United States District Court, S.D. Illinois
MEMORANDUM AND ORDER
J. ROSENSTENGEL Chief U.S. District Judge.
Jesse Ward filed this copyright infringement action against
Defendant Consequence Holdings, LLC, on September 17, 2018,
pursuant to 17 U.S.C. § 101, et seq. (Doc. 1).
The Court has subject matter jurisdiction over the case
pursuant to 28 U.S.C. §§ 1331 and 1338(a).
Holdings was served with a summons on September 27, 2018, and
its response to the complaint was due on or before October
16, 2018 (Doc. 8). On January 24, 2019, Consequence Holdings
had yet to respond to the complaint, and Ward moved for a
Clerk's entry of default under Federal Rule of Civil
Procedure 55(a) (Doc. 11). The Clerk entered default the next
day, and on April 22, 2019, Ward moved for default judgment
pursuant to Federal Rule of Civil Procedure 55(b) (Doc. 17).
On May 8, 2019, the Court ordered Ward to certify that a copy
of the motion for default judgment was sent to the last known
address for Consequence Holdings, in accordance with Local
Rule 55.1(a) (Doc. 19). Ward complied, verifying that he sent
a copy of the motion to Consequence Holdings via United
States mail on July 10, 2019 (Doc. 21). A few weeks later, on
August 2, 2019, Consequence Holdings moved to set aside the
Clerk's entry of default (Doc. 25).
to the motion to set aside, the founder and publisher of
Consequence Holdings, Alex Young, received the summons in
October 2018 due to an incorrect address on file with the
registered agent for Consequence Holdings (Doc. 26, Exs. 1
& 2). Young reached out to Ward's attorney a few days
later and began negotiating a settlement (Doc. 26, Exs. 1
& 3). The parties agreed to continue settlement
negotiations throughout the following week and to extend the
deadline for Consequence Holdings to respond to the complaint
(Id.). The Court notes the parties did not file a
motion for extension of time, or otherwise inform the Court
they were involved in settlement negotiations. Communication
between the parties broke down around November 2018, after
Ward stopped responding to correspondence (Doc. 26, Ex. 1).
Consequence Holdings became aware of the Clerk's entry of
default and motion for default judgment around July 17, 2019
(Id.), and moved to set aside the entry of default
on August 2, 2019 (Doc. 25).
Court may set aside an entry of default for good
cause.” Fed.R.Civ.P. 55(c). To vacate an entry of
default, the moving party must show (1) good cause for the
default, (2) quick action to correct it, and a (3)
meritorious defense to plaintiff's complaint. Pretzel
& Stouffer v. Imperial Adjusters, 28 F.3d 42, 45
(7th Cir. 1994). Courts apply a less stringent standard to
motions to set aside an entry of default compared to motions
to set aside a default judgment. See Cracco v. Vitran
Express, Inc., 559 F.3d 625, 631 (7th Cir. 2009)
(recognizing “the lenient standards that [the Seventh
Circuit] ha[s] established for the application of Rule
review of the docket sheet reveals Ward failed to comply with
Local Rule 55.1(a) when moving for a Clerk's entry of
default. Specifically, Ward did not “give notice of the
entry of default to the defaulting party by regular mail sent
to the last known address of the defaulted party” or
“certify to the Court that notice has been sent.”
See Reeves v. Harrington, No. 13-cv-01171-JPG-PMF,
2014 WL 5028206, at *2 (S.D. Ill. Oct. 8, 2014) (denying a
motion for default judgment for failure to comply with Local
Rule 55.1(a)). And, once Consequence Holdings finally
received notice of the entry of default, it acted quickly by
moving to set-aside the entry of default approximately
sixteen days later. See Yan Fang Jiang v. Hannon Group,
Ltd., No. 14-CV-309-JPS, 2015 WL 541678, at *4 (E.D.
Wis. Feb. 10, 2015) (finding “quick action” when
the defaulted party moved to set aside the entry of default
within sixteen days after its entry).
without commenting on the merits, it appears Consequence
Holdings has raised a meritorious defense to the complaint by
disputing the Court's personal jurisdiction over the
Chicago-based company. A showing of a “meritorious
defense” requires “more than bare legal
conclusions . . . but less than a definitive showing that the
defense will prevail.” Parker v. Scheck Mech.
Corp., 772 F.3d 502, 505 (7th Cir. 2014). Consequence
Holdings has alleged that it does not reside, transact
business, or have a place of business in the Southern
District of Illinois, for purposes of personal jurisdiction
or venue. Moreover, the alleged wrong took place in New York,
and Ward has not alleged any connection with the Southern
District of Illinois.
for good cause shown, the Clerk's entry of default (Doc.
13) is SET ASIDE, and the motion for default
judgment (Doc. 17) is DENIED. Defendant
SHALL respond to the Complaint within 21
days. The parties are ADVISED that they must
move the Court for an extension of time of any deadlines set
by the Court.