IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF TEXAS

DALLAS DIVISION

HEATHER SPENCER MEANS, §

 §

 PLAINTIFF, §

 §

V. § CASE NO. 3:22-CV-1249-G-BK

 § 

GATEWAY MORTGAGE CO. §

COVENANT TRANSPORT, INC. § 

 §

 DEFENDANT/COUNTERCLAIMANT. §

FINDINGS, CONCLUSIONS, AND RECOMMENDATION

OF THE UNITED STATES MAGISTRATE JUDGE

Pursuant to 28 U.S.C. § 636(b) and Special Order 3, Defendants’ Motion for Default 

Judgment, Doc. 10, is before the Court for consideration. For the reasons that follow, the motion 

should be DENIED.

I. PROCEDURAL HISTORY

In June 2022, Plaintiff filed this action in state court for breach of contract realted to the 

impending foreclosure of a property in which she claims to have an interest (the “Property”). 

Doc. 3-3 at 2. Defendant removed the case to this Court based on diversity jurisdiction, Doc. 1 

at 2-3, and filed a counterclaim against Plaintiff seeking (1) a declaratory judgment to the effect 

that it is authorized to enforce the power of sale enumerated in the governing deed of trust 

through foreclosure; (2) non-judicial foreclosure of the Property; and (3) a writ of possession. 

Doc. 7 at 4-5. When Plaintiff failed to answer or otherwise plead in response to Defendant’s 

counterclaims, the Clerk entered a default at Defendant’s request. Doc. 9; Doc. 11. Defendant 

now moves for a default judgment on its counterclaims. Doc. 10.

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II. APPLICABLE LAW

The conditions upon which a default may be entered against a party, as well as the 

procedure to seek the entry of default judgment, are found in Rule 55 of the Federal Rules of 

Civil Procedure. As an initial matter, the moving party must establish that the nonmovant (1) has 

been served with the summons and complaint and default was entered due to their failure to 

appear; (2) defendant is neither a minor nor an incompetent person; (3) defendant is not in 

military service or otherwise subject to the Soldiers and Sailors Relief Act of 1940; and (4) if 

defendant has appeared in the action, she was provided with notice of the application for default 

judgment at least three days prior to any hearing on the matter. FED. R. CIV. P. 55.

The entry of a default judgment thereafter is the culmination of three events: (1) default, 

which occurs when a defendant has failed to plead or otherwise respond to the complaint within 

the time required by Rule 12 of the Federal Rules of Civil Procedure; (2) entry of default by the 

clerk of court when such default is established by affidavit or otherwise; and (3) application by 

the movant to the clerk for a default judgment after the entry of default. FED. R. CIV. P. 55(a); 

New York Life Ins. Co. v. Brown, 84 F.3d 137, 141 (5th Cir. 1996). The entry of default alone 

does not entitle a plaintiff to a default judgment. Lewis v. Lynn, 236 F.3d 766, 767 (5th Cir. 

2001) (per curiam). The decision to grant a default judgment is one soundly within the district 

court’s discretion. Id. “Default judgments are a drastic remedy, not favored by the Federal 

Rules.” Sun Bank of Ocala v. Pelican Homestead & Sav. Ass’n, 874 F.2d 274, 276 (5th Cir. 

1989). “[T]hey are available only when the adversary process has been halted because of an 

essentially unresponsive party.” Id. (citation omitted).

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III. ANALYSIS

Plaintiff did not respond to Defendant’s Motion for Default Judgment. Accordingly, the 

Court issued an Order to Show Cause (the “OSC”), directing Plaintiff to explain her failure to do 

so. Doc. 16. In response to the Court’s OSC, Plaintiff avers her oversight and other missteps 

were the result of a series of inadvertent administrative errors and a misunderstanding of 

applicable law. Doc. 17. She requests leave to file an answer to Defendant’s counterclaims, 

noting the case is in its infancy.1 Doc. 17. In reply to Plaintiff’s OSC response, Defendant 

maintains it is entitled to a default judgment, but its argument is primarily based on the perceived 

lack of merit in Plaintiff’s claims and the strength of its own case. See Doc. 18, passim.

Upon consideration of the applicable law and the record, including Plaintiff’s response to 

the OSC and Defendant’s reply thereto, Defendant’s Motion for Default Judgment should be 

denied. While Plaintiff clearly defaulted by failing to respond to Defendant’s counterclaims and 

the Clerk thus appropriately entered a default, the Court cannot say that the adversary process 

has ground to a halt due to Plaintiff’s lack of action. Sun Bank of Ocala, 874 F.2d at 276. 

Plaintiff also has attempted to establish she has a meritorious defense to Defendant’s 

counterclaim. See Doc. 17 at 2 (“As an owner of the property, Means had the right to notice of 

the sale and she did not receive it. She has a legitimate defense to the suit and requests leave to 

file her answer.”). Given the “drastic” nature of a default judgment, entry of such is not 

warranted under the circumstances presented here. Sun Bank of Ocala, 874 F.2d at 276.

1 While Plaintiff separately requests leave to respond to Defendant’s motion, Doc. 17 at 2, the 

Court finds the most expeditious course of action is to deny Defendant’s motion and grant 

Plaintiff leave to file her Answer, as recommended infra.

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IV. CONCLUSION

For the foregoing reasons, Defendant’s Motion for Default Judgment, Doc. 10, should be 

DENIED. Thereafter, Plaintiff should be granted leave to file an Answer to Defendant’s 

counterclaim.

SO RECOMMENDED on October 12, 2022.

INSTRUCTIONS FOR SERVICE AND

NOTICE OF RIGHT TO APPEAL/OBJECT

A copy of this report and recommendation will be served on all parties in the manner provided by 

law. Any party who objects to any part of this report and recommendation must file specific 

written objections within 14 days after being served with a copy. See 28 U.S.C. § 636(b)(1); FED.

R. CIV. P. 72(b). An objection must identify the finding or recommendation to which objection is 

made, the basis for the objection, and the place in the magistrate judge’s report and 

recommendation the disputed determination is found. An objection that merely incorporates by 

reference or refers to the briefing before the magistrate judge is not specific. Failure to file specific 

written objections will bar the aggrieved party from appealing the factual findings and legal 

conclusions of the magistrate judge that are accepted or adopted by the district court, except upon 

grounds of plain error. See Douglass v. United Services Automobile Ass’n, 79 F.3d 1415, 1417 

(5th Cir. 1996), modified by statute on other grounds, 28 U.S.C. § 636(b)(1) (extending the time 

to file objections to 14 days).

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