Court Opinion

ID: 2661424
Source: CourtListenerOpinion
Date Created: 2014-04-03 10:54:33.866977+00
Date Added: 2024-06-11T13:00:35.828834
License: Public Domain

UNITED STATES DISTRICT COURT
                           FOR THE DISTRICT OF COLUMBIA

GUARANTEE COMPANY OF NORTH
AMERICA USA,

            Plaintiff,
                                                         Civil Action No. 12-00736 (CKK)
       v.

JESUS BARRERA, et al.,

            Defendants.

                                 MEMORANDUM OPINION
                                    (December 9, 2012)

       Presently before the Court are six Motions for Default Judgment by Guarantee Company

of North America USA (“Plaintiff”) against Defendants Jesus Barrera d/b/a Barrera Transport

(“Barrera”), February Fourteen, Inc. (“February Fourteen”), Liverpool Express, Inc. (“Liverpool

Express”), MTS of Wisconsin, Ltd. (“MTS”), Rakhwinder Singh d/b/a Rainbow Trucking

(“Singh”), and Budreck Truck Lines, Inc. (“Budreck”) (collectively “Defendants”). Defendants

have not entered an appearance before this Court, nor have they responded to the respective

motions for default judgment against them.           Having carefully considered the Amended

Complaint, Plaintiff’s submissions and attachments thereto, applicable case law, statutory

authority, and the record of the case as a whole, the Court shall GRANT Plaintiff’s [27], [28],

[29], [30], [31], and [35] Motions for Default Judgment, for the reasons that follow.

                                      I. BACKGROUND

       A review of the facts of this case, as alleged by Plaintiff, is necessary for a discussion of

this Court’s jurisdiction over Plaintiff’s claims.    Plaintiff was at all relevant times a duly

admitted and licensed insurer, permitted under the laws of the State of Michigan and the District
of Columbia to offer and sell the surety bond that is the subject of this action. Am. Compl. ¶ 1.

On December 22, 2012, Plaintiff issued a property broker’s surety bond number TM5122229

(the “Bond”) in the penal sum of $10,000. Id. ¶ 5. The Bond was issued on behalf of non-party

Cambridge Logistics, Inc., a property broker in the business of arranging for transportation of

goods by motor carrier, for the benefit of any and all motor carriers or shippers to whom

Cambridge Logistics, Inc. may be legally liable for the damages described in the Bond. Id. ¶ 8.

        Beginning in January 2012, Plaintiff began receiving claims against the Bond from the

Defendants motor carriers who alleged that they had provided transportation services for

Cambridge Logistics, Inc. and had not been paid for such services. See id. ¶ 9 & Ex. B. On May

8, 2012, Plaintiff commenced this interpleader action pursuant to 28 U.S.C. § 1335 against

Barrera, February Fourteen, Liverpool Express, MTS, and Singh. See Compl., ECF No. [1]. On

August 7, 2012, Plaintiff filed an Amended Complaint, adding Budreck as a Defendant. See Am.

Compl., ECF No. [13]. Plaintiff alleges that the claims, and claims which could be asserted, by

Defendants are all adverse to each other, as the sum of the amounts claimed exceeds the

maximum liability of Plaintiff under the Bond. Id. ¶ 12. Specifically, the amount of the claims

asserted by Defendants total approximately $36,200 while the maximum liability of Plaintiff, if

any, is $10,000. Id. For this reason, and in order to avoid multiple litigation and potential

multiple or inconsistent liability, Plaintiff’s Amended Complaint requests that the Court order all

Defendants with claims against the Bond to interplead and establish their respective claims in

this single action. Id. ¶ 14.

        Plaintiff has filed proof of putative service on each of the Defendants. See ECF Nos. [6]-

[9], [11], [33]. According to the proof of service filed with the Court, Budreck was required to

respond by October 7, 2012, and all remaining Defendants were required to respond by July 8,

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2012. Because all of the Defendants failed to respond to Plaintiff’s Complaint within the

prescribed period of time, and upon the filing of motions for entry of default by Plaintiff, the

Clerk of the Court made an entry of default as to each Defendant on October 16, 2012. See ECF

Nos. [36], [37]. Presently before the Court are Plaintiff’s Motions for Default Judgment against

each Defendant. See ECF Nos. [27]-[31],[35]. As of the date of this Memorandum Opinion,

Defendants have neither entered an appearance nor filed any pleadings in this case.

                            II. LEGAL STANDARD AND DISCUSSION

       Plaintiffs bring this action pursuant to the Federal Interpleader Statute, 28 U.S.C. § 1335,

which permits a party who is exposed to multiple claims on a single obligation, and who wants to

obtain adjudication of the claims in a single proceeding, to bring an action in interpleader. See

Comm’l Union Ins. Co. v. United States, 999 F.2d 581, 583 (D.C. Cir. 1993). A court may

exercise jurisdiction over an interpleader action if: (1) the plaintiff has custody of the disputed

property, which exceeds $500; (2) the plaintiff deposits the disputed property into the registry of

the court; and (3) two or more adverse claimants of diverse citizenship claim or may claim an

interest in the disputed property. 28 U.S.C. § 1335; Star Ins. Co. v. Cedar Valley Express, LLC,

273 F. Supp. 2d 38, 41 (D.D.C. 2002). The Court has jurisdiction over this interpleader action

under the provisions of 28 U.S.C. § 1335(a) because, as alleged in the pleadings, there exists

diversity of citizenship between at least two of the Defendants, Am. Compl. ¶ 2, and the penal

sum of the Bond against which all Defendants assert adverse claims is $10,000, a sum in excess

of $500, Am. Compl. ¶ 3. Furthermore, Plaintiff, at the time of filing its Complaint, filed a

motion for leave to deposit $10,000 into the Registry of this Court. See Pl.’s Mot. for Leave to

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Deposit Funds into the Registry of the Court, ECF No. [2].1

       A Court has broad discretion to order interpleader relief as an equitable remedy designed

to achieve an orderly distribution of a limited fund. See Star Ins. Co., 273 F. Supp. 2d at 40.

Where a court grants interpleader relief, the plaintiff may be discharged from further court

proceedings, provided the plaintiff does not assert an interest in the distribution of the disputed

property. 28 U.S.C. § 2361. Normally, an interpleader action is concluded in two stages, the

first determining that the statutory requirements are met and relieving the plaintiff from liability,

and the second adjudicating the adverse claims of the defendant claimants to the disputed

property. However, this bifurcation is not mandatory. New York Life Ins. Co. v. Connecticut

Dev. Auth., 700 F.2d 91, 95 (2d Cir. 1983). Where, as here, no defendant enters an appearance

in the action, their subsequent defaults “d[o] not make the interpleader action inappropriate but

merely expedite its conclusion by obviating the normal second stage.” Id. at 95. See also Gulf

Coast Galvanizing, Inc. v. Steel Sales, Co., Inc., 826 F. Supp. 197, 203 (S.D. Miss. 1993) (“The

failure of a named interpleader defendant to answer the interpleader complaint and assert a claim

to the res can be viewed as forfeiting any claim of entitlement that might have been asserted.”)

(citation omitted).

       Federal Rule of Civil Procedure 55 provides that the Clerk of the Court must enter a

party’s default “[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.” FED. R.

CIV. P. 55(a). Upon entry of a default by the clerk, the well-pleaded allegations in the complaint

1
  On May 9, 2012, the Court issued an Minute Order denying without prejudice Plaintiff’s [2]
Motion for Leave to Deposit Funds into the Registry of the Court, and indicating that Plaintiff
could renew its motion after it filed proof of service as to all Defendants. See Min. Order (May
9, 2012). While Plaintiff at no point renewed its motion, depositing the value of the Bond into
the Registry of the Court is no longer necessary in light of Defendants’ failure to plead or
otherwise defend in this action, and by operation of the decision rendered by the Court today.
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are deemed admitted. City of New York v. Mickalis Pawn Shop, LLC, 645 F.3d 114, 137 (2d Cir.

2011). Thereafter, unless the claim is for a sum certain, the plaintiff must apply to the court for a

default judgment. FED. R. CIV. P. 55(b).      “The determination of whether default judgment is

appropriate is committed to the discretion of the trial court.” Int’l Painters & Allied Trades

Indus. Pension Fund v. Auxier Drywall, LLC, 531 F. Supp. 2d 56, 57 (D.D.C. 2008) (citing

Jackson v. Beech, 636 F.2d 831, 836 (D.C. Cir. 1980)).

       Where, as here, there is a complete “absence of any request to set aside the default or

suggestion by the defendant that it has a meritorious defense, it is clear that the standard for

default judgment has been satisfied.” Auxier Drywall, 531 F. Supp. 2d at 57 (internal quotation

marks omitted). The Clerk of the Court entered default for each Defendant in this action, and the

factual allegations in the Complaint are therefore taken as true. See Int’l Painters, 239 F. Supp.

2d at 30. Further, the Court finds that Plaintiff’s Amended Complaint sufficiently alleges facts

to support its claims. Accordingly, Plaintiff is entitled to a default judgment discharging it of all

liability to the Defendants under the Bond. See Jenkens & Gilchrist v. Groia & Co., 542 F.3d

114, 119-24 (5th Cir. 2008) (default judgment is available in interpleader actions), cert. denied

sub nom Felderhof v. Jenkens & Gilchrist, 129 S. Ct. 1585 (2009).

                                       III. CONCLUSION

       For all of the foregoing reasons, the Court shall GRANT Plaintiff’s [27], [28], [29], [30],

[31], and [35] Motions for Default Judgment.            An appropriate Order accompanies this

Memorandum Opinion.

Date: December 9, 2012                                _____/s/______________________

                                                      COLLEEN KOLLAR-KOTELLY
                                                      United States District Judge

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