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Fresh & Best Produce, Inc. v. Oaktown Ventures, LLC

United States District Court, N.D. California, San Jose Division

July 14, 2017

FRESH & BEST PRODUCE, INC., Plaintiff,
v.
OAKTOWN VENTURES, LLC, et al., Defendants.

          ORDER CONSTRUING PLAINTIFF'S COUNSEL'S DECLARATION AS A MOTION FOR RECONSIDERATION; GRANTING MOTION FOR RECONSIDERATION; AND GRANTING PLAINTIFF'S MOTION FOR DEFAULT JUDGMENT AGAINST DEFENDANT RICHARD HACKETT

          BETH LAB SON FREEMAN United States District Judge.

         On July 3, 2017, Plaintiff Fresh & Best Produce, Inc. filed a document titled “Declaration of Susan E. Bishop in Support of Second Request for Default Judgment as to Richard Hackett.” Bishop Decl., ECF 32. The document is a declaration of Plaintiff's counsel which acknowledges the Court's denial of Plaintiff's prior motion for default judgment against Defendant Richard Hackett (ECF 14) on the basis that Plaintiff had failed to establish this Court's personal jurisdiction over Hackett; asserts the existence of a new fact establishing the existence of personal jurisdiction over Hackett; and requests that the Court grant Plaintiff's prior motion for default judgment against Hackett. Id. The declaration relies on a proof of service filed by Plaintiff on June 16, 2017, showing personal service of process on Hackett within the state of California on June 7, 2017. POS, ECF 31.

         The Court construes counsel's declaration as a motion for reconsideration of the Court's prior denial of default judgment against Hackett based on a new fact. For the reasons discussed below, the Court GRANTS Plaintiff's motion for reconsideration and GRANTS Plaintiff's (previously denied) motion for default judgment against Hackett.

         I. BACKGROUND

         On December 6, 2016, Plaintiff Fresh & Best Produce, Inc. filed this complaint against Defendants Oaktown Ventures, LLC and its managing member, Richard Hackett. Compl., ECF 1. Plaintiff alleges that Oaktown, which then was doing business as Jack's Oyster Bar and Fish House, ordered and accepted produce from Plaintiff but failed to pay invoices due and owing in excess of $27, 000. Id. ¶¶ 2, 7-10. Plaintiff asserts claims against Oaktown for multiple violations of the Perishable Agricultural Commodities Act (“PACA”), 7 U.S.C. §§ 499a-499t, and for breach of contract. Id. ¶¶ 12-39. Plaintiff also asserts a single claim against Hackett for breach of fiduciary duty under PACA. Id. ¶¶ 40-49. Plaintiff alleges that as a result of Hackett's breach of fiduciary duty, Plaintiff “has incurred damages in the amount of $27, 053.06, plus interest from the date each invoice became past de [sic], costs and attorneys' fees.” Id. ¶ 47.

         Neither Oaktown nor Hackett responded to the complaint. Plaintiff obtained a clerk's entry of default against Oaktown and Hackett and then filed a motion for default judgment against both defendants. Clerk's Entry of Default, ECF 12; Motion for Default Judgment, ECF 14. At that time, the case was assigned to Magistrate Judge Nathanael M. Cousins. Judge Cousins issued a Report and Recommendation (“R&R”) recommending that Plaintiff's motion for default judgment be granted against Oaktown but denied against Hackett, and requesting that the case be reassigned to a district judge. R&R, ECF 22. The case thereafter was reassigned to the undersigned judge. Order Reassigning Case, ECF 23. This Court adopted the R&R, granted default judgment against Oaktown, and denied default judgment against Hackett. Order Adopting R&R, ECF 29. The basis for the denial as to Hackett was Plaintiff's failure to establish this Court's personal jurisdiction over Hackett. Id. The denial as to Hackett was without prejudice. Id.

         Plaintiff has filed a declaration of counsel requesting that the Court grant default judgment against Hackett based upon Plaintiff's subsequent personal service of process on Hackett within the state of California on June 7, 2017. Bishop Decl. ¶ 7, ECF 32; POS, ECF 31. As noted above, the Court construes the declaration of counsel as a motion for reconsideration of the prior denial of default judgment against Hackett.

         II. DISCUSSION

         A. Reconsideration

         In order to obtain reconsideration of an interlocutory order, the moving party “must specifically show reasonable diligence in bringing the motion” and also must show one of the following: (1) “a material difference in fact or law exists from that which was presented to the Court before entry of the interlocutory order for which reconsideration is sought”; (2) “[t]he emergence of new material facts or a change of law occurring after the time of such order”; or (3) “[a] manifest failure by the Court to consider material facts or dispositive legal arguments which were presented to the Court before such interlocutory order.” Civ. L.R. 7-9(a), (b).

         Here, Plaintiff has satisfied the second prong by showing the emergence of a new material fact occurring after the Court's denial of Plaintiff's motion for default judgment against Hackett, namely, personal service of process on Hackett within the state of California. Bishop Decl. ¶ 7, ECF 32; POS, ECF 31. Personal service of process on an individual who is voluntarily in the forum state is sufficient to confer personal jurisdiction over that individual even if his presence in the state is unrelated to the litigation. Burnham v. Superior Court, 495 U.S. 604, 628 (1990). Plaintiff therefore has established personal jurisdiction over Hackett. Because lack of personal jurisdiction was the basis upon which the Court denied Plaintiff's motion for default judgment against Hackett, the Court will reconsider its denial of that motion.

         B. Default Judgment

         Having determined that reconsideration is appropriate with respect to its denial of Plaintiff's motion for default judgment against Hackett, the Court now revisits that motion.

         1. ...


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