-FBS Pinpoint IT Services, LLC v. Atlas IT Export Corp., No. 2:2010cv00516 - Document 33 (E.D. Va. 2011)
Court Description: OPINION AND ORDER that the Court DENIES Defendant's Motion to Change Venue, GRANTS Plaintiff's Motion to Strike Defendant's Memorandum in Opposition to Motion to Certify Entry of Default, GRANTS Defendant's Motion to Set Aside Def ault, DENIES Plaintiff's Motion for Default Judgment and forCertification of Default as Final as to Counts I and III of the Complaint, and DENIES Plaintiff's Motion for Leave to File a Supplemental Brief. Signed by District Judge Mark S. Davis and filed on 7/13/11. (jcow, )
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--- UNITED STATES ' FILED DISTRICT COURT EASTERN DISTRICT OF VIRGINIA Norfolk Division PINPOINT IT SERVICES, JUL 1 3 2011 ClFHK.US C^/Mid COURT L.L.C., O^*^ K VA Plaintiff, v' Civil Action No. ATLAS 2:10cv516 IT EXPORT CORP., Defendant. OPINION AND ORDER This filed matter by to before both parties. ("Pinpoint" Judgment is or the Plaintiff "Plaintiff") has and for Certification Counts I and III Court of the of on a number of Pinpoint IT filed a "Motion for Default Judgment as motions Complaint," a Services, "Motion L.L.C. Default Final to as Strike Defendant's Memorandum in Opposition to Motion to Certify Entry of Default," Brief." and a Defendant, "Defendant"), has "Motion Atlas filed for IT just one Leave Export to File Corp. substantive Supplemental ("Atlas" motion, or entitled "Motion to Set Aside Default and to Change Venue."1 Defendant has also requested, regarding its on Motion two to Set separate Aside occasions, Default and oral to argument Change Venue. The Court notes that a "Motion for Sanctions" has also been filed in this case by a non-party, Robert L. Vaughn. The Court will address that motion in a separate Order. After examining the Complaint, memoranda, the Court finds the motions, that the facts and the associated and legal contentions are adequately presented and oral argument would not aid in the decisional process. Fed. R. Civ. P. 78(b); E.D. Va. Loc. Civ. 7(J). The matter is therefore ripe for decision. set forth below, Venue, the Court GRANTS For the reasons DENIES Defendant's Motion Plaintiff's Motion to R. Strike to Change Defendant's Memorandum in Opposition to Motion to Certify Entry of Default, GRANTS Defendant's Motion to Set Aside Default, DENIES Plaintiff's Motion for Default Judgment and for Certification of Default as Final as to Counts I and III of the Complaint, and DENIES Plaintiff's Motion for Leave to File Supplemental Brief. I. FACTUAL & PROCEDURAL HISTORY A. Plaintiff with its Pinpoint, principal Virginia, Compl. SI 1, Factual a History Virginia place of limited business in liability company Virginia Beach, filed this suit against Defendant Atlas, a corporation organized under the laws of Puerto Rico and with its principal place of business in Puerto Rico. Compl. f 2. The suit seeks a declaration of non-liability, with damages Compl. g[ 3, exceeding $75,000.00, Prayer when and seeks injunctive relief. for Relief. The events giving rise 2009, alleges breach of contract Plaintiff to entered this into suit began on September 24, an agreement with Advanced Health Media, L.L.C. ("AHM"), to provide facility in Chesapeake, Virginia. Compl. 26, 2009, wherein Plaintiff Defendant Puerto Rico on entered into would provide behalf of an that Defendant these to AHM's in turn, SI 7. IT Plaintiff was services on August agreement that Compl. required with services so obtain favorable offshore labor costs. alleges IT to AHM Plaintiff if under Defendant 8-9. the from could Plaintiff contract to identify and hire forty-five consultants within 120 days of the execution of perform its the agreement in contract with AHM. order Compl. to 5 allow 10. Plaintiff However, to according to Plaintiff, Defendant breached this provision of the contract. Compl. Plaintiff st 15. also alleges that Defendant materially breached its contract by missing target deadlines and performing the contract poorly. asserts hire the that l 15. contract did Defendant, not require forty-five consultants by the target contract consultants 21, the Compl. at 5 merely were provided it to identify date but rates identified and hired by that if rather and that the forty-five date. Docket No. 3. According to Plaintiff, Defendant discount on the other hand, allowed for the contract between Plaintiff and Plaintiff to terminate the contract without cause upon three months' notice and allowed Plaintiff to terminate the contract for cause at any time. Given an alleged material breach on the part Compl. fla 13-14. of Defendant, by letter of April 1, Defendant 2010, effective Plaintiff terminated the contract with March 25, 2010. Compl. because of Defendant's alleged breach, March 25, 2010, a 20. Further, prior to termination on Plaintiff amended its contract with AHM, which required the Plaintiff to hire consultants at a higher price in Virginia. Compl. a 17. On July 9, 2010, over three months after Plaintiff terminated its contract with Defendant, a letter contract Compl. 25, to and f 22. 2010, Plaintiff alleging challenging damages Court October in stating contract with contract, and any reason. breached III from the of the termination. which Plaintiff alleges tortiously interfered with its B. Complaint resulting termination Defendant also forwarded this letter to AHM on July amended contract with AHM. On the Defendant sent the seeks interfering an this 18, 2010, Plaintiff g[ contract 42. any Compl. filed seeks a Plaintiff not Count the with fl 53. its three-count Declaration entitled to did indebted from terminate not to Defendant for that two parties. Finally, from Plaintiff's its said alleges Defendant the breach II preventing further relationships with AHM. History was is between injunction I that Plaintiff Compl. 26. Plaintiff Count Defendant, that SIS! 24, Procedural Court. that Compl. Defendant Count tortiously contractual The president of Atlas, Julio Pamias, service of process papers on November 16, Docket No. 15, 7, 2010 pursuant to Rule Federal Rules of Civil Procedure. Fed. R. Defendant did requested that not file the default on December 16, Jane No. local judgment 23, and for Counts response, aside Court I Docket No. III and 25, to already submitted a vice Atlas, hac Plaintiff the 2010, change filed The Clerk entered Defendant pro However, 2010. for motion Docket No. Defendant Docket No. motion to final as No. aside set Docket 11. 13. filed a motion Docket for for default judgment as venue. a on December filed a motion Complaint. the against 8. appear of default 7. of Plaintiff Docket No. for 2010, on December had 6; 12{a)(l). When pleading, certification of default and default Defendant Docket No. 12 (a) (1) P. enter which was granted on December 21, On December to of 2010. to Civ. responsive 2010. counsel Becker Whitaker 9, a Clerk Defendant on December 15, 2010, 2010. at 9. Defendant was required to file a responsive pleading by December 20, personally received 15. In to set Although default, it did not file its Memorandum in Opposition to Plaintiff's Motion to 17. Certify Entry of On January 24, Default 2011, until January Plaintiff Defendant's Memorandum in Opposition of a memorandum Default Docket No. along with 18. On January 28, filed 18, 2011. a motion to Motion in support 2011 and March 22, Docket No. to strike to Certify Entry of that 2011, motion. Defendant requested a and to hearing Change regarding Venue. its Docket Motion No. 20, to Set Aside 23. On May Default 11, 2011, Plaintiff filed a motion for leave to file a supplemental brief in further support of Plaintiff's response to Defendant's motion to set aside default and to change venue. Docket No. 24. The analyzed first in for Court to Court addresses these motions below. II. Defendant's order to Motion determine to whether DISCUSSION Change Venue it necessary is is this rule on any other motion. The Plaintiff's Motion to Opposition to Motion to Strike Defendant's Memorandum in Certify Entry of Default is analyzed next because of the motion's potential effect on the analysis of Defendant's Motion to Set Aside Default. opposition is stricken from the record, that Defendant may have raised the Court when deciding whether in it If memorandum in any meritorious defenses may not there the is be considered by "good cause" to grant Defendant's Motion to Set Aside Default. Defendant's Motion to Set Aside Default will be considered next since the Plaintiff's Motion Certification of Default Judgment for Default as Final as Judgment and to Counts I for and III of the Complaint will require no analysis from this Court if Defendant's Motion to Set Aside Default is granted. hand, On the other if Defendant's Motion to Set Aside Default is denied, the Plaintiff's motion analysis the by regarding Court. default Finally, the judgment Court will also will require consider Plaintiff's Motion for Leave to File Supplemental Brief. A. Motion to Change Venue 1. Personal Jurisdiction a. Since states the parties and subject Standard of Review in this the is for matter demand an amount $75,000, case basis of diversity of citizenship. U.S. Const, art. Ill, U.S.C. aside default transfer venue, However, in Defendant its motion does jurisdiction over its person. objection to personal of the Federal contend jurisdiction Rules to set that this on the § 2; 28 Court and lacks Although Defendant has raised the the default and transfer venue, 12 (b) satisfied different than greater of this 1332. is citizens for § jurisdiction case are of in its motion to set aside rather than a motion under Rule Civil Procedure, the Court will nonetheless address the merits of Defendant's contention. When personal the plaintiff possesses jurisdiction is bears personal the jurisdiction evidence. Mylan Labs., Cir. 1993); Combs v. burden challenged by the defendant, of by proving a the preponderance Inc. v. Akzo, N.V., Bakker, that 886 F.2d 673, 2 F.3d 56, 676 court of the 59-60 (4th (4th Cir. 1989). The plaintiff must make a prima facie demonstration of personal jurisdiction when the court decides personal jurisdiction based solely on "motion papers, allegations in Geometric Ltd., 886 F.2d showing, at the supporting complaint." 561 F.3d 273, 676). "the In court memoranda, Consulting 276 a all the y. (citing Combs, plaintiff's construe and Corp. Eng'rs (4th Cir. 2009) evaluating must legal prima relevant facie pleading allegations in the light most favorable to the plaintiff, credibility, and existence jurisdiction." where of "the draw the defendant present favorable Combs, provides essential for jurisdiction, dismissal, most 886 inferences F.2d evidence at 'the plaintiff must, sufficient evidence to for 676. which assume In the cases denies facts under threat of create a factual dispute on each jurisdictional element which has been denied by the defendant and on evidence.'" Colt Def., 2:04cv258, 2004 U.S. 22, (quoting 2004) Leasing Corp., Court 737 demonstration of L.L.C. v. Heckler & Koch Def., Indus. Carbon Corp. v. Supp. that 925, personal made although at has trial. Moore's Federal Practice SI 12.31 See 2 (3d ed. inc., (E.D. Va. Va. made at 1990)). a this stage 2011). Wm. Oct. If this facie in the jurisdiction determinations James No. Equip. prima if it has personal factual presented Equity Auto & (W.D. jurisdiction this matter, 926 Plaintiff over be has at *29-30 the Court will proceed as may defendant LEXIS 28690, case, contrary the Dist. F. determines which Moore to the et al. , Personal jurisdiction is determined by utilizing a two-part test. First, the long-arm statute of the applicable state must authorize the exercise of personal jurisdiction, and second, the application of the long-arm statute must be consistent with the Due Process Clause of States Constitution. arm portion section of Fourteenth Geometric, the 8.01-328.1 the of Amendment 561 F.3d at 277. analysis, Virginia's the United As to the long- long-arm the Code of Virginia, court may exercise personal to statute, provides that jurisdiction over a person, "[a] who acts directly or by an agent, as to a cause of action arising from" a number of enumerated business in this services or things activities, including Commonwealth," in this ¢[transacting "[c]ontracting Commonwealth," and to any supply w[c]ausing tortious injury by an act or omission in this Commonwealth." Va. Code § 8.01-328.1(A). The long-arm statute an act is committed in the Commonwealth if computer or computer network located in also specifies that the person "us[es] the Commonwealth." a Va. Code § 8.01-328.1(B). The long-arm statute further provides that "[w]hen jurisdiction over section, only a cause of action arising from acts enumerated in this section may be a person asserted is against based him." solely Va. upon Code § this 8.01- 328.1{C) . Virginia's personal long-arm statute has been determined jurisdiction to the extent permissible "to under extend the due process clause, [so that] constitutional Young v. the Geometric, New Haven Advocate, Moreover, for inquiry." the statutory inquiry merges with the jurisprudence Fourth nonresident which amounts F.3d 315 F.3d 256, of Circuit 561 the has United noted to at that «a 2002)). Court States (citing (4th Cir. 261 277 Appeals of single 'transacting business' act by a in Virginia and gives rise to a cause of action may be sufficient to confer jurisdiction upon contractual [Virginia] relationship telephone and mail. 40 (4th Cir. courts," even if that act is a mere conducted English & Smith v. 1990) (quoting Danville Fancy Kitchens, Inc., Corp. of Am. Hollywood Brands, Cir. v. entirely 238 S.E.2d out-of-state via 901 F.2d 36, 38- Metzger, Plywood Corp. 800, Inc., 802 (Va. 696 v. Plain 1977)); F.2d 311, & Peanut 314 (4th 1982). With respect requirement 'minimum the due satisfied is to if contacts' maintenance of the with (quoting Int'l Shoe Co. order to prove that forum state, "'purposefully forum' and the the prong, the defendant has forum not state such offend traditional justice.'" Geometric, v. Wash. , due 326 U.S. process "sufficient that 'the notions of 561 F.3d at 277 310, 316 (1945)). In the defendant had minimum contacts with the plaintiff directed that the the suit does fair play and substantial process his must prove activities plaintiff's 10 cause that at the of action the defendant residents of the 'arise[s] out of those Burger activities." King Corp. Furthermore, haled Corp. has into v. the v. in sufficient a U.S. 286, at 277 (quoting 462, U.S. state. 297 472 (1985)). for exist anticipate World-Wide (1980). test contacts F.3d "reasonably forum three-part minimum 471 must the 444 Woodson, 561 Rudzewics, defendant court" utilized Geometric, Volkswagen The Fourth Circuit determining for being the whether defendant subjected to personal jurisdiction in the forum state: to be « Ml) the extent to which the defendant purposefully availed itself of the privilege of conducting activities in the State; (2) whether the plaintiffs' claims arise out of those activities directed at the State; (3) and would be 278 whether constitutionally (quoting ALS Scan, 293 F.3d. the 707, 712 Inc. v. (4th Cir. argues pressing Defendant Defendant Puerto in argues Rico corporation, Puerto that including implying this Defendant's instead alleges jurisdiction Digital Serv. that with In Geometric, jurisdiction 561 F.3d at Consultants, Inc., Analysis of forum. personal 2002)). jurisdiction because the of reasonable.'" b. Defendant exercise that its Court lack motion Plaintiff Rico for Plaintiff has is personal meaningful of lacks contact to transfer subject several First, other business relations Puerto majority interest in that venue Puerto Rico 11 to personal reasons. a in venue, a would in Rico also be proper. Second, Defendant services of Defendant in argues that Plaintiff sought the Puerto Rico and fully negotiated and executed the contract between Plaintiff and Defendant in Puerto Rico. out Finally, of Defendant implies Defendant's performed all activities services required that the claim does not arise in Virginia under the since Defendant contract in Puerto Rico. Plaintiff jurisdiction argues over that this Defendant Court since the can exercise Defendant's within the reach of Virginia's long-arm statute, is not violated. Plaintiff executed the any statute, Code Defendant this Commonwealth" Virginia. that order to § as since Code the by § is and due process Defendant Virginia, provided to its which in and constituted Virginia's Second, long-arm Plaintiff argues services or things in contract required Defendant to located in computer 8.01-328.1(A)(2). without negotiated supply using accessing Virginia, complete in that 8.01-328.1(A)(1). "contract[ed] Defendant's Chesapeake, contract contract Va. argues business" that the first final "transacting perform conduct In regards to the reach of Virginia's long-arm statute, va. personal of Plaintiff with performing an act within the forum since also computer AHM's downloading contract servers servers in servers, in from Plaintiff, constitutes "[u]sing a computer or computer network located in the Commonwealth" 12 the argues constitutes an act in Virginia. Va. Code § 8.01-328.1(B). Finally, Plaintiff argues that Virginia's long-arm statute reaches Defendant due to Defendant's tortious interference with Plaintiff's contract with AHM. Va. Code § 8.01-328.1(A)(3). Plaintiff also argues that due process is not violated and the three-part test set forth in Geometric is satisfied. First, Plaintiff argues that "defendant purposefully availed himself of the privilege of conducting activities in the State" by reaching into Virginia to negotiate modifications to the contract and by forwarding the Virginia so contends that training in that final that draft Plaintiff Defendant order Defendant was to of could sent contract execute team perform required the the to to it. leaders Plaintiff in also to Virginia for with contract access Plaintiff Plaintiff and computer servers located in Virginia on a daily basis in order to fulfill its obligations under the contract. "arise out of Plaintiff's Second, those claims activities of reasonable" being haled activities personal since into directed at revolve around Defendant's its contract with Plaintiff. exercise Plaintiff asserts that its claims do Finally, jurisdiction should court Virginia and contacts in have be 13 since alleged breach of constitutionally reasonably because in Virginia stemming with Plaintiff. State" Plaintiff argues that "the would Defendant the of anticipated its business from its contract The Court finds that Plaintiff's arguments satisfy the prima facie showing needed to demonstrate this Court's personal jurisdiction facts the over Defendant. supporting personal evidence standard, Plaintiff has clearly asserted jurisdiction under a preponderance of and this Court must "construe all relevant pleading allegations in the light most favorable to the Plaintiff, assume credibility, and inferences for existence of jurisdiction." at 676. Court the exercise without merit. most favorable 886 F.2d this personal While Defendant's subject to personal the Defendant's allegation that For the above reasons, cannot draw jurisdiction claims that Combs, over Defendant Plaintiff is is also jurisdiction in Puerto Rico are not grounds upon which this Court could conclude that personal is improper in this forum, jurisdiction such allegations may factor into the determination of whether transfer of venue is warranted. 2. a. In its Motion Defendant requests States 1391 to Standard of Review Set Aside Default and to Change Venue, that this Court transfer venue to the United District Court of Title 28 of is proper Transfer of Venue for the District of Puerto Rico. the United States Code provides for a diversity of citizenship action in a Section that venue "judicial district in which a substantial part of the events or omissions giving rise to the claim occurred" or in a "judicial district in 14 which any defendant is subject to personal jurisdiction at the time the 1404(a) action both venue but § serve in as or 1404(a) for U.S. 612, Carefirst Cir. Urgent 2002) otherwise," the from (noting that transfers are L.L.C., is no this Court, under indication any justice." In the 1404(a). civil This action 305 253, its under any of parties 28 U.S.C. order district where to and Barrack, Inc. other a when personal Since in transfer request district district in (4th laid venue or if the transfer is witnesses, v. suggests technically proper). improperly has 255-56 language 1406(a) section allows "to plaintiff Van Dusen v. F.3d is contrast, of Md. , Plaintiff where it might have been brought" convenience in the Court will analyze Defendant's Section transfer that dismissal, Carefirst "[a]lthough proper of of sections in which venue whereas, also transfer both instead venue privilege." Ctr., the "Although that Section the United States forums premise See 1391(a). of transfer jurisdiction is lacking but venue is there 28 § authorize laid, (1964); Care which transfer on 634 u.S.C. Title allow improperly operates 28 circumstances. to properly exercised his 376 of statutes designed provides wrongly 1406(a) different broadly 1406(a) § commenced." and Section Code were is the court to division "[f]or the interest of court a 1404(a). determine the cause of whether action 15 the transferee is "might have been brought," the Court must determine whether plaintiff's claims been brought in the transferee court initially. Inc. v. Micromuse, Inc., 316 F. Supp. 2d could have Agilent Techs 322, 325 (E.D. Va. 2004). The phrase "might have been brought" has been interpreted to mean that "when a suit is commenced, sue in that district, Hoffman v. 316 F. Blaski, Supp. whether claims independently of the wishes of defendant." 363 2d at plaintiff has a right to U.S. 324 could 335, 344 (1960); (noting that be brought court must in decision in to 2d 824, Douglas, transferee transfer venue One Beacon Ins. Supp. the Co. 828 Inc., v. (E.D. 806 exercising this factors to include "'(1) convenience obtaining of the compulsory Supp. the of familiarity interest of of (5) at with justice.'" to access attendance court's the parties decided If the claims could have the subsequent discretion of 591 witnesses; interest in in One Beacon Ins. 312 factors (2) the cost of having law; F. of local cases, and In several availability diversity Co. , 1992)). the F. Hunter These (3) the (6) v. proof; (4) applicable 16 of court. 312 consider venue. sources witnesses; the Corp., Va. will transfer and home; (E.D. Court to the the (citing Verosol B.V. 582, before initially, the 2004) whether process; controversies Va. discretion, ease in court JNB Storage Trailer Rental F. determine is court first determine transferee considering whether to transfer venue). been brought See also Agilent, (7) Supp. the the 2d at 828 (quoting BHP mt'l Inv., Supp. is 2d 493, also 498 Inc., 105 F. transfer venue, Va. 2000)). Plaintiff's choice of forum substantial given (E.D. inc. v. Online Exch., weight in and «[i]t is well a court's settled that decision a court to should rarely disturb a plaintiff's choice of forum unless the balance of hardships Servs., clearly Inc. v. favor Ralsky, transfer F. 203 . 2d Supp. . . ." 601, Verizon 623-24 Online {E.D. Va. 2002). b. First, the Court must Analysis consider whether the United States District Court for the District of Puerto Rico is a forum where the claim "might commenced. Since have the been brought" parties are when citizens of the action different and the demand is for an amount greater than $7 5,000, States has District subject matter citizenship. in Puerto resident Court for the jurisdiction Additionally, Rico since defendants with F. Supp. principal Def.'s place Mot. Therefore, 2d to 804, of Set on personal "[g]eneral their the jurisdiction," LG Elecs. 131 District Aside Puerto basis of jurisdiction is jurisdiction place of states the United Rico clearly diversity of also proper exists over business in Advance Creative Computer Corp., (E.D. business the principal v. 813 of was is Va. in Default 2001), Puerto and to and Rico. Change Defendant's Compl. f 2; Venue SI 1. the United States District Court for the District of 17 Puerto Rico appears to be a forum where the claim "might have been brought" for purposes of transferring venue under 28 U.S.C. 1404(a). Second, District the Court considers the fact that the United States Court Plaintiff's for the choice of Eastern forum. District This of choice Virginia will be is given substantial weight and will not be disturbed unless the balance of the remaining factors weighs in favor of the Defendant. In the first instance, choice of forum is the the Court observes that Plaintiff's Plaintiff's principal place of business, location where a substantial amount of the events and giving rise to this case occurred. The balance of the remaining factors does not counsel in favor of the Defendant's requested transfer. First, addressing Plaintiff weighs in argues favor Plaintiff, to Defendant's that of the ease argument of access retaining venue in sources proof, of proof According to the majority of the documentation can be transported Virginia Arthur to Virginia. or exists in digital form "location is entitled to little weight." & regarding R. Miller, ed. 2007) ("The the litigation Federal location is a of factor Practice records that and and therefore 15 Charles Alan Wright Procedure and documents should its be § 3853 relevant considered by (3d to the transferor court in determining the proper transferee forum on a motion under Section 1404(a) of 18 Title 28 of the United States Code and it numerous has been citations in many in the cases, note as is below. illustrated by However, the since most records and documents now can be transported easily or exist in miniaturized or electronic ubiquitous e-mail, (citations especially, Moreover, Plaintiff example, the has introduced indicating that the bulk of the documentary evidence is in Virginia. PL's Resp. to Def.'s Mot. and Venue Downing to for their location is entitled to little weight." omitted)). affidavits form, Change Defendant also argues, 18; to Set Aside Default Second in addressing this Aff. f factor, 23. While that the ease of access to sources of proof favors transfer of venue since the witnesses predominantly are located in Puerto Rico, this argument is applicable to the second and third factors involving convenience and cost of obtaining witnesses, a result, the Court finds that factor argues that one not factor one. counsels As in favor of venue is denying the transfer. Second, necessary Defendant for the convenience of transfer of parties and the Although Defendant lists at least nine witnesses Puerto Rico, Plaintiff party witnesses Carolina. Even that if also identifies reside in Virginia, both parties are that reside in approximately New Jersey, correct, witnesses. and ten non- and North witnesses on both sides will experience inconvenience in either jurisdiction, a transfer of venue that merely switches 19 the inconvenience from one party to the other generally will be refused. 15 Charles Alan Wright & Arthur R. Miller, Federal Practice and Procedure § 3849 (3d ed. which considers witnesses. counsel 2007). This logic also applies to the third factor, As the a result, in favor of Next, cost the of obtaining factors two the and attendance three also do of not transfer. availability of compulsory retaining venue in Virginia as well. process favors Plaintiff argues that seven of the ten witnesses identified by Defendant are either parties to the case Puerto Rico. witnesses or are employees of Plaintiff or its affiliate Plaintiff also asserts that only two of Defendant's could not be compelled to testify in Virginia, that their testimony would be immaterial to the case. further asserts compelled to that appear none in of its Puerto inconvenience Virginia. and Consequently, cost of this non-party Rico. argument based on availability of the in makes compulsory process their factor witnesses also Plaintiff witnesses Defendant may be no other other than to counsels but travel to favor of in this Court retaining venue. The Court must interests Defendant decided issues in of in also consider having argues Puerto Puerto that local its the parties' controversies interest Rico weighs Rico law in that 20 in its decided having favor should be and the because localities' at home. controversy there determined by are the United States District Court However, law, for the District of Puerto Rico. according to the Complaint and Plaintiff's memoranda of Plaintiff's breach of contract claim and claim for injunctive relief arose from Defendant's contractual obligations to be performed in Virginia, maintained by AHM in Chesapeake, Resp. 23. the to If Def.'s Mot. to Set such an allegation breach of Virginia. Aside is contract utilizing claim Compl. Default true, computer and Virginia brought 5 a 4-5; Pi. ' s Change Venue to law will by servers apply to Plaintiff since "Virginia adheres to the principle that the law of the place of performance governs questions arising in connection performance of a contract." Equitable Trust Co. Management Corp., 514 Arkla Lumber and Mfg. 840, 842 Rico, (1926)). the F.2d Co. 565, v. court if venue is will apply transferor court would have applied. 37. Since this was Virginia, albeit Virginia law will arguably by a workers likely (4th Cir. 1975) the contract apply, factors (citing 132 S.E. transferred to Puerto same Van Pusen, employed the Bratwursthaus West Virginia Timber Co., Therefore, transferee 567 v. with to in law that 376 U.S. at 632- be performed Puerto Rico, five and the six in and support denial of the motion to transfer venue. Finally, favor of factors the interest Plaintiff. aimed at "This systemic of justice factor 'encompasses integrity 21 factor and also weighs public in interest fairness.'" Heinz Kettler GMBH & Co. 669 (E.D. v. Razor USA, Va. 2010) Supp. 2d 627, these two considerations, avoiding as 669-70. to inconsistent local well citizens, other one filed by Mem. 635 avoiding docket in Supp. of PL's Resp. Info. Servs., 2006)). 660, In examining conflicts already considered by Defendant of Mot. 2d congestion, unnecessary currently pending in the Supp. Equifax Va. F. courts often look to judicial economy, judgments, factors (E.D. While the Court recognizes this 750 (quoting Byerson v. 467 F- L-L-C" on L.L.C., after this the burden of law, the Court. as Id^ at that there is a suit similar Puerto Rico, action was that action was initiated. PL's for Leave to File Brief in Further Support to Def.'s Mot. to Set Aside Default and to Change Venue 3. As to the other considerations relevant to this factor, the Court is unable to say, the action However, the could proceed more in light of previous factor at this juncture, would factors have efficiently or in which district more seamlessly. the Court's determinations with respect to considered, very little the effect outcome of on Court's the this seventh ultimate determination of the transfer issue. As a result, given the analysis above, the balance of factors clearly weighs in favor of venue remaining in Virginia. Therefore, the Court DENIES Defendant's venue. 22 motion to transfer B. Motion to Strike Defendant's Memorandum in Opposition 1. Standard of Review Before considering Defendant's Motion to Set Aside Default, Plaintiff's Motion to Opposition must raised Defendant by considered After in be response. in filed 2011, 13; Local of the cause" motion whether set Rule can aside default in arguments memorandum to for Memorandum be default. judgment 2011 on to file a file its memorandum in opposition to for default Docket No. Civil determine opposition "good Defendant did not Docket No. to the its Defendant's Defendant had until January 6, plaintiff's motion filing analyzed determining Plaintiff December 23, Strike judgment until January 18, 2011. 17. 7 (H) complaint, of all this Court pleadings, states, n[a]fter the motions, briefs, and filings of any kind must be timely filed with the Clerk's Office of the Civ. division R. opposing 7{H). a in which Local motion the case is pending." Civil Rule 7(F)(1) "shall file a after service." E.D. Va. Federal Rules of Civil if service service 6(d), to is be made made 5(b){2)(E). Local Civ. R. Procedure adds under through Rule that 5{b)(2)(E), means. a party such (11) days Rule 6{d) to which Fed. Local and brief three days Given the rules above, Va. within eleven 7(F)(1). electronic 23 provides responsive supporting documents as are appropriate, E.D. of the this period allows R. Civ. for P. Defendant's response to Plaintiff's motion January 2011, 6, for default or judgment was fourteen days after 7(I) provides filed the 2010. an extension of time relating to motions must be in writing and, in R. Rule than for general, Civil later Plaintiff motion for default judgment on December 23, Local due no that "requests will be looked upon with disfavor." 7(1). Rule 6(b)(l) of the Federal E.D. Rules of Va. Loc. Civil Civ. Procedure provides that the court may give extensions for filing for "good cause." Fed. R. Civ. P. 6(b)(l). Rule 6(b)(l)(B) extension for good cause may be given states that an "on motion made after the time has expired if the party failed to act because of excusable neglect." filing Nat'l Fed. had R. Civ. already Wildlife (explaining 6(b)(l)(B). passed, Fed'n, that P. "any Rule 497 Since 6{b)(l)(B) U.S. 871, postdeadline the deadline governs. 896-97 & extension Lujan n.5 must for v. (1990) be 'upon motion made,' and is permissible only where the failure to meet the deadline 'was the result of excusable neglect'" and n[a]fter the time for filing has expired . . the No time only 'upon requesting of Defendant's Memorandum Certify the the motion.'"). Entry Court of in an . the court motion extension Opposition Default. to of . was . . may extend made time Plaintiff's Therefore, by for Atlas filing Motion excusable to neglect analysis is not relevant since Defendant failed to make a motion 24 pursuant to Procedure. Rule Fed. 6(b){l)(B) R. Civ. P. of Based on these rules, to January 6, outside 2011. of the Court, the its Rules the Court finds Civil that the deadline for opposition memorandum was deadline of Analysis Since Defendant the on no later than filed its opposition memorandum January 18, 2011, without leave of the Court GRANTS Plaintiff's motion to strike it from record. 577-78 file Federal 6(b)(l)(B). 2. Defendant the See, (E.D. e.g. , Va. 2009); 2008 U.S. Dist. Key v. Robertson, Rossman v. LEXIS 78925, at *5 626 F. Lazarus, No. (E.D. Va. Oct. Supp. 2d l:08cv316 7, 566, (JCC), 2008). C. Motion to Set Aside Entry of Default 1. The Court must Standard of Review next consider aside entry of default. Rule 55(a) Procedure states, affirmative defend, relief is a enter default the party's judgment against failed to Rule default." resulting entered by the clerk pursuant pursuant has to 55(b)(2). whom to Fed. from to Rule Rule set of the Federal Rules of Civil party sought motion a plead judgment or R. such 55(b)(l) 55{b)(l) Civ. for otherwise and that failure is shown by affidavit or otherwise, clerk must Entry of "[w]hen Defendant's the P. 55(a). "default" may be or by the court states, »[i]f the plaintiff's claim is for a sum certain or a sum that can be made certain by computation, the clerk-on 25 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)(l). Rule 55 (b) (2) states, «[i]n all other cases, the party must apply to the court for a default judgment." court The accounting, may determine allegations, or investigate Rule 55(c) Fed. R. Civ. Rule 55 (c) P. . . R. v. is a Wagman Constr. matter Corp., In considering whether party reasonable has less F.3d of 198, Payne 204-05 {4th truth of of Civil Procedure, for good cause." motions largely lies made under within the Masonry & Fireproofing, F.2d 249, 251 exists to (4th Cir. set 1967). aside default a court should consider "whether the the action, ex an determine whether of defense, personal whether and rel. Cir. the Estate 2006). it acts responsibility the prejudice to the party, dilatory drastic." 383 conduct 55(b)(2). Rules Consol. meritorious promptness, defaulting party, history a to P. which "good cause" judgment under Rule 55(c), moving Civ. disposition discretion of the trial judge." Inc. matters Federal "The to the aside an entry of default 55 (c). . the hearing establish other Fed. of "[t]he court may set a damages, to enter default judgment. Under hold Calzada The of the whether there is a availability of with of v. criteria sanctions Brake, must 439 be "liberally construed in order to provide relief from the onerous 26 consequences of Arthur Murray, in defaults Inc., an unpublished also noted that reserved for and default 816 F.2d 951, decision, judgments." 954 a panel (4th Cir. of the "the extreme sanction of only cases where the Lolatchy 1987). v. Although Fourth Circuit has judgment by default party's is noncompliance represents bad faith or a complete disregard for the mandates of procedure and de Venez. v. (4th Cir. 1993) has "repeatedly also the disposed Inc. v. of Parada Jimenez, the trial court." 989 F.2d 494, expressed a strong Mobil Oil 1993 WL 616863, (unpublished table decision). general matter, be authority Co. at *3 The Fourth Circuit preference that, as a defaults be avoided and that claims and defenses of on Hoover their merits." Universal, Inc., Colleton 616 F.3d Preparatory 413, 417 Acad., (4th Cir. 2010). 2. In aside order to default consider the determine judgment "good them in Defendant's favor. The Court defense v. Host (citing or & "has Trueblood cause" Defendant, factors Lolatchy, while exists the Court liberally to set will construing 816 F.2d at 954. discretion to determine whether a proffered L.L.C., v. "good Meritorious Defense counterclaim Cook, whether against cause" a. Analysis is meritorious." 239 Grayson F.R.D. Shops 27 Bank 441, of of Southside Va. 445 (E.D. Va. Tenn., Inc., 32 2007) F.R.D. 190, 196 (E.D. Va. meritorious, the would permit a establish valid Inc. v. 1988) a Fodor "allege[] finding for is (3d Cir. meritorious pointless. Indigo Am., 1, Cir. (1st makes little 2010) the defenses 728 of Defendant's because from L.L.C., defense the default 597 F.3d exists, et SI 55.70 (3d the claims made Court will Practice look at default, it Moore the entry of must See 10 James Wm. Federal the a so would merely delay the inevitable."); Therefore, aside Cir. Currency, relief Big Impressions, (4th conclusionary U.S. ("Where no meritorious set or analysis makes Coatings, proffering consideration defenses or which would for in be "which 812 but the one 808, denials to to doing Moore's to F.2d simple vital be Fiberglass burden The v. defense only $55,518.05 v. Inc. a as al., sense 843 onerous, 1984). absence must Augusta The beyond is for defaulting party Corp., States defenses 4 the not facts meritorious of order evidence omitted). United 195 of Contracting specific 192, In counterclaim." defense statements." F.2d proffer (citations meritorious 1963)). ed. by 2011). Pinpoint and the defenses to those claims which Atlas has asserted. In Count I, Plaintiff seeks a declaration that it was entitled to terminate the contract between it and Atlas because of Atlas' breach, Atlas material breach, and for a any declaration reason. a declaration that that Compl. g[ 28 Plaintiff 42. is Although Plaintiff did not not the indebted Defendant to has not addressed Defendant's contract cause Defendant, to filings first, without Mot. defenses Count argue not with was to that I one contrary to Set Aside Default the most Plaintiff Defendant, only in by month the in fact notice, terms of and to Change Venue S[ namely to was terminating it whether Defendant the without the cause has in first contract. That issue is breach fact at Ex. 1. meritorious, contract by depends on proffered the is Def.'s the improper to Id. to notice, with Defendant did not breach prior according 8; I the contract agreement. to Count Plaintiff the which the manner, breached terminating Whether Defendant's proffered defense that orderly evidence more properly addressed the terminating Plaintiff that the in the analysis of whether the Defendant has introduced a meritorious defense to Count II. Court Therefore, determines defense to the that Count II, Court will Defendant then turn to Count alleged Defendant the has has II. a If the meritorious necessarily also introduced a meritorious defense to Count I. In three the posited turn. II independent between has Count two a to missing target Plaintiff's ways in parties. meritorious According failing of hire to the the which The Complaint, deadlines, and Atlas Court defense requisite Complaint, breached will to number address each Atlas of the of alleges contract whether these materially performing 29 Plaintiff Atlas claims in breached by qualified consultants, the contract poorly. Compl. I 15. After examining Atlas' and to Change Venue, Docket No. text itself of the motion Pinpoint's claims. believes this transferred Atlas' venue to the is Motion to Set Aside Default 15, the Court concludes that the proffers no meritorious defenses to response merely asserts reasons why it improper District of and Puerto why the Rico. case be assertions Such should do not address the merits of Plaintiff's lawsuit. The motion does state that contract was erroneous because Pinpoint's "no just termination cause existed." alone were the sole argument proffered by Atlas, be unable However, Venue to incorporates for is a suit, Plaintiff's As that to that to 1 from Atlas Atlas meritorious Set In to existed. Default that "no 1 Atlas' Pinpoint asserts defense Aside Exhibit to and to Change just cause motion, declaring Atlas' several this the Court would evidence as termination. Pinpoint's Pinpoint allegation for that intent counterarguments scrutinized the and project Although respect Atlas failed forty-five consultants, unreasonably decide whether with a If the to claims. requirements. not Motion the project with proposed that Exhibit the letter file staff conclude Defendant's existed" which to of constantly the Court or not it to the first the is meritorious 30 of candidates this that the it the Atlas staffing defense, because breach, adequately letter claims changed considers claim the to it need concludes Court need not look further than the Complaint. contract to It perform the the for to merely subsequently clear appears than the While facts contract, terms consultants the rates the order of pursuant consultants of affect an in charged argument of number forty-five may as the that making execution. the that forty-five It developed of the contract attached to the influences rather contract interpretation hire contract. hired of altogether Atlas contract, mandatory and not require consultants to is terms the parties the initial Court's matter the contract does not appear to mandate forty-five consultants. As to Pinpoint's deadlines, such conduct alleged "day to Default of letter day" of Ex. could Pinpoint the Court indicates occurred, changing scrutiny Court the second allegation of and consultants. further facts conclude whether such permissible of missed target deadlines Lastly, allegation, as of the to the be under and would the Pinpoint's criteria" and Mot. be alleged to from excessiveU" to Set Aside needed before behavior contract, defenses if at on the this this part point, to the allegation is without any merit. Pinpoint's contract, reasons deadlines, attributed Def.'s that Atlas' missed target missed "consistent[] While was the requirements Pinpoint's cannot conclude performance also "staffing potential 1. could that that Atlas third given provided 31 the by allegation vague Atlas nature in of of response poor this to allegations the one and allegation fully of recognizes letter and Lolatchy, Count 816 II defense its the F.2d the 954, completely Count I, Count III, interfering with Unlike Count Atlas' by and say that the Atlas the in apply Atlas' did defenses not to to Atlas' breach and is also plausibly meritorious. Plaintiff the when favor, Consequently, it this Court, Defendant's that to Court in accuses Atlas of tortiously the Amended Contract between Plaintiff II, Motion While vague, unmeritorious. asserting Pinpoint breached first, In cannot easily well. provided are liberally could as defenses memorandum at above performance defenses are to discussed poor that in construing two Court Set is Aside unable to Default construe and to any and AHM. aspect Venue Change of or memoranda as asserting a meritorious defense to this Count. As II and factor aside a result Atlas' does of lack not Atlas' of concerning regarding counsel in Counts Count of favor III, against or I the and first setting default. The prompt Court in promptness each defense clearly b. and allegations is next Reasonable considers responding to is determined evaluated "in occasion." United whether the at light States Promptness Defendant entry the of of default. discretion the v. 32 facts Moradi, was of and 673 the reasonably Reasonable trial judge circumstances F.2d 725, 727 of {4th Cir. 1982). default entry must of claim of v. " (A party act with default a and Airways to set aside reasonable promptness provide meritorious Pan Am. attempting underlying defense.'" Corp., 130 F. in entry responding facts in Wainwright's Supp. an to support Vacations, 2d 712, 718 (D. of the of a L.L.C. Md. 2001) (citation omitted). In the response from to present entry Defendant filed four however, motion days default and of default a until motion reasonably for In month nine day delay in by filing default Thus, the responding a venue judgment of a Court to of to vice two nine filed was set days to set that to after Plaintiff was Judgment, entered response to by Defendant the Court. Plaintiff's responded Because motion for 33 after aside to be respond filed a Motion for before default Defendant's default of could also be Although Defendant did not Default aside Defendant's considered reasonably prompt. the entry of default until did, days considered default was Plaintiff's within and in Court Defendant to concludes entry the hac motion motion default prompt by pro promptness change entry received admission reasonable to reasonably entered default. Wainwright's, after prompt. for clerk judgment was Nothing was motion the with motion one a after default. Defendant default. default Plaintiff's entry of respond for case, judgment promptness judgment should in be liberally construed in favor of Court Courts when in is have the 55.70 a for timely 10 (3d of negligence, in its to its to this factor default 2011). failure Moore When to Defendant was Wm. whether failure deny James ed. consider manner. discretion party's excusable must attributable negligence. SI also responsible Complaint favor, counsels Personal Responsibility of Defaulting Party ultimately failure Defendant's setting aside default. c. The in to setting answer obtain aside the al. , Moore's party's determining whether to set local this counsel. of the default result Federal default the Court may consider whether that entry or is Plaintiff's contends intentional et Defendant was of Practice the result the negligence was aside entry of default. Id. In the "agreed to No. 15, present case, take the case" 10. However, SI Defendant but alleges "failed to Defendant "take the Brief case" and was they served with exhibit attorney contained and an No. 26) submitted an Defendant were aware (Docket of an the then Plaintiff's email attorney that later they counsel it Id. Defendant's to Docket in never weeks at Ex. to did that before 2. Puerto contact a to File a demonstrated against attempted 34 that Complaint. between counsel admitted for Leave local exhibit proceedings local follow through." Response in Opposition to Plaintiff's Motion Supplemental that The Rico become local counsel 2010, and she had this of Defendant. Defendant's spoken with matter." Ex. Plaintiff's local a for in this Motion to order factor of if dated Rico "a Defendant timely in referenced favor of was failed to responsive 19, that ago about clearly and Defendant a November few weeks aware obtain pleading. denying evidence; (2) defaulting party's used by the Vick v. Wong, v. As Defendant's 2008 non-defaulting party delay made WL a ability to proceed determining prejudice, prejudice 325, 1944033, to 330 at trial the (3) to are or to present for Va. (E.D. Va. given 2009) 2008 May present 1, is non- the non- (4) fraud.'" U.S. Dist. 2008)). most and weight insufficient Id. was (quoting evidence the party. a (1) some the and commit inconvenience 35 default]: discovery; (E.D. non-moving prejudiced, hampered 3:07-CV-760, *4 party the party collude No. and mere to trial; to by was difficult complete Inc., non-moving more with to F.R.D. of it party Cos. , [caused non-defaulting proceed 263 TJX Party ability ability constitute the defaulting The 35839, to to Non-Moving the for party LEXIS it, file the whether defaulting Burton 26. counsels impossible its Puerto attorney No. Prejudice determine examine it to was Set Aside Default. MXTo made Docket email in the Virginia 2, d. courts attorney action against counsel result, The The the in to Furthermore, delay of only a few months generally prejudice to the non-moving party. Plaintiff has decision to by a on the merits. have to analysis, in the if set aside the Aside Default. default also has presenting two most Court Lolatchy, demonstrated Plaintiff difficulty trial, not Therefore, that and not this it or would let be the that in proceed it would proceeding the Defendant's factor weighs prejudiced case difficulty factors grant constitute 816 F.2d at 953. to evidence to not demonstrated important were does prejudice Motion to Set in favor of setting aside default. e. Courts often look dilatory action on to determine warranted. dilatory default. one to also of fail Plaintiff's but is Lolatchy, Defendant Defendant's file Complaint, to Certify tardiness fault 953. action to are other entry at Court at Entry in F.3d the which failed aside the a there instances the defaulting party as 616 F.2d dilatory to of setting solely 816 Defendant Motion the part blameless, instance whether Colleton, action is to whether See defendant History of Dilatory Action of will this timely the the attorney and the favor setting has Not "Memorandum 36 an in entry a opposition than only did response in file filing an aside had more matter. answer Default" is if in of default However, resulted its factor 418. Defendant in of a of to of in default, Opposition timely brief manner. led to Plaintiff's Defendant motion has knowledge was filed, many Defendant's excuses of legitimacy at blameless in the of as Pinpoint's noted lawsuit above. f. Alternative be to Neither party has will it, certainly such as associated the drastic Defendant's for reimbursement Plaintiff's Defendant's 816 have charged F.2d including motion motion at 953 with all costs attorneys' Therefore, this to to ("The the and or factor Complaint counsels entry that are of in set but respond. the Court brought and aside for expenses counsels to default before Plaintiff's strike even of failure attorney, fees, considering factor than motion with conclude Sanctions suggestions a action with Set Aside Default. any Lolatchy, court."). cure cannot before this consider to delay, less Court Although delays, suggested alternative sanctions, response been Alternative these weeks Therefore, sanctions imposed the brief. dilatory favor of denying Defendant's Motion to could for best, was Defendant its strike asserted varying degrees that to in Plaintiff's default. example, in See could attendant held costs to contempt favor the of of setting "good cause" aside default. g. The factors Court is required liberally and to by allowing Summary of the party to to Factors construe avoid the proceed 37 all "extreme to defend of the sanction" on of default the merits. While all of many set the of factors them aside do. certainly not the and allow Defendant action on the merits. GRANTED. Because reasons weigh For default Plaintiff's do Defendant's default motion for is stated Defendant's favor, above, the Court will proceed to motion set default in to defend this to set aside, judgment, aside the and default Court this is DENIES case will be allowed to proceed on the merits. D. Motion for Leave to File Supplemental Brief in Further Support of Plaintiff's Response to Defendant's Motion to Set Aside Default and Change Venue On May a 11, 2011, Supplemental to Brief Defendant's Docket new No. 24. obtain desires additional reasons because undermines The new counsel used to Aside come to local to claim in Court counsel are a of a for and good inaccurate. only determine aids in whether the the cause and analysis to 38 set of aside that Docket new No. to argue should be undermines Docket No. of 25. information failure one that regarding set aside that Defendant's Venue. brief brief representations made by Defendant. regarding File Response Change Defendant to to indicating supplemental alleges to supporting by motion Leave Plaintiff's light the file of Default to why Defendant's information local Support indicated Plaintiff any credibility of Set has Plaintiff denied to made filed a Motion Further Plaintiff representations to in Motion information attempts Plaintiff to the default. the 25. obtain factors The new information does not change the decision of the Court concerning Defendant's DENIES motion to Plaintiff's set aside motion for default. leave Therefore, to file a the Court supplemental brief. III. For Motion the reasons to Change Defendant's of DENIES stated above, Venue, Memorandum Default, GRANTS GRANTS Motion Certification of Default as and DENIES the Court DENIES Defendant's Plaintiff's in Opposition Defendant's Plaintiff's Complaint, CONCLUSION to Motion for Final Motion to Default as Plaintiff's Motion to Set Aside Motion for I Strike Certify Entry Judgment to Counts to Default, and and III Leave to of for the File a Supplemental Brief. The Clerk Order to all IT IS SO is DIRECTED counsel of to send a copy of this and record. ORDERED. Mark S. UNITED Norfolk, Opinion Virginia July 13 , 2011 39 STATES Davis DISTRICT JUDGE
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