Girlsongs & Warner Bros. v. Constance & Ezell Starkey

108 F.R.D. 275, 1984 U.S. Dist. LEXIS 23004, 1985 Copyright L. Dec. (CCH) 25,791
District Court, N.D. California·Decided October 4, 1984·No. No. C-84-1656 RFP·Published

Opinion

ORDER

PECKHAM, Chief Judge.

The defendants Constance and Ezell Starkey have moved to set aside the default judgment entered against them in this case on May 18, 1984. For the reasons set forth below, the court denies the defendants’ motion.

[276] FACTS

The plaintiffs, on April 2, 1984, filed a complaint against Constance and Ezell Starkey alleging copyright infringements under the United States Copyright Act, 17 U.S.C. sections 101-810. The defendants are former owners of a disco in Santa Clara. The plaintiffs alleged that on April 16 and 17, 1983, unauthorized performances of copyrighted songs occurred at defendants’ disco.

The plaintiffs served each defendant with a summons and a copy of the complaint on April 13, 1984 by substitute service. The defendants failed to respond in any way to the complaint, and on May 17, 1984, the plaintiffs requested an entry of default. The plaintiffs served the defendants with the request by mail that same day, and default was entered against the defendants on May 18, 1984.

On May 31, 1984, the plaintiffs filed their notice of motion and motion for entry of default judgment and served the defendants by mail. On July 2, 1984, at the hearing on plaintiffs’ motion, this court entered a default judgment against the defendants for $2579.50 ($2000 in damages, $119.50 in costs, and $460 in attorneys fees). On July 16,1984, a writ or execution was issued, and the writ was served on the escrow office at the Bank of America on July 23, 1984.

On July 24, 1984, the defendants moved to set aside entry of default and the default judgment.

INTRODUCTION

Once a default judgment has been entered, Federal Rule of Civil Procedure rule 60(b) governs whether the court should set aside the judgment. While the decision to set aside a default judgment is within the trial court’s sound discretion, Madsen v. A.J. Bumb, 419 F.2d 4, 6 (9th Cir.1969), the Ninth Circuit, in Schwab v. Bullocks, 508 F.2d 353, 355 (9th Cir.1974), set out three considerations a court should keep in mind when deciding to grant or deny a Rule 60(b) motion:

First, Rule 60(b) is remedial in nature and therefore must be liberally applied [citations omitted]. Second, default judgments are generally disfavored; whenever it is reasonably possible, cases should be decided on their merits [citations omitted]. Third, and as a consequence of the first two considerations, ‘[w]here timely relief is sought from a default judgment and the movant has a meritorious defense, doubt, if any, should be resolved in favor of the motion to set aside the judgment so that cases may be decided on their merits.’ [citations omitted]. ■

Keeping these limitations in mind, the court nevertheless denies the defendants’ motion.

DISCUSSION

The defendants rely on F.R.C.P. rule 60(b)(1) *, which allows the court to set aside a default judgment on the basis of “mistake, inadvertence, surprise, or excusable neglect.” To make their rule 60(b)(1) argument, defendants must show: 1) that they had no actual knowledge of the suit, and 2) that the neglect on their part that prevented them from acquiring actual knowledge was excusable. See, e.g., Horn v. Intelectron Corp., 294 F.Supp. 1153, 1155 (S.D.N.Y.1968) (the court asked, whether the ... [defaulting defendants] had actual knowledge that this suit had been instituted, and if not, whether they were responsible for the lack of knowledge”).

[277] The defendants here argue that they had no actual knowledge of the proceeding against them. The only way they could have gotten actual notice of the proceeding was by picking up their mail at the disco, which they failed to do. The court will assume for purposes of the analysis that the defendants did not have actual knowledge of the suit. The court does not, however, find that the defendants have explained adequately their failure to p'ick up their mail to enable this court to find excusable neglect.

The defendants have three explanations to excuse their failure to pick up the mail or go to their business. First, they explain that the business was in the process of being sold, and therefore they just never went there to pick up their business mail. But, by their own statements in their papers, the defendants admit that the new owners did not take possession of the premises until May 16, 1984, almost a full month after the substitute service was made at their place of business. Thus, the sale did not necessarily interfere with the defendants’ ability to go to the business and pick up the substitute service papers on April 13, 1984.

Furthermore, even if notices of other proceedings in this case were sent to the business after May 16, 1984, the defendants have no explanation of why their mail was not forwarded to them. Courts have deemed excusable those situations when third parties fail to properly forward mail, see, e.g., Horn v. Intelectron Corp., 294 F.Supp. 1153,1155 (S.D.N.Y.1968), but here the defendants apparently made no effort to have their mail forwarded. Defendants cannot just fail to pick up their mail or have it forwarded upon completing a sale, and expect a court to find excusable neglect. See, e.g., Greenspun v. Bogan, 492 F.2d 375, 382 (1st Cir.1974) (“[t]he liberal construction [of rule 60(b)] is usually reserved for instances where error is due to failure of attorneys or other agents to act on behalf of their clients, not where the client’s own internal procedures are at fault”). Insurance Co. of North American v. S/S “Hellenic Challenger,” 88 F.R.D. 545, 548 (S.D.N.Y.1980) (when summons and complaint lost in defendants’ internal mail handling procedure, court refused to find excusable neglect under rule 60(b)(1).

The defendants also present the fact that Mr. Starkey had health problems which prevented him from going to the business on a regular basis. This is certainly a valid excuse for not physically going to the business. But this does not explain why he did not have the mail forwarded, or why Constance Starkey, the other owner, did not then attend to the business mail.

Constance explains that she was out of town during April 10-21, during which time the substitute served was made. But, she did not ever go to the business upon her return and she did not arrange to have the business mail forwarded to her. These failures are not excused by her April trip, not as the court reads the term used in rule 60(b)(1).

Here the defendants were fully responsible for their failure to get their own business mail. This is not excusable neglect.

Even if it were a close question of whether the defendants’ neglect was excusable, the defendants have not persuaded the court that the defendants have a meritorious defense, which would tip the balance in their favor.

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Girlsongs & Warner Bros. v. Constance & Ezell Starkey, 108 F.R.D. 275, 1984 U.S. Dist. LEXIS 23004, 1985 Copyright L. Dec. (CCH) 25,791 (N.D. Cal. 1984).

108 F.R.D. 275 (Girlsongs & Warner Bros. v. Constance & Ezell Starkey) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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