A&C Trade Consultants, Inc. v. Alvarez

Background

A&C Trade Consultants, Inc. filed a motion on March 19, 2021, seeking default judgment against all defendants. Default judgment is a judgment entered when a party has failed to plead or otherwise defend. The court considered the motion and denied it without prejudice.

Reasons for the Ruling

The court identified three problems.

First, the court said it has an affirmative duty to examine its personal jurisdiction over parties against whom default is sought. Personal jurisdiction is the court’s authority over a particular defendant. The motion did not establish that the court could exercise personal jurisdiction over the remaining defendants. The court noted that at least two of those defendants appeared to be citizens of another country.

Second, the motion did not adequately support liability. Although well-pleaded factual allegations in the complaint are treated as true when considering default judgment, facts that are not alleged in the pleadings are not established merely because a defendant defaulted. The court found that the motion relied on several factual assertions without citing the complaint allegations supporting them.

Third, the motion did not adequately support damages. The motion stated the amount sought in its conclusion, but it did not explain why the plaintiff was entitled to that amount. It also did not direct the court to the relevant portions of five declarations or more than 6,000 exhibits filed in support of the motion.

Disposition

Judge Maxine M. Chesney denied the motion for default judgment without prejudice. The court permitted the plaintiff to file an amended motion no later than April 23, 2021. The amended motion had to address personal jurisdiction, identify the particular complaint allegations supporting liability, and identify the particular evidence supporting damages.