United States District Court, C.D. California
ORDER GRANTING MOTION FOR DEFAULT JUDGMENT
D. WRIGHT, II UNITED STATES DISTRICT JUDGE
INTRODUCTION AND BACKGROUND
December 4, 2018, Plaintiff United States of America
initiated this in rem forfeiture action. (Compl., ECF No. 1.)
The government subsequently amended its complaint on January
10, 2019. (Verified First Am. Compl. (“FAC”), ECF
No. 10.) Through this action, the government seeks forfeiture
of $110, 186.35 in funds seized by members of the Los Angeles
County Sheriff's Parcel and Cargo Narcotics Enforcement
Team in November and December 2017. (FAC ¶¶ 8,
14-22.) The government alleges that the “defendant
funds represent or are traceable to proceeds of illegal
narcotic trafficking or were intended to be used in one or
more exchanges for a controlled substance or listed chemical,
in violation of 21 U.S.C. § 841 et seq.” (FAC
¶ 22.) The government alleges that, as such, the
defendant funds are subject to forfeiture pursuant to 21
U.S.C. § 881(a)(6). (FAC ¶ 22.)
are no known potential claimants to the defendant funds as a
result of a pre-judicial action settlement agreement. (FAC
¶ 7.) The government published Notice of Civil
Forfeiture for thirty days pursuant to the Supplemental Rules
for Admiralty or Maritime Claims and Asset Forfeiture
Actions. (Mot. for Default J. (“Mot.”) 1, ECF No.
20; Decl. of Katharine Schonbachler (“Schonbachler
Decl.”) ¶ 4, Ex. A, ECF No. 20-1.) Process was
executed on the defendant funds by the United States Marshals
Service in accordance with the Supplemental Rules.
(Schonbachler Decl. ¶ 5, Ex. B.) The time for filing a
claim or answer for all interested parties has expired and no
potential claimant has filed a claim or answer. (Schonbachler
Decl. ¶¶ 7-8.)
April 25, 2019, the Clerk entered default as to the interests
of all potential claimants regarding the defendant funds.
(Default, ECF No. 18.) On May 9, 2019, the government filed
its Motion for Default Judgment (“Motion”).
(Mot.) Pursuant to Local Rule 7-9, any opposition to the
government's Motion was due no later than twenty-one days
before the June 17, 2019 hearing date. The Court received no
opposition to the Motion.
Rule of Civil Procedure (“FRCP”) 55(b) authorizes
a district court to grant a default judgment after the Clerk
enters default under Rule 55(a). Fed.R.Civ.P. 55(b). Before a
court can enter a default judgment against a defendant, the
plaintiff must satisfy the procedural requirements set forth
in FRCP 54(c) and 55, as well as Local Rules 55-1 and 55-2.
Fed.R.Civ.P. 54(c), 55; C.D. Cal. L.R. 55-1, 55-2. Local Rule
55-1 requires that the movant submit a declaration
establishing: (1) when and against which party default was
entered; (2) identification of the pleading to which default
was entered; (3) whether the defaulting party is a minor or
incompetent person; (4) that the Servicemembers Civil Relief
Act, 50 U.S.C. § 3931, does not apply; and that (5) the
defaulting party was properly served with notice, if required
under Rule 55(b)(2). C.D. Cal. L.R. 55-1.
these procedural requirements are satisfied, a district court
has discretion to enter default judgment. Aldabe v.
Aldabe, 616 F.2d 1089, 1092 (9th Cir. 1980). “[A]
defendant's default does not automatically entitle the
plaintiff to a court-ordered judgment.” PepsiCo,
Inc., v. Cal. Sec. Cans, 238 F.Supp.2d 1172, 1174 (C.D.
Cal 2002). In exercising discretion, a court considers
several factors (the “Eitel Factors”):
(1) the possibility of prejudice to the plaintiff, (2) the
merits of 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 policy underlying the [FRCP]
favoring decisions on the merits.
Eitel v. McCool, 782 F.2d 1470, 1471-72 (9th Cir.
1986). The Court need not make detailed findings of fact in
the event of a default judgment. See Adriana Int'l
Corp. v. Thoeren, 913 F.2d 1406, 1414 (9th Cir. 1990).
Generally, after the Clerk enters default, the
defendant's liability is conclusively established, and
the well-pleaded factual allegations in the complaint are
accepted as true, except those pertaining to damages.
TeleVideo Sys., Inc. v. Heidenthal, 826 F.2d 915,
917-18 (9th Cir. 1987) (per curiam) (quoting Geddes v.
United Fin. Grp., 559 F.2d 557, 560 (9th Cir. 1977)).
reviewed the filings in this action, the Court is satisfied
that the government has met all procedural requirements for
obtaining a default judgment against the interests of all
potential claimants. Notice was adequately published and the
time for filing a claim or an answer has expired and no
claims or answers have been filed. The government has
satisfied the procedural requirements of FRCP 55 and Local
Rule 55-1: (1) the Clerk entered default against the
interests of all potential claimants on April 25, 2019; (2)
no potential claimants responded to the FAC; (3) no potential
claimants are infants or incompetent persons; and (4) no
potential claimants are in the military, so the Service
Members Civil Relief Act does not apply. (See Default, ECF
No. 18; Schonbachler Decl. ¶¶ 2-3, 8-11.)
the Court finds that on balance the Eitel factors weigh in
favor of granting the government's Motion. The
allegations establish that the defendant funds represent or
are traceable to proceeds of illegal narcotic trafficking or
were intended to be used in one or more exchanges for a
controlled substance or listed chemical, in violation of 21
U.S.C. § 841, et seq., rendering them subject to
forfeiture pursuant to 21 U.S.C. § 881(a)(6). In light
of the well-pleaded allegations in the FAC and no claims
having been filed, the government's interest in an
efficient resolution of the case outweighs any potential
claimant's interest in adjudication on the merits.
PepsiCo, 238 F.Supp.2d at 1177 (“Defendant's
failure to answer Plaintiffs' Complaint makes a decision
on the merits impractical, if not impossible.”).
the relief the government seeks, forfeiture of the defendant
funds to the United States for disposition according to law
(Mot. 12), is appropriate because it does not “differ
in kind from, or exceed in ...