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Case 2:13-cv-00126-TOR Document 114 Filed 09/03/14
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`UNITED STATES DISTRICT COURT
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`EASTERN DISTRICT OF WASHINGTON
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` NO: 13-CV-0126-TOR
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`ORDER DENYING PLAINTIFF’S
`MOTION FOR DEFAULT
`JUDGMENT AS AGAINST HAYES,
`KAPPEN, MAXWELL, AND URENA
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` Defendants.
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`BEFORE THE COURT is Plaintiff’s Motion for Default Judgments and
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`Permanent Injunctions against Defendants Hayes, Kappen, Maxwell, and Urena
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`(ECF No. 108). This matter was submitted for consideration without oral
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`argument. The Court has reviewed the motion and the record and files herein and
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`is fully informed.
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`FACTS1
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`1 Unless otherwise noted, these facts are excerpted from Plaintiff’s complaint and
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`used for purposes of the instant motion only.
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`ORDER DENYING MOTION FOR ENTRY OF DEFAULT JUDGMENT WITH
`LEAVE TO RENEW ~ 1
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`THE THOMPSONS FILM, LLC,
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` Plaintiff,
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`ROSS KAPPEN, et al.,
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`Case 2:13-cv-00126-TOR Document 114 Filed 09/03/14
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`This is an action concerning alleged copyright infringement of a motion
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`picture. Plaintiff The Thompsons Film, LLC, is a limited liability company that
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`produced the motion picture at issue in this matter, The Thompsons. Defendants are
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`identified as having at least one of the following roles: 1) BitTorrent users or peers
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`whose computers are collectively interconnected and used for illegally copying and
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`distributing Plaintiff’s motion picture; 2) contributing to the infringement of
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`Plaintiff’s copyright by others; 3) permitting, facilitating, and/or promoting the use
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`of the internet access identified by the IP address for the infringing of Plaintiff’s
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`exclusive rights under the Copyright Act by others.
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`BitTorrent is an interactive peer-to-peer file transfer technology protocol.
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`Peer-to-peer networks, in their most common form, are computer systems enabling
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`users to make files stored on each user’s computer available for copying by other
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`users, to search for files stored on other users’ computers, and to transfer exact
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`copies of the files from one computer to another via the internet. The complaint
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`alleges that Plaintiff has recorded each Defendant identified (through his or her IP
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`address) as actually copying and publishing Plaintiff’s motion picture via
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`BitTorrent, as Plaintiff’s investigator has downloaded the motion picture from each
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`Defendant. Plaintiff alleges that, upon information and belief, each Defendant was
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`a willing and knowing participant in the file transfer “swarm” at issue and engaged
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`in such participation for the purpose of infringing Plaintiff’s copyright.
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`ORDER DENYING MOTION FOR ENTRY OF DEFAULT JUDGMENT WITH
`LEAVE TO RENEW ~ 2
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`Case 2:13-cv-00126-TOR Document 114 Filed 09/03/14
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`Plaintiff sued Defendants, claiming copyright infringement, contributory
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`infringement, and indirect infringement of copyright. Plaintiff’s First Amended
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`Complaint requests damages of $30,000 from each Defendant pursuant to 17
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`U.S.C. § 504(c)(1) for its claims of infringement and contributory infringement,
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`and damages of not more than the statutory minimum of $750.00 on its indirect
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`infringement claim. Plaintiff also requests entry of permanent injunctions
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`enjoining each Defendant from directly, contributorily or indirectly infringing
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`Plaintiff’s rights in Plaintiff’s motion picture, and reasonable costs and attorney
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`fees.
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`The Clerk of Court has entered orders of default for all Defendants named in
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`the instant motion. Despite being properly served, as of the date of this Order, the
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`Non-Appearing Defendants have not filed an answer or moved to set aside their
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`default. Plaintiff now moves for default judgment seeking the relief requested in its
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`First Amended Complaint.
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`DISCUSSION
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`Motions for entry of default judgment are governed by Federal Rule of Civil
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`Procedure 55(b). Rule 55(b)(1) provides that the Clerk of Court may enter default
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`judgment when the plaintiff’s claim “is for a sum certain or a sum that can be made
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`certain by computation.” Fed. R. Civ. P. 55(b)(1). When the value of the claim
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`cannot be readily determined, or when the claim is for non-monetary relief, the
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`ORDER DENYING MOTION FOR ENTRY OF DEFAULT JUDGMENT WITH
`LEAVE TO RENEW ~ 3
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`Case 2:13-cv-00126-TOR Document 114 Filed 09/03/14
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`plaintiff must move the court for entry of default judgment. Fed. R. Civ. P.
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`55(b)(2). In such circumstances, the court has broad discretion to marshal any
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`evidence necessary in order to calculate an appropriate award. See Fed. R. Civ. P.
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`55(b)(2)(A)-(D). At the default judgment stage, well-pleaded factual allegations
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`are considered admitted and are sufficient to establish a defendant's liability, but
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`allegations regarding the amount of damages must be proven. Geddes v. United
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`Fin. Group, 559 F.2d 557, 560 (9th Cir. 1977); Microsoft Corp. v. Lopez, 2009 WL
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`959219 (W.D.Wash. 2009). The court must ensure that the amount of damages is
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`reasonable and demonstrated by the evidence. See Fed. R. CIv. P. 55(b); Getty
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`Images (US), Inc. v. Virtual Clinics, 2014 WL 358412 (W.D.Wash. 2014).
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`The entry of default judgment under Rule 55(b) is “an extreme measure.”
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`Cmty. Dental Servs. v. Tani, 282 F.3d 1164, 1170 (9th Cir. 2002). “As a general
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`rule, default judgments are disfavored; cases should be decided upon their merits
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`whenever reasonably possible.” Westchester Fire Ins. Co. v. Mendez, 585 F.3d
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`1183, 1189 (9th Cir. 2009). In determining whether to enter default judgment, a
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`court should consider the following factors: “(1) the possibility of prejudice to the
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`plaintiff; (2) the merits of the plaintiff’s substantive claim; (3) the sufficiency of
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`the complaint; (4) the sum of money at stake in the action; (5) the possibility of a
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`dispute concerning material facts; (6) whether the default was due to excusable
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`neglect; and (7) the strong policy underlying the Federal Rules of Civil Procedure
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`ORDER DENYING MOTION FOR ENTRY OF DEFAULT JUDGMENT WITH
`LEAVE TO RENEW ~ 4
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`Case 2:13-cv-00126-TOR Document 114 Filed 09/03/14
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`favoring decisions on the merits.” Eitel v. McCool, 782 F.2d 1470, 1471-72; see
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`also United States v. VanDenburgh, 249 F. App’x 664, 665 (2007).
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`The Court considers each of the factors in turn.
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`1. Possibility of Prejudice to Plaintiff
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`Despite having been properly served, the Non-Appearing Defendants have
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`failed to plead or otherwise defend. As a result, Plaintiff’s claims against them
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`cannot move forward on the merits, and Plaintiff’s ability to obtain effective relief
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`has been prejudiced. This factor weighs in favor of entering default judgment.
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`2. Merits of Plaintiff’s Substantive Claims
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`Plaintiff’s complaint alleges copyright infringement, contributory
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`infringement, and indirect infringement of copyright for Defendants’ alleged
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`participation in a BitTorrent “swarm.” Despite receiving notice of Plaintiff’s
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`allegations of infringement, the non-appearing Defendants have failed to plead or
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`otherwise defend. This factor weighs in favor default judgment.
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`3. Sufficiency of the Complaint
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`The Court finds that the first amended complaint states a claim upon which
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`relief may be granted in that it is grounded in a cognizable legal theory and alleges
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`sufficient facts to support that theory. This factor weighs in favor of entering
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`default judgment.
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`ORDER DENYING MOTION FOR ENTRY OF DEFAULT JUDGMENT WITH
`LEAVE TO RENEW ~ 5
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`Case 2:13-cv-00126-TOR Document 114 Filed 09/03/14
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`4. Sum of Money at Stake
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` Plaintiff has requested the highest amount of statutory damages available
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`under the Copyright Act, $30,000. In a copyright infringement case, a plaintiff
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`may elect either actual or statutory damages. 17 U.S.C. § 504(a). Statutory
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`damages may be not less than $750 or more than $30,000, “as the court considers
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`just.” 17 U.S.C. § 504(c)(1). “In a case where the copyright owner sustains the
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`burden of proving, and the court finds, that infringement was committed willfully,
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`the court in its discretion may increase the award of statutory damages to a sum of
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`not more than $150,000. In a case where the infringer sustains the burden of
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`proving, and the court finds, that such infringer was not aware and had no reason to
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`believe that his or her acts constituted an infringement of copyright, the court in its
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`discretion may reduce the award of statutory damages to a sum of not less than
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`$200.” 17 U.S.C. § 504(c)(2).
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`Plaintiff argues that statutory damages may be increased if a defendant
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`willfully infringed the copyright, and that Plaintiff alleged in its complaint that
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`defendants willfully infringed the copyright, and facts in the complaint are
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`admitted as true. ECF No. 108 at 3-4. Plaintiff, while maintaining that it is entitled
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`to increased statutory damages because Defendants’ conduct was willful, seeks
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`“only” $30,000 in statutory damages. Id. at 6.
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`ORDER DENYING MOTION FOR ENTRY OF DEFAULT JUDGMENT WITH
`LEAVE TO RENEW ~ 6
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`Case 2:13-cv-00126-TOR Document 114 Filed 09/03/14
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`Insofar as Plaintiff’s argument about increased statutory damages for willful
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`infringement is made to justify its request of $30,000 damages for each infringer,
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`the Court is unpersuaded. Plaintiff has alleged, inter alia, that “numerous
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`Defendants, either directly or indirectly, engaged in mass copyright infringement
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`of Plaintiff’s motion picture,” ECF No. 28 at 19; “Each Defendant knew or should
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`have known the infringing conduct observed by Plaintiff was unlicensed and in
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`violation of Plaintiff’s copyrights,” id. at 18; “each Defendant whose conduct
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`constitute direct infringement was a willing and knowing participant in the swarm
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`at issue and engaged in such participation for the purpose of infringing Plaintiff’s
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`copyright,” id. at 19; “Defendants’ conduct has been willful, intentional, in
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`disregard of and indifferent to Plaintiff’s rights,” id. at 21. In other words,
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`examined as a whole, Plaintiff has only very generally alleged willfulness—
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`without any specific findings as to which defendants might have willfully infringed
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`or what behavior indicates their willfulness. Well pleaded allegations in a
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`complaint are deemed admitted on a motion for default judgment, see Matter of
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`Visioneering Constr., 661 F.2d at 124, but the allegations must in fact be well
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`pleaded—Plaintiff’s allegations on this point are not. Plaintiff’s complaint only
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`alleges the most bare bones indication of willfulness, unsupported with factual
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`allegations indicating intent or knowledge of infringement. Furthermore, the first
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`amended complaint alleges only that at least some of the Defendants acted
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`ORDER DENYING MOTION FOR ENTRY OF DEFAULT JUDGMENT WITH
`LEAVE TO RENEW ~ 7
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`Case 2:13-cv-00126-TOR Document 114 Filed 09/03/14
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`willfully. Thus, Plaintiff acknowledges that some of the Defendants may have been
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`involved only unintentionally with the swarm. The Court will not impute a state of
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`mind to all Defendants based on such a pleading. Thus, Plaintiff’s argument about
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`willfulness, without more, is insufficient to sustain a finding that the Court should
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`impose a $30,000 fine on each Defendant named in the instant motion.
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`5. Possibility of Dispute as to Material Facts
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`Given that the Non-Appearing Defendants have not answered the Complaint
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`or otherwise participated in this case, there remains a possibility that material facts
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`are disputed. This factor weighs against entering default judgment.
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`6. Whether Default is Attributable to Excusable Neglect
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`The Court has no means of determining whether excusable neglect
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`contributed to the default of the Non-Appearing Defendants. Given that each of
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`these Defendants was properly served, however, the Court will presume that
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`excusable neglect did not play a role. This factor weighs in favor of entering
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`default judgment.
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`7. Policy Favoring Decisions on the Merits
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`Public policy clearly favors resolution of cases on their merits. Eitel, 782
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`F.2d at 1472; Westchester Fire, 585 F.3d at 1189. Nevertheless, this policy must
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`eventually yield to the proper administration of justice. Where, as here, a party
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`ORDER DENYING MOTION FOR ENTRY OF DEFAULT JUDGMENT WITH
`LEAVE TO RENEW ~ 8
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`Case 2:13-cv-00126-TOR Document 114 Filed 09/03/14
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`fails to defend on the merits of a claim, entry of default judgment is generally an
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`appropriate remedy.
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`However, in this case, where Plaintiff has requested sizable statutory
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`damages, the Court elects to exercise its power under Rule 55(b)(2) to “conduct
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`hearings” to “determine the amount of damages” and “establish the truth of any
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`allegation by evidence.” Fed. R. Civ. P. 55(b)(2). Accordingly, the Court directs
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`Plaintiffs to brief and provide evidence supporting the amount of damages against
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`each defaulting defendant separately. Upon a showing substantiating Plaintiff’s
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`damages against each Defendant, the Court will reconsider Plaintiff’s motion for
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`default judgment and request for attorney fees.
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`ACCORDINGLY, IT IS HEREBY ORDERED:
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`Plaintiff’s Motion for Default Judgments and Permanent Injunctions Against
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`Defendants Hayes, Kappen, Maxwell, and Urena (ECF No. 108) is DENIED with
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`leave to renew. Plaintiff is directed to submit a memorandum and evidence in
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`support of its claims against each defaulting Defendant and in support of its request
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`for damages on or before October 6, 2014.
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`///
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`///
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`///
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`///
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`ORDER DENYING MOTION FOR ENTRY OF DEFAULT JUDGMENT WITH
`LEAVE TO RENEW ~ 9
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`Case 2:13-cv-00126-TOR Document 114 Filed 09/03/14
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`The District Court Executive is hereby directed to enter this Order, provide
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`copies to counsel, and mail a copy to all unrepresented Defendants at their
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`addresses of record.
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`DATED September 3, 2014.
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`THOMAS O. RICE
`United States District Judge
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`ORDER DENYING MOTION FOR ENTRY OF DEFAULT JUDGMENT WITH
`LEAVE TO RENEW ~ 10

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