MAK, LLC v. VUOZZO
Filing
76
ORDER granting 73 Amended Motion to Vacate Judgment. The Order granting Final Default Judgment [ECF No. 69 ] is VACATED. The Clerk of the Court is instructed to REOPEN the case. Defendant has until December 27, 2021 to move to have the Clerk's Entry of Default [ECF No. 56 ] set aside. Signed by Chief Judge Cecilia M. Altonaga on 12/21/2021. See attached document for full details. (ps1)
Case 1:17-cv-23310-CMA Document 76 Entered on FLSD Docket 12/21/2021 Page 1 of 11
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF FLORIDA
CASE NO. 17-23310-CIV-ALTONAGA/Goodman
MAK, LLC,
Plaintiff,
v.
MARK VUOZZO,
Defendant.
__________________/
ORDER
THIS CAUSE came before the Court on Defendant, Mark Vuozzo’s Amended Motion to
Vacate Judgment [ECF No. 73], filed on November 2, 2021. Plaintiff, Mak, LLC filed its
Response in Opposition [ECF No. 75] on November 16, 2021. Curiously, Defendant did not file
a reply. After carefully considering the parties’ written submissions, the record, and applicable
law, Defendant’s Motion is granted.
I.
BACKGROUND
Plaintiff filed its Complaint [ECF No. 1] on August 31, 2017, asserting five claims 1 against
Defendant: breach of fiduciary duties, fraud, negligent misrepresentation, tortious interference,
and negligence. (See generally id.). On September 25, 2017, Defendant filed a Motion to Dismiss
[ECF No. 17] for lack of personal jurisdiction, followed by an Amended Motion to Dismiss [ECF
No. 20] for lack of personal jurisdiction two days later. On October 6, 2017, the Court denied
Defendant’s Amended Motion to Dismiss and ordered Defendant to answer the Complaint and
then-pending Motion for Preliminary Injunction [ECF No. 10]. (See Order [ECF No. 27] 19).
Defendant filed his Answer [ECF No. 34] on October 20, 2017.
1
Plaintiff also requested a preliminary and permanent injunction in a sixth claim. (See Compl. ¶¶ 78–86).
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On January 18, 2018, the Court granted Defendant’s counsel’s Motion to Withdraw [ECF
No. 47]. (See Order [ECF No. 48] 1). The Order contained three instructions: withdrawing counsel
must send Defendant a copy of the Order; the Clerk must remove withdrawing counsel from the
CM/ECF service list; and Defendant must either have successor counsel file an appearance or
Defendant must file a notice of intent to proceed pro se by February 1, 2018. (See id.). With no
submission from Defendant, the Court issued another Order [ECF No. 49] on February 2, 2018
giving Defendant until February 9, 2018 to file the appropriate notice. (See id. 1). Again,
Defendant did not comply.
Once the second deadline passed, the Court ordered Plaintiff to file a motion for entry of
Clerk’s default by February 19, 2018. (See Feb. 12, 2018 Order [ECF No. 54] 1). On February
14, 2018, Plaintiff filed its Motion for Entry of Clerk’s Default [ECF No. 55]. The Clerk entered
Default [ECF No. 56] the following day.
Unbeknownst to the Court and Plaintiff, Defendant had filed a petition for bankruptcy in
the United States Bankruptcy Court for the Southern District of California on February 13, 2018
— one day before Plaintiff’s Motion for Entry of Clerk’s Default. (See Notice of Stay [ECF No.
58]; see also Resp. 4). The Bankruptcy Noticing Center mailed a Notice of Chapter 7 Bankruptcy
Case [ECF No. 75-5] on February 16, 2018, which Plaintiff did not receive until February 20,
2018. (See Resp. 4). Upon receiving the Notice, Plaintiff filed a Notice of Stay, and the Court
closed the matter pending the outcome of the bankruptcy action. (See generally Feb. 20, 2018
Order [ECF No. 59]).
The stay did not last. (See In re Mark Vuozzo & Oskana G. Vuozzo, No. 18-00784-CL7,
Court Modified Order on Noncontested Mot. Relief Stay [ECF No. 140] filed Sept. 18, 2018
(Bankr. S.D. Cal. 2020) (lifting the stay on the action)). Consequently, on November 13, 2018,
Plaintiff filed a Motion to Reopen Case and Set Schedule to Move for Default Final Judgment
2
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[ECF No. 60]. The Court granted Plaintiff’s Motion and ordered it to file a motion for default final
judgment by November 27, 2018. (See Nov. 13, 2018 Order [ECF No. 61] 1). Importantly, the
Court also directed Plaintiff to “send a copy of the motion to Defendant’s counsel or to Defendant,
if he does not have counsel[,] [and] [i]n the certificate of service, . . . indicate that notice was sent
to Defendant and the address where the notice was sent.” (Id. 2 (emphasis in original; alterations
added)).
The certificate of service in Plaintiff’s first Memorandum of Law in Support of Motion for
Default Final Judgment [ECF No. 65] stated that Plaintiff “filed the foregoing document with the
clerk of the court using CM/ECF, which caused the foregoing document to be served on all counsel
of record.” (Id. 31). 2 Plaintiff knew Defendant had no attorney because Plaintiff premised the
Motion on the departure of Defendant’s attorney and subsequent failure to respond. (See id. 13).
The Court rejected Plaintiff’s first attempt, citing violations of the Local Rules. (See Dec. 26, 2018
Order [ECF No. 67] 1).
Plaintiff’s Renewed Motion for Default Final Judgment [ECF No. 68] copied the original
certificate of service verbatim. (See id. 3). The Court entered Final Judgment [ECF No. 70] for
Plaintiff in the amount of $1,847,750.51. (See id. 1). Now, almost three years later, Defendant
asks that the Court vacate the Final Judgment as void under Federal Rule of Civil Procedure
60(b)(4) and requests attorney’s fees and costs. (See generally Mot.).
II.
LEGAL STANDARD
Under Federal Rule of Civil Procedure 60(b)(4), “the court may relieve a party . . . from a
final . . . order” if “the judgment is void.” Id. (alterations added). “Voidness for purposes of a
60(b)(4) motion contemplates lack of jurisdiction or defects in due process that deprive a party of
2
The Court uses the pagination generated by the electronic CM/ECF database, which appears in the headers
of all court filings.
3
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notice or an opportunity to be heard.” Stansell v. Revolutionary Armed Forces of Colom., 771
F.3d 713, 737 (11th Cir. 2014) (citation omitted).
“[A] mere error in the exercise of jurisdiction does not support relief under Rule 60(b)(4).”
In re Optical Techs., Inc., 425 F.3d 1294, 1306 (11th Cir. 2005) (alteration added; citation and
quotation marks omitted). “Federal courts considering Rule 60(b)(4) motions that assert a
judgment is void because of jurisdictional defect generally have reserved relief for the exceptional
case in which the court that rendered judgment lacked even an arguable basis for jurisdiction.”
United Student Aid Funds, Inc. v. Espinosa, 559 U.S. 260, 271 (2010) (emphasis added; citations
and quotation marks omitted).
“[W]here service of process is insufficient, the court has no power to render judgment and
the judgment is void.” In re Worldwide Web Sys., Inc., 328 F.3d 1291, 1299 (11th Cir. 2003)
(alteration added; citations omitted). However, “Rule 60(b)(4) does not provide a license for
litigants to sleep on their rights.” Espinosa, 559 U.S. at 275 (alteration added).
III.
DISCUSSION
Defendant’s Motion boils down to two arguments. First, Plaintiff sought default, and the
Clerk entered such default against Defendant in violation of the automatic stay of 11 U.S.C. section
362(a). Second, the Court violated Defendant’s procedural due process rights when it entered final
Default Judgment despite Plaintiff’s failure to serve Defendant. The Court addresses each in turn.
Violation of Stay. Defendant argues that Plaintiff’s Motion for Entry of Clerk’s Default
and the Clerk’s subsequent entry of Default violated 11 U.S.C. section 362(a). (See Mot. 4–6).
This argument contains an implicit premise that section 362(a) divested the Clerk, as an extension
of the Court, of jurisdiction to enter default against him. (See id.). Further, Defendant contends
the Clerk’s and Plaintiff’s violations entitle him to attorney’s fees and costs under 11 U.S.C.
section 362(k)(1). (See id. 9 (citing 11 U.S.C. § 362(k)(1)). Defendant’s position is unavailing.
4
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Section 362(a) of the Bankruptcy Code provides that the filing of a bankruptcy petition
“operates as a stay, applicable to all entities, of . . . (1) the commencement or continuation . . . of
a judicial, administrative, or other action or proceeding against the debtor that was or could have
been commenced before the commencement of the case.” 11 U.S.C. § 362(a)(1) (alterations
added). The stay takes effect immediately upon the filing of the petition. Cf. In re Williford, 294
F. App’x 518, 521 (11th Cir. 2008). “Actions taken in violation of the automatic stay are void and
without effect.” United States v. White, 466 F.3d 1241, 1244 (11th Cir. 2006) (citations and
quotation marks omitted). An exception exists for “ministerial acts or automatic occurrences that
entail no deliberation, discretion, or judicial involvement . . . [and thus,] do not constitute
continuations of such a proceeding.” Roberts v. C.I.R., 175 F.3d 889, 897 (11th Cir. 1999)
(alterations added; citations omitted).
As a reminder, federal courts considering a Rule 60(b)(4) motion based on voidness for
lack of jurisdiction need have only an “arguable basis” for jurisdiction. See, e.g., Espinosa, 559
U.S. at 271 (“Federal courts considering Rule 60(b)(4) motions that assert a judgment is void
because of jurisdictional defect generally have reserved relief [if] . . . the court that rendered
judgment lacked even an arguable basis for jurisdiction.” (alterations and emphasis added;
citations and quotation marks omitted)). In granting Plaintiff’s Motion for Entry of Clerk’s
Default, the Clerk had, at the very least, “an arguable basis” for jurisdiction: the Motion and the
Clerk’s entry of default constituted “ministerial acts” that fell outside the automatic stay provision.
A common theme appears in decisions evaluating whether judicial proceedings constitute
ministerial acts: judicial actions that are taken after a judgment or order on the merits and are
collateral to the merits fall within the ambit of ministerial conduct. See, e.g., Corley v. Fairbanks
Morse Pump Corp., No. 2:09-cv-01812, 2017 WL 6884339, at *3 (N.D. Ala. Dec. 7, 2017)
(entering final judgment after a court granted summary judgment for the defendants was a
5
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ministerial act of the clerk), report and recommendation adopted by 2018 WL 333836 (N.D. Ala.
Jan. 9, 2018), aff’d sub nom Corley v. Long-Lewis, 965 F.3d 1222 (11th Cir. 2020). 3
Corley is a fitting example. There, the court considered whether it could direct the clerk
of court to enter final judgment after a defendant obtained a stay under 11 U.S.C. section 362(a).
See Corley, 2017 WL 6884339, at *3. The court held that the entry of final judgment constituted
a ministerial act of the clerk. See id.
Following a failed appeal, the plaintiffs asked the lower court to enter final judgment so
that they could reappeal to the Eleventh Circuit. One of the defendants, however, had obtained a
stay under 11 U.S.C. section 362(a). See id. at *2. Rejecting the defendant’s argument that the
clerk’s entry of final judgment would “continue proceedings” for purposes of section 362(a), the
court directed the clerk to enter final judgment. Id. at *3 (quotation marks and citations omitted).
The court reasoned that the clerk’s entry of final judgment would not “commence” or “continue
proceedings” for purposes of section 362(a) because the clerk’s entry only finalized the existing
judgment. Id. (quotation marks and citations omitted). Thus, the clerk’s entry of final judgment
“constituted no more than a ‘ministerial act’ of the Clerk” not subject to section 362(a). Id.
(quotation marks and citations omitted).
Like Corley, none of the at-issue conduct “commence[d]” or “continue[d]” proceedings.
11 U.S.C. § 362(a) (alterations added). The Clerk’s Entry of Default did not address the merits of
the dispute. See Roberts, 175 F.3d at 897 (“[A] judicial proceeding within the meaning of section
3
See also Gulf Refining Co. of La. v. United States, 269 U.S. 125, 136 (1925) (rendering judgment for
precise sums set forth in stipulations was a ministerial duty); Turner v. Orr, 759 F.2d 817, 820 (11th Cir.
1985) (calculating back pay and seniority of employee was purely ministerial), cert. denied, 478 U.S. 1020
(1986); Jove Eng’g, Inc. v. I.R.S., 92 F.3d 1539, 1548 (11th Cir. 1996) (entering $500 offset against the IRS
pursuant to a final order constituted a ministerial act); Roberts, 175 F.3d at 897 (“running of the 90–day
period for filing a notice of appeal and the resulting finality of the Tax Court’s decision” were ministerial
(citations omitted)); Beste v. Lewin, 488 B.R. 663, 669 (N.D. Cal. 2012) (holding that enforcing a vexatious
litigant order constituted ministerial conduct).
6
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362(a) ends once a decision on the merits has been rendered[.]” (alterations added; citations and
quotation marks omitted)). Rather, it addressed a collateral issue, i.e., Defendant’s failure to
appear before the Court. 4
Nor did Plaintiff’s filing of the Motion violate the stay. Corley demonstrates that the filing
of a motion, alone, does not necessarily commence or continue proceedings. See 2017 WL
6884339, at *3. If anything, the situation here is less indicative of a Plaintiff commencing or
continuing proceedings than that in Corley. Before Defendant obtained the stay, the Court ordered
Plaintiff to seek entry of default from the Clerk. (See Feb. 12, 2018 Order 1). Plaintiff’s failure
to comply could have violated the Court’s instructions. Contrast this with Corley, where the
plaintiffs had full discretion to file their motion without the risk of contempt and did so after the
defendant had obtained a stay. See 2017 WL 6884339, at *2.
At a minimum, there is an “arguable basis for jurisdiction.” Espinosa, 559 U.S. at 271
(quotation marks and citation omitted).
Defendant’s failure to identify any conduct that
“commence[d]” or “continue[d]” proceedings forecloses his argument that Plaintiff and the Clerk
violated the stay. 11 U.S.C. § 362(a) (alterations added). Rather, Plaintiff’s filing and the Clerk’s
entry of Default constitute ministerial actions not subject to the stay. Without a showing that
Plaintiff or the Clerk violated the stay, Defendant’s claim for attorney’s fees and costs under 11
U.S.C. section 362(k)(1) is denied.
Violation of Due Process. Next, Defendant argues that Plaintiff’s failure to serve a copy
of the Renewed Motion for Default Final Judgment on him deprived him of notice and,
4
Even if the entry of Default violated the stay, at least one circuit court has held that “the bankruptcy court’s
order lifting the stay cured any defect.” Picco v. Global Marine Drilling Co., 900 F.2d 846, 850 (5th Cir.
1990). But see Bronson v. United States, 28 Fed. Cl. 756, 759 n.2 (Fed. Cl. 1993) (observing that the Fifth
Circuit is the only circuit to conclude that actions taken in violation of the stay are voidable, rather than
void ab initio, and thus capable of being cured). Without wading into the persuasiveness of the Fifth
Circuit’s minority position, Picco, at a minimum, provides “an arguable basis for jurisdiction” for purposes
of a Rule 60(b)(4) motion. Espinosa, 559 U.S. at 271 (quotation marks and citation omitted).
7
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consequently, procedural due process. (See Mot. 7–9). According to Plaintiff, due process does
not require service upon Defendant, and even if it did, Plaintiff perfected service when it filed its
Renewed Motion for Default Final Judgment on the Court’s electronic case management system,
CM/ECF. (See Resp. 15–16). Before explaining why Plaintiff’s argument fails, it is worth pausing
to review the requirements to obtain a final default judgment.
A party can obtain default judgment against a party who “fail[s] to plead or otherwise
defend” against a lawsuit. Fed. R. Civ. P. 55(a) (alteration added). To do so, the party seeking
default must first file for entry of default from the clerk of court. See id. Upon obtaining entry of
default, the party must then seek entry of final judgment from the clerk or the court. See id. 55(b).
The clerk can enter a final default judgment if “the plaintiff’s claim is for a sum certain or a sum
that can be made certain by computation[.]” Id. 55(b)(1) (alteration added). If the sum is not
certain, the party seeking default must apply to the court for final judgment. See id. 55(b)(2).
A written application to the court “must be served with written notice of the application at
least 7 days before the hearing” on a defaulting party who has appeared “personally or by a
representative[.]” Id. (alteration added). A party seeking default judgment does not need to serve
a defaulting party who has not appeared in the matter. See id.; see also Davies v. MidWestern
Corp., 214 F.R.D. 699, 700 n.2 (M.D. Fla. 2003).
The parties do not dispute that Plaintiff failed to mail a physical copy of its Renewed
Motion for Default Final Judgment to Defendant. Instead, Plaintiff argues that the service
requirement in Rule 55(b)(2) does not apply because Defendant failed to appear in the action. (See
Resp. 15).
“The appearance required by . . . rule [55(b)(2)] has been broadly defined, and not limited
to a formal court appearance.” Charlton L. Davis & Co., P.C. v. Fedder Data Ctr., Inc., 556 F.2d
308, 309 (5th Cir. 1977) (alterations added and citations omitted). “The defendant must simply
8
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manifest a clear intention to defend.” S.E.C. v. Getanswers, Inc., 219 F.R.D. 698, 700 (S.D. Fla.
2004) (collecting cases).
Here, Defendant exhibited an explicit intent to defend: he filed a Motion to Dismiss; he
submitted a Joint Scheduling Report [ECF No. 28] with Plaintiff; and he filed an Answer after the
Court denied his Motion to Dismiss. Either the Answer or Motion to Dismiss, alone, is sufficient
to establish that Defendant appeared before the Court for purposes of Rule 55(b). See, e.g.,
Wakefield v. City of Pembroke Pines, No. 05-61536-Civ, 2005 WL 8154853, at *2 (S.D. Fla. Dec.
15, 2005) (concluding that the filing of a motion to dismiss or answer constitutes an appearance).
Moreover, binding Circuit authority establishes that a defendant who files an answer before his
attorney withdraws from the matter does not obviate the notice requirements of Rule 55(b). See
Bass v. Hoagland, 172 F.2d 205, 209 (5th Cir. 1949) (“If the plaintiff wished to present it to the
court as in default, he was bound to notify the defendant or his counsel three days in advance of
the hearing. Rule 55(b)(2) [sic]. The withdrawal of counsel did not make the notice unnecessary,
but made it servable on the defendant instead of his counsel.” (citation omitted)). Suffice it to say,
Defendant’s filings constituted an appearance sufficient to trigger the service requirements of Rule
55(b)(2).
Plaintiff next argues that even if Rule 55(b)(2) applied, Defendant received automatic
electronic service when Plaintiff filed its Renewed Motion for Default Final Judgment on
CM/ECF. (See Resp. 15–16). This is wrong. Defendant’s email is not listed on CM/ECF, so he
does not receive electronic notices of filings. Had Plaintiff checked CM/ECF, it would have
discovered that Defendant’s home address is the only address listed. 5
5
Plaintiff also argues that notice is satisfied because Plaintiff served Defendant’s former counsel. (See
Resp. 15 (“Plaintiff obeyed the Court’s direction by serving Defendant electronically at the last (and only)
address he provided to Plaintiff and the Court for service — the electronic address of his prior counsel.”)).
Had Plaintiff paid closer attention to the Court’s Order granting defense counsel’s motion to withdraw, it
9
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Still, Plaintiff apparently believes that it “serv[ed] Defendant electronically at the last (and
only) address he provided to Plaintiff and the Court for service[.]” (Id. 15 (alterations added)).
Plaintiff should note that the Local Rules only require an attorney provide an email address to the
Clerk of the Court; whereas, a party appearing pro se need only provide a physical address. See
S.D. Fla. L. R. 11.1(g) (“Each attorney shall update contact information including e-mail
address . . . . A party appearing pro se shall conventionally file a Notice of Current Address with
updated contact information[.]” (alterations added)). 6
Adding insult to injury, Plaintiff also simply ignored the Court’s two Orders directing it to
send a copy of the motion directly to Defendant. (See Feb. 16, 2018 Order [ECF No. 57] 2
(“Plaintiff shall send a copy of the motion to Defendant’s counsel, or to Defendant if he does not
have counsel. In the certificate of service, Plaintiff shall indicate that notice was sent to Defendant
and the address or addresses where notice was sent.” (emphasis in original)); Nov. 13, 2018 Order
2 (same)). To argue that Defendant had sufficient notice in the absence of any service borders on
frivolity considering Plaintiff’s ample notice of, yet failure to satisfy, the service requirements
outlined in Rule 55(b)(2) and the Court’s two Orders. The Court cannot deny Defendant the
requested relief knowing he never received actual notice of Plaintiff’s Renewed Motion for Default
Final Judgment. Thus, the Order granting Final Default Judgment is vacated.
Accordingly, it is ORDERED AND ADJUDGED that Defendant, Mark Vuozzo’s
would have realized that the Court directed the Clerk to remove defense counsel from the service list on
CM/ECF. (See Jan. 18, 2018 Order 1 (“The Clerk is directed to remove Michael D. Stewart from the
CM/ECF service list of this case.”)).
6
Somehow Plaintiff also believes that the following provision of Local Rule 11.1(g) obviates its physical
service requirements: “All Court Orders and Notices will be deemed to be appropriately served if directed
either electronically or by conventional mail consistent with information on file with the Clerk of Court.”
(Resp. 1–16 (quoting S.D. Fla. L.R. 11.1(g) (quotation marks and footnote call number omitted)).
Notwithstanding that this excerpt clearly applies to “Court Orders and Notices,” not parties’ motions,
Plaintiff should know that when Local Rules conflict with the Federal Rules of Civil Procedure, the latter
control. See Brown v. Crawford Cnty., Ga., 960 F.2d 1002, 1008–09 (11th Cir. 1992).
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Amended Motion to Vacate Judgment [ECF No. 73] is GRANTED. The Order granting Final
Default Judgment [ECF No. 69] is VACATED. The Clerk of the Court is instructed to REOPEN
the case.
Defendant has until December 27, 2021 to move to have the Clerk’s Entry of Default [ECF
No. 56] set aside. If Defendant fails to comply with this deadline, Plaintiff shall file a corrected
motion for default final judgment no later than December 29, 2021.
DONE AND ORDERED in Miami, Florida, this 21st day of December, 2021.
________________________________________
CECILIA M. ALTONAGA
CHIEF UNITED STATES DISTRICT JUDGE
cc:
counsel of record
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