United States District Court, D. Massachusetts
MEMORANDUM AND ORDER
ALLISON D. BURROUGHS, UNITED STATES DISTRICT JUDGE
a dispute involving the allegedly unauthorized broadcasting
of the Manny Pacquiao v. Juan Manuel Marquez, IV
Welterweight Fight Program (the “Fight Program”),
at a restaurant located at 408 Broadway Street, Chelsea,
Massachusetts (“408 Broadway Street”) on December
8, 2012. Complaint (“Compl.”) [ECF No. 1].
Because of Anh Dao Thi Luu's (the
“Defendant”) failure to appear or otherwise
defend, this Court entered an order for default judgment,
upon J&J Productions, Inc.'s (the
“Plaintiff”') motion and after an entry of
default, on March 23, 2016 and assessed damages, costs,
attorneys' fees, and post-judgment interest in the total
amount of $7, 831.37. [ECF No. 40].
September 9, 2016, the Defendant filed a Motion to Vacate
Default Judgment [ECF No. 41], which was opposed by the
Plaintiff [ECF No. 42] on September 15, 2016. Thereafter, the
Defendant filed a Request to File a Reply to Plaintiff's
Opposition [ECF No. 48]. A hearing was held on September 27,
2016. At the hearing, over Plaintiff's objection, the
Court allowed Defendant's request to file a reply [ECF
No. 48]. For the reasons explained below, the Defendant's
Motion to Vacate Default Judgment [ECF No. 41] is
Plaintiff, J&J Sports Productions, Inc., had acquired
exclusive commercial rights to broadcast the Fight Program.
Compl. ¶ 9. It entered into sublicensing agreements with
various commercial entities that granted these entities
limited sublicensing rights to publicly exhibit the Fight
Program. Compl. ¶ 10. The Complaint alleges that the
Defendant herself or through “agents, servants, workman
or employees” showed the Fight Program on December 8,
2012 at her commercial establishment at 408 Broadway Street
without any authorization. Compl. ¶¶ 12, 13. The
Complaint further alleges that, “upon information and
belief, the Defendant resides at 408 Broadway Street,
Chelsea, Massachusetts and is an owner, and/or operator,
and/or licensee, and/or permitee, and/or person in charge,
and/or an individual with dominion, control, oversight and
management of the commercial establishment doing business as
EL CORRAL RESTAURANT aka WINGS RESTAURANT at 408 Broadway
Street, Chelsea, Massachusetts.” Compl. ¶ 7.
Plaintiff first attempted to serve the Complaint by leaving a
copy of the Summons, Complaint, Cover Sheet, and Corporate
Disclosure Statement at 408 Broadway Street, Chelsea,
Massachusetts with Silvia Sarano, a bartender, on April 6,
2016 and by sending copies by first class mail to the same
address on April 7, 2016. [ECF Nos. 7, 10]. The Court
concluded that service was not proper because the Defendant
was being sued in her individual capacity but was being
served at her place of business. [ECF No. 14]. In late
October 2015, Plaintiff again attempted to execute service on
the Defendant at her last known residence, 221 Central
Avenue, Apt #1, Chelsea, Massachusetts. [ECF Nos. 19, 22].
The Defendant acknowledges receipt of the documents, but
explains that she and her husband were confused given that
they had sold the business, had limited English, and were
unfamiliar with the U.S. legal system. See Anh Dao
Thi Luu Affidavit (“Luu Aff.”) [ECF No. 41-1
¶ 9]; see also [ECF No. 41 at 3]. She never
answered or appeared in any capacity in this case. Default
judgment against the Defendant was entered on March 23, 2016.
[ECF No. 40].
default judgment has been entered, relief must be sought
under Rule 60(b). See Fed. R. Civ. P. 55(c). The
Rule 60(b) standard for setting aside entries of default
judgment is less liberal than the “good cause”
standard for setting aside entries of default. See United
States v. $23, 000 in U.S. Currency, 356 F.3d 157, 164
(1st Cir. 2004) (discussing Fed.R.Civ.P. 55(c)). In this
case, the Defendant argues that the default judgment should
be vacated under Rule 60(b)(1), which provides, in pertinent
part, that “[o]n motion and just terms, the court may
relieve a party or its legal representative from a final
judgment . . . [for] (1) mistake, inadvertence, surprise or
excusable neglect.” See Fed.R.Civ.P. 60(b)(1).
motion under Rule 60(b)(1) must be brought within one year of
entry of judgment. See Fed. R. Civ. P. 60(c)(1);
see also Blanchard v. Cortes-Molina, 453 F.3d 40, 44
(1st Cir. 2006). Furthermore, Rule 60(b)(1) “requires a
showing of ‘excusable neglect' to win relief from a
final judgment.” $23, 000 in U.S.
Currency, 356 F.3d at 164; see also
Aguiar-Carrasquillo v. Agosto-Alicea, 445 F.3d 19, 28
(1st Cir. 2006) (“excusable neglect” is a
“fairly flexible concept that encompasses
‘inadvertence, mistake, or carelessness, as well as by
intervening circumstances beyond the party's
control.'”) (quoting Pioneer Inv. Serv. Co. v.
Brunswick Assoc. Ltd., 507 U.S. 380, 388 (1993)).
“Our evaluation of what constitutes excusable neglect
is an equitable determination, taking into account the entire
facts and circumstances surrounding the party's omission,
including factors such as the danger of prejudice to the
non-movant, the length of the delay, the reason for the
delay, and whether the movant acted in good faith.”
Davila-Alvarez v. Escuela de Medicina Universidad Cent.
del Caribe, 257 F.3d 58, 64 (1st Cir. 2001). At bottom,
however, the determination is an equitable one, and the
critical factor is the reason for the movant's neglect
and whether it excuses the neglect. Nansamba v. N. Shore
Med. Ctr., Inc., 727 F.3d 33, 38-39 (1st Cir. 2013).
the First Circuit has taken a somewhat “harsher
tack” than other circuits, Davila-Alvarez, 257
F.3d at 64 (internal quotation marks omitted), district
courts nonetheless have “wide discretion in deciding
Rule 60(b) motions, ” Claremont Flock Corp. v.
Alm, 281 F.3d 297, 299 (1st Cir. 2002). Further, legal
policy favors resolving a case on the merits. See Am.
Metals Serv. Exp. Co. v. Ahrens Aircraft, Inc., 666 F.2d
718, 720 (1st Cir. 1989). When deciding whether to vacate a
default judgment, the court must balance “the
importance of finality in litigation against the desirability
of deciding cases on the merits.” Ungar v.
Palestine Liberation Org., 599 F.3d 79, 83 (1st Cir.
2010). Accordingly, to obtain relief under Rule 60(b), the
movant must also show that a meritorious defense exists.
See United States v. Proceeds of Sale of 3, 888 Pounds
Atl. Sea Scallops, 857 F.2d 46, 48 (1st Cir. 1988).
Defendant argues that, under Rule 60(b)(1), the default
judgment should be vacated because there was good reason for
the default, the Plaintiff would not be prejudiced, and the
Defendant has a meritorious defense, namely that she had sold
the business and was no longer involved at the time of the
broadcast of the Fight Program. [ECF No. 41]. The Plaintiff
responds that the default judgment should not be set aside
because the Defendant has failed to provide a good reason to
vacate and does not have a plausible defense. [ECF No. 42].
Specifically, the Plaintiff argues that service was properly
executed and that it was sufficiently clear on the face of
the summons that the person named, the Defendant, had to
respond to the complaint. [ECF No. 42 at 5]. The Plaintiff
also claims that the Defendant remained involved in the
business at 408 Broadway Street as a licensee of record for
liquor sales and as a director of the Wings El Corral, Inc.,
subsequent to the business being sold. See [ECF No.
42 at 2, 7]; see also Affidavit in Support of
Opposition to Motion to Vacate Default Judgment [ECF No. 43,
Court finds that the Defendant's default in this case was
the result of excusable neglect. First, the Court finds that
the Defendant's effort to vacate the default judgment is
timely as the Defendant filed the present motion within six
months of entry of the default judgment. See Claremont
Flock, 281 F.3d at 300. Second, the Court credits the
Defendant's explanation of the reasons for the default,
and finds that the circumstances of this case warrant
vacating the default and allowing the Defendant to defend the
case on its merits. The Complaint and Corporate Disclosure
Statement that were served on the Defendant list the
following defendant: “Anh Dao Thi Luu, dba El Corral
Restaurant aka Wings Restaurant.” [ECF Nos. 1, 2, 7].
Thus, although she received court papers in her name, the
papers referenced a business entity that she no longer owned
and an event that took place at the restaurant after
she had already sold it. Even then, rather than simply ignore
the summons, the Defendant claims that, when she received it
in October 2015, she passed it along to the actual owners of
the business at 408 Broadway Street. See Luu Aff.
¶ 9. Further, the Defendant asserts that her and her
husband's English language abilities and knowledge of the
U.S. legal system were limited. See Luu Aff. ¶
9; see also [ECF No. 41 at 3]. There is also no
evidence of bad faith on the part of the Defendant, and it is
not apparent how the Plaintiff would be prejudiced, beyond
having to prove its case at trial, if the default judgment is
and perhaps most significantly, the Defendant has a plausible
defense as there is evidence she was no longer the owner or
in control of the business at the time that it allegedly
broadcast the Fight Program. The Defendant claims that she
sold the business located at 408 Broadway Street on October
15, 2012. [ECF No. 41 at 1]. She includes with her Reply a
copy of the sale agreement, executed by herself and Jose
Eliseo Pineda Recinos. [ECF No. 48-1]. She also states in her
affidavit that she “signed over management, control and
ownership of the restaurant located at 408 Broadway . . . in
October 2012.” Luu Aff. ¶ 8. The Defendant
represents that, since the sale, she has had no involvement
with the business. [ECF No. 41 at 1- 2]. The Plaintiff
counters that the Defendant's disavowal of any connection
to the business at the relevant time is belied by the fact
that the Defendant's name remained on the liquor license
well beyond the date of the sale of the business, and there
are other indications as well that the Defendant may have
played an ongoing role in the business following the sale.
Nonetheless, the affidavits coupled with ...