The opinion of the court was delivered by: David O. Carter United States District Judge
ORDER GRANTING DEFAULT JUDGMENT
Before the Court is a Motion for Default Judgment ("Motion") filed by Federal Deposit Insurance Corporation ("FDIC") requesting that the Court enter default judgment against Defendants Lamarsh Financial, Inc. ("Lamarsh Financial"); Linda Mate ("Mate"); Eric Wexelman ("Wexelman"); Brisa Arenas ("Arenas"); Britten Kimbell ("Kimbell"); Yacou Lazar ("Lazar"); Rashel Saralan ("Saralan") (collectively, "Defendants") in the above-captioned case (Docket 68). After considering the moving papers and [oral argument], and for the reasons described below, the Court hereby GRANTS the Motion.
Plaintiff alleges that Lamarsh Financial, in conjunction with real estate professionals and individual borrowers, fraudulently obtained loans from Downey Savings and Loan Association, F.A. ("Downey"). The FDIC, as appointed receiver for Downey, now seeks damages to recover on claims of (1) breach of written contract, (2) professional negligence, (3) negligent misrepresentation, and (4). Complaint, ¶ 3.
Plaintiff first alleges that Arenas, Lamarsh Financial, Mate, and Zeny Lamarsh, Lamarsh Financial's alleged alter ego ("Z. Lamarsh"), submitted a fraudulent written loan application to Downey. Complaint, ¶ 14, 20. Lamarsh Financial, Z. Lamarsh, and Mate allegedly represented that Arenas earned a certain monthly income as a loan officer at a mortgage company. Id. at ¶ 15. In reliance on these representations, Downey made a refinance loan to Arenas for $318,000. Id. at ¶ 14. On July 10, 2008, Arenas allegedly defaulted on the loan payments, which ultimately resulted in an alleged loss of $224,000. Id. at ¶ 18, 21.
The facts are similar for the other loans at issue. Downey made a refinance loan in the amount of $436,00 to Kimbell and Chris Wells ("Wells"), a previous defendant. Id. at ¶ 31. The Kimbell/Wells loan was allegedly induced by fraudulent statements from Kimbell, Wells, Lamarsh Financial, Z. Lamarsh, and Wexelman. Id. at ¶ 32. On January 22, 2008, Kimbell and Wells allegedly defaulted on their loan payments, resulting in a loss of $301,00. Id. at ¶ 35, 38.
Similarly, Downey allegedly made a refinance loan to Lazar in the amount of $448,000 based on material misrepresentations by Lazar, Lamarsh Financial, Z. Lamarsh, and Sam David (initially incorrectly named as Benis Lazar). Id. at ¶ 39. On June 16, 2008, Lazar allegedly defaulted on his loan payments, resulting in a loss of $239,000 to Downey. Id. at ¶ 46.
Finally, Downey made a refinance loan to Saralan in the amount of $396,000 based on alleged fraudulent misrepresentations by Saralan, Lamarsh Financial, Z. Lamarsh and Sam David ("David"). Id. at ¶ 47. On July 5, 2008, Saralan defaulted on payments, allegedly resulting in a loss of $288,000. Id. at ¶ 53, 56.
Federal Rule of Civil Procedure 55 provides that the Court may, in its discretion, order default judgment following the entry of default by the Clerk. Fed. R. Civ. P. 55(b). Local Rule 55 sets forth procedural requirements that must be satisfied by a party moving for default judgment. Upon entry of default, the well-pleaded allegations of the complaint are taken as true, with the exception of allegations concerning the amount of damages. See, e.g., Geddes v. United Fin. Group, 559 F.2d 557, 560 (9th Cir. 1977). However, "necessary facts not contained in the pleading, 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). Where the pleadings are insufficient, the Court may require the moving party to produce evidence in support of the motion for default judgment. See TeleVideo Sys., Inc. v. Heidenthal, 826 F.2d 915, 917-18 (9th Cir. 1987).
The Court begins by determining whether Plaintiff has complied with the applicable procedural requirements. The Court finds that Plaintiff has fulfilled its obligations under Fed. R. Civ. P. 55(a) and Local Rules 55-1 and 55-2 with respect to the entry of default judgment. Specifically, Plaintiff has identified the Defendants against whom the default is sought and have established that the clerk of the court entered a default against them (Docket 58 -- Lamarsh Financial, Docket 28 -- Arenas, Mate, Saralan, Wexelman, Docket 62 -- Kimbell, Docket 38 - Lazar). Plaintiff has attested that none of the Defendants are infants or incompetent persons and that no Defendants are in active military service. Decl. Wilcox, ¶ 3. Finally, Plaintiff has provided proof that Defendants were served with the Notice of Motion for Default Judgment. Having determined Plaintiff's procedural compliance, the Court turns to the substance of Plaintiff's Motion.
B.Sufficiency of the Claim
1.Breach of Written Contract
The essential elements of a contract are: (1) the existence of a contract, (2) that plaintiff performed or had an excuse for not performing the contract, (3) that defendants breached the contract, and (4) that plaintiff was damaged. First Commercial Mortgage Co., v. Reece, 89 Cal. App. 4th 731, 745 (2001). Here, Plaintiff ...