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Greenfield Fresh, Inc. v. Berti Produce-Oakland, Inc.

United States District Court, N.D. California

November 3, 2014




Plaintiff Greenfield Fresh, Inc. brought claims against Berti Produce-Oakland, Inc. ("Berti Produce" or "Defendant"), Raymond Mah, and Henry Chow for violations of the Perishable Agricultural Commodities Act, 7 U.S.C. §§ 499a-t (the "PACA"), and for breach of contract. (Dkt. No. 1.) Plaintiff executed service of summons on Berti Produce through the company's agent for service of process, Henry Chow. (Dkt. No. 13.) The Court subsequently dismissed all claims against Raymond Mah and Henry Chow pursuant to stipulation by the parties. (Dkt. No. 36.) Berti Produce, the only remaining defendant in this action, has not made an appearance, settled, nor filed consent, and its default has been entered. (Dkt. No. 31.) Now pending is Plaintiff's Motion for Default Judgment against Berti Produce on all claims pleaded in the Complaint. After carefully considering Plaintiff's submission, the Court concludes that oral argument is unnecessary, see Civ. L.R. 7-1(b), and orders as follows.


Plaintiff is a wholesale supplier of perishable agricultural commodities with offices located in Walnut Creek, California. (Dkt. No. 1, ¶¶ 1-2.) Defendant is a California company located in Oakland, California, formerly operating under a valid PACA license.[1] From November 22, 2013 through January 20, 2014, Plaintiff sold Defendant various items of produce. Id. at Ex. A. Plaintiff provided Defendant invoices for each shipment, all of which contain the following statement:

The perishable agricultural commodities listed on this invoice are sold subject to the statutory trust authorized by Section 5 (C) of the Agricultural Commodities Act of 1930 (7 U.S.C. 499e (C)). The seller of these commodities retains a trust claim over these commodities, all inventories of food or other products derived from these commodities until full payment is received.

Id. The invoices also require Defendant to pay for interest on "past-due account balance[s] at the rate of 1.5% per month (18% APR)" and "all costs of collection, including attorney's fees." Id.

Defendant never paid Plaintiff for any of the produce it received. (Dkt. No.1, ¶¶ 12-13.) The total price of the produce delivered was $25, 391.25. Id at Ex. A. Plaintiff seeks default judgment against Defendant in the total amount of $63, 718.32, representing the total amount of produce delivered plus prejudgment interest, costs, and attorney's fees.


I. Jurisdiction and Service of Process

When a court is considering whether to enter a default judgment it has "an affirmative duty to look into its jurisdiction over both the subject matter and the parties." In re Tuli, 172 F.3d 707, 712 (9th Cir. 1999). Here, Plaintiff alleges that Defendant has violated several sections of the PACA, a federal statute. Thus, the action arises under the laws of the United States, and the Court may exercise subject matter jurisdiction over the dispute pursuant to 28 U.S.C. § 1331. The Court has personal jurisdiction over Berti Produce-Oakland because it is a California corporation that engages in business activities in the Northern District of California.

A court is also required to "assess the adequacy of the service of process on the party against whom default is requested." Bd. of Trs. of the N. Cal. Sheet Metal Workers v. Peters, No. 00-0395, 2000 U.S. Dist. LEXIS 19065, at *2 (N.D. Cal. Jan. 2, 2001). Federal Rule of Civil Procedure 4(e) provides that service in accordance with California law is proper. Under California law, a corporation may be served by delivering a copy of the summons and of the complaint to the person designated as agent for service of process. See Cal. Civ. P. Code 416.10(a). Here, Berti Produce's agent for service of process was personally served with the Summons and Complaint. (Dkt. No. 13.)

II. Default Judgment

After entry of default, a court may grant default judgment on the merits of the case. See Fed.R.Civ.P. 55. The factual allegations of the complaint, except those concerning damages, are deemed to have been admitted by the non-responding party. Geddes v. United Fin. Grp., 559 F.2d 557, 560 (9th Cir. 1977). "The district court's decision whether to enter a default judgment is a discretionary one." Aldabe v. Aldabe, 616 F.2d 1089, 1092 (9th Cir. 1980). A court should consider the following factors in determining whether to enter default judgment:

(1) the possibility of prejudice to the plaintiff; (2) the merits of the 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 ...

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