Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_07-cv-05551/USCOURTS-cand-3_07-cv-05551-5/pdf.json

Parties Involved:
Lay Siok Lin
Plaintiff
Bruce Mabey
Defendant
Platinum Too, LLC
Defendant
William Teitelbaum
Defendant

Document Text:

United States District Court

For the Northern District of California

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IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

LAY SIOK LIN,

Plaintiff,

 v.

PLATINUM TOO, LLC, a Utah Limited

Liability Company, BRUCE MABEY, 

and WILLIAM TEITELBAUM,

Defendants. /

No. C 07-05551 WHA

ORDER DENYING PLAINTIFF’S

MOTION FOR DEFAULT

JUDGMENT AND

GRANTING ALL MOTIONS

TO SET ASIDE DEFAULTS

INTRODUCTION

In this securities fraud action, plaintiff Lay Siok Lin moves for entry of default judgment

against all defendants following entry of default two months ago. All defendants move to set

aside the defaults against them and oppose the motion for entry of default judgment. 

STATEMENT

Plaintiff filed the instant action on October 31, 2007. Six weeks earlier, defendant

William Teitelbaum had filed a complaint in the United States District Court for the Eastern

District of New York against plaintiff. Both actions purportedly involve the same events,

transactions, and occurrences. On December 14, Teitelbaum filed an amended complaint in

the New York action adding Platinum Too, LLC and Bruce Mabey as defendants (Metz Decl.

Exh. 3). In the instant action, plaintiff moved for entry of default against all defendants on

January 16, 2008, and defaults were entered a few days later. Plaintiff now moves for entry of

Case 3:07-cv-05551-WHA Document 54 Filed 04/04/08 Page 1 of 2
United States District Court

For the Northern District of California

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default judgment against all defendants. Defendants Mabey and Teitelbaum move to set aside

their defaults and oppose entry of default judgment on the ground that they were improperly

served and also that they previously contested liability in a related action. Defendant Platinum

Too also does likewise on the ground that liability was contested in the related action but does

not contest the service of process. 

ANALYSIS

Default judgments are disfavored. Eitel v. McCool, 782 F.2d 1470, 1472 (9th Cir.

1986). Cases should be decided on their merits whenever possible. Falk v. Allen, 739 F.2d

461, 463 (9th Cir. 1984). In addition, a district court’s discretion to set aside an entry of default

is “especially broad where, as here, it is entry of default that is being set aside, rather than a

default judgment.” Mendoza v. Wight Vineyard Management, 783 F.2d 941, 945 (9th Cir.

1986). An entry of default may be set aside for “good cause shown” under FRCP 55(c). 

Only relief from a default judgment, not merely from an entry of default, requires compliance

with the specific requirements of FRCP 60(b). See FRCP 55(c); Hawaii Carpenters’ Trust

Funds v. Stone, 794 F.2d 508, 513 (9th Cir. 1986). 

All defendants have made an unqualified general appearance so long as the defaults are

set aside (which they now are) and without prejudice to a motion for transfer. Only a short

period of time has passed since the defaults. This order therefore sets aside all defaults. 

CONCLUSION

For all of the above-stated reasons, plaintiff’s motion for default judgment is DENIED

and all motions to set aside defaults are GRANTED. All defendants shall file responses to the

complaint, as well as any motion for change of venue, by April 23, 2008. All Rule 26(a)

disclosures shall also be made by that date. The case management order previously issued in

this case shall continue to stand. 

IT IS SO ORDERED.

Dated: April 3, 2008. WILLIAM ALSUP

UNITED STATES DISTRICT JUDGE

Case 3:07-cv-05551-WHA Document 54 Filed 04/04/08 Page 2 of 2