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95 - Response to Motion to Set Aside Default

95 - Response to Motion to Set Aside Default

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Published by Ripoff Report
Pleadings filed in malicious prosecution action against attorney Lisa Borodkin.
Pleadings filed in malicious prosecution action against attorney Lisa Borodkin.

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Categories:Types, Business/Law
Published by: Ripoff Report on Mar 18, 2013
Copyright:Attribution Non-commercial

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RESPONSE TO MOTION TO SET ASIDE ENTRY OF DEFAULT
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David S. Gingras, #021097
Gingras Law Office, PLLC
3941 E. Chandler Blvd., #106-243Phoenix, AZ 85048Tel.: (480)668-3623Fax: (480) 248-3196David@GingrasLaw.comAttorney forPlaintiff Xcentric Ventures, LLC
UNITED STATES DISTRICT COURTDISTRICT OF ARIZONA
XCENTRIC VENTURES, LLC, anArizona limited liability company,Plaintiff,v.LISA JEAN BORODKIN
et al 
.,Defendants.Case No.: 11-CV-1426-GMS
PLAINTIFF'S RESPONSE TODEFENDANTS' MOTION TO SETASIDE ENTRY OF DEFAULT
Plaintiff Xcentric Ventures, LLC (“Xcentric”)respectfully submits the followingResponse toDefendantsRAYMOND MOBREZ and ILIANA LLANERAS' (the"Mobrez Defendants") Motion to Set Aside [Entry of] Default (Doc. #94). For thereasons stated herein, the motion should be denied.
I.BACKGROUND
This action was commenced nearly one year ago on July 18, 2011. As reflected inDoc. # 81 (Notice of Filing Affidavits of Service) Mr. Mobrez and Ms. Llaneras wereserved with the Complaint and Summons on July 27, 2011and July 29, 2011respectively.On August 18, 2011, Mr. Mobrez and Ms. Llaneras filed a
 pro se
"Motion for Extension of Time to Answer of Otherwise Respond to Plaintiff's Complaint" (Doc. #12)which requested a 60-day extension of time to respond. On September 2, 2011, the Courtgranted the motion in part (Doc. #14), giving the Mobrez Defendants until September 30,2011 in which to file an Answer or motion.
Case 2:11-cv-01426-GMS Document 95 Filed 06/12/12 Page 1 of 6
 
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RESPONSE TO MOTION TO SET ASIDEENTRY OF DEFAULT
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On September 30, 2011, the Mobrez Defendants (acting through retained counselHartwell Harris) filed a variety of motions including a Motion to Change Venue (Doc.#17) and a Motion to Dismiss for Lack of Personal Jurisdiction (Doc. #18). The Courtdenied thesemotions by order dated March 1, 2012 (Doc. #52). Because their Rule 12motions were denied, Fed. R. Civ. P. 12(a)(4)(A) required the Mobrez Defendants to filetheir Answer "within 14 days after notice of the court's action", but no Answer or other responsive pleading was ever filed.On that same date—March 1, 2012—the Court also set a scheduling conference(Doc. #53) for April 13, 2012. However, by order dated March 26, 2012 (Doc. #58) thescheduling conference was changed to a status conference to discuss, among other things,whether the Mobrez Defendants'formercounsel, Hartwell Harris, would be permitted towithdraw from representing their LLC, Asia Economic Institute. The Court's March 26thOrder further directed Mr. Mobrez, Ms. Llaneras, and their former counsel, Ms. Harris, toappear at the status conference which theyeachsubsequently did.After Ms. Harris was permitted to withdraw from the case, several weeks passedwith no further participation in the case by the Mobrez Defendants. As such, on May 3,2012, Xcentric applied for entry of default against Mr. Mobrez and Ms. Llanera (Doc. #82). By order dated May 23, 2012, the Court entered default (Doc. #86) followed by theclerk's entry of default on the same day (Doc. #87).
II.ARGUMENT
Xcentric acknowledges that the disposition of claims by default is not favored andthat "Rules55(c) and 60(b) express a policy of liberality toward motions for relief fromdefault entries and default judgments." 10A Charles A. Wright & Arthur R. Miller,
 Federal Practice & Procedure
§ 2693 (3d. ed). On the other hand,when a litigantignores their obligations under the Rules of Civil Procedure, default is an appropriateremedy which may only be vacated upon a showing of "good cause". This analysisrequires the Court to “considerthree separate factors: (1) whether [the party seeking toset aside the default] engaged in culpable conduct that led to the default; (2) whether 
Case 2:11-cv-01426-GMS Document 95 Filed 06/12/12 Page 2 of 6
 
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RESPONSE TO MOTION TO SET ASIDEENTRY OF DEFAULT
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[they] had [no] meritorious defense; or (3) whether reopening the default judgment would prejudice" the other party.
 Franchise Holding II, LLC v. Huntington Restaurants Group, Inc.
, 375 F.3d 922, 926 (9th Cir. 2004) (affirming Arizona district court's refusal tovacate entry of $24 million default judgment). A district court may properly refuse tovacate the entry of default ifany one of these factors are present; "As these factors aredisjunctive, the district court was free to deny the motion 'if any of the three factors wastrue.'
 Franchise Holding II 
, 375 F.3d at 926 (quoting
 American Ass'n of Naturopathic Physicians v. Hayhurst 
, 227 F.3d 1104, 1108 (9th Cir.2000)). Further, as the partiesseeking to vacate the default, Mr. Mobrez and Ms. Llaneras bear the burden of showingthat none of these factors are present.
See id 
.
a.Culpability
Relief from the entry of default may be properly denied when the defaulting partyhas engaged in "culpable conduct"resulting in the default. In this context, "[i]f adefendant 'has received actual or constructive notice of the filing of the action and failedto answer,'its conduct is culpable."
 Franchise Holding II 
, 375 F.3d at 926(emphasisadded)(quoting
 Direct Mail Specialists, Inc. v. Eclat Computerized Techs., Inc
., 840 F.2d685, 690 (9th Cir.1988)).Here, as reflected in the Affidavits of Service (Doc. #81) Mr. Mobrez and Ms.Llaneras were personally served with the Complaint and Summons nearly a year ago inJuly 2011. Furthermore, both Mr. Mobrez and Ms. Llaneras have filed numerous pleadings in this action which conclusively demonstrates their actual knowledge of thefiling of this action. Despite this, more than three months have passedsince this Courtdenied the Mobrez Defendants' Rule 12 motions and yetthey have filedno Answer or responsivepleading of any kind.In their motion, the Mobrez Defendants appear to suggest that these eventsoccurredthrough no fault of their ownbecauseat some pointthe post office in LosAngeles failed to properly forward mail from their previous office address.Evenassuming this is true, this argument is insufficient for twodifferentreasons.
Case 2:11-cv-01426-GMS Document 95 Filed 06/12/12 Page 3 of 6

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