Label Health, LLC v. Haywire Consulting, Inc.

Background

Label Health, LLC brought claims for breach of contract and fraudulent inducement against Haywire Consulting, Inc. and Matthew Blackwell. Label Health served both defendants, but neither filed a response, requested more time, or appeared in the action.

Label Health initially filed an incorrect request for entry of default. After the court directed it to follow the required procedures, Label Health filed additional requests, and the clerk entered a certificate of default against both defendants. Label Health then moved for default judgment. Neither defendant appeared at the hearing ordered by the court, and the court entered default against them as to liability.

Magistrate Judge’s Recommendation

The court referred the issue of damages to Magistrate Judge Stewart D. Aaron. Judge Aaron recommended that Label Health receive $104,750 in damages, prejudgment interest, and $400 in costs.

The parties had 14 days to submit written objections to the recommendation. Neither party objected or requested additional time. Because there were no objections, the district court reviewed the recommendation for clear error, meaning it looked for an obvious mistake. The court found no clear error.

Ruling

The court adopted the Report and Recommendation in its entirety. It granted Label Health judgment against Haywire and Blackwell, jointly and severally, for $104,750 in damages, plus prejudgment interest at 9% per year beginning May 25, 2020, and $400 in costs. The clerk was directed to enter judgment, terminate any open motions, and close the case.

A default judgment is a judgment entered after a party fails to defend the case. The opinion states that the defendants defaulted as to liability and that the court then adopted the magistrate judge’s damages recommendation; it does not describe a contested trial on the underlying claims.