Armeni v. Trans Union, LLC et al
Filing
64
MEMORANDUM OPINION. Signed by Judge Norman K. Moon on 12/2/16. (hnw)
IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF VIRGINIA
CHARLOTTESVILLE DIVISION
DANIEL ARMENI,
Plaintiff,
v.
TRANSUNION LLC, INC., et al.,
Defendants.
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CASE NO. 3:15-CV-00066
OPINION
By: Norman K. Moon
United States District Judge
Default judgment was entered against the remaining Defendant BSI Financial Services,
Inc. (“Defendant”) in this Fair Credit Reporting Act (“FCRA”) case. (Dkt. 38). After a briefing
order, the Court must decide whether damages in this case should be determined by the Court or
by a jury. (Dkt. 53). The parties were unable to reach an agreement on the issue; Plaintiff
desires a jury trial, while Defendant believes one is not available. (Dkts. 57, 58).
Under Federal Rule of Civil Procedure 38(a), the “right to a jury trial as declared by the
Seventh Amendment to the Constitution—or as provided by a federal statute—is preserved to the
parties inviolate.”1 On the other hand, Rule 55(b)(2)(B) states that, in finalizing a default
judgment, “the court may conduct hearings or make referrals—preserving any federal statutory
right to a jury trial—when, to enter or effectuate judgment, it needs to . . . determine the amount
of damages.”
I.
PLAINTIFF’S POSITION
Plaintiff argues that Rule 55(b)(2) must be read not in isolation, but in conjunction with
Rule 38’s declaration that the right to a jury trial is “inviolate” and withdrawn only on the
parties’ consent. He contends that “it is the better practice, if not actually compelled, that the
issue as to damages be submitted to the jury” after a default. Barber v. Turberville, 218 F.2d 34,
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Plaintiff made a timely jury demand. See Fed. R. Civ. P. 38(d); Complaint, p.15.
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37 & n.1 (D.C. Cir. 1954). Plaintiff also relies on a handful of district court cases. See Mitchell
v. Bd. of Cty. Comm’rs of Cty. of Santa Fe, No. CIV 05-1155 JBALM, 2007 WL 2219420, at
*13 (D.N.M. May 9, 2007) (holding that Rule 38(d) prevented plaintiff from unilaterally
“withdrawing” jury demand after obtaining default against non-appearing defendant); Abernathy
v. Church of God, No. 4:11-CV-2761-VEH, 2013 WL 2248286, at *1 (N.D. Ala. May 22, 2013)
(“better practice” to empanel jury in light of Rule 38(d)); Zero Down Supply Chain Sols., Inc. v.
Glob. Transp. Sols., Inc., 282 F.R.D. 604, 606 (D. Utah 2012); Ault v. Baker, No. 4:12-CV00228-KGB, 2013 WL 1247647, at *10–11 (E.D. Ark. Mar. 27, 2013).2
As an alternative argument, Plaintiff submits that the Court may permit a jury even if one
is not allowed as of right. See Wright & Miller, 10A Fed. Prac. & Proc. Civ. § 2688 (4th ed.)
(Westlaw); Gill v. Stolow, 18 F.R.D. 508, 510 (S.D.N.Y. 1955) (stating it is “no doubt within
[court’s] discretion to order a jury trial” after default), rev’d on other grounds, 240 F.2d 669 (2d
Cir. 1957). He argues that valuing emotional harm damages like those he intends to prove is
especially proper for a jury determination. (Dkt. 57 at 7–8).
Finally, Plaintiff argues that punitive damages must go to the jury. Punitive damages
under the FCRA are permitted in an amount “as the court may allow.” 15 U.S.C. § 1681n(a)(2).
Plaintiff cites cases holding that this language is merely a codification of the Court’s duty to
review excessive verdicts, not a congressional command for a bench trial in lieu of a jury. See,
e.g., Saunders v. Branch Banking And Trust Co. of Va., 526 F.3d 142, 145 (4th Cir. 2008);
Northrop v. Hoffman of Simsbury, Inc., 12 F. App’x 44, 50 (2d Cir. 2001); Collins v. Retail
Credit Co., 410 F. Supp. 924, 933 (E.D. Mich. 1976).
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Plaintiff also cites Apache Corp. v. GlobalSantaFe Drilling Co., 832 F. Supp. 2d 678,
697 (W.D. La. 2010) in placing emphasis on the right to a jury trial, but that case does not
address the existence of such right after default.
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II.
DEFENDANT’S POSITION
Defendant asserts that any Seventh Amendment right to a jury trial does not survive an
entry of default. See Graham v. Malone Freight Lines, Inc., 314 F.3d 7, 16 (1st Cir. 1999)
(holding that plaintiff was not entitled to jury trial on damages after obtaining default against two
defendants); Frankart Distributors, Inc. v. Levitz, 796 F. Supp. 75, 76 (E.D.N.Y. 1992)
(compiling cases).
Moreover, Defendant argues that the statutory right to a jury trial survives default only if
the statute expressly preserves it in that situation, and the sole statute to do so is not applicable
here. See Shepherd v. Am. Broad. Companies, Inc., 862 F. Supp. 486, 492 (D.D.C.) (observing
paucity of such statutes), vacated on other grounds, 62 F.3d 1469 (D.C. Cir. 1995). Defendant
cites several district court cases which have thus determined FCRA damages after entry of
default. (See dkt. 58 at 6). Defendant also contends that Rule 38(d), which prohibits a unilateral
withdraw of a jury demand, does not apply in this situation because there is no withdraw of the
demand at all; instead, a jury trial is simply not available by law. (Id. at 7–8). Finally,
Defendant urges the Court not to refer damages to a jury.
III.
ANALYSIS
The parties have not identified a Fourth Circuit case addressing whether a default
extinguishes the constitutional right to a jury trial. Nevertheless, the overwhelming weight of
authority instructs that the Seventh Amendment does not guarantee a jury trial after default. See
Graham, 314 F.3d at 9, 12, 16 (holding plaintiff had not right to jury trial after defendant’s
default); Goldman, Antonetti, Ferraiuoli, Axtmayer & Hertell v. Medfit Int’l, Inc., 982 F.2d 686,
692 n.15 (1st Cir. 1993) (citing Adriana Int’l Corp. v. Thoeren, 913 F.2d 1406, 1414 (9th Cir.
1990)); Matter of Dierschke, 975 F.2d 181, 185 (5th Cir. 1992) (“[I]n a default case neither the
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plaintiff nor the defendant has a constitutional right to a jury trial on the issue of damages”);
Henry v. Sneiders, 490 F.2d 315, 318 (9th Cir. 1974); Olcott v. Del. Flood Co., 327 F.3d 1115,
1124 (10th Cir. 2003); Mwani v. Bin Ladin, 244 F.R.D. 20, 23–24 (D.D.C. 2007) (denying
plaintiff’s motion for jury trial after default); Benz v. Skiba, Skiba & Glomski, 164 F.R.D. 115,
116 (D. Me. 1995) (rejecting plaintiff’s request for jury trial because “[c]aselaw dating back to
the eighteenth century . . . makes clear that the constitutional right to jury trial does not survive
the entry of default”); CountrymAn Nevada, LLC. v. Suarez, No. 6:15-CV-0436-SI, 2016 WL
5329597, at *4–5 (D. Or. Sept. 22, 2016) (overruling plaintiff’s request for jury trial after
default); Sonoco Prod. Co. v. Guven, No. 4:12-CV-00790-BHH, 2015 WL 127990, at *7 n.5
(D.S.C. Jan. 8, 2015) (holding that “parties do not have the right to a jury trial as to the amount
of recovery” after default judgment is entered); Estate of Faull v. McAfee, No.
613CV1746ORL31KRS, 2015 WL 6125309, at *4 (M.D. Fla. Oct. 16, 2015) (ruling plaintiff
was not entitled to jury trial after defendant’s default).3 Wright and Miller also agree that, after
default, “neither side has a right to a jury trial on damages.” 10A Fed. Prac. & Proc. Civ. § 2688
(4th ed.).
As for any statutory right that Rule 38(a) might protect, Plaintiff has identified neither a
provision of the FCRA that guarantees a jury trial nor a case so holding. True, he points to
several cases in which a jury ultimately decided FRCA claims. (Dkt. 57 at 4 n.3, 10 n.4). But
those cases involved a full trial on the merits (not default), and thus were premised on a Seventh
Amendment (not statutory) right, which as discussed is no longer guaranteed.
Further, even if the FCRA generally granted the right to a jury trial, that would not
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See also Parlier v. Casteen, No. 514CV00085RLVDCK, 2016 WL 3032692, at *2 n.2
(W.D.N.C. May 26, 2016); Teri Woods Publ’g, L.L.C. v. Williams, No. CIV.A. 12-4854, 2013
WL 6179182, at *4 (E.D. Pa. Nov. 25, 2013); Verizon Cal. Inc. v. Onlinenic, Inc., No. C 08-2832
JF (RS), 2009 WL 2706393, at *2 (N.D. Cal. Aug. 25, 2009); Patray v. Nw. Pub., Inc., 931 F.
Supp. 865, 870 (S.D. Ga. 1996) (quoting Dierschke, 975 F.2d at 185).
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guarantee a jury after default. “Despite the reference to a ‘federal statutory right to a jury trial,’
courts have interpreted the language of Rule 55 as preserving a right to a jury trial only in the
atypical situation where a statute specifically preserves the jury trial right even after a default.”
Manno v. Tennessee Prod. Ctr., Inc., 657 F. Supp. 2d 425, 429–30 (S.D.N.Y. 2009). That is, the
statute must protect the right in the specific context of default; the only statute to do so—28
U.S.C. § 1874—is not implicated here. See Sells v. Berry, 24 F. App’x 568, 572 (7th Cir. 2001);
Meyers v. Lakeland Supply, Inc., 133 F. Supp. 2d 1118, 1119 (E.D. Wis. 2001) (holding that,
even where statute provided general jury trial right, it failed to provide one in case of default);
Benz, 164 F.R.D. at 115–16 (protection in Rule 55(b)(2) only “applies to statutes requiring jury
trials specifically after default has occurred”); Shepherd, 862 F. Supp. at 492 n.4; Offei v. Omar,
No. 11 CIV. 4283 SAS MHD, 2011 WL 4448954, at *1 (S.D.N.Y. Sept. 20, 2011); Wright &
Miller, 10A Fed. Prac. & Proc. Civ. § 2688 (Rule 55(b)(2) “provides that the court must
preserve any federal statutory right of trial by jury. The only relevant statute is Section 1874 of
Title 28”).
Although Plaintiff is not entitlement to a jury trial, the Court may choose to empanel one,
which it will do here for several reasons. First, Rule 55(b)(2) imbues the Court with authority to
“make referrals” to determine the amount of damages. See Consol. Masonry & Fireproofing,
Inc. v. Wagman Const. Corp., 383 F.2d 249, 252 (4th Cir. 1967) (affirming referral of damages
after default to special master); Maher v. Cont’l Cas. Co., 76 F.3d 535, 540–41 (4th Cir. 1996)
(Court’s decision “to delegate its role as factfinder to a jury is of no consequence, inasmuch as
such delegation is specifically authorized by the Federal Rules”). It is the “better practice” to
empanel jury on damages after plaintiff obtains default. Barber, 218 F.2d at 37.
Second and relatedly, the “court does retain the [inherent] discretion to order a jury trial
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even in the absence of a constitutional or statutory right.” Lumbermen’s Mut. Cas. Co. v.
Holiday Vehicle Leasing Inc., No. 02CIV.137(LAK)(MHD), 2003 WL 1797888, at *2 (S.D.N.Y.
Apr. 4, 2003)) (citing 6 Moore’s Federal Practice ¶ 55.07 at 55–57 (2d ed. 1996)); Coton v.
Televised Visual X-Ography, Inc., No. 8:07-CV-1332-T-TGW, 2010 WL 813345, at *2 n.*
(M.D. Fla. Mar. 9, 2010); see Wright & Miller, 10A Fed. Prac. & Proc. Civ. § 2688 (The “court
may order a jury trial as to damages in a default situation if it seems to be the best means of
assessing damages”); Swoope v. Gary Cmty. Sch. Corp., No. 2:10-CV-423-RL, 2011 WL
6826410, at *2 (N.D. Ind. Dec. 28, 2011) (observing existence of discretion to “provide a postdefault jury trial on damages”); Offei v. Omar, No. 11 CIV. 4283 SAS MHD, 2011 WL 4448954,
at *2 (S.D.N.Y. Sept. 20, 2011).
Indeed, Federal Rule of Civil Procedure 39(b)—which allows the court to “order a jury
trial on any issue for which a jury might have been demanded”—is a codified example of a
court’s inherent power to order a jury.4
When a Rule 39(b) motion is made, 5 many courts favor
a jury trial and the decision is a discretionary one. See Lewis v. Thigpen, 767 F.2d 252, 257 (5th
Cir. 1985) (A “trial court, in exercising its Rule 39 discretion, should grant a jury trial in the
absence of strong and compelling reasons to the contrary”); Merritt v. Faulkner, 697 F.2d 761,
767 (7th Cir. 1983) (holding similarly); Malbon v. Pennsylvania Millers Mut. Ins. Co., 636 F.2d
936, 940 (4th Cir. 1980) (applying discretionary standard of review); Maher, 76 F.3d at 541
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Likewise, even if—contrary to fact—this case never implicated the right to a jury trial,
Rule 39(c)(1) empowers the Court to use an advisory jury.
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Rule 39(b) requires that a party move for a jury. Because Plaintiff, in response to the
Court’s briefing order, has asked the Court to exercise its discretion, that prerequisite is satisfied.
Of course, Rule 39(b) is not strictly applicable because it applies only when a party
initially fails to demand a jury. The point is that because the Court has power to grant a jury trial
to a party who did not demand one at the outset, then a fortiori it can grant a jury trial to a party
that did request one originally. See Maher v. Cont’l Cas. Co., 76 F.3d 535, 541 (4th Cir. 1996)
(holding court was within discretion to order jury trial).
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(same); Lawrence v. Hanson, 197 F. Supp. 2d 533, 537 (W.D. Va. 2002) (granting Rule 39(b)
request); Branham v. Dolgencorp, Inc., No. CIV. 6:09-CV-00037, 2009 WL 2588493, at *2
(W.D. Va. Aug. 21, 2009) (same).
Third, considerations of fairness counsel in favor of a jury trial. Plaintiff demanded a
jury in her complaint. Had Defendant timely defended the case, Plaintiff would have been
entitled to one under the Constitution. As it is, Defendant’s failure to defend has the effect of
depriving Plaintiff of his jury right. Put differently, refusing to grant a discretionary trial would
punish Plaintiff for obtaining a default and reward Defendant for it. This would be an unjust
result and should be avoided.
Fourth, Plaintiff seeks actual damages in the form of emotional, mental, and physical
distress. (Dkt. 56 (description of testimony of proposed witnesses); see dkt. 1, Prayer for Relief).
These types of damages are particularly within the province of a jury. See Williams v. Trader
Pub. Co., 218 F.3d 481, 486 n.3 (5th Cir. 2000); F.D.I.C. v. Hulsey, 22 F.3d 1472, 1489 (10th
Cir. 1994); Shepard v. Wapello Cty., Iowa, 303 F. Supp. 2d 1004, 1021 (S.D. Iowa 2003); Mills
v. Penn Cent. Co., 329 F. Supp. 530, 533 (D.D.C. 1971)
Fifth, Defendant does not argue that it would suffer prejudice. (See dkt. 58 at 8–10). The
Court finds none would result from empanelling a jury because the case was previously set for a
jury trial. (Dkt. 52).
For the foregoing reasons, this case will remain set as a jury trial. An appropriate order
will enter. The Clerk is directed to send a copy of this opinion to all counsel of record.
2nd
Entered this ______ day of December, 2016.
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