UNITED STATES DISTRICT COURT

DISTRICT OF NEW JERSEY

UNITED STATES OF AMERICA,

 Plaintiff,

v.

DAVID G. HOLOHAN,

 Defendant.

Civil No. 11-4017 (NLH/KMW)

OPINION

APPEARANCES:

Frank J. Martone, Esquire

Frank J. Martone, PC

1455 Broad Street 

Bloomfield, New Jersey 07003 

Attorney for Plaintiff

David G. Holohan 

2919 Marne Highway 

Mt. Laurel, New Jersey 08054 

Pro se

HILLMAN, District Judge

This matter comes before the Court by way of pro se

Defendant David Holohan’s motion [Doc. No. 5] to vacate a default

judgment previously entered against him. Plaintiff, the United

States of America (hereinafter, the “United States”), opposes

Defendant’s motion. The Court has considered the parties’

submissions, and decides this matter pursuant to Federal Rule of

Civil Procedure 78.

For the reasons expressed below, Defendant’s motion to

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vacate the default judgment is denied. 

I. JURISDICTION

The United States brings this action against Defendant

seeking to recovery on defaulted student loans asserting that the

Court has jurisdiction over this matter pursuant to 28 U.S.C. §

1345. Section 1345 provides in pertinent part that “the district

courts shall have original jurisdiction of all civil actions,

suits or proceedings commenced by the United States, or by any

agency or officer thereof expressly authorized to sue by Act of

Congress.” 28 U.S.C. § 1345. Because the present suit was

brought by the United States, the Court exercises jurisdiction

over Plaintiff’s claims under Section 1345.

II. BACKGROUND

On July 13, 2011, the United States filed the complaint in

this action alleging that Defendant was indebted to the United

States in the amount of $17,419.95, plus costs and post-judgment

interest for defaulting on student loan obligations, and a

summons was issued that same day. (See Compl. [Doc. No. 1] ¶ 2;

see also Summons [Doc. No. 2] 1.) On September 15, 2011, the

United States requested that the Clerk of Court enter default

against Defendant pursuant to Federal Rule of Civil Procedure

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55(a). (Request for Entry of Default & Default J. [Doc. No. 3] 1

1.) The United States further requested that the Clerk of Court

enter default judgment against Defendant pursuant to Federal Rule

of Civil Procedure 55(b)(1). (Id.) On the following day, the 2

Clerk of Court entered default against Defendant under Rule

55(a), and subsequently entered a default judgment against

Defendant pursuant to Rule 55(b)(1) in the amount of $17,813.34

as of September 15, 2011, plus interest at a rate of $1.41 per

day until the date of judgment, costs in the amount of $110.00,

and post judgment interest. (Default J. [Doc. No. 4] 1.) 

Approximately six weeks later, Defendant filed the present

motion [Doc. No. 5] to vacate the default judgment entered

against him. 

 

III. DISCUSSION

Federal Rule of Civil Procedure 55(c) provides that the

Court “may set aside an entry of default for good cause, and ...

1. Rule 55(a) provides that “[w]hen a party against whom a

judgment for affirmative relief is sought has failed to plead or

otherwise defend, and that failure is shown by affidavit or

otherwise, the clerk must enter the party’s default.” FED. R.

CIV. P. 55(a). 

2. Under Rule 55(b)(1), “[i]f the plaintiff’s claim is for a sum

certain or a sum that can be made certain by computation, the

clerk – on the plaintiff’s request, with an affidavit showing the

amount due – must enter judgment for that amount and costs

against a defendant who has been defaulted for not appearing and

who is neither a minor nor an incompetent person.” FED. R. CIV.

P. 55(b)(1). 

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may set aside a default judgment under Rule 60(b).” FED. R. CIV.

P. 55(c). Accordingly, pursuant to Rule 60(b), a defendant may

move to set aside a default judgment, and the Court may grant

such relief for any of the following reasons: 

(1) mistake, inadvertence, surprise, or excusable

neglect; 

(2) newly discovered evidence that, with

reasonable diligence, could not have been

discovered in time to move for a new trial

under Rule 59(b); 

(3) fraud ..., misrepresentation, or misconduct

by an opposing party;

(4) the judgment is void;

(5) the judgment has been satisfied, released or

discharged; it is based on an earlier

judgment that has been reversed or vacated;

or applying it prospectively is no longer

equitable; or

(6) any other reason that justifies relief.

FED. R. CIV. P. 60(b). Defendant does not identify the subsection

of Rule 60(b) upon which he relies, but construing Defendant’s

motion to vacate the default judgment liberally, it appears

Defendant is moving to set aside the default judgment under the

first and sixth subsections. 

Generally, default judgments are disfavored by the courts,

and therefore, where a defendant moves to set aside a default

judgment the law “require[s] doubtful cases to be resolved in

favor of the party moving to set aside the default judgment ‘so

that cases may be decided on their merits.’” United States v.

$55,518.55 in U.S. Currency, 728 F.2d 192, 194-95 (3d Cir. 1984)

(citation omitted). Moreover, the “decision to set aside ... a

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default judgment pursuant to Fed.R.Civ.P. 60(b) is left primarily

to the discretion of the district court.” Id. at 194 (footnotes

omitted). As the Third Circuit recently explained, “‘[i]n

exercising its discretion in granting or denying a motion to set

aside a ... default judgment under Rule 60(b)(1),’ the district

court should consider: ‘(1) whether the plaintiff will be

prejudiced; (2) whether the defendant has a meritorious defense;

[and] (3) whether the default was the result of the defendant's

culpable conduct.’” United States v. $90,745.88 Contained in

Account Number 9506826724 Held in the Name of and/or for the

Benefit of Amiri Mbubu Auto Sales, LLC., at Bank of America, 1125

Rt. 22 W., Bridgewater, New Jersey 08807, No. 11-1324, 2012 WL

456535, at *1 (3d Cir. Feb. 14, 2012) (citing $55,518.55 in U.S.

Currency, 728 F.2d at 195). 

Although listed as the second factor, the Third Circuit and

courts in this District have repeatedly acknowledged that “the

meritorious-defense factor [is] the ‘threshold issue in opening a

default judgment.’” Nationwide Mut. Ins. Co. v. Starlight

Ballroom Dance Club, Inc., 175 F. App’x 519, 522 (3d Cir. 2006)

(citing Hritz v. Woma Corp., 732 F.2d 1178, 1181 (3d Cir. 1984));

see also $90,745.88 Contained in Account Number, 2012 WL 456535,

at *1 (same); Nyholm v. Pryce, 259 F.R.D. 101, 105-06 (D.N.J.

2009) (“The second factor, whether the defendant has established

a meritorious defense, is deemed a ‘threshold question’ because

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without it, the defendant could not win at trial and, thus,

‘there would be no point in setting aside the default[.]’”);

Wyndham Hotels and Resorts, LLC v. Rhonda & Sons, Inc., No. 10-

cv-02868, 2011 WL 831940, at *1 (D.N.J. Mar. 1, 2011) (same). 

To demonstrate a meritorious defense, a defendant must set

forth “‘allegations ... [that], if established on trial, would

constitute a complete defense to the action.’” $55,518.55 in

U.S. Currency, 728 F.2d at 195. The defendant must allege

“specific facts beyond simple denials or conclusionary

statements[,]” id., because “‘[d]efault judgments cannot be set

aside simply because of ... ambiguous conclusions’” or

“threadbare assertions[.]” $90,745.88 Contained in Account

Number, 2012 WL 456535, at *1 (citing $55,518.55 in U.S.

Currency, 728 F.2d at 196). Once a defendant “set[s] forth with

some specificity the grounds for his defense[,]” the court must

“then look at the substance of that defense to determine whether

it is meritorious” but is not required to decide the legal issue

at that stage of the case. Nationwide Mut., 175 F. App’x at 522. 

With respect to the other two factors, a showing that

defendant’s culpability led to the default judgment requires

“‘more than mere negligence ... be demonstrated.’” Nationwide

Mut., 175 F. App’x at 523 (citing Hritz v. Woma Corp., 732 F.2d

1178, 1183 (3d Cir. 1984)). A lack of culpability by the

defendant is typically found in cases that “involved innocent

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mishaps or mere mistakes[,]” whereas “‘[r]eckless disregard for

repeated communications from plaintiffs and the court ... can

satisfy the culpable conduct standard.’” Nationwide Mut., 175 F.

App’x at 523 (citing Hritz, 732 F.2d at 1183). Prejudice to

plaintiff “is established ... when a plaintiff's ‘ability to

pursue the claim has been hindered .... [by, for example,] loss

of available evidence, increased potential for fraud or

collusion, or substantial reliance upon the judgment.’” 

Nationwide Mut., 175 F. App’x at 524 (citing Feliciano v. Reliant

Tooling Co., 691 F.2d 653, 657 (3d Cir. 1982)). However,

“[d]elay in realizing satisfaction on a claim rarely serves to

establish the degree of prejudice sufficient to prevent the

opening [of] a default judgment entered at an early stage of the

proceeding.” Feliciano, 691 F.2d at 656-57. 

As compared to Rule 60(b)(1), “the text of Rule 60(b)(6)

states simply that a court may grant relief from a final judgment

for ‘any other reason that justifies relief,’ [but] courts have

added a requirement that a party seeking Rule 60(b)(6) relief

must demonstrate the existence of ‘extraordinary circumstances’

that justify reopening the judgment.” Budget Blinds, Inc. v.

White, 536 F.3d 244, 255 (3d Cir. 2008) (footnote and citations

omitted). Thus, under Rule 60(b)(6), relief can only be granted

upon “a showing of ‘extreme and unexpected hardship.’” 

$90,745.88 Contained in Account Number, 2012 WL 456535, at *2

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(citing Budget Blinds, 536 F.3d at 255).

IV. ANALYSIS

A. Meritorious Defense

In order to assess whether Defendant in this case has

alleged a meritorious defense, the Court must first consider the

nature of the underlying action to recover on defaulted student

loans and what Defendant would need to demonstrate to

successfully defend against that action. See $55,518.55 in U.S.

Currency, 728 F.2d at 195 (recognizing that “[t]o determine

whether [the defendant’s answer] establishes a complete defense

we must look to the [underlying] forfeiture action itself and

what is required of a defendant in order to successfully defend”

against it). 

Here, the United States brings this action against Defendant

seeking to recover a debt that arises out of defaulted student

loans guaranteed by the Pennsylvania Higher Education Assistance

Agency (“PHEAA”) and then reinsured by the Department of

Education under loan guaranty programs authorized by the Higher

Education Act of 1965. (See U.S. Dep’t of Ed. Certificate of

Indebtedness [Doc. No. 1-3] 1.) The United States asserts that

Defendant executed promissory notes to secure three loans from

Girard Bank and now owes over $17,000 for defaulting on his

obligation to repay these student loans. (Id.)

As noted by other courts in this Circuit, “[i]n an action to

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recover on a promissory note for student loans, ‘the government

must show (1) the defendant signed [the note], (2) the government

is the present owner or holder, and (3) the note is in default.’” 

United States v. Considine, No. 3:06-cv-6118-FLW, 2008 WL

4723030, at *2 (D.N.J. Oct. 24, 2008) (citing United States v.

Hargrove, No. 06-1059, 2007 WL 2811832, at *2 (E.D. Pa. Sept. 24,

2007)). In assessing whether Defendant in this case has

sufficiently alleged a meritorious defense, the Court must

evaluate Defendant’s allegations within this framework. 

Defendant makes several allegations he considers as sufficiently

meritorious to warrant setting aside the default judgment entered

against him. The Court addresses each of Defendant’s allegations

in turn. 

(1) Readability 

Initially, Defendant alleges that he was unable to view the

document provided to him because he has poor eye sight and the 3

document was a “bad copy.” (Mot. to Vacate Default J. [Doc. No.

5] 2.) The United States disputes Defendant’s contention and

further argues that it was Defendant’s responsibility to seek

assistance in reading the documents or requesting “additional

copies or clarifications” from the United States. (Mem. in Opp’n

3. It is unclear from the motion which document Defendant is

referencing. Presumably Defendant is referring to the summons

and complaint, although it also seems plausible to the Court that

Defendant is referring to a copy of the original student loan

agreement or the promissory notes attached as exhibits to the

United States’ complaint in this action. 

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to Mot. to Vacate Default J. [Doc. No. 7] 4.) The United States

specifically represents that the “documents and papers attached

to the Complaint are readable, particularly the multiple

promissory notes, even with business markings made on them

throughout their life span.” (Id.) 

To the extent Defendant contends that the complaint in this

action and the accompanying exhibits, including copies of the

original promissory notes, are illegible or unreadable in their

present form, the Court finds this allegation insufficient to

constitute a meritorious defense. A review of the complaint

[Doc. No. 1] demonstrates that the complaint is type-written and

utilizes a legible type-face in a size adequate for the Court to

read, review, and understand the allegations made by the United

States. The same is true of the U.S. Department of Education

Certificate of Indebtedness [Doc. No. 1-3] attached as an exhibit

to the complaint. With regard to the attached copies of the

promissory notes, it is the Court’s view that generally these

documents are legible. Moreover, even accepting Defendant’s 4

4. The Court notes though, that some portions of the promissory

notes contain very small print, which may, in some cases be

difficult to read without the aid of glasses or another

magnification device for someone with poor eye sight. Moreover,

some of the copied documents have even been stamped as “Poor

Source Original - Documents will be retained in portfolio” and

“Best Copy Available At Time of Imaging”. (Ex. 1, Promissory

Notes [Doc. No. 1-2] 6-8.) 

 However, in spite of these issues, the key terms of the notes

are sufficiently legible, and to the extent Defendant had

difficulty reading these documents, he could have requested other

copies or sought assistance in reviewing the documents. 

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allegation as true -- that he could not read the documents

because he has poor eye sight and was given bad copies -- the

inability to read the allegations of a law suit brought against

you, whether it results from poor eye sight, the quality of the

documents, or complete illiteracy, is simply insufficient to

constitute a defense to, what may be, legitimate claims by a

plaintiff. Cf. Hughes v. Idaho State Bd. of Corr., 800 F.2d 905,

909 (9th Cir.1986) (explaining that pro se habeas corpus

petitioner is accountable for procedural default even if he was

illiterate). A party cannot be permitted to defend against

claims made against him simply by asserting an inability to read

the documents provided to him, without more, and thus,

Defendant’s first assertion does not satisfy the meritorious

defense standard.

(2) Terms of the Agreement & Amount of Judgment

Next, Defendant asserts that the “entire agreement was never

presented to” him, but that he specifically remembers “a clause

in the original agreement stating that the interest and penalties

can not [sic] exceed more that 25% of the principal balance.” 

(Mot. to Vacate Default J. [Doc. No. 5] 2.) According to

Defendant, the “stated amount of this judgment is far more than

[the principal balance] and [therefore,] must be incorrect.” 

(Id.) The United States disputes Defendant’s allegations and

argues that a review of the promissory notes demonstrates that

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none of the notes contain a clause or term limiting interests and

penalties on the loan from exceeding twenty-five percent of the

principal balance. (Mem. in Opp’n to Mot. to Vacate Default J.

[Doc. No. 7] 5.) The United States further contends the amount

of the judgement, as supported by the Certificate of

Indebtedness, is in fact correct because, under paragraph VI of

each of the notes, interest on the loans began to accrue on the

dates the loans were disbursed, and any unsubsidized, unpaid

interest could properly be capitalized at any time. (Id.) 

Having considered Defendant’s allegations regarding the

terms of the loan and the accuracy of the judgment, the Court

finds that these allegations are also insufficient to constitute

a meritorious defense. Specifically, Defendant could not

establish these allegations at trial because the promissory notes

undisputedly demonstrate that there is no clause limiting the

total amount of interest and penalties which may accrue on the

loans to just twenty-five percent of the principal balance,

despite Defendant’s assertions to the contrary. (See Ex. 1,

Promissory Notes [Doc. No. 1-2] 6-8). Defendant’s threadbare

assertion that the amount of the judgment “must be incorrect”

remains wholly unsupported here because Defendant does not allege

specific facts to challenge the amount of the judgment beyond

Defendant’s inaccurate recollection of the terms of the loan. 

Defendant’s ambiguous conclusion that the judgment is incorrect,

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alone, is inadequate to constitute a complete defense to the

specific terms set forth in the promissory notes and the

information presented in the Certificate of Indebtedness from the

U.S. Department of Education.

Although Defendant asserts that he was “never presented”

with the “entire agreement[,]” Defendant’s representation is

belied by the fact that his signature is evidenced on each of the

six promissory notes attached to the complaint. Moreover,

Defendant not only fails to dispute that he executed the

promissory notes in question, or to otherwise challenge the

authenticity of the signatures on the notes, but it appears to

the Court that the signatures on the promissory notes are nearly

identical to Defendant’s signature as it appears on his affidavit

in support of the present motion. (Compare Ex. 1, Promissory

Notes [Doc. No. 1-2] 6-8, with Aff. in Supp. of Mot. [Doc. No. 5]

1.) 

(3) Fair Debt Collection Practices Act 

Third, Defendant alleges that his last contact with the

Department of Education was in 1986, and since that time, the

United States has not sent “official correspondence [to

Defendant] or [made an] attempt to collect this debt” under the

requirements of the Fair Debt Collection Practices Act (“the Act”

or “FDCPA”), 15 U.S.C. § 1601, et seq. (Mot. to Vacate Default

J. [Doc. No. 5] 2.) The United States argues that this “point is

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without merit[,]” noting that the complaint itself contains a

section entitled “Notice Required by the Fair Debt Collection

Practices Act 15 U.S.C. Section 1601 as amended[,]” thereby

demonstrating that the United States complied with the

requirements of the Act (Mem. in Opp’n to Mot. to Vacate Default

J. [Doc. No. 7] 5.) The United States further argues that the

allegation that Defendant has not had any contact with the

Department of Education since 1986 is irrelevant. (Id.) The

United States further contends that to the extent Defendant’s

allegation can be construed as a statute of limitations, laches,

or estoppel defense, any such argument must fail because there is

no statute of limitations on the collection of student loan debt

by the federal government pursuant to 20 U.S.C. § 1901a, and case

law similarly bars the defenses of estoppel and laches. (Id. at

5-6.)

As with the prior allegations made by Defendant, these

allegations similarly fail to constitute a meritorious defense to

the underlying student loan debt action. With respect to whether

the United States provided notice under the FDCPA, a review of

the final page of the complaint demonstrates that the United

States included a notice purporting to conform to the

requirements of the Act. Additionally, the Court notes that a 5

5. In observing that the United States provided a purported

notice under the FDCPA, the Court makes no determination

regarding the legal sufficiency of this notice and whether it

fully complies with the requirements of the Act. That issue is

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primary purpose behind the FDCPA is to “eliminate abusive debt

collection practices” such that Congress gave consumers a private

right of action against debt collectors who fail to comply with

the FDCPA’s requirements. Lesher v. Law Offices of Mitchell N.

Kay, PC, 650 F.3d 993, 996-97 (3d Cir. 2011) (citing 15 U.S.C. §

1692(e)). It is clear that the FDCPA is a remedial statute,

Lesher, 650 F.3d at 997, which is “designed to protect consumers

who have been victimized by unscrupulous debt collectors,

regardless of whether a valid debt actually exists.” Baker v.

G.C. Servs. Corp., 677 F.2d 775, 777 (9th Cir. 1982). Therefore,

even assuming that Defendant properly alleged and could prove

violations of the FDCPA by the United States in attempting to 6

collect this student loan debt, those alleged violations, in and

of themselves, do not constitute a defense to the validity of the

underlying debt for which collection was sought. Cf. Azar v.

Hayter, 874 F. Supp. 1314, 1317 (N.D. Fla. 1995), aff'd, 66 F.3d

342 (11th Cir. 1995) (recognizing that claims brought under the

FDCPA have “nothing to do with whether the underlying debt is

not presently before the Court because this is not a private

action brought by a consumer against a debtor under the FDCPA. 

For purposes of this motion, the Court simply recognizes that a

purported notice was included in the complaint to counter

Defendant’s allegation that no such notice was provided because

Defendant did not have any contact with the Department of

Education since 1986. 

6. To be clear, this issue is not before the Court, and the

Court makes no findings regarding whether any alleged actions by

the United States violated the FDCPA. 

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valid” but instead concern “the method of collecting the debt”). 

Thus, Defendant’s reliance on the FDCPA is misplaced because any

alleged violation of the the Act cannot stand independently to

establish a meritorious defense to the underlying debt. 

However, the Court -- broadly construing Defendant’s

allegation that he has not received any correspondence from or

had contact with the Department of Education since 1986 --

interprets this allegation as an argument that the United States

is somehow barred from collecting on Defendant’s defaulted

student loans based on the defenses of the statute of

limitations, laches, or estoppel. Contrary to Defendant’s

argument, the law is clear that these defenses are inapplicable

in actions where the United States seeks to recover on defaulted

student loans. See, e.g., United States v. Tuerk, 317 F. App’x

251, 252-53 (3d Cir. 2009) (affirming grant of summary judgment

to the United States in an action on defaulted student loans

where pro se defendant asserted the claim was otherwise timebarred, and further noting that 20 U.S.C. § 1901a eliminated all

limitations defenses in student loan actions, including equitable

defenses such as laches); United States v. Schiffres, No. 09-

6273, 2011 WL 198057, at *2 (D.N.J. Jan 20, 2011) (granting

summary judgment to the United States on defendant’s defaulted

student loans and rejecting defendant’s statute of limitations

argument because Section 1901a “eliminated all statutes of

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limitation on actions to recover defaulted student loans.”). 

Accordingly, the allegation that Defendant has not been contacted

by the Department of Education since 1986 fails to qualify as a

meritorious defense because, even if Defendant established this

fact at trial, it cannot provide Defendant with a complete

defense to the action. 

(4) Settlement and an Inability to Pay

Defendant argues that he previously attempted to settle his

debt by making “a lump sum payment once,” but that he was unable

to “accumulate a sum of money as large as ... requested.” (Mot.

to Vacate Default J. [Doc. No. 5] 2.) Defendant also alleges

that he “did not refuse to make payment” on his loans but simply

that he “was unable to” in light of his finances. (Id.) 7

(emphasis in original). Defendant also seemingly relies on the

October 2011 enactment by Congress of an income based repayment

plan, as a potential meritorious defense to the underlying 8

action. (Id.) 

7. Regarding his alleged inability to pay, Defendant represents

that he “sent all [his] financial documents to them via

registered US mail with return receipt for review.” (Id.) It is

unclear whether Defendant sent these documents to the Department

of Education, or to Plaintiff’s counsel in this case. 

8. According to Defendant the income based repayment plan “sets

payments at no more than 10% of house hold income with a cap of

no more than 15% with the remaining balance forgiven in as little

as 10 years [for] those willing to work in public service.” 

(Id.) 

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In response, the United States argues that it was within its

rights to reject any alleged settlement offer made by Defendant

and that such a rejection cannot serve as a basis to vacate the

default judgment. (Mem. in Opp’n to Mot. to Vacate Default J.

[Doc. No. 7] 6-7.) The United States further argues that the

reason for Defendant’s failure to pay his student loan

obligations, whether it be the intentional result of a voluntary

choice not to pay or the incidental result of a financial

inability to pay, is not relevant to the underlying action. (Id.

at 8.) The only relevant facts, according to the United States,

are that “Defendant voluntarily, intelligently, and knowingly

entered into multiple loan agreements with the U.S. Government,

received federal funds per the agreements, and then failed to

make repayments as scheduled by those agreements.” (Id.) The

United States further asserts that Defendant cannot rely on the

recently enacted income based repayment plan because it is not

retroactive and because under the promissory notes, once

Defendant defaulted on the student loans, the lender is entitled

to collect the entire amount still due and owing on the loan,

without consideration for Defendant’s annual or monthly income. 

(Id. at 7-8.) 

Defendant’s final allegations, just as those previously

asserted, also fail to qualify as meritorious defenses in this

defaulted student loan action. By (1) alleging a prior, though

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unsuccessful, attempt to settle this debt with the Department of

Education; (2) asserting that he was unable to make payment on

the loans for financial reasons; and (3) seeking to utilize a

newly enacted income based repayment plan, Defendant, rather than

defend against this claim, implicitly concedes the essential

elements of the government’s cause of action. Specifically,

Defendant has conceded that (1) he executed the promissory notes

at issue and took out three student loans in the amounts of

$2,500, $2,500, and $1,200; (2) the Department of Education, and

thereby the United States, is the present owner or holder of the

promissory notes in question; and (3) Defendant has not repaid

the balance on these loans as he was required to do, and is

therefore in default. See Considine, 2008 WL 4723030, at *2

(setting forth the required elements the government must prove in

order to recover on a promissory note for defaulted student

loans). Furthermore, Defendant’s allegations to not offer

specific facts or evidence which rebut the Certificate of

Indebtedness submitted by the United States. In sum these

allegations fall far short of the conclusion that if established

at trial, Defendant would have a complete defense to this

action. 

9

9. To the extent Defendant challenges the involvement of the law

firm of Frank J. Martone, P.C. in this case on behalf of the

United States by asserting that this law firm has not shown any

“relationship to this case for the last 25 years and has no

interest in this case other than monetary compensation[,]” (see

..... at 1), the Court finds this argument irrelevant to any

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Having carefully considered each of Defendant’s allegations,

the Court concludes that Defendant has not proffered a

sufficiently meritorious defense to the underlying student loan

action which warrants vacating the default judgment in this case. 

B. Lack of Culpability

To determine whether it was defendant’s culpable conduct

that led to the default judgment requires a showing of “more than

mere negligence[.]” Nationwide Mutual, 175 F. App’x at 523

(citation and internal quotations omitted). Innocent mishaps or

mere mistakes generally indicate a lack of culpability on the

part of a defendant, but “[r]eckless disregard for repeated

communications from plaintiffs and the court” can be sufficient

to” demonstrate culpable conduct. Id.

Here, Defendant asserts that his failure to plead or

otherwise respond in this action was the result of excusable

neglect. (Mot. to Vacate Default J. [Doc. No. 5] 2.) 

Specifically, Defendant contends that the “[s]ummons was not

delivered to” him, but rather “was left on a chair in front of

[his] estranged wife’s domicile[.]” (Id.) Defendant concedes 10

consideration regarding whether to set aside the default

judgment. The United States is entitled to its choice of

counsel, and any challenge to Plaintiff’s choice of legal

representation may only be made by a separate disqualification

motion, and therefore is not properly before the Court. 

10. In his moving papers, Defendant only refers to the summons,

as opposed to both the summons and the complaint. For purposes

of this motion and in light of Defendant’s pro se status,

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in the motion that his estranged wife’s address, located at 2919

Marne Highway, Mount Laurel, New Jersey 08054, is Defendant’s

“only legal address.” (Id.) However, Defendant explains that as

a result of “financial difficulties over the last year ...

[Defendant and his wife] are not always on speaking terms, nor

do[es] [Defendant] always reside at the legal address” set forth

above. (Id.) Defendant represents that although he and his wife

are presently trying to reconcile, “[a]t the time of service

[Defendant] was not [at their legal residence].” (Id.) 

According to Defendant, he “assumed at the time, that in a matter

as important as this[,] some one [sic] would attempt to contact

[him] again.” (Id.)

The United States disputes Defendant’s argument that the

summons and complaint were not properly served in this case. The

United States asserts that service was properly effected in this

case because a copy of the summons and complaint were left at

Defendant’s dwelling house or usual place of abode with someone

of suitable age and discretion who resides there pursuant to

Federal Rules of Civil Procedure 4(c)(1) and 4(e)(2)(B). (Mem.

in Opp’n to Mot. to Vacate Default J. [Doc. No. 7] 1-2.) In

support of this contention, the United States submitted an

Affidavit of Service by process server Wilbert Smith of

however, the Court construes the term “summons” as used by

Defendant broadly and intended to refer to both the summons and

the complaint. 

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Consolidated Legal Support Services, Inc., declaring under

penalty of perjury that the content of the Affidavit is true and

correct. (See Aff. of Service, Ex. B to the Decl. of Josephine

Martone [Doc. No. 7-3] 1.) 

Under Federal Rule of Civil Procedure 4(e)(2)(B), “an

individual — other than a minor, an incompetent person, or a

person whose waiver has been filed — may be served in a judicial

district of the United States by: ... leaving a copy of [both the

summons and complaint] at the individual's dwelling or usual

place of abode with someone of suitable age and discretion who

resides there[.]” FED. R. CIV. P. 4(e)(2)(B). The Court’s review

of the Affidavit of Service specifically evidences the fact that

Wilbert Smith, the processor server here, successfully served a

copy of both the summons and complaint in this action on July 29,

2011 at 12:15 p.m. by leaving “a copy with a competent household

member over 14 years of age residing” at 2919 Marne Highway,

Mount Laurel, New Jersey 08054 -- Defendant’s address. (See Aff.

of Service, Ex. B to the Decl. of Josephine Martone [Doc. No. 7-

3] 1.) The Affidavit of Service further identifies the

“competent household member” as “Mrs. Holohan[,]” the “spouse” of

Defendant, noting that Mrs. Holohan is a female, approximately

forty-five years of age, five feet, five inches tall with brown

hair. (Id.) 

Significantly, Defendant readily concedes that his then

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estranged wife’s domicile at 2919 Marne Highway in Mount Holly is

in fact Defendant’s “only legal address.” (Mot. to Vacate

Default J. [Doc. No. 5] 2.) Moreover, Defendant fails to offer

factual support, by way of affidavit, declaration, or otherwise,

demonstrating that the summons and complaint were simply left on

a chair in front of the home as he contends, rather than served

on Mrs. Holohan directly. (Id.) Defendant’s unsupported

assertion standing alone is insufficient to rebut the Affidavit

of Service by Wilbert Smith attesting that the summons and

complaint was left with Mrs. Holohan at the couple’s home. 

Accordingly, the Court finds that service was proper under Rule

4(e)(2)(B). 

Whether Defendant was physically present at the home on a

daily-basis during the estrangement from his wife is immaterial

to determining whether the 2919 Marne Highway address constitutes

Defendant’s usual dwelling or place of abode pursuant to the

Rule. Further, Defendant does not allege a lack of access to the

home in order to receive mail or otherwise check in on his

affairs at that address. Defendant, having elected to utilize

this address as his sole legal address even during the

estrangement from his wife, had a responsibility to inquire on a

regular basis whether any documents effecting his legal affairs

and financial obligations were delivered to that address by mail

or otherwise. Although not as egregious as recklessly

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disregarding repeated communications from Plaintiff or the Court,

Defendant’s conduct in failing to regularly inquire and follow up

on whether deliveries were made for him at his only legal address

represents more than an innocent mishap or mere mistake. 

Accordingly, Defendant bears at least some degree of culpability

for the default judgment being entered in this case. 

C. Prejudice to the United States

The United States asserts that it may have already been

prejudiced in this action because the filing of the present

motion resulted in an inherent delay while the motion was pending

before the Court during which time Defendant could “spend any

available money he has, leaving nothing for ... Plaintiff” in the

future in order to execute on the judgment. (Mem. in Opp’n to

Mot. to Vacate Default J. [Doc. No. 7] 3.) Because a plaintiff

suffers prejudice where its “ability to pursue the claim has been

hindered .... [by, for example,] loss of available evidence,

increased potential for fraud or collusion, or substantial

reliance upon the judgment[,]” Nationwide Mutual, 175 F. App’x

at 524 (citation and internal quotations omitted), the Court

agrees with the United States that to the extent Defendant may

have depleted his financial assets during the pendency of this

motion, the United States may have suffered some amount of

prejudice. At this time, however, the Court cannot make a

finding on this issue because there is no evidence on the record

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to suggest that Defendant actually engaged in this type of

activity and depleted his available financial resources.

Moreover, at any time after the expiration of the automatic

fourteen-day stay under Rule 62(a), the United States was free to

execute on the default judgment, even after the motion was filed, 

because Defendant’s motion to vacate under Rule 60(b) did “not

affect the judgment's finality or suspend its operation.” FED.

R. CIV. P. 60(c)(2); see also 11 Charles Alan Wright & Arthur R.

Miller, Federal Practice and Procedure § 2903 (2d ed. 1995)

(noting that “[a] posttrial motion, seeking a new trial or some

similar kind of relief, does not stay the judgment[, and] [t]he

party in whose favor the judgment runs is free to have execution

on it or to bring proceedings to enforce it after the expiration

of the automatic stay provided for in Rule 62(a).”). While it is

within the discretion of the Court to stay the execution of a

judgment or any proceedings to enforce it during the pendency of

a motion for relief from the judgment under Rule 60(b), see FED.

R. CIV. P. 62(b)(4), no such stay was entered in this particular

case, and the United States could have sought to execute on this

judgment in early October of 2011, approximately three weeks

before Defendant even filed his motion under Rule 60(b). Thus,

the Court cannot find that the United States has already, or will

later, suffer any prejudice if the default judgment were vacated.

Having considered all three factors in determining whether

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Defendant’s motion to vacate a default judgment should be

granted, the Court finds that the motion must be denied and the

default judgment entered against Defendant must stand. As set

forth more fully supra, Defendant failed to allege a sufficiently

meritorious defense to the underlying action seeking to recover

on defaulted student loans -- the threshold issue for vacating a

default judgment. Additionally, Defendant’s failure to regularly

inquire and follow up on whether deliveries were made for him at

his only legal address constitutes at least some moderate level

of culpability by Defendant which resulted in the default

judgment. Although there has not been a significant showing that

the United States will be prejudiced by vacating the default

judgment, the Court notes that the absence of a meritorious

defense and the presence of culpable conduct by Defendant, on

balance, are sufficient in this case to deny the motion. 

11

 

11. To the extent Defendant’s motion may be construed as seeking

to vacate the default judgment pursuant to Rule 60(b)(6) based on

“any other reason that justifies relief”, the Court finds that

Defendant has failed to satisfy the “added a requirement that a

party ... must demonstrate the existence of ‘extraordinary

circumstances’ that justify reopening the judgment.” Budget

Blinds, 536 F.3d at 255 (footnote and citations omitted). The

allegations of Defendant’s motion, set forth in detail supra,

cannot fairly be said to demonstrate the type of “extreme and

unexpected hardship” which is required to set aside a default

judgment under Rule 60(b)(6). $90,745.88 Contained in Account

Number, 2012 WL 456535, at *2 (citing Budget Blinds, 536 F.3d at

255).

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V. CONCLUSION

For the foregoing reasons, Defendant’s motion to vacate a

default judgment [Doc. No. 5] is denied with prejudice. An Order

consistent with this Opinion will be entered. 

Dated: June 18, 2012 /s/ Noel L. Hillman 

At Camden, New Jersey NOEL L. HILLMAN, U.S.D.J.

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