarations submitted by the plaintiff or order a full evidentiary hearing. Fed. R. Civ. P. 55(b)(2);

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See Philip Morris USA, 219 F.R.D. at 498. Default judgment should not be granted when a moving

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party has failed to adequately establish the basis for the requested relief. See Adams v. U.S., 2008

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WL 3244149 (E.D. Cal. 2008) (Denying a motion for default judgment where the plaintiffs had

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failed to establish an adequate measure of damages by way of default). Furthermore, punitive

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damages can not be awarded absent an evidentiary showing. See Dolphin v. Ruiz, 2008 WL 4552940

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(C.D. Cal. 2008) (“As a general proposition, punitive damages cannot be awarded simply on the

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basis of the pleadings, but must instead be established at an evidentiary hearing held pursuant to

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Fed.R.Civ.P. 55(b)(2) because they clearly are not liquidated or computable.”) (citing Comdyne I,

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Inc. v. Corbin, 908 F.2d 1142 (3rd Cir. 1990).

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Similarly, with respect to a request for attorney fees, “block billing” or failing to specify the

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amount of time spent on each task makes it impossible to determine if the requested fees are

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reasonable. Welch v. Metropolitan Life Ins., Co., 489 F.3d 942, 948 (9th Cir. 2007). The fee

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applicant bears the burden of documenting the appropriate hours expended in the litigation and must

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submit evidence in support of those hours worked. See Gates v. Deukmejian, 987 F.2d 1392, 1397

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(9th Cir. 1992).

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Plaintiff has failed to demonstrate she is entitled to the damages requested in her Motion.

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The substance of Plaintiff’s Motion is less than one page, does not contain a request for any relief,

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nor does it articulate any facts supporting Plaintiff’s damage request. Moreover, Plaintiff’s Motion

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does not present any legal arguments, factual declarations or exhibits to support her claim for

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damages. While Plaintiff’s SAC presents facts and exhibits which support Plaintiff’s claim for

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special damages in the amount of $54,648.00 (the unlawful conversion of $48,278.00 in addition to

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the $6,370.00 in fees paid to Everett), Plaintiff’s SAC and the exhibits attached thereto do not

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present any factual or legal basis for claiming general, punitive or treble damages.

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Lodged concurrently with Plaintiff’s Motion is the declaration of Plaintiff’s counsel, Philip

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C. Bourdette (the “Bourdette Declaration”). The Bourdette Declaration is also less than one page

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and does not articulate any facts supporting Plaintiff’s damage request. Similarly, Plaintiff’s

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counsel’s fee request does not specify the activities undertaken to litigate this case. Rather,

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Plaintiff’s counsel states he expended 60 hours litigating this case at a rate of $400.00 per hour.

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Additionally, Plaintiff’s claimed costs are not itemized.

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/././

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/././

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IV.

CONCLUSION

Plaintiff’s Motion does not present sufficient facts, evidence, legal analysis or specificity to

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support Plaintiff’s damage claims or Plaintiff’s Counsel’s fee and costs request. Based on the

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foregoing, the Court DENIES Plaintiff’s Motion for Default Judgment without prejudice.

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IT IS SO ORDERED.
Dated:
10c20k

February 15, 2012

/s/ Barbara A. McAuliffe
UNITED STATES MAGISTRATE JUDGE

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