HATTON v. RIDE RIGHT, LLC

Filing 19

ORDER denying Plaintiff's 9 Motion for Clerk's Entry of Default (S.O.). Signed by Judge Tanya Walton Pratt on 9/1/2015. (MAC)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF INDIANA
INDIANAPOLIS DIVISION
CAROL HATTON, on behalf of herself
and all others similarly situated,
Plaintiff,
v.
RIDE RIGHT, LLC.,
Defendant.

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Case No. 1:15-cv-00352-TWP-DML

ENTRY DENYING CLERK’S DEFAULT
This case was initiated on February 27, 2015. Defendant Ride Right’s registered agent, CT
Corporation System, was served with copies of the Complaint and Summons on March 9, 2015 by
certified U.S. Mail. However, return of service was not docketed until July 27, 2015 (Filing No.
8), following this Court’s issuance of an order to show cause why the Complaint should not be
dismissed with prejudice for failure to serve Defendant within 120 days of filing the law suit.
(Filing No. 7). On July 27, 2015, Plaintiff also filed a Verified Motion for Clerk’s Entry of
Default (Filing No. 9) pursuant to Federal Rule of Civil Procedure 55(a), alleging that the
Defendants had failed to appear, plead or otherwise defend as required by the Federal Rules of
Civil Procedure. Thereafter, on August 14, 2015, Bride Right’s retained counsel filed an Answer
to Plaintiff’s Complaint for Damages (Filing No. 13), and a Motion for Leave to File Response in
Opposition to Plaintiff’s Motion for Clerk’s Entry of Default (Filing No. 15). On August 31, 2015
Plaintiff filed a Reply In Support of Motion for Clerk’s Entry of Default. (Filing No. 18).
“When a party against whom a judgment for affirmative relief is sought has failed to plead
or otherwise defend, and that failure is shown by affidavit or otherwise, the clerk must enter the
party's default.” Fed. R. Civ. P. 55(a). “Although Rule 55(a), Fed. R. Civ. P. refers to entry of

default by the clerk, it is well established that a default also may be entered by the court.” Breuer
Electric Manufacturing Co. v. Toronado Systems of America, Inc., 687 F.2d 182, 185 (7th
Cir.1982). “[B]ecause the Court, not its Clerk, is addressing the present motion, the question of
entry of default merges with the question a court usually addresses later: whether good cause exists
to set aside an entry of default under Rule 55(c).” Broadwater v. Kalina, 2013 WL 3353946, *1
(S.D. Ind. July 3, 2013).
To obtain relief from default under Rule 55(c), Ride Right must show: “1) good cause for
default, 2) prompt action to correct it, and 3) a meritorious defense to the plaintiff's complaint.”
O'Brien v. R.J. O'Brien & Assoc., Inc., 998 F.2d 1394, 1401 (7th Cir.1993). Federal procedural
law does not favor default judgments, noting that “courts must balance the need for efficient
administration of justice with the preference for deciding cases on their merits and giving a party
its day in court.” McGrath v. Everest National Ins. Co., 668 F.Supp.2d 1085 (N.D.Ind. 2009),
citing, Flying J., Inc., v. Jeter, 720 N.E.2d 1247, 1249 (Ind.App. 1999).
The Defendants have filed a response to the motion for default which explains that there
was a mistake in Ride Right’s mail processing which resulted in its failure to submit a timely
response to Plaintiff’s Complaint, and when put on notice of its error, Ride Right took prompt
action to remediate the processing error. In her reply, Plaintiff asserts that she would be prejudiced
if Defendants were able to assert a statute of limitations affirmative defense, therefore, if the Court
chooses to allow this case to move forward on the merits, Plaintiff ask the court to toll the statute
of limitations to avoid prejudice to putative class members. (Filing No. 18).
The Court finds good cause for default, prompt action to correct it and accepts Ride Right’s
assertion that it has a meritorious defense to Plaintiff’s Complaint. Because counsel has appeared,
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and an Answer was filed prior to the entry of Clerk’s default, a Clerk’s default at this stage of the
proceedings would be futile for purposes of Fed. R. Civ. P. 55(c). To alleviate potential prejudice
to Plaintiff, the Court will equitably toll the statute of limitations for Plaintiff and any putative
class member from April 1, 2015 to the date of this Entry. For these reasons, the Motion for Clerk’s
Entry of Default (Filing No. 9) is DENIED.

SO ORDERED.

Date: 9/1/2015

DISTRIBUTION:
Robert F. Seidler
OGLETREE, DEAKINS, NASH, SMOAK & STEWART PC (Indianapolis)
[e-mail]
Ronald E. Weldy
WELDY LAW
[e-mail]

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