United States District Court, C.D. California
TIM BEKINS, ET AL.
DMITRY ZHELEZNYAK, ET AL.
Attorneys Present for Plaintiffs: Tim Bekins, Pro Se.
Donald, Pro Se.
Present: The Honorable CHRISTINA A. SNYDER.
CIVIL MINUTES - GENERAL‘O'
PLAINTIFFS' MOTION FOR DEFAULT JUDGMENT AGAINST DMITRY
ZHELEZNYAK AND AKVINTA USA, INC. (DKT. 133, FILED JANUARY 30,
INTRODUCTION & BACKGROUND
12, 2015, plaintiffs Tim Bekins (“Bekins”), Tami
Donald (“Donald”) and Reba Barber-Money
(“Barber”), proceeding pro se, initiated
this action against defendants Dmitry Zheleznyak
(“Zheleznyak”), Jeff Becker
(“Becker”), Kristina Bucic (“Bucic”),
and Pavel Ryabov (“Ryabov”). Dkt. 1. In brief,
plaintiffs allege that they were California-based sales
representatives of Akvinta USA, Inc. (“Akvinta”),
a vodka distributor, but were not paid their salaries or
reimbursed for their expenses between November 2013 and May
2015. Plaintiffs also allege that Zheleznyak and Becker are
the alter egos of Akvinta.
October 9, 2015, plaintiffs filed a First Amended Complaint
(“FAC”) dismissing Ryabov as a defendant. Dkt.
11. On November 2, 2015, the remaining defendants moved to
dismiss on several grounds, including that the FAC failed to
name a necessary party, Akvinta. Dkt. 15. On January 11, 2016
the Court granted the motion but allowed plaintiffs leave to
amend. Dkt. 29. On January 14, 2016 plaintiffs filed the
operative Second Amended Complaint (“SAC”)
against Zheleznyak, Becker, and Akvinta. Dkt. 31. The SAC
asserts claims for (1) breach of contract; (2) fraud; (3)
deceit; (4) misrepresentation; (5) negligent
misrepresentation; (6) breach of the implied covenant of good
faith and fair dealing; (7) money had and received; (8)
violation of California's Unfair Competition Law, Cal.
Bus. & Prof. Code §§ 17200, et seq.;
and (9) violation of the federal Fair Labor Standards Act
February 1, 2016, defendants filed a motion to dismiss
plaintiffs' claims and to strike the SAC's alter ego
allegations pursuant to Rule 12(b)(6) of the Federal Rules of
Civil Procedure. Dkt. 34. On March 21, 2016, the Court
granted the motion in part and denied it in part. Dkt. 44.
Relevant here, the Court denied defendants' motion to
strike the alter ego allegations, finding that plaintiffs
sufficiently alleged facts demonstrating (1) a unity of
interest between Zheleznyak, Becker and Akvinta; (2) that
piercing the corporate veil is necessary to avoid an
inequitable result. Id. at 5-8. In addition, the
Court denied defendants' motion to dismiss the breach of
contract claim, finding that plaintiffs sufficiently pleaded
they had an oral agreement with Akvinta to serve as sales
representatives in California. Id. at 8-9. Finally,
the Court denied the motion to dismiss plaintiffs'
fraud-based claims, finding that the SAC alleged sufficient
facts to satisfy Rule 9(b)'s heightened pleading
standing. Id. at 15. On May 4, 2016, Becker filed an
amended answer and asserted cross-claims against Zheleznyak
and Akvinta. Dkt. 56.
September 27, 2017, counsel for Zheleznyak and Akvinta filed
a motion requesting to withdraw from the representation. Dkt.
107. On October 5, 2017, the Court granted the motion and
ordered Akvinta to retain new counsel. Dkt. 109. On December
11, 2017, the Court held a status conference but no
appearance was made by Zheleznyak or Akvinta nor on their
behalf. The Court ordered Zheleznyak to show cause why his
answer should not be stricken and default be entered against
him for not appearing at a court-ordered hearing. The Court
also ordered Akvinta to show cause why its answer and
counterclaim should not be stricken and default be entered
against it for not retaining new counsel nor having counsel
appear the hearing. Dkt. 123. Zheleznyak and Akvinta failed
to respond to the Court's order to show cause.
January 16, 2018, the Court struck Zheleznyak's answer
and Akvinta's answer and counterclaim, entered default
against both defendants pursuant to Rule 55(a) of the Federal
Rules of Civil Procedure, and directed plaintiffs to file an
application for entry of default judgment against Zheleznyak
and Akvinta. Dkt. 129. On January 22, 2018, the Court held a
pretrial conference at which counsel for plaintiffs and
Becker informed the Court that they had reached a settlement.
Dkt. 132. On January 30, 2018, plaintiffs Bekins and Donald
filed the instant motion requesting the entry of default
judgment against Zheleznyak and Akvinta. Dkt. 133
(“Mot.”). Having carefully considered
plaintiffs' motion and supporting declarations, the Court
finds and concludes as follows.
to Rule 55 of the Federal Rules of Civil Procedure, when a
party against whom a judgment for affirmative relief is
sought has failed to plead or otherwise defend, and the
plaintiff does not seek a sum certain, the plaintiff must
apply to the court for a default judgment. Fed.R.Civ.P. 55.
As a general rule, cases should be decided on the merits as
opposed to by default, and, therefore, “any doubts as
to the propriety of a default are usually resolved against
the party seeking a default judgment.” Judge William W.
Schwarzer et al., California Practice Guide: Federal Civil
Procedure Before Trial ¶ 6:11 (The Rutter Group 2015)
(citing Pena v. Seguros La Comercial, S.A., 770 F.2d
811, 814 (9th Cir. 1985)).
Ninth Circuit has directed that courts consider the following
factors in deciding whether to enter default judgment: (1)
the possibility of prejudice to plaintiff, (2) the merits of
plaintiff's substantive claims, (3) the sufficiency of
the complaint, (4) the sum of money at stake in the action,
(5) the possibility of a dispute concerning the material
facts, (6) whether defendant's default was the product of
excusable neglect, and (7) the strong policy favoring
decisions on the merits. See Eitel v. McCool, 782
F.2d 1470, 1471-72 (9th Cir. 1986). Granting or denying a
motion for default judgment is a matter within the
court's discretion. Elektra Entm't Grp. Inc. v.
Crawford, 226 F.R.D. 388, 392 (C.D. Cal. 2005).