Servant Health LLC v. Eric McWilliams, Individually; and McWilliams Collective LLC

Opinion

UNITED STATES DISTRICT COURT WESTERN DISTRICT OF TEXAS SAN ANTONIO DIVISION

SERVANT HEALTH LLC,

Plaintiff,

v. Case No. 5:25-CV-00745-JKP

ERIC MCWILLIAMS, INDIVIDUAL- LY; AND MCWILLIAMS COLLEC- TIVE LLC,

Defendants.

O R D E R Before the Court is Plaintiff Servant Health LLC’s (“Servant”) Motion for Default Judg- ment Against Defendants Eric McWilliams (“McWilliams”) and McWilliams Collective LLC (“McWilliams LLC”). ECF No. 13. For the following reasons, Servant’s Motion, (ECF No. 13), is DENIED as to McWilliams and DENIED WITHOUT PREJUDICE as to McWilliams LLC. Rule 55 of the Federal Rules of Civil Procedure authorizes the Court to enter a default judgment against a defendant who has failed to plead or otherwise defend upon motion of the plaintiff. Fed. R. Civ. P. 55(b). “Default judgments are a drastic remedy, not favored by the Fed- eral Rules and resorted to by courts only in extreme situations.” Sun Bank of Ocala v. Pelican Homestead & Savs. Ass'n, 874 F.2d 274, 276 (5th Cir. 1989). In addition, “[a] party is not enti- tled to a default judgment as a matter of right, even where the defendant is technically in de- fault.” Ganther v. Ingle, 75 F.3d 207, 212 (5th Cir. 1996). Rather, the district court “has the dis- cretion to decline to enter a default judgment.” Lindsey v. Prive Corp., 161 F.3d 886, 893 (5th Cir. 1998). Though Servant may possibly be entitled to a default judgment, it would nevertheless be improper to enter judgment against Defendant McWilliams LLC at this time because there is an- other defendant, Defendant McWilliams, that filed an Answer, (see ECF No. 21), and Servant is requesting the defendants be held jointly and severally liable—at least as to some of its asserted causes of action. See ECF No. 8 at 3 (“Plaintiff sued Defendants for breach of contract, fraudu-

lent inducement, and Negligent Misrepresentation.”) (emphasis added). Since the Supreme Court decided Frow v. De La Vega, 82 U.S. 552 (1872), the estab- lished rule regarding default judgments has been “that when defendants are sued as jointly liable, and less than all default, the court may not enter default judgment against the defaulted defend- ants until the liability of the non-defaulted defendants has been decided.” Levitation Arts, Inc. v. Fascinations Toys & Gifts, Inc., 2009 WL 10669490, at *3 (W.D. Tex. May 28, 2009) (quoting McMillian/McMillian, Inc. v. Monticello Ins. Co., 116 F.3d 319, 321 (8th Cir. 1997)). If the court did otherwise, it might enter judgment for the plaintiff against the defaulting defendant, only to later enter judgment against the plaintiff on the same claim against the other

defendant. To avoid this problem, “when there are multiple defendants only one of whom is in default, the Court will withhold even granting default judgment until a decision on the merits has been reached as to the remaining defendants.” Nasufi, 2017 WL 6497762, at *3.1 Because there is another defendant in this case who has answered—McWilliams—and because the claims against the defendants are seeking joint and several liability, it would be im- proper to enter a default judgment against Defendant McWilliams LLC now. Because Servant obtained a Clerk's Entry of Default as to the defaulting party, McWilliams LLC, it is thus pro-

1 See also Wieck v. Synrg. Royce LLC, No. A-17-CV-599 LY, 2018 WL 620048 (W.D. Tex. Jan. 30, 2018), R. & R. adopted, No. A-17-CV-599-LY, 2018 WL 4732083 (W.D. Tex. Aug. 17, 2018); Metropcs v. PC-Wiz Corp., 2017 WL 131696, at *6 (N.D. Tex. Jan. 13, 2017); Martinez v. Brownsville Doctors Hosp., LLC, 2013 WL 12174046, at *2 (S.D. Tex. Aug. 29, 2013); Gen. Elec. Capital Corp v. Arnoult, 2002 WL 32856, at *2 (E.D. La. Jan. 9, 2002); Raleigh Cycle Co. of Am. v. Risha, 1987 WL 11889, at *1 (S.D. Tex. May 27, 1987). tected with regard to having to proceed any further as to Defendant McWilliams LLC. Before a joint and several judgment may be entered against it, however, Servant must first obtain a judg- ment against the answering defendant, McWilliams. Accordingly, it is ORDERED Servant’s Motion, (ECF No. 13), is DENIED as to McWilliams and DENIED WITHOUT PREJUDICE as to McWilliams LLC. The Clerk of Court is DIRECTED to mail, via certified mail with return receipt re- quested, a copy of this Order to: 1) McWilliams Collective, LLC c/o Eric McWilliams, 176 Midway Park Drive, St. Au- gustine, FL 32084; and 2) Eric McWilliams, 176 Midway Park Drive, St. Augustine, FL 32084 The Clerk of Court is FURTHER DIRECTED to email a copy of this Order to: 1) Ene.mewilliams@mewilliamscollective.co It is so ORDERED. SIGNED this 20th day of February, 2026. i" / Onaen NUD STATES DISTRICT JUDGE