United States District Court, D. Hawaii
FINDINGS AND RECOMMENDATION TO GRANT IN PART AND DENY
IN PART PLAINTIFF'S MOTION FOR DEFAULT JUDGMENT AGAINST
DEFENDANT ARI DANIELS AS TO COUNT I OF THE FIRST AMENDED
Richard L. Puglisi United States Magistrate Judge
the Court is Plaintiff's Motion for Default Judgment
Against Defendant Ari Daniels as to Count I of the First
Amended Complaint, filed on March 16, 2018
(“Motion”). ECF No. 53. 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. 54.
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.
First Amended Complaint, Plaintiff alleges that in August
2016, Defendant Ari Daniels and others created a website that
contained a number of false statements about Plaintiff,
Plaintiff's businesses, and the company that
Plaintiff's businesses contracted with. ECF No. 15
¶¶ 7-15. The website stated that Plaintiff
committed a number of crimes, that Plaintiff was residing
illegally in the United States, and that Plaintiff's
businesses were scamming tourists. Id. It included a
map pinpointing Plaintiff's residence and an image of
Plaintiff's Hawaii driver's license. Id.
¶ 14. Defendant Daniels knew that the statements
published in the website were false. Id. ¶ 17.
Plaintiff alleges that he has been injured by the false
statements. Id. ¶ 18.
asserted claims against Defendant Daniels and others for
defamation, extortion, negligent infliction of emotional
distress, and intentional infliction of emotional distress.
Id. On July 11, 2017, the court adopted the
recommendations of this Court to grant default judgment
against Defendant Jerry Kmiec as to Plaintiff's claim for
defamation and awarded general damages in the amount of $10,
000. ECF Nos. 31, 33. The court also adopted the
recommendation of this Court to deny Plaintiff's request
for default judgment against Defendant Daniels because
Plaintiff had failed to demonstrate proper service.
the court's order, Plaintiff obtained leave of court to
attempt to serve Defendant Daniels by certified mail. ECF No.
38. After Plaintiff's attempt to serve by certified mail
failed, Plaintiff then obtained leave of court to serve
Defendant Daniels by publication. See ECF No. 40.
Plaintiff filed a Affidavit of Publication on November 24,
2017, stating that notice had been published for four
consecutive weeks in the Honolulu Star-Advertiser. ECF No.
43. Pursuant to Rule 55(a) of the Federal Rules of Civil
Procedure, the Clerk entered default against Defendant
Daniels on December 19, 2017. ECF No. 46. Plaintiff then
filed the instant Motion, seeking default judgment against
Defendant Daniels on Plaintiff's claim for defamation.
judgment may be entered for the plaintiff if the defendant
has defaulted by failing to appear and the plaintiff's
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
(1) the possibility of prejudice to the plaintiff;
(2) the merits of plaintiff's 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 in the complaint regarding liability are
deemed true, but the plaintiff 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)).
Court has an affirmative obligation to determine whether or
not it has subject matter jurisdiction over this action and
personal jurisdiction over defendant. 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
Subject Matter Jurisdiction
is a resident of Honolulu, Hawaii. ECF No. 15 ¶ 1.
Defendant Daniels is a resident of Nevada. Id.
¶ 2. Plaintiff sought damages in excess of $75, 000.
Id. ¶ 5. Because Plaintiff and Defendant are
residents of different states and the amount in controversy
exceeds $75, 000, the Court has diversity jurisdiction over
this matter. See 28 U.S.C. § 1332(a)(1).
jurisdiction is proper if it is consistent with Hawaii's
long-arm statute and it comports with due process of law.
Boschetto v. Hansing, 539 F.3d 1011, 1021-22 (9th
Cir. 2008). Because Hawaii's long-arm statute reaches to
the full extent permitted by the United States Constitution,
the Court need only determine whether due process permits the
exercise of personal jurisdiction. Television Events
& Mktg., Inc. v. Amcon Distrib. Co., 416
F.Supp.2d 948, 958 (D. Haw. 2006) (citing Schwarzenegger
v. Fred Martin Motor Co., 374 F.3d 797, 800-01 (9th Cir.
2004)); Haw. Rev. Stat. § 634-35. Under the Federal
Rules of Civil Procedure, service of process is sufficient if
it complies with state law for serving a summons in the state
where the district court is located. Fed.R.Civ.P. 4(e)(1).
Hawaii law permits service of summons by publication, when
personal service and service by certified mail has failed,
when the defendant resides outside of Hawaii, and only when
authorized by a court order. See Haw. Rev. Stat.
§§ 634-23, 634-24;
process to be satisfied, a defendant must have “minimum
contacts” with the forum state such that the assertion
of jurisdiction “does not offend traditional notions of
fair play and substantial justice.” Pebble Beach
Co. v. Caddy, 453 F.3d 1151, 1155 (9th Cir. 2006)
(citing Int'l Shoe Co. v. Wash., 326 U.S. 310,
315 (1945)). Here, the Court must determine whether it has
specific jurisdiction over Defendant Daniels. Specific
jurisdiction exists if (a) the defendant has performed some
act or consummated some transaction within the forum or
otherwise purposefully availed himself of the privileges of
conducting activities in the forum; (b) the claim arises out
of or results from the defendant's forum related
activities; and (c) the exercise of jurisdiction is
reasonable. Boschetto, 539 F.3d at 1021.