United States District Court, D. Hawaii
FINDINGS AND RECOMMENDATION TO GRANT IN PART AND DENY
IN PART PLAINTIFF FERRARI FINANCIAL SERVICES, INC.'S
MOTION FOR DEFAULT JUDGMENT AGAINST DEFENDANTS SEN MING LIN
A.K.A. SAM LIN AND AUTO X-CHANGE, INC.
RICHARD L. PUGLISI, UNITED STATES MAGISTRATE
the Court is Plaintiff Ferrari Financial Service, Inc.'s
Motion for Default Judgment Against Defendants Sen Ming Lin
a.k.a. Sam Lin and Auto X-Change, Inc., filed February 11,
2019. ECF No. 44. The Court found the Motion suitable for
disposition without a hearing pursuant to Local Rule 7.2(d).
ECF No. 45. After careful consideration of the Motion and the
record in this action, the Court FINDS AND RECOMMENDS that
the Motion be GRANTED IN PART AND DENIED IN PART.
filed this action against Defendants alleging various causes
of action related to the purchase and financing of a 2014
Lamborghini Gallardo in 2015 by Defendant Jason Yokoyama. ECF
No. 11. In the First Amended Complaint, Plaintiff alleges
that it entered into a contract in the amount of $168, 417.78
with Defendant Yokoyama to finance the vehicle purchase (the
“Contract”). Id. ¶¶ 10, 15.
Plaintiff alleges Defendant Yokoyama granted Plaintiff a
security interest in the vehicle to secure repayment.
Id. ¶ 12. Plaintiff alleges that if Defendant
Yokoyama fails to make payments under the Contract, the
Contract allows Plaintiff to take possession of and to sell
the vehicle. Id. ¶ 14. Plaintiff alleges that
Defendant Yokoyama is in default under the Contract because
he failed to make payments after January 2018. Id.
alleges that Defendant Yokoyama transferred possession of the
vehicle to Defendant Auto X-Change, Inc. and/or Defendant Sen
Ming Lin pursuant to an agreement. Id. ¶ 21.
Plaintiff alleges that Defendant Auto X-Change and/or
Defendant Lin and/or Defendant Yokoyama remain in possession
of the vehicle. Id. ¶¶ 22, 27, 38.
Plaintiff alleges that it has demanded that Defendant
Yokoyama, Defendant Auto X-Change, and Defendant Lin deliver
possession of the vehicle to Plaintiff, but Defendants have
refused. Id. 36-37, 39-40.
asserts claims for breach of contract and money lent against
only Defendant Yokoyama. Id. ¶¶ 10-19,
43-46. Plaintiff asserts claims for replevin and conversion
against all Defendants. Id. ¶¶ 20-42.
Yokoyama filed his Answer to the First Amended Complaint on
May 30, 2018. ECF No. 16. In his Answer, he denied the
allegations related to all of the claims asserted against
him, including the claims for replevin and conversion.
See ECF No. 16 ¶¶ 1, 4, 6-9. Pursuant to
Rule 55(a) of the Federal Rules of Civil Procedure, the Clerk
entered default against Defendant Auto X-Change and Defendant
Lin on June 27, 2018, and July 13, 2018. ECF No. 19, 22.
August 3, 2018, Plaintiff filed its first motion seeking
default judgment against Defendant Auto X-Change and
Defendant Lin. ECF No. 26. The Court denied Plaintiff's
first motion for default judgment without prejudice reasoning
that default judgment cannot be entered against Defendant
Auto-X-Change and Defendant Lin while the same claims and a
breach of contract claim against Defendant Yokoyama regarding
the same vehicle remained pending. See ECF Nos. 35,
on Plaintiff's filings, Plaintiff repossessed the Vehicle
on August 13, 2018. ECF No. 44-1 at 13. Thereafter, Plaintiff
and Defendant Yokoyama entered into a Stipulated Judgment
against Defendant Yokoyama in the amount of $149, 914.76,
plus post-judgment interest, which was approved by the Court
on September 26, 2018. ECF No. 37.
present Motion, Plaintiff asks the Court to grant default
judgment in favor of Plaintiff against Defendant Auto
X-Change and Defendant Lin and to enter judgment awarding
Plaintiff $7, 397.01 in damages, $11, 584.20 in
attorneys' fees, $257.81 in costs, and prejudgment
interest. ECF No. 44-1.
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. ofMarin 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 ...