M.I.T., Inc., v. Medcare Express, N. Charleston, LLC et al

Filing 21

ORDER denying Defendants' 14 Motion to Set Aside Default Judgment. Signed by Judge J. Randal Hall on 8/23/2016. (jah)

IN THE UNITED
FOR THE

STATES DISTRICT COURT

SOUTHERN DISTRICT OF GEORGIA
AUGUSTA DIVISION

M.I.T.,

INC,

*
*

Plaintiff,

*

v.

*

*

MEDCARE EXPRESS,
LLC, et al.,

N.

CHARLESTON,

CV

114-081

*
*
*

Defendants.

*
*

ORDER

Currently

before

the

aside default judgment.
below,

Court

(Doc. 14.)

Defendants'

For the

motion

to

set

reasons explained

Defendants' motion is DENIED

I.

Plaintiff

initiated

1.)

Plaintiff's

three

different

Defendant

(Doc.

is

1 M

this

complaint

contracts

entered

8-11.)

Background

into

action

alleges

to
a

On May

March

that

purchase

25,

2014.

Defendants

medical

(Doc.

breached

equipment;

contract

2,

Defendants

waived service

(Doc. 3.)

The waivers of

2014,

with

each

separate

through their counsel, Alicia Gevers.
service all stated:

on

Plaintiff.

"I understand that a judgment may be entered

against me ... if an answer or motion under Rule 12 is not

served upon you within

60 days

after

3/27/2014 . . . ."

(Doc.

3.)

At
began

some point after Defendants waived service,
settlement

Plaintiff

the

offered

medical

Defendants
with

June

6,

Hallaba,

settle

at

First,

the

in

matter

issue.

if

(See

(Id.)

to

pay

June

5,

2014,

$20,000.00

by August

Plaintiff

2014,

an

On

rejected

(Doc.

14-4

e-mail

at

1.)

from

early

14-3

were

at

Defendants

2014.

returned

2.)

But

responded

by

14-4.)

On

(Doc.

offer

June

13,

Defendants'

2014,

"fully encumbered

the

On

May

Defendants

Doc.

declined because the machines

$150,000.00.

forwarded

to

equipment

debt."

offering

negotiations.

the parties

and

2014,

requested
Ms.

Gevers

representative,

Dr.

that stated the following:

I have seen MIT's counter request.
I can't pay what
we don't have or promise what I know can't happen.

We are facing several simultaneous serious obstacles
and
challenges
that
simply
make
the
request
literally impossible.
In addition to increased
insurer
oversight
and
audit
requests
of
our
imaging ... we
are
actively
defending
a
discrimination

lawsuit

in

Federal

Blue
Cross
has
effectively
network
without
providing

Court

....

'kicked us
out'
any
rationale

of
or

explanation.
patient base.

They represented just over 50% of our
This final insult is catastrophic for

our

and

business

heads around this

(Doc. 14-5 at 2.)

Robert

Lowe,

we

are

still

trying

to

wrap

our

....

The e-mail also informed Plaintiff's counsel,

that Ms.

Gevers would no longer be representing

Defendants in this matter.

(Id. at 1.)

When Mr. Lowe requested

Dr.

Hallaba's

request

e-mail

and

Dr.

Hallaba

But

(Id. )

to

Mr.

Lowe

address,

default,

June

5,

claims

which

Then,

on

which

the

2014,

that

attorney

where

filed

entered the

17,

2014,

Plaintiff

granted

to

Defendants

on

help

collect

are

located.

the

same

day.
for

14,

Mr.

judgment

Within

a

4.)

Nelson failed to provide Mr.
Lowe

2015.

continued to

(Doc.

16-1 at

26.)

entry
6,

of
7.)

judgment,

(Docs.

9,

12.)

after

South
days,

numerous

he

Plaintiff's

requests,

agreement.

Nelson through

Eventually,

Carolina,

who claimed he could

Lowe with a fee

contact Mr.

for

default

in

few

But,

Mr.

Lowe.

Lowe began searching for

help.

at

the

Hallaba

(Docs.

2014.

Thomas Nelson,

16-1

Mr.

from Dr.

motion

moved

October

judgment,

its

counsel located an attorney,

(Doc.

contact

never heard

Clerk

Court

forwarded

(Doc. 16-1 at 3.)

Plaintiff

Soon after the entry of

an

he

the

June

Gevers

and instructed him to

or any other representative.
On

Mr.

at

Mr.
(Id. )

least

June

gave up and found new

representation in October 2015, who made the appropriate filings
on November 4 and 5,

2015.

(Doc. 16-1 at 5; Doc.

14-6 at 3-6.)

Defendants claim that they did not have notice of the

until

Plaintiff

attempted to collect

it in November

they now move to set aside the judgment.

judgment

2015,

and

II.

Defendants

move

to

Discussion

set

aside

Rule of Civil Procedure 60(b),

the

judgment

under

Federal

which provides:

(b) Grounds for relief from a Final Judgment, Order,
or Proceeding.
On motion and just terms, the court
may relieve a party or its legal representative from
a final
judgment,
order,
or proceeding for the
following reasons:
(1) mistake,
neglect;

(2)
newly
reasonable
discovered

inadvertence,

discovered
diligence,
in

time

to

surprise,

evidence
could
not

move

for

a

new

or

excusable

that,
have
trial

with
been
under

Rule 59(b);

(3) fraud (whether previously called intrinsic or
extrinsic), misrepresentation, or misconduct by an
opposing party;
(4) the judgment is void;

(5) the judgment has been satisfied, released or
discharged; it is based on an earlier judgment
that has been reversed or

vacated;

or applying it

prospectively is no longer equitable; or

(6) any other reason that justifies relief.
Fed. R. Civ.

60(b)

(1),

must

(2),

P. 60(b).

Under Rule 60(c),

"[a] motion under Rule

be made within a reasonable time —

and

(3)

judgment . . . ."
did not move

to

no more

reasons

than a year after the entry of the

Fed. R. Civ. P. 60(c)(1).
set

and for

aside the

Because Defendants

judgment until more

than a year

after the Court entered judgment, they concede that reasons (1),

(2), and (3) are not in play, and they do not contend that (4)

and

(5)

are relevant.

Instead,

Defendants expressly move under

Rule 60(b)(6).

Rule 60(b)(6)

set

aside

a

judgment

relief," but it
Aldana v.

Cir.

provides a "catch-all" that allows a court to

for

"any

other

that

justifies

only applies in exceptional circumstances.

Del Monte Fresh Produce,

2014)

reason

("Our

case

precedent

open-ended language.").

NA,

has

741 F.3d 1349,

See

1355

(11th

carefully constrained this

"Rule 60(b)(6)

motions must demonstrate

that the circumstances are sufficiently extraordinary to warrant
relief."

(11th

Galbert

Cir.

omitted).

relief,

an

(citation
Moreover,

2013)

v.

W.

Caribbean Airways,

(citation

"[T]hat

extreme

is,

and

omitted)
"[t]he

omitted)

movants

show

hardship

(internal
provisions

(internal

must

unexpected

715

quotation
of

Rule

F.3d

1290,

quotation

that

1294

marks
such

result."

will

absent

Id.

marks

60(b)

omitted).

are

mutually

exclusive, meaning a party cannot offer reasons for relief under
Rule

60(b)(6)

that

he

also

offers

or

the other five subsections of Rule

Ltd.
*5

v.

AAdyn Tech.,

(S.D.

Fla.

Mar.

LLC,
18,

quotation marks omitted);
No. l:12-CV-02477-RWS,

2015)
and

No.

could

60(b)."

14-CV-61376,

2015)

(citation

offer

Prof.

under

of

LED Lighting,

2015 WL

1246287,

omitted)

at

(internal

see also Bohannon v. PHH Mortg.

2015 WL 1137663,

one

Corp.,

at *4 (N.D. Ga. Mar. 12,

("The Eleventh Circuit consistently has held that 60(b)(1)

(b)(6)

are

mutually

exclusive.

Therefore,

a

court

cannot

grant

relief under

consider

under

(b) (6)

(b)(1)."

for

any reason which the

(citation

omitted)

court

(internal

could

quotation

marks omitted)).

In

this

case,

the

circumstances

extraordinary to warrant relief."
noted

above,

the

waivers

of

are

Aldana,

service

not

"sufficiently

741 F.3d at 1355.

that

Defendants

As

executed

clearly informed Defendants that judgment may be entered against
them if they failed to appear.

have

believed that

them

during

Plaintiff

the

could

(Doc.

3.)

Plaintiff would not

settlement
do

so

if

pursue

discussions,
it

chose

While Defendants may

to.

judgment

against

they

were

aware

that

And

they

could

have

avoided this predicament simply by appearing in this Court.
Defendants contend that they were entitled to notice of the

motion

for

appeared.1

default

judgment

because

1

had

informally

Even if that were true, they have not explained how

that would entitle them to relief.

authority

they

supporting

relief

According to Defendants,

on

Defendants have provided no

those

grounds

under

Rule

they made an informal appearance because

they "manifest[ed] a clear intention to defend."
S.E.C. v. Getanswers, Inc.,
219 F.R.D. 698, 700 (S.D. Fla. 2004).
The Court, however, questions this
proposition because, though Defendants engaged in some preliminary settlement
discussions, their last communication to Plaintiff clearly stated that they
could not pay, and after Ms. Gevers withdrew, Defendants never contacted Mr.
Lowe.
Moreover, the Court also questions whether Defendants sought relief
from judgment "within a reasonable time," Fed. R. Civ. P. 60(c), because they
did not move to set aside the judgment until fourteen months after the Court
entered it.
And they could have easily learned of the judgment as soon as it

was entered and promptly moved to set it aside.
See Ramsey v. Walker, 304 F.
App'x 827, 828 (11th Cir. 2008)
("A determination of what constitutes a
reasonable time depends on the facts in an individual case, and in making the
determination, courts should consider whether
for the delay . . . .").

the movant

had

a

good

reason

60(b)(6).

provide

And

notice

and have

also

seek

that

to

not
for

Mr.

enforce

relief

have

does

not moved

argue

seeking

they

Lowe

Rule

conceded

that

render a judgment void
relief

the

under

essentially

under

Rule

intentionally

judgment

so

60 (b) (1)- (3) .

this issue shows that Mr.

(doc.

60(b)(4).

waited

that

failure

14

5)

Defendants

a

year

Defendants

However,

at

to

before

could

the

not

record

on

Lowe began his efforts to collect the

judgment almost immediately, though it took him over a year.
Additionally,

way

of

later

knowing
when

true.

Defendants appear to

about

Plaintiff

the

default

sought

to

assert that they had no

judgment

collect

a

But

that

is

Defendants were undeniably aware of the lawsuit,

however,

Court,

chose not to do

it

appears

matter

Because

In fact,

Defendants

June

2014.

she

14-5 at 1),

so.

that

after

representation,
(doc.

over

it.

could have checked the Court's docket at

this

until

not

and they

Defendants,

on the record before the

made

When

instructed Dr.

any time.

year

no

Ms.

attempt

Gevers

Hallaba to

to

address

withdrew

from

contact Mr.

Lowe

but he failed to do so.

Defendants

have

not

shown

that

absent

an

order

vacating the entry of judgment, "extreme and unexpected hardship
will

result,"

(internal

Galbert,

quotation

715

marks

F.3d

at

omitted)

1294

(citation

(emphasis

omitted)

added),

the

circumstances of this case are not sufficiently extraordinary to
warrant

relief.

Id.

7

III.

Conclusion

For the reasons explained above,
default judgment (doc.

14)

Plaintiff's motion to set aside

is DENIED.

ORDER ENTERED at Augusta,

Georgia this

day of August,

2016,

HONORABLE

J.

RANDAL

HALI

UNITED STATES DISTRICT JUDGE
DISTRICT

OF GEORGIA