People10 Technologies Inc. v. Certintell Inc.
- Analisa Torres
- 1:19-cv-08196
- U.S. District Court · Southern District of New York
- 3
In People10 Technologies v. Certintell, Judge Torres vacated Certintell’s default-related order, canceled the hearing, and set an answer deadline.
Certintell Inc. may defend the breach-of-contract lawsuit without the default-related proceedings continuing and must answer or otherwise respond by December 26, 2019; People10 Technologies Inc. must proceed with the case on the merits.
What happened
People10 Technologies Inc. sued Certintell Inc. for breach of contract. The court had issued an order requiring Certintell to explain why it should not be found in default after Certintell did not respond.
Certintell asked to set aside the default-related order, stating that it did not learn about the lawsuit until it received that order. People10 Technologies consented and agreed to give Certintell 30 more days to answer.
Judge Analisa Torres vacated the Clerk’s Certificate of Default and the order to show cause, canceled the December 5, 2019 hearing, and required Certintell to answer or otherwise respond by December 26, 2019.
The detailed version
- People10 Technologies Inc. v. Certintell Inc. · No. 1:19-cv-08196
- Analisa Torres
- Nov. 25, 2019
Background
People10 Technologies Inc. filed a complaint against Certintell Inc. alleging breach of contract. The opinion states that People10 Technologies filed proof of service showing that the summons, complaint, and exhibits were served on Grant Awes of Certintell. The court later issued an order to show cause concerning default, and People10 Technologies served that order on Greta Haas of Certintell.
Certintell’s attorney stated that he first learned about the lawsuit and the order to show cause on November 12, 2019. Certintell asserted that it did not have notice of the lawsuit until it was served with the order to show cause. Certintell also did not concede that service on Mr. Awes was sufficient to serve Certintell.
Motion and Standard
Certintell moved under Federal Rule of Civil Procedure 55(c) to set aside the default-related order. It asked the court to vacate the order to show cause, cancel the December 5 hearing, and allow 30 additional days to answer the complaint. People10 Technologies consented to the requested relief and agreed to withdraw its motion for default judgment.
The opinion explains that courts generally consider whether a default was willful, whether the defendant has a potentially valid defense, and whether setting aside the default would prejudice the other party. It also states that negligence alone is not enough to establish willfulness and that courts apply a lenient standard because disputes are generally favored to be resolved on their merits.
Ruling
Judge Analisa Torres ordered that the Clerk’s Certificate of Default be vacated. The court also vacated the order to show cause for default, canceled the December 5, 2019 hearing without setting a new date, and required Certintell to answer or otherwise respond to the complaint by December 26, 2019. The court stated that an order would issue scheduling an initial conference. The ruling addressed the default-related procedure; it did not decide the underlying breach-of-contract claim.
Read the full 3-page opinion on CourtListener, the free public archive maintained by the Free Law Project.