Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-azd-2_10-cv-00049/USCOURTS-azd-2_10-cv-00049-0/pdf.json

Nature of Suit Code: 190
Nature of Suit: Other Contract Actions
Cause of Action: 28:1332 Diversity-Breach of Contract

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IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF ARIZONA

Mattivi Brothers Leasing, Inc., a

California corporation, 

Plaintiff, 

vs.

Ecopath Industries, LLC, an Arizona

limited liability company, 

Defendant. 

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No. CV-10-49-PHX-DGC

ORDER AND DEFAULT JUDGMENT

In August 2008, Plaintiff Mattivi Brothers Leasing, Inc. purchased an asphalt rubber

blending plant from Defendant Ecopath Industries, LLC. Plaintiff claims that the plant is

defective and fails to conform to representations and covenants made in the sales contract.

Plaintiff filed a complaint seeking monetary damages and asserting claims for breach of

contract, breach of express warranty, rescission, and consumer fraud. Doc. 1.

Plaintiff served written discovery requests on June 1, 2010. Defendant failed to

respond. The Court held a discovery conference call with the parties on August 26, 2010,

ruling that Defendant had to respond fully to Plaintiff’s discovery requests. As reflected in

its written order (Doc. 31), the Court made clear to Defendant that its failure to do so may

result in a terminating sanction:

Defendant has not responded to the requests for production of documents or

interrogatories served on [June 1, 2010]. Defendant shall respond in full by

September 3, 2010. If Defendant fails to do so, the Court will entertain a

motion for sanctions against Defendant, including a motion for default

judgment. Plaintiff may serve a second round of written discovery by

Case 2:10-cv-00049-DGC Document 33 Filed 12/09/10 Page 1 of 3
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September 13, 2010. Defendant shall respond in full to the second round of

discovery by September 30, 2010. The Court made clear [during the

conference call] that it regards Defendant’s failure to fulfill its discovery

obligations as unacceptable. Full compliance will be expected.

Defendant has not complied with that order, or its underlying discovery obligations.

Plaintiff has filed a motion for the entry of default judgment pursuant to Rule 37 of the

Federal Rules of Civil Procedure. Doc. 32. Defendant has not filed a response, and the time

for filing one has now passed. LRCiv 7.2(c). For reasons that the follow, the motion will

be granted.

Rule 37 provides that where a party “fails to obey an order to provide or permit

discovery,” the district court may sanction that disobedient party by “rendering a default

judgment against [it].” Fed. R. Civ. P. 37(b)(2)(A)(vi). This Circuit has established a fivepart test to determine whether a terminating sanction is just: “‘(1) the public’s interest in

expeditious resolution of litigation; (2) the court’s need to manage its dockets; (3) the risk

of prejudice to the party seeking sanctions; (4) the public policy favoring disposition of cases

on their merits; and (5) the availability of less drastic sanctions.’” Valley Eng’rs Inc. v. Elec.

Eng’g Co., 158 F.3d 1051, 1057 (9th Cir. 1998) (citation omitted); see also Eitel v. McCool,

782 F.2d 1470, 1471-72 (9th Cir. 1986) (identifying similar factors to be considered before

granting default judgment under Rule 55(b)).

Having considered the five-factor test, the well-pled factual allegations of the

complaint (Doc. 1), and the declaration provided in support of default judgment (Doc. 32-1

at 2-10), the Court finds the entry of default judgment against Defendant in the amount of

$268,846.95 to be an appropriate sanction. This litigation cannot be resolved expeditiously,

the Court cannot manage its docket, and Plaintiff is prejudiced when Defendant utterly fails

to comply with its discovery obligations, defies court orders, and fails to respond to well

pleaded motions. This case cannot be resolved on the merits when Defendant refuses to

provide the information needed for a ruling on the merits. The Court has considered less

drastic sanctions, but has identified none in light of Defendant’s utter failure to follow

applicable federal rules and court orders. The Court concludes that default judgment is a

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reasonable sanction in light of its prior warning and Defendant’s complete disregard of its

responsibilities in this case.

IT IS ORDERED:

1. Plaintiff’s motion for entry of default judgment (Doc. 32) is granted. Default

judgment is entered in favor of Plaintiff Mattivi Brothers Leasing, Inc. and against Defendant

Ecopath Industries, LLC in the amount of $268,846.95, plus interest at the applicable legal

rate until the judgement is satisfied.

2. Plaintiff may file a motion for attorneys’ fees pursuant to Local Rule 54.2.

DATED this 9th day of December, 2010.

Case 2:10-cv-00049-DGC Document 33 Filed 12/09/10 Page 3 of 3