Metropolitan Life Insurance Company v. Johnson et al

Filing 35

ORDER; Defendant George J. Johnson's (Movant) Motion for Default Judgment Pursuant to Fed.R.Civ.P. 55(b) Against Co-Defendants Jamie Johnson and Jennifer Johnson 34 and the Brief in Support of Motion forDefault Judgment Pursuant to Fed.R.Civ .P. 55(b) Against Co-Defendants JamieJohnson and Jennifer Johnson [34-1] is GRANTED. The Clerk of the Court shall enter JUDGMENT in favor of Defendant George H. Johnson declaring that Defendants Jennifer and Jamie Johnson have defaulted in this inte rpleader action and have thereby waived any entitlement to payment of the proceeds of the benefits of the Federal Employees Group Life Insurance Policy payable as a result of the death of Bruce R. Johnson. The Clerk of the Court shall distribute the funds deposited by Plaintiff into the Courts Registry, see Receipt 32 , in the amount of $343,653.78 to Defendant George H. Johnson. As this Order resolves all remaining issues in this case, IT IS FURTHER ORDERED that the Clerk of the Court shall close this case, by Magistrate Judge Kristen L. Mix on 4/29/15.(morti, )

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLORADO
Civil Action No. 14-cv-00811-KLM
METROPOLITAN LIFE INSURANCE COMPANY,
Plaintiff,
v.
GEORGE H. JOHNSON,
JAMIE JOHNSON, and
JENNIFER JOHNSON,
Defendants.
______________________________________________________________________
ORDER
______________________________________________________________________
ENTERED BY MAGISTRATE JUDGE KRISTEN L. MIX
This matter is before the Court on Defendant George J. Johnson’s (“Movant”)
Motion for Default Judgment Pursuant to Fed.R.Civ.P. 55(b) Against Co-Defendants
Jamie Johnson and Jennifer Johnson [#34]1 and the Brief in Support of Motion for
Default Judgment Pursuant to Fed.R.Civ.P. 55(b) Against Co-Defendants Jamie
Johnson and Jennifer Johnson [#34-1] (collectively, the “Motion”). No response has
been filed and the deadline to do so has elapsed. The Court has reviewed the Motion, the
entire case file, and the applicable law and is sufficiently advised in the premises.2 For the
reasons set forth below, the Motion [##34, 34-1] is GRANTED.

1

“[#11]” is an example of the convention I use to identify the docket number assigned to
a specific paper by the Court’s case management and electronic case filing system (CM/ECF). I
use this convention throughout this Order.
2

The case has been referred to the undersigned for all purposes [#15] pursuant to the
Court’s Pilot Program and 28 U.S.C. § 636(c), upon consent of the parties [#14].

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I. Background
Plaintiff commenced this action on March 19, 2014 by filing a Complaint In
Interpleader [#1] (“Complaint”). Plaintiff invokes this Court’s jurisdiction pursuant to 28
U.S.C. § 1331 “because this action arises under the law of the United States, specifically
the Federal Employees’ Group Life Insurance Act, 5 U[.] S[.] C[.] §§ 8701, et seq.” Compl.
[#1] ¶ 5. Plaintiff alleges that it insured Bruce R. Johnson (the “Decedent”) through the
Federal Employees’ Group Life Insurance Policy (the “Policy”). Id. ¶ 7. Plaintiff avers that
following the Decedent’s death, $342,000 in benefits became payable under the Policy.
Id. ¶ 12. Plaintiff further states that it “cannot determine to whom the [ ] benefits should be
paid based on the allegation that the [D]ecedent was not competent at the time he signed”
a beneficiary designation on September 24, 2013. Id. ¶¶ 15, 17. Accordingly, Plaintiff
sought to deposit the benefits into the Court’s Registry for disbursement by the Court once
the competing beneficiaries’ dispute is resolved. See generally Metropolitan Life Insurance
Company’s Motion to Deposit Life Insurance Proceeds Into Registry of Court and for
Discharge and Dismissal With Prejudice [#11] (the “MetLife Motion”). In the MetLife Motion,
Plaintiff also sought injunctive relief against the competing beneficiaries “[r]estraining and
enjoining the Defendants by Order and Injunction of this Court from instituting any action
or proceeding in any state or United States court against [Plaintiff] for the recovery of [the]
Benefits, plus any applicable interest payable as a consequence of the death of the
Decedent . . . .” Id. at 5. Plaintiff also sought “costs and attorney’s fees, to be paid from
the [ ] Benefits prior to deposit into the Registry of the Court” and sought to be discharged
from this action with prejudice. Id. at 6. On September 2, 2014, the Court granted the
MetLife Motion in part. Order [#24] at 3-4. The Court ordered Plaintiff to deposit the life
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insurance benefits into the Court’s Registry and held that “[u]pon deposit, Plaintiff shall be
relived of any and all further liability relating to the payment of the Benefits resulting from
the death of Bruce R. Johnson.” Id. at 3.
Plaintiff named three Defendants: Movant, the Decedent’s brother, and Jamie and
Jennifer Johnson, the Decedent’s daughters. Movant filed an Answer in which he agreed
that the amount of Benefits due under the Policy is $342,000. Answer [#10] ¶ 12. Jamie
and Jennifer Johnson were represented by counsel in this matter initially and consented
to the jurisdiction of the Court, but have not responded to the Complaint. See Consent
Form [#14] at 2; Minute Order [#17] at 1 (extending Jamie and Jennifer Johnson’s deadline
to respond to the Complaint to June 16, 2014); see generally Motion for Extension of Time
[#16]; Motion to Withdraw [#18]; Minute Order [#19]. On September 16, 2014, the Court
held a Status Conference in this matter. See generally Courtroom Minutes/Minute Order
[#31]. Movant’s counsel attended the Status Conference, as did Jennifer Johnson. Id. at
1. Ms. Johnson was “advised that she [had the opportunity to] file a Motion for Leave to
File an Answer Out of Time and a proposed Answer no later than September 23, 2014.”
Id. (emphasis in original). Neither Jennifer Johnson nor Jamie Johnson filed a motion
requesting leave to file an answer out of time or an answer.
On September 19, 2014, Plaintiff deposited $343,653.78 into the Court’s Registry.
See generally Receipt [#32].
On October 1, 2014, the Clerk of the Court entered default against Defendants
Jamie and Jennifer Johnson. See generally Clerk’s Entry of Default [#33].

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II. Analysis
Pursuant to Fed. R. Civ. P. 55, default may enter against parties who fail to appear
or otherwise defend a lawsuit.

Here, Entry of Default [#33] was proper because

Defendants Jennifer and Jamie Johnson failed to respond to Plaintiff’s Complaint [#1].
Before proceeding with a default judgment, however, the Court normally must consider
whether it has jurisdiction, whether the facts establish a legitimate basis for the entry of
judgment, and whether the amount of damages can be ascertained. See Grady v. Swisher,
No. 11-cv-02880-WYD-KLM, 2014 WL 3562794, at *5 (D. Colo. July 18, 2014). In this case
there is no dispute about the amount of benefits available under the Policy, so the Court’s
analysis addresses jurisdiction and whether there is a basis for entry of judgment.
A.

Jurisdiction
In determining whether a default judgment is warranted, the Court must first consider

whether it has jurisdiction over the subject matter and the parties against whom default
judgment is sought. Dennis Garberg & Assocs., Inc., v. Pack-Tech Int’l Corp., 115 F.3d
767, 772 (10th Cir. 1997); Williams v. Life Sav. & Loan, 802 F.2d 1200, 1202-03 (10th Cir.
1986). The Court must do so in consideration of the well-established rule that “a judgment
is void if the court that enters it lacks jurisdiction over either the subject matter of the action
or the parties to the action.” United States v. 51 Pieces of Real Prop., 17 F.3d 1306, 1309
(10th Cir. 1994).
1.

Subject Matter Jurisdiction

Federal question jurisdiction is governed by 28 U.S.C. § 1331, which provides in
pertinent part that “[t]he district courts shall have original jurisdiction of all civil actions

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arising under the Constitution, laws, or treaties of the United States.” In the Complaint,
Plaintiff alleges that “this action arises under the . . . Federal Employees’ Group Life
Insurance Act . . . .” Compl. [#1] ¶ 5. The Federal Employees’ Group Life Insurance Act,
5 U.S.C. §§ 8701, et seq., (“FEGLI”) is a federal statute. As alleged in the Complaint, the
Decedent’s Policy was issued pursuant to FEGLI and the proceeds became payable
pursuant to FEGLI. Id. ¶¶ 7, 12. Accordingly, based on federal question jurisdiction, the
Court finds that it has subject matter jurisdiction over this dispute.
2.

Personal Jurisdiction

In addition to subject matter jurisdiction, entry of a default judgment in a civil case
requires personal jurisdiction over the parties against whom judgment is sought. Bixler v.
Foster, 596 F.3d 751, 761 (10th Cir. 2010). The Court must first address the adequacy of
service in deciding whether it has personal jurisdiction over Defendants. See United States
v. Elsberg, No. 08-cv-00522-MSK-KLM, 2010 WL 5177439, at *2 (D. Colo. Aug. 17, 2010).
As noted above, Jamie and Jennifer Johnson had counsel in this matter initially and
consented to the jurisdiction of the Court, but have not responded to the Complaint. See
Consent Form [#14] at 2; Minute Order [#17] at 1 (extending Jamie and Jennifer Johnson’s
deadline to respond to the Complaint to June 16, 2014); see generally Motion for Extension
of Time [#16]; Motion to Withdraw [#18]; Minute Order [#19]. In addition, their counsel
executed a Waiver and Acceptance of Service [#30] prior to withdrawing. The Court
therefore finds that Jennifer and Jamie Johnson were properly served in compliance with
Fed. R. Civ. P. 4.
Movant bears the burden of establishing personal jurisdiction. Intercon, Inc. v. Bell
Atl. Internet Solutions, Inc., 205 F.3d 1244, 1247 (10th Cir. 2000). Movant “need only make
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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 Int’l Corp., 115 F.3d 767, 773 (10th Cir. 1997).
“Defects in personal jurisdiction . . . are not waived by default when a party fails to appear
or to respond.” Williams v. Life Sav. & Loan, 802 F.2d 1200, 1202 (10th Cir. 1986) (citing
V.T.A., Inc. v Airco, Inc., 597 F.2d 220, 225 (10th Cir. 1979)).
Thus, when entry of a default judgment is sought against a party who has
failed to plead or otherwise defend, the district court has an affirmative duty
to look into its jurisdiction both over the subject matter and the parties. In
reviewing its personal jurisdiction, the court does not assert a personal
defense of the parties; rather, the court exercises its responsibility to
determine that it has the power to enter the default judgment.
Id. at 1203.
As explained by the Tenth Circuit,
It is well settled that lack of personal jurisdiction is a privileged defense that
can be waived “by failure to assert it seasonably, by formal submission in a
cause, or by submission through conduct,” Neirbo Co. v. Bethlehem Corp.,
308 U.S. 165, 168, (1939); see also Federal Deposit Ins. Corp. v. Oaklawn
Apartments, 959 F.2d 170, 176 (10th Cir. 1992) (noting that “‘defendant may
[not] halfway appear in a case, giving . . . the impression that he has been
served, and [later] pull failure of service out of the hat like a rabbit’” (quoting
Broadcast Music, Inc. v. MTS Enters., Inc., 811 F.2d 278, 281 (5th Cir.
1987))); Ziegler v. Akin, 261 F.2d 88, 92 (10th Cir. 1958) (holding that
voluntary appearance cures any defect in service).
Morreale v. City of Cripple Creek, 113 F.3d 1246, at *5 (10th Cir. 1997) (table decision).
Here, Defendants Jennifer and Jamie Johnson participated in this case by executing a
Waiver and Acceptance of Service [#30], executing a Consent Form [#14], and filing a
Motion for Extension of Time [#16]. In addition, Jennifer Johnson appeared at the
September 31, 2014 Status Conference. Courtroom Minutes/Minute Order [#31] at 1.
Under Fed. R. Civ. P. 12(h), a defendant waives any objection based on personal
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jurisdiction by filing a responsive pleading that does not contain an objection to personal
jurisdiction. However, neither Jennifer nor Jamie Johnson filed a responsive pleading.
The Court has personal jurisdiction over residents of the state of Colorado because
the District of Colorado encompasses the entire state. See Dallas Buyers Club, LLC v.
Cordova, --- F.Supp.3d ---, 2015 WL 782988, at *7 (D. Colo. 2015) (“As Defendant resides
in the District of Colorado, the Court has personal jurisdiction over him.”). As explained
above, regarding personal jurisdiction, Movant “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., 115 F.3d
at 773. In the Complaint, Plaintiff alleges that Jennifer and Jamie Johnson are residents
of Colorado. Compl. [#1] ¶¶ 3-4. Plaintiff’s allegations in the Complaint are sufficient to
satisfy the Court that it may exercise personal jurisdiction over Jennifer and Jamie Johnson.
See Satriano v. Countrywide Home Loans, Inc., No. 14-cv-02216-KLM, 2015 WL 1887260,
at *3 (D. Colo. April 23, 2015) (“As alleged in the pleadings, the Subject Property is located
in Colorado and Plaintiff resides in Colorado. Compl. [# 1] ¶¶ 1, 6. Service by publication
was proper. Therefore, the Court is satisfied that it may exercise personal jurisdiction in
this matter.”); United States v. Stock Asylum LLC, No. 14-cv-01979-WJM-NYW, 2015 WL
638200, at *2 (D. Colo. Feb. 13, 2015) (“The Court further finds that it has personal
jurisdiction over Defendants, as Stock Asylum is a Colorado limited liability corporation with
its principal place of business in Boulder, Colorado and Defendant Rovtar resides in
Boulder, Colorado. (Compl. ¶¶ 3–4.)”); Evans v. Loveland Automotive Invs., Inc., No. 13-cv02415-WJM-KMT, 2015 WL 161295, at *3 (D. Colo. Jan. 12, 2015) (“The Court also finds
it has personal jurisdiction over the Defendants because, Plaintiffs allege, Defendant Pipe
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is domiciled in Colorado, and Defendants Pipeline Auto Transport, Inc. and Loveland
Automotive Investments, Inc. are incorporated and have their principal places of business
in Colorado. (ECF No. 1 at ¶¶ 3–6.)”).
B.

Default Judgment
In the Motion, Movant seeks default judgment against Jennifer and Jamie Johnson

and release of the funds deposited into the Court’s Registry by Plaintiff to Movant. Motion
[#34-1] at 4. Even after a proper Entry of Default [#40], the Court must decide “‘whether
the unchallenged facts constitute a legitimate cause of action’” such that a judgment should
be entered. Bixler, 596 F.3d at 762 (quoting 10A Charles A. Wright, Arthur R. Miller & Mary
K. Kane, Federal Practice and Procedure § 2688, at 63 (3d ed. 1998)). “‘There must be
a sufficient basis in the pleadings for the judgment entered.’” Id. (quoting Nishimatsu
Constr. Co. v. Houston Nat’l Bank, 515 F.2d 1200, 1206 (5th Cir. 1975)). “[A] party is not
entitled to a default judgment as of right; rather the entry of a default judgment is entrusted
to the ‘sound judicial discretion’ of the court.” Greenwich Ins. Co. v. Daniel Law Firm, No.
07-cv-2445-LTB-MJW, 2008 WL 793606, at *2 (D. Colo. Mar. 22, 2008) (quoting
Cablevision of S. Conn., Ltd. P’ship v. Smith, 141 F. Supp. 2d 277, 281 (D. Conn. 2001)).
Upon review of a motion for default judgment, assuming default was properly
entered, the moving party enjoys the benefit of deferential pleading interpretation. See
Olcott v. Del. Flood Co., 327 F.3d 1115, 1125 (10th Cir. 2003). The Court deems the wellpled facts of the complaint to be true. Vibe Tech., LLC v. Suddath, No. 06-cv-00812, 2009
WL 2055186, at *1 (D. Colo. 2009) (citing Dundee Cement Co. v. Howard Pipe & Concrete
Prods., Inc., 722 F.2d 1319, 1323 (7th Cir. 1983)). Undisputed facts set forth by the
moving parties in affidavits and exhibits are also accepted as true. Id.
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As alleged in the Complaint, “[o]n October 12, 2013 Geroge H. Johnson completed
a claim for the FEGLI Benefits.” Compl. [#1] ¶ 13; Compl. Ex. C [#1-3]. Further, “as a
result of the Decedent’s death” certain benefits became payable under the FEGLI Policy
. . . .” Id. ¶ 12. While the Complaint also alleges that Jennifer and Jamie Johnson “alleged
that the Decedent was medically incapable of properly authorizing or executing” the
Beneficiary designation that named Movant as the sole beneficiary, “the failure of a named
interpleader defendant to answer the interpleader complaint and assert a claim to the res
can be viewed as forfeiting any claim of entitlement that might have been asserted.”
Amoco Prod. Co. v. Aspen Group, 59 F.Supp.2d 1112, 1116 (D. Colo. 1999) (quoting Gulf
Coast Galvanizing, Inc. v. Steel Sales Co., 826 F.Supp. 197, 203 (S.D. Miss. 1993)). As
here, “if all but one named interpleader defendant default[s], the remaining defendant [is]
entitled to the fund[s].” Nationwide Mut. Fire Ins. Co. v. Eason, 736 F.2d 130, 133 n.4 (4th
Cir. 1984). Here, as in Combined Ins. Co. of Am. v. Glass, No. 14-cv-01458-KMT, 2015
WL 996172, at *9-10 (D. Colo. Mar. 3, 2015), the Court finds that as the sole remaining
interpleader Defendant, Movant is entitled to the Policy benefits.
III. Conclusion
Therefore, for the reasons stated above,
IT IS HEREBY ORDERED that the Motion [##34, 34-1] is GRANTED.
IT IS FURTHER ORDERED that the Clerk of the Court shall enter JUDGMENT in
favor of Defendant George H. Johnson declaring that Defendants Jennifer and Jamie
Johnson have defaulted in this interpleader action and have thereby waived any entitlement
to payment of the proceeds of the benefits of the Federal Employees’ Group Life Insurance

9

Policy payable as a result of the death of Bruce R. Johnson.
IT IS FURTHER ORDERED that the Clerk of the Court shall distribute the funds
deposited by Plaintiff into the Court’s Registry, see Receipt [#32], in the amount of
$343,653.78 to Defendant George H. Johnson.
As this Order resolves all remaining issues in this case,
IT IS FURTHER ORDERED that the Clerk of the Court shall close this case.
Dated: April 29, 2015

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