Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-4_18-cv-06677/USCOURTS-cand-4_18-cv-06677-1/pdf.json

Parties Involved:
Hawaiian Islands
Defendant
Matson Navigation Company, Inc.
Plaintiff
Venn Corporation
Defendant

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United States District Court

Northern District of California

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

MATSON NAVIGATION COMPANY, 

INC.,

Plaintiff,

v.

VENN CORPORATION DBA HAWAIIAN 

ISLANDS,

Defendant.

Case No. 18-cv-06677-HSG 

ORDER GRANTING MOTION FOR

DEFAULT JUDGMENT

Re: Dkt. No. 22

Pending before the Court is Plaintiff Matson Navigation Company, Inc. (“Matson”)’s 

motion for default judgment against Defendant Venn Corporation DBA Hawaiian Islands

(“Venn”). Dkt. No. 22 (“Mot.”). The Court held a hearing on this motion on August 1, 2019, 

after which Plaintiff submitted supplemental information concerning Plaintiff’s principal place of 

business and state of incorporation. See Dkt. No. 27. After careful consideration, the Court 

GRANTS the motion.

I. BACKGROUND

Plaintiff alleges that Defendant breached a shipping services agreement by refusing to pay 

for the shipping services rendered by Plaintiff. See Dkt. No. 1 (“Compl.”). To date, Defendant 

has neither filed an answer nor other responsive pleading. On March 6, 2019, the Clerk of Court 

entered default as to Defendant. See Dkt. No. 16. Plaintiff thereafter filed the pending motion for 

default judgment.

II. LEGAL STANDARD

After entry of a default by the clerk, a party may move for default judgment. See Fed. R. 

Civ. P. 55. “The district court’s decision whether to enter a default judgment is a discretionary 

one.” Aldabe v. Aldabe, 616 F.2d 1089, 1092 (9th Cir. 1980). As a preliminary matter, a district 

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court must confirm that it has subject matter jurisdiction over the action, personal jurisdiction over 

the defendant, and that service of process was adequate. See In re Tuli, 172 F.3d 707, 712 (9th 

Cir. 1999); Disney Enters., Inc. v. Vuong Tran, No. 12-5030 SC, 2013 WL 1832563, at *1 (N.D. 

Cal. May 1, 2013). After finding these threshold matters met, a court next considers whether the 

following factors (“the Eitel factors”) support an entry of default judgment:

(1) the possibility of prejudice to the plaintiff, (2) the merits of 

plaintiff’s substantive claim, (3) the sufficiency of the complaint, (4) 

the sum of money at stake in the action; (5) the possibility of a dispute 

concerning material facts; (6) whether the default was due to 

excusable neglect, and (7) the strong policy underlying the Federal 

Rules of Civil Procedure favoring decisions on the merits.

Eitel v. McCool, 782 F.2d 1470, 1471–72 (9th Cir. 1986).

In considering these factors, a court takes all factual allegations in a plaintiff’s complaint 

as true, except for those relating to damages. See TeleVideo Sys., Inc. v. Heidenthal, 826 F.2d 915, 

917–18 (9th Cir. 1987). And relief granted under a default judgment is always limited by Federal 

Rule of Civil Procedure 54(c), in that the judgment “shall not be different in kind or exceed in 

amount that prayed for in the [complaint].”

III. DISCUSSION

A. Jurisdiction

Before entering a default judgment, a court has “an affirmative duty to look into its 

jurisdiction” over the subject matter of the action and the parties involved. Tuli, 172 F.3d at 712. 

Plaintiff here asserts that the Court has diversity jurisdiction over this case and specific personal 

jurisdiction over Defendant.

District courts “have original jurisdiction of all civil actions where the matter in 

controversy exceeds the sum or value of $75,000, exclusive of interest and costs,” and there is 

complete diversity of citizenship between the opposing parties. 28 U.S.C. § 1332(a); Owen Equip. 

& Erection Co. v. Kroger, 437 U.S. 365, 373–74 (1978). Here, Plaintiff has its principal place of 

business and is incorporated in Hawaii,

1 Defendant has its principal place of business and is 

 

1 Plaintiff initially argued that for purposes of evaluating diversity jurisdiction the Court should 

look to its parent company, Matson Inc., which has its principal place of business and is 

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incorporated in Virginia, and the amount in controversy far exceeds $75,000. Compl. ¶¶ 5–6; Dkt. 

No. 27. Thus, the parties are diverse, and Plaintiff has established that the Court has subject 

matter jurisdiction.

The Court also has specific personal jurisdiction over Defendant. The complaint asserts 

that personal jurisdiction exists because, among other reasons, Defendant consented to jurisdiction

in this district through a forum-selection clause included in the various bills of lading. Compl. ¶ 8; 

Dkt. No. 22-4 (“All suits and legal proceedings . . . shall be brought in the United States District 

Court for the Northern District of California . . . .”). Consent is a well-established ground for 

exercising personal jurisdiction over a non-resident defendant. See Burger King Corp. v. 

Rudzewicz, 471 U.S. 462, 472 n.14 (1985) (holding that “because the personal jurisdiction 

requirement is a waivable right, there are a variety of legal arrangements by which a litigant may 

give express or implied consent to the personal jurisdiction of the court”) (internal quotation 

marks omitted). And a forum-selection clause is by itself sufficient to establish consent and 

confer personal jurisdiction. SEC v. Ross, 504 F.3d 1130, 1149 (9th Cir. 2007). Finally, forumselection clauses are presumed valid, even in default judgment cases. M/S Bremen v. Zapata OffShore Co., 407 U.S. 1, 10 (1972) (forum-selection clauses “are prima facie valid and should be 

enforced unless enforcement is shown by the resisting party to be ‘unreasonable’ under the 

circumstances”); Craigslist, Inc. v. Kerbel, No. C–11–3309 EMC, 2012 WL 3166798, at *6 (N.D.

Cal. Aug. 2, 2012) (finding personal jurisdiction based on forum-selection clause where defendant 

failed to appear).

Here, the bills of lading provided that the parties consented to all related actions being 

brought in the U.S. District Court for the Northern District of California. Compl. ¶ 8; Dkt. No. 22-

4. And although Defendant did not manifest consent to the individual forum-selection clauses 

 

incorporated in Hawaii. See, e.g., Compl. ¶ 5 (“Plaintiff Matson Navigation Company, Inc. is a 

wholly owned subsidiary of Matson, Inc., a Hawaiian corporation with its principal place of 

business located in Honolulu, Hawaii.”). “The general rule,” however, “is that in a suit involving 

a subsidiary corporation, the court looks to the state of incorporation and principal place of 

business of the subsidiary, and not its parent.” Danjaq, S.A. v. Pathe Commc’ns Corp., 979 F.2d 

772, 775 (9th Cir. 1992) (internal quotation marks omitted). Plaintiff’s supplemental briefing 

clarified the proper entity’s state of incorporation and principal place of business. See Dkt. No. 

27.

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with a signature, the Ninth Circuit has held that parties are bound to such clauses in bills of lading. 

See Kukje Hwajae Ins. Co. v. M/V Hyundai Liberty, 408 F.3d 1250, 1254–55 (9th Cir. 2005)

(explaining that a party that accepts a bill of lading becomes bound by it, including with respect to 

forum-selection clauses). The forum-selection clauses in this action are thus prima facie valid and 

the burden shifts to any party disputing the validity of the clause to prove that the clauses are

otherwise unenforceable. See M/S Bremen, 407 U.S. at 10. And where, as here, the Defendant has 

not appeared but the clauses appear reasonable, they may be enforced as a basis for personal 

jurisdiction. See Craigslist, Inc., 2012 WL 3166798, at *6.

B. Adequacy of Service

The Court next considers whether procedural prerequisites, including adequate service of 

process, have been met. See, e.g., PepsiCo, Inc. v. Cal. Sec. Cans, 238 F. Supp. 2d 1172, 1175 

(C.D. Cal. 2002). And as is relevant here, Federal Rule of Civil Procedure 4 provides that a 

corporation may be served by delivering relevant material to an agent “authorized by appointment 

or by law to receive service of process.” Fed. R. Civ. P. 4(h)(1)(B). Here, Plaintiff identified 

Defendant’s agent for service of process as listed in the Commonwealth of Virginia State 

Corporation Commission, and served the agent with notice of the application for default judgment 

on April 2, 2019.

2

 See Dkt. No. 23. Thus, Plaintiff has fulfilled the procedural requirements for 

obtaining default judgment against Defendant.

C. Eitel Factors

Next, the Court evaluates the merits of the default judgment request based on the seven 

Eitel factors. See Eitel, 782 F.2d at 1471–72. First, because Defendant has not appeared in this 

action, Plaintiff would be prejudiced absent a default judgment because it would have no “other 

recourse for recovery.” See PepsiCo, Inc., 238 F. Supp. 2d at 1177. Second, Plaintiff’s 

substantive claim of breach of contract is meritorious, based on the documents submitted by 

Plaintiff. Third, the complaint is sufficient because it adequately alleges all elements of the causes 

 

2 Although Venn Corporation previously filed a Certificate of Dissolution with the State 

Corporation Commission of Virginia, see Compl. ¶ 12, dissolution under Virginia law does not 

“[t]erminate the authority of the registered agent of the corporation.” Va. Code Ann. § 13.1-

906(B)(6).

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of action. Specifically, there existed a contract under which Defendant agreed to procure shipping 

services from Plaintiff and to pay for the services upon receipt of bills of lading. See Compl. 

¶¶ 13, 20; Dkt. No. 22-3 (“Daniels Decl.”) ¶¶ 3–4. Plaintiff sufficient alleges its full performance 

under the contract. See Compl. ¶¶ 15, 21–22; Daniels Decl. ¶ 9. Plaintiff also alleges that 

Defendant breached the contract by failing to pay for shipping services reflected on sixty-five bills 

of lading received from Plaintiff. See Compl. ¶¶ 16, 23; Daniels Decl. ¶ 10. And Plaintiff has 

been damaged by the amount of the unpaid bills of lading. See Compl. ¶¶ 17, 24; Daniels Decl. 

¶ 12. Fourth, the sum of money at stake—$445,442.03 based on the total amount owed on the 

bills of lading, and $99,440.90 in prejudgment interest calculated based on the dates payments

became due—is reasonable. See Compl. ¶ 17; Mot. at 6; Cal. Civ. Code § 3289 (providing that in 

the absence of a stipulation to the contrary, “the obligation shall bear interest at a rate of 10 

percent per annum after a breach.”); Daniels Decl. Ex. F (detailing the prejudgment interest 

calculations); Bd. of Trs. of the Clerks v. Piedmont Lumber & Mill Co., No. C 10-1757 MEJ, 2010 

WL 4922677, at *5 (N.D. Cal. Nov. 29, 2010) (finding sum of money at stake reasonable because 

“damages Plaintiff seeks are proportionate to the harm Defendant caused, are justified under the 

[contract], and are properly documented”). Fifth, given that Defendant has not appeared in this 

lawsuit and Plaintiff’s claims are well-documented, there is little possibility of a dispute over 

material facts. Sixth, default was not due to excusable neglect, as Defendant was properly served. 

See Shanghai Automation Instrument Co. v. Kuei, 194 F. Supp. 2d 995, 1005 (N.D. Cal. 2001) 

(finding no excusable neglect where defendant was “properly served with the Complaint, the 

notice of entry of default, as well as the papers in support of the instant motion”). Seventh, while 

the strong policy of deciding cases on their merits weighs against a default judgment, deciding the 

case on the merits would be difficult given that Defendant has not participated in the case.

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IV. CONCLUSION

The Court finds that Plaintiff has met the requirements to obtain a default judgment and 

GRANTS the motion in the amount of $445,442.03, plus $99,440.90 in prejudgment interest, for 

a total judgment of $544,882.93. The Clerk is directed to enter judgment in favor of Plaintiff and 

close the file.

IT IS SO ORDERED.

Dated:

HAYWOOD S. GILLIAM, JR.

United States District Judge

 8/6/2019

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