United States District Court, D. Hawaii
FINDINGS AND RECOMMENDATION TO GRANT IN PART AND DENY
IN PART DEFENDANT AND COUNTER-CLAIMANT DIAMOND RESORTS HAWAII
COLLECTION DEVELOPMENT, LLC'S MOTION TO ENTER DEFAULT
JUDGMENT AGAINST MARIA CARBAJAL
Richard L. Puglisi United States Magistrate Judge
the Court is Defendant and Counter-Claimant Diamond Resorts
Hawaii Collection Development, LLC's Motion to Enter
Default Judgment Against Maria Carbajal, filed on January 19,
2018 (“Motion”). ECF No. 40. Plaintiff was served
with a copy of the Motion, but did not file an opposition or
otherwise respond. See ECF No. 40-7. The Court found
the Motion suitable for disposition without a hearing
pursuant to Rule 7.2(d) of the Local Rules of Practice of the
United States District Court for the District of Hawaii. ECF
No. 41. After careful consideration of the Motion, the
declarations, exhibits, and the record established in this
action, the Court FINDS AND RECOMMENDS that the Motion be
GRANTED IN PART and DENIED IN PART.
filed this action against Defendant Diamond Resorts Hawaii
Collection Development, LLC (“Diamond Resorts”)
in California state court on January 3, 2017. ECF No. 3-1. On
February 8, 2017, Defendant removed this action to federal
court in California. ECF Nos. 1, 3. Defendant then filed an
motion to transfer this case to the District of Hawaii. ECF
No. 11. Plaintiff filed a statement of no opposition to
Defendant's motion to transfer. ECF No. 15. On June 8,
2017, the court granted Defendant's motion and
transferred the case to this court. ECF No. 21.
9, 2017, the Clerk of Court issued a notice to all counsel
that they must comply with the Local Rules regarding
admission to this court and the submission of applications
for pro hac vice admittance and the designation of local
counsel. See ECF No. 24. On July 28, 2017, local
counsel for Defendant filed a notice of appearance.
See ECF No. 26. Defendant's mainland counsel
then filed motions for pro hac vice admission, which were
granted by the Court. See ECF Nos. 27-30. No local
counsel filed a notice of appearance in this action on behalf
of Plaintiff. Plaintiff's mainland counsel, Mitchell Reed
Sussman, Esq., did not submit an application to appear pro
hac vice. On September 13, 2017, Mr. Sussman informed the
Court by telephone that Plaintiff would not be obtaining
local counsel and had ceased communications with him. On
September 15, 2017, the Court issued an Order to Show Cause
directing Plaintiff to appear and show cause why this action
should not be dismissed pursuant to Federal Rule of Civil
Procedure 41(b) for failure to prosecute and to comply with
the Local Rules. ECF No. 32. After Plaintiff failed to appear
at the Show Cause hearing, the court dismissed
Plaintiff's complaint and entered default against
Plaintiff on Diamond Resorts' Counterclaim. ECF Nos. 36,
37. The present Motion followed.
judgment may be entered against a party from whom affirmative
relief is sought and the claim is for a “sum certain or
for a sum which can by computation be made certain[.]”
Fed.R.Civ.P. 55(b)(1), (2). The granting or denial of a
motion for default judgment is within the discretion of the
court. Haw. Carpenters' Trust Funds v. Stone,
794 F.2d 508, 511-12 (9th Cir. 1986). Entry of default does
not entitle the non-defaulting party to a default judgment as
a matter of right. Valley Oak Credit Union v.
Villegas, 132 B.R. 742, 746 (9th Cir. 1991). Default
judgments are ordinarily disfavored, and cases should be
decided on their merits if reasonably possible. Eitel v.
McCool, 782 F.2d 1470, 1472 (9th Cir. 1986). The court
should consider the following factors in deciding whether to
grant a motion for default judgment:
(1) the possibility of prejudice to the moving party;
(2) the merits of the 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.
Id. at 1471-72.
default “the factual allegations of the complaint,
except those relating to the amount of damages, will be taken
as true.” TeleVideo Sys., Inc. v. Heidenthal,
826 F.2d 915, 917-18 (9th Cir. 1987) (quoting Geddes v.
United Fin. Group, 559 F.2d 557, 560 (9th Cir. 1977)).
The allegations regarding liability are deemed true, but the
moving party must establish the relief to which it is
entitled. Fair Hous. of Marin v. Combs, 285 F.3d
899, 906 (9th Cir. 2002). Also, “necessary facts not
contained in the pleadings, and claims which are legally
insufficient, are not established by default.”
Cripps v. Life Ins. Co. of N. Am., 980 F.2d 1261,
1267 (9th Cir. 1992) (citing Danning v. Lavine, 572
F.2d 1386, 1388 (9th Cir. 1978)).
considering the merits of default judgment, the Court has an
affirmative obligation to determine whether or not it has
subject matter jurisdiction over this action and personal
jurisdiction over Plaintiff. See In re Tuli, 172
F.3d 707, 712 (9th Cir. 1999) (“To avoid entering a
default judgment that can later be successfully attacked as
void, a court should determine whether it has the power,
i.e., the jurisdiction, to enter the judgment in the first
the Court has diversity jurisdiction because the amount in
controversy exceeds $75, 000 and there is complete diversity
between Plaintiff and Defendant. See 28 U.S.C.
§ 1332. Plaintiff is a resident of California. ECF No.
3-1 ¶ 1. Diamond Resorts is a Delaware limited liability
company with its principal place of business in Nevada, and