Gonzalez v. H.K. Second Ave Restaurant Inc.

Background

Luis Gonzalez and Julio Sanchez Espinoza brought wage-and-hour claims under the Fair Labor Standards Act and New York Labor Law against their alleged former employers: H.K. Second Ave Restaurant Inc., Shaheen Khan, and Maha Khondoker. The defendants had not appeared or answered the amended complaint.

The case had previously been dismissed twice for the plaintiffs’ failure to prosecute and reopened each time. After the first motion for default judgment, the court denied the motion without prejudice and allowed the plaintiffs to amend their complaint because of substantive deficiencies. The plaintiffs later filed a second default-judgment motion, which the court also denied without prejudice after identifying problems with service.

Service and Default Judgment

Under Rule 55 of the Federal Rules of Civil Procedure, obtaining a default judgment generally involves two steps: entry of a default and entry of judgment. The court explained that a default judgment cannot be entered unless the complaint or amended complaint was properly served and the court has jurisdiction over the defendant. A plaintiff bears the responsibility of showing that service was proper, and default judgment remains within the trial court’s discretion.

At an earlier hearing, the court noted that the restaurant had been closed before the original complaint was filed. Plaintiffs’ counsel agreed that serving the restaurant in that manner would not be proper. The court also found that service on the individual defendants through a coworker was improper because the business was closed and the individuals were no longer working there. The plaintiffs later submitted a letter describing difficulties in locating information about the restaurant but did not provide documentation showing that the restaurant remained active or otherwise establish proper service.

The court concluded that the plaintiffs had failed to cure the service deficiencies or provide assurance that the defendants had been effectively notified of the action. The court also stated that it could not give counsel legal advice or instruct counsel how to prosecute the case.

Disposition

The court denied the plaintiffs’ motion for entry of default judgment. Because the plaintiffs had already received multiple opportunities to correct the service problems, had filed three deficient default-judgment motions, and had previously failed to prosecute the case, the court dismissed the case with prejudice. The Clerk of Court was directed to close the motion and the case.