Shive v. Amazon.com Inc. et al

Filing 79

PROPOSED FINDINGS AND RECOMMENDED DISPOSITION by Magistrate Judge William P. Lynch re 77 MOTION for Default Judgment as to filed by James Shive. Objections to PFRD due by 9/8/2017. Add 3 days to the deadline if service is by mailing it to the person's last known address (or means described in Fed. R. Civ. P. 5(b)(2)(D) and (F)); if service is by electronic means, no additional days are added. (Fed. R. Civ. P. 6(d); Fed. R. Crim. P. 45(c).) (mej)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW MEXICO

JAMES SHIVE,
Plaintiff,
v.

CV 15-406 JB/WPL

AMAZON.COM INC.; EBAY, INC.;
JOHN LAVECCHIA; J&C BASEBALL
CLUBHOUSE, INC.; SEARS HOLDING
CORPORATION; UNBEATABLE
SALE.COM INC.; and WAL-MART STORES, INC.;
Defendants.

SECOND PROPOSED FINDINGS AND RECOMMENDED DISPOSITION
Pro se Plaintiff James Shive filed his third motion for default judgment against Defendant
J&C Baseball Clubhouse, Inc. (J&C). (Doc. 77.) The Court previously set aside default and
denied Shive’s previous motions for default judgment due to procedural errors. (See Docs. 72,
74.)
Shive filed a complaint for copyright infringement against J&C, alleging that J&C
reproduced and sold online copies of a photograph of Clarence Clemons. (Doc. 1 at 6.) Shive
took the Clemons Photograph in May 1978 and authorized Rolling Stone Magazine to use the
photograph in the August 4, 2011 issue, as part of tribute to Clemons after his death. (Id.)
Rolling Stone registered its copyright in the August 4, 2011 issue with the U.S. Copyright
Office, Certificate of Registration No. TX 7,494,880. (Id.) Shive also applied for and obtained a
separate registration of his copyright in that photograph in his own name, recorded as Copyright
Registration No. VA 1-952-611, effective January 20, 2015. In 2014 and 2015, J&C was

reproducing and offering for sale copies of the Clemons Photograph and advertising the image as
“valuable memorabilia.” (Id.) Shive did not approve the reproduction or sales.
Rule 55 of the Federal Rules of Civil Procedure sets out a two-step process for a default
judgment. First, a party must obtain a Clerk's entry of default. See Fed.R.Civ.P. 55(a) (“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default.”); Watkins v. Donnelly, 551 F. App'x 953, 958 (10th Cir. 2014)(unpublished)(“Entry of
default by the clerk is a necessary prerequisite that must be performed before a district court is
permitted to issue a default judgment.”). Second, the party must either request the clerk to enter
default judgment when the claim is for “a sum certain or a sum that can be made certain by
computation,” Fed.R.Civ.P. 55(b)(1), or, “[i]n all other cases, the party must apply to the court
for a default judgment,” Fed.R.Civ.P. 55(b)(2).
After entering default judgment, a district court takes all of the well-pleaded facts in a
complaint as true. See United States v. Craighead, 176 F. App'x 922, 925 (10th Cir. 2006)
(unpublished); Flaks v. Koegel, 504 F.2d 702, 707 (2d Cir. 1974)(“While a default judgment
constitutes an admission of liability, the quantum of damages remains to be established by proof
unless the amount is liquidated or susceptible of mathematical computation.” (citations
omitted)). “If defendant does not contest the amount prayed for in the complaint [by failing to
answer] and the claim is for a sum certain or a sum that can be made certain by computation, the
judgment generally will be entered for that amount without any further hearing.” United States v.
Craighead, 176 F. App'x at 925 (alteration in original)(quoting 10A Charles Alan Wright, Arthur
-2A true copy of this order was served
on the date of entry--via mail or electronic
means--to counsel of record and any pro se
party as they are shown on the Court’s docket.

R. Miller, Mary Kay Kane, Richard L. Marcus & Adam N. Steinman, Federal Practice &
Procedure § 2688 (3d ed. 1998)). See Fed.R.Civ.P. 8(d) (“Averments in a pleading to which a
responsive pleading is required, other than those as to the amount of damage, are admitted when
not denied in the responsive pleading.”). A court may enter a default judgment for a damage
award without a hearing if the amount claimed is “one capable of mathematical calculation.”
Applied Capital, Inc. v. Gibson, 558 F. Supp. 2d 1189, 1202 (D.N.M.2007)(Browning, J.)
(quoting H.B. Hunt v. Inter–Globe Energy, Inc., 770 F.2d 145, 148 (10th Cir. 1985))(citing
Venable v. Haislip, 721 F.2d at 300). “It is a familiar practice and an exercise of judicial power
for a court upon default, by taking evidence when necessary or by computation from facts of
record, to fix the amount which the plaintiff is lawfully entitled to recover and to give judgment
accordingly.” 10A Wright & Miller, supra, § 2688 (quoting Pope v. United States, 323 U.S. 1,
12, 65 S.Ct. 16, 89 L.Ed. 3 (1944)). “If the damages sum is not certain or capable of easy
computation, the court may” conduct such hearings or order such references as it deems
necessary. Applied Capital, Inc. v. Gibson, 558 F. Supp. 2d at 1202 (citing Beck v. Atl.
Contracting Co., 157 F.R.D. 61, 64 (D.Kan.1994)). See Fed.R.Civ.P. 55(b)(2)(B) (“The court
may conduct hearings or make referrals ... when, to enter or effectuate judgment, it needs to ...
determine the amount of damages.”).
“Default judgments are a harsh sanction.” Ruplinger v. Rains (In re Rains), 946 F.2d 731,
732 (10th Cir. 1991). The Court has noted that, “[b]ecause default judgment is a harsh sanction
involving a court's power to enter and enforce judgments regardless of the merits of a case,
courts do not favor such a sanction ‘purely as a penalty for delays in filing or other procedural
-3A true copy of this order was served
on the date of entry--via mail or electronic
means--to counsel of record and any pro se
party as they are shown on the Court’s docket.

error.’” Noland v. City of Albuquerque, No. CIV 08–0056 JB/LFG, 2009 WL 2424591, at *1
(D.N.M. June 18, 2009)(Browning, J.)(quoting In re Rains, 946 F.2d at 733).
[S]trong policies favor resolution of disputes on their merits: [T]he default
judgment must normally be viewed as available only when the adversary process
has been halted because of an essentially unresponsive party. In that instance, the
diligent party must be protected lest he be faced with interminable delay and
continued uncertainty as to his rights. The default judgment remedy serves as
such a protection.
In re Rains, 946 F.2d at 732–33 (citations omitted) (internal quotation marks omitted). See
Noland v. City of Albuquerque, 2009 WL 2124591, at *1 (denying motion for default judgment,
because the counsel for the defendant City of Albuquerque “entered an appearance three days
after Noland filed his motion for default judgment,” and, thus, the Court could not “reasonably
say that the City of Albuquerque is an essentially unresponsive party, that the adversary process
has been halted, or that Noland faces interminable delay because of the City of Albuquerque's
actions”).
“The court may set aside an entry of default for good cause, and it may set aside a default
judgment under Rule 60(b).” Fed.R.Civ.P. 55(c). “[T]he good cause required by Fed.R.Civ.P.
55(c) for setting aside entry of default poses a lesser standard for the defaulting party than the
excusable neglect which must be shown for relief from judgment under Fed.R.Civ.P. 60(b).”
Pinson v. Equifax Credit Info. Servs., Inc., 316 F. App'x 744, 750 (10th Cir. 2009)(unpublished)
(quoting Dennis Garberg & Assocs., Inc. v. Pack–Tech Int'l Corp., 115 F.3d 767, 775 n. 6 (10th
Cir. 1997)). The distinction between setting aside an entry of default and setting aside a default

-4A true copy of this order was served
on the date of entry--via mail or electronic
means--to counsel of record and any pro se
party as they are shown on the Court’s docket.

judgment “reflects the different consequences of the two events and the different procedures that
bring them about.” 10A Wright & Miller, supra, § 2692.
[T]he clerk or the court may enter a default upon the application of the
nondefaulting party. The entry simply is an official recognition of the fact that one
party is in default, as, for example, for failure to comply with the rules, to appear
as scheduled, or to prosecute the case with due diligence. The entry is an
interlocutory step that is taken under Rule 55(a) in anticipation of a final
judgment by default under Rule 55(b).
In sharp contrast, a final default judgment is not possible against a party in default
until the measure of recovery has been ascertained, which typically requires a
hearing, in which the defaulting party may participate; in some situations, a jury
trial may be made available to determine an issue of damages. Moreover, the
entry of a default judgment is a final disposition of the case and an appealable
order.
....
Additional differences between relief from the entry of a default and from a
default judgment appear in the grounds that will support the motion being
granted. Stated generally, the defaulting party is not entitled to relief from a
judgment as a matter of right under Rule 60(b). The movant must present a
justification supporting the relief motion and must establish his contentions if
challenged. Although whether relief will be granted is a matter within the sound
discretion of the trial court, the vacation of a default judgment is subject to the
explicit provisions of Rule 60(b), which places additional restraints upon the
court's discretion. The motion to set aside a default entry, on the other hand, may
be granted for “good cause shown,” which gives a court greater freedom in
granting relief than is available in the case of default judgments.

10A Wright & Miller, supra, § 2692 (footnotes omitted).
While there are some differences between setting aside the entry of default and setting
aside a default judgment, there are some important similarities, including that courts may
consider the same factors: whether the party willfully defaulted, whether setting aside the entry

-5A true copy of this order was served
on the date of entry--via mail or electronic
means--to counsel of record and any pro se
party as they are shown on the Court’s docket.

of default or default judgment would prejudice the non-movant, and whether the movant has
presented a meritorious defense. See Pinson v. Equifax Credit Info Servs., Inc., 316 F. App'x at
750 (“In deciding whether to set aside an entry of default, courts may consider, among other
things, ‘whether the default was willful, whether setting it aside would prejudice the adversary,
and whether a meritorious defense is presented.’” (quoting Dierschke v. O'Cheskey (In re
Dierschke), 975 F.2d 181, 183 (5th Cir. 1992)); United States v. $285,350.00 in U.S. Currency,
547 F. App'x 886, 887 (10th Cir. 2013)(unpublished)(“Three requirements must be met when
setting aside a default judgment under Rule 60(b): ‘(1) the moving party's culpable conduct did
not cause the default; (2) the moving party has a meritorious defense; and (3) the non-moving
party will not be prejudiced by setting aside the judgment.’” (quoting United States v. Timbers
Pres., 999 F.2d 452, 454 (10th Cir. 1993), abrogated on other grounds by Degen v. United States,
517 U.S. 820, 825, 116 S.Ct. 1777, 135 L.Ed.2d 102 (1996))). The United States Court of
Appeals for the Tenth Circuit has, at times, listed two factors rather than three for the standard in
setting aside a default judgment:
Rule 60(b) of the Federal Rules of Civil Procedure permits relief from a final
judgment only if the movant can demonstrate justifiable grounds, including
mistake, inadvertence, surprise or excusable neglect. In the case of default
judgments, courts have established the further requirement that a movant
demonstrate the existence of a meritorious defense. E.g., Gomes v. Williams, 420
F.2d 1364, 1366 (10th Cir. 1970). A 60(b) motion thus comprehends two distinct
aspects[:] justification for relief and a meritorious defense.
In re Stone, 588 F.2d 1316, 1319 (10th Cir. 1978). See Sawyer v. USAA Ins. Co., 839 F. Supp.
2d 1189, 1230 (D.N.M.2012)(Browning, J.)(setting aside a default judgment, because, “when a
plaintiff fails to properly serve a defendant, a default judgment is void and should be set aside
-6A true copy of this order was served
on the date of entry--via mail or electronic
means--to counsel of record and any pro se
party as they are shown on the Court’s docket.

under rule 60(b)(4)”). “Although how these factors will be evaluated and weighed lies within the
discretion of the trial court to a considerable degree, ... federal courts are willing to grant relief
from a default entry more readily and with a lesser showing than they are in the case of a default
judgment.” 10A Wright & Miller, supra, § 2692 (footnotes omitted). “The standard for setting
aside an entry of default under Rule 55(c) is fairly liberal because ‘[t]he preferred disposition of
any case is upon its merits and not by default judgment.’” Crutcher v. Coleman, 205 F.R.D. 581,
584 (D.Kan.2001)(Vratil, J)(quoting Gomes v. Williams, 420 F.2d 1364, 1366 (10th Cir. 1970)).
See Applied Capital, Inc. v. Gibson, No. CIV 05–98 JB/ACT, 2007 WL 5685131, at *20–23
(D.N.M. Sept.27, 2007)(Browning, J.)(liberally construing a pro se defendant's motion to dismiss
as a motion to set aside the default, but concluding that the pro se defendant did not show good
cause for the Court to set aside the entry of default, because, although setting aside the entry of
default would not prejudice the plaintiff, the pro se defendant was “fully aware of the need to
answer within the given time limitation and chose not to respond timely,” and he failed to appear
at a hearing to support his allegation that he had a meritorious defense).
The owner of a registered copyright under the federal statute has the exclusive rights to
that copyright and can sue to enforce it. See 17 U.S.C. §§ 106, 106A, 411, 505-505. “To prove a
copyright infringement under the federal Copyright Act, a plaintiff must show: ‘(1) ownership of
a valid copyright, and (2) copying of constituent elements of the work that are original.’”
Harolds Stores, Inc. v. Dillard Dept. Stores, Inc., 82 F.3d 1533, 1543 (10th. Cir. 1996) (internal
citation omitted), cert. denied, 519 U.S. 928.

-7A true copy of this order was served
on the date of entry--via mail or electronic
means--to counsel of record and any pro se
party as they are shown on the Court’s docket.

Shive has now complied with the dictates of Rule 55. Shive moved for a Clerk’s Entry of
Default on June 6, 2017 (Doc. 75), and default was entered against J&C on June 28, 2017 (Doc.
76). Taking all facts stated in the complaint as true, Shive has established that he owns the
copyright to the Clemons Photograph and that J&C copied and reproduced the photograph
without permission.
I therefore recommend that the Court grant Shive’s motion for default judgment and hold
a damages hearing on this matter.

THE PARTIES ARE NOTIFIED THAT WITHIN 14 DAYS OF SERVICE of a
copy of these Proposed Findings and Recommended Disposition they may file written objections
with the Clerk of the District Court pursuant to 28 U.S.C. § 636(b)(1). A party must file any
objections with the Clerk of the District Court within the fourteen-day period if that party
wants to have appellate review of the Proposed Findings and Recommended Disposition. If
no objections are filed, no appellate review will be allowed.

____________________________________
William P. Lynch
United States Magistrate Judge

-8A true copy of this order was served
on the date of entry--via mail or electronic
means--to counsel of record and any pro se
party as they are shown on the Court’s docket.