Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-azd-4_10-cv-00675/USCOURTS-azd-4_10-cv-00675-0/pdf.json

Nature of Suit Code: 791
Nature of Suit: Employee Retirement Income Security Act (ERISA)
Cause of Action: 29:1001 E.R.I.S.A.: Employee Retirement

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UNITED STATES DISTRICT COURT

DISTRICT OF ARIZONA

Hilda L. Solis, Secretary of Labor, United

States Department of Labor,

Plaintiff,

v. 

Sonora Environmental, L.L.C., an Arizona

corporation; Lee Jolley, an individual; and

Sonora Environmental, L.L.C. 401(K) Profit

Sharing Plan, an employee benefit plan, 

Defendants. ______________________________________

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CV 10-675 TUC-JGZ (JM)

REPORT AND

RECOMMENDATION

In accordance with the Rules of Practice of the United States District Court for the

District of Arizona and 28 U.S.C. § 636(b)(1), this matter was referred to the Magistrate

Judge for report and recommendation. As explained below, the Magistrate Judge

recommends that the District Court, after an independent review of the record, enter an order

of default as to Defendant Jolley based on his failure to defend this matter.

Background

Plaintiff Hilda Solis, the Secretary of Labor, filed this action on November 15, 2010,

alleging that Defendants Sonora Environmental, L.L.C. (“the Company”), its 401(K) Profit

Sharing Plan (“401(K) Plan”) and, Lee Jolley, as the President and owner of Sonora

Environmental and the Trustee of the Company’s 401(K) Plan failed to remit employee

contributions and loan payments to the 401(K) Plan in a timely manner. On January 18,

2011, Defendant Jolley, individually and as the Managing Member of the Company, filed an

Answer. 

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On April 7, 2011, a scheduling conference was set. On April 28, 2011, the Court

noted that the Company and the 401(K) Plan were unrepresented and, citing Church of the

New Testament v. United States, 783 F.2d 771 (9th Cir.1986), ordered that they obtain counsel

prior to the scheduling conference. The scheduling conference was subsequently continued

to allow additional time for the defendants to obtain counsel. Despite the extension, counsel

for the defendants did not appear for the scheduling conference. Subsequently, the Court set

another scheduling conference and warned the Plaintiff that if no action was taken with

regard to the unrepresented defendants, those defendants would be dismissed from the action

without prejudice. The Plaintiff subsequently applied for the entry of default against the

Company and the 401(K) Plan. The Clerk entered the defaults on December 15, 2011.

After initially answering the Complaint and contacting the Magistrate Judge’s

chambers, Defendant Jolley failed to participate in this proceeding. He did not appear for

the rescheduled scheduling conferences. Additionally, the docket reflects that mail sent to

the defendants, all of which share the same California address, has been returned as

undeliverable since October of 2011. 

As Defendant Jolley has failed to defend this action and provide his current address,

he is in violation of Rule 55(a), Fed.R.Civ.P. As such, on January 4, 2012, the Magistrate

Judge issued an Order to Show Cause giving Defedant Jolley thirty days to show cause why

the Magistrate Judge should not recommend to the District Court that his default be entered

in this matter. As of the date of this recommendation, Defendant Jolley has neither contacted

the Court nor filed an affidavit or pleading addressing the Court’s order.

Recommendation

For all of the above reasons, THE MAGISTRATE JUDGE RECOMMENDS that

the District Court, after its independent review and notice to the parties, enter and order of

default against Defendant Jolley. The Magistrate Judge further recommends that pursuant

to Rule 55(b)(2), Fed.R.Civ.P., the Plaintiff be ordered to submit an application for default

judgment.

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This Recommendation is not an order that is immediately appealable to the Ninth

Circuit Court of Appeals. Any notice of appeal pursuant to Rule 4(a)(1), Federal Rules of

Appellate Procedure, should not be filed until entry of the District Court's judgment. 

However, the parties shall have fourteen (14) days from the date of service of a copy

of this recommendation within which to file specific written objections with the District

Court. See 28 U.S.C. § 636(b)(1) and Rules 72(b), 6(a) and 6(e) of the Federal Rules of Civil

Procedure. Thereafter, the parties have fourteen (14) days within which to file a response to

the objections. If any objections are filed, this action should be designated case number: CV

10-675-TUC-JGZ. Failure to timely file objections to any factual or legal determination of

the Magistrate Judge may be considered a waiver of a party's right to de novo consideration

of the issues. See United States v. Reyna-Tapia 328 F.3d 1114, 1121 (9th Cir. 2003) (en

banc).

DATED this 9th day of February, 2012.

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