United States District Court, D. Kansas
MEMORANDUM AND ORDER
D. Crabtree United States District Judge.
matter comes before the court on plaintiffs' Amended
Motion for Default Judgment against defendant McCusker
Holding Corp. Doc. 10. On February 15, 2018, the court held a
hearing on this motion. Both plaintiffs Regina Sergiyenko and
Russell Joly testified at the hearing and presented other
evidence. Plaintiffs asked the court to enter default
judgment against defendant McCusker Holding Corporation on
the three claims they assert against it: (1) Fair Labor
Standards Act (“FLSA”) violations, 29 U.S.C.
§ 201 et seq., (2) Kansas Wage Payment Act
(“KWPA”) violations, Kan. Stat. Ann. §
44-313 et seq., and (3) breach of contract.
Plaintiffs also made a damage request at the hearing, asking
the court to award them damages for unpaid contract wages,
unpaid overtime wages, unpaid expenses, liquidated damages,
state statutory penalties, and attorney's fees.
carefully considering the evidence adduced at the February
15, 2018 hearing and plaintiffs' submissions, the court
grants plaintiffs' Amended Motion for Default Judgment
against McCusker Holding Corporation and awards damages to
each plaintiff. The court awards plaintiff Regina Sergiyenko:
$13, 730.76 for unpaid contract wages, $2, 055.94 for unpaid
expenses, $4, 903.50 for FLSA unpaid overtime wages, $4,
903.50 for FLSA liquidated damages, and $13, 730.76 for KWPA
statutory penalties. The court awards plaintiff Russell Joly:
$16, 384.56 for unpaid contract wages, $5, 775.00 for unpaid
expenses, $3, 115.80 for FLSA unpaid overtime wages, and $3,
115.80 for FLSA liquidated damages. The court also awards
plaintiffs their attorney's fees in the amount of $17,
610.00 and costs in the amount of $1, 353.69. The court
explains how it reaches this decision below.
1, 2017, plaintiffs filed this lawsuit against their former
employers McCusker Holding Corporation
(“McCusker”) and Willard L.
McCusker. Doc. 1. Plaintiffs served the Complaint on
both defendants on July 10, 2017. Doc. 4. Neither defendant
responded to the Complaint or otherwise appeared in the
September 12, 2017, plaintiffs filed an Application for
Clerks Entry of Default against both defendants. Doc. 5. On
September 14, 2017, the Clerk entered default against both
defendants under Federal Rule of Civil Procedure 55(a). Doc.
January 11, 2018, plaintiffs filed an Amended Motion for
Default Judgment. Doc. 10. The motion seeks a default
judgment against defendant McCusker. On February 14, 2018,
plaintiff voluntarily dismissed defendant Willard L. McCusker
from the lawsuit without prejudice. Doc. 16. So, defendant
McCusker is the only defendant remaining in the case. The
court thus refers to McCusker as the
“defendant”-in the singular form-for the
remainder of this Order.
date, defendant never has answered or otherwise appeared in
this lawsuit. Defendant, thus, is in default. Also, defendant
never has appeared personally or by a representative at any
time in this case. Thus, written notice of the application
for default to defendant is not required. See Fed.
R. Civ. P. 55(b)(2) (requiring seven days' notice of the
application for default judgment only when “the party
against whom a default judgment is sought has appeared
personally or by representative”); see also
Winfield Assocs., Inc. v. Stonecipher, 429 F.2d 1087,
1091 (10th Cir. 1970) (denying relief from a default judgment
entered by a district court in Illinois without notice to
defendant because the Illinois court concluded that defendant
had not entered an appearance in the case); Local Union
No. 226 Int'l Bhd. of Elec. Workers Open End Pension Tr.
Fund v. Flowers Elec., Inc., No. Civ. A. 04-2237-CM,
2004 WL 2278562, at *1 (D. Kan. July 23, 2004) (holding that
defendant's acceptance of service was not an appearance
for purposes of Rule 55(b)(2), and thus concluding that no
written notice of the motion for default judgment was
required because defendant had not appeared in the action).
plaintiffs' counsel provided notice of their Amended
Motion for Default Judgment to defendant in several ways.
First, plaintiffs' counsel mailed copies of the Amended
Motion for Default Judgment and the Notice of Hearing on the
motion to defendant's registered agent in Nevada and to
Mr. McCusker's personal address in Texas. Also,
plaintiffs' counsel emailed the Amended Motion for
Default Judgment and the Notice of Hearing to Mr.
McCusker's email address. Plaintiffs' counsel
previously had used this email address to correspond with Mr.
McCusker. And plaintiffs' counsel sent the email with an
electronic read receipt verifying that the email recipient
received and opened the email.
Rule of Civil Procedure 55 provides a two-step process for
securing a default judgment. First, Rule 55(a) allows the
Clerk to enter default against a party who “has failed
to plead or otherwise defend” a lawsuit. Second, after
the Clerk enters default, plaintiff may request the Clerk to
enter judgment in an amount that is “a sum certain or a
sum that can be made certain by computation.”
Fed.R.Civ.P. 55(b)(1). But, when a plaintiff's claim does
not seek such a sum, plaintiff must apply to the court for a
default judgment under Rule 55(b)(2). When considering a
motion for default judgment, the court may hold a hearing if
“it needs to (A) conduct an accounting; (B) determine
the amount of damages; (C) establish the truth of any
allegation by evidence; or (D) investigate any other
matter.” Fed.R.Civ.P. 55(b)(2).
the default is established, defendant has no further standing
to contest the factual allegations of plaintiff's claim
for relief.” Mathiason v. Aquinas Home Health Care,
Inc., 187 F.Supp.3d 1269, 1274 (D. Kan. 2016) (citations
and internal quotation marks omitted). The court accepts as
true the well-pleaded factual allegations from
plaintiff's Complaint but not allegations about the
amount of damages. Id.
even after default, “‘it remains for the court to
consider whether the unchallenged facts constitute a
legitimate cause of action, since a party in default does not
admit mere conclusions of law.'” Bixler v.
Foster, 596 F.3d 751, 762 (10th Cir. 2010) (quoting 10A
Charles A. Wright et al., Federal Practice and
Procedure § 2688, at 63 (3d ed. 1998)). The
district court exercises broad discretion when deciding
whether to enter a default judgment. Mathiason, 187
F.Supp.3d at 1274.
default judgment also does not establish the amount of
damages. Id. at 1274-75. Instead,
“[p]laintiff must establish that the amount requested
is reasonable under the circumstances.” Id. at
1275 (citing DeMarsh v. Tornado Innovations, LP, No.
08-2588-JWL, 2009 WL 3720180, at *2 (D. Kan. Nov. 4, 2009)).
A court may award damages “‘only if the record
adequately reflects the basis for [the] award via a hearing
or a demonstration by detailed affidavits establishing the
necessary facts.'” DeMarsh, 2009 WL
3720180, at *2 (quoting Adolph Coors Co. v. Movement
Against Racism & the Klan, 777 F.2d 1538, 1544 (11th
Cir. 1985) (further citations and internal quotation marks
Findings of Fact
court finds that plaintiffs are entitled to recover damages
for their FLSA, KWPA, and breach of contract claims, based on
these facts, taken from plaintiffs' Complaint as well as
testimony and evidence presented at the February 15 hearing.
Both plaintiffs testified during this hearing. Defendant
neither appeared personally or by a representative at the
hearing. Defendant thus presented no witnesses or evidence on
its behalf. Defendant also did not cross-examine either
plaintiff. The court found each plaintiff's testimony
credible and incorporates their testimony into its factual
Facts Establishing FLSA and KWPA Violations and Breach of
is a company who assists other companies with processing
extended warranties. It operates a call center in Texas.
There, defendant's employees make inbound and outbound
telephone calls to other states in the country.
Regina Sergiyenko's Employment
October 24, 2016, defendant hired plaintiff Regina Sergiyenko
as its Executive Vice President. Ms. Sergiyenko and defendant
entered into a written employment agreement. The agreement
provided that defendant would pay Ms. Sergiyenko an annual
salary of $119, 000 plus commissions. Defendant also agreed
to reimburse Ms. Sergiyenko for her work expenses. Ms.
Sergiyenko primarily worked for defendant from her home in
Kansas. But she sometimes traveled to the call center in
Texas to perform work in that location.
October 2016 through January 2017, defendant paid Ms.
Sergiyenko her salary and expense reimbursements. But,
beginning in February 2017, defendant stopped paying Ms.
Sergiyenko any salary. Also, Ms. Sergiyenko regularly worked
more than 40 hours in a workweek, but received no overtime
compensation for such work. Ms. Sergiyenko testified that she
worked from 8:00 a.m. to 7:00 or 8:00 p.m. every day, with a
30 minute meal break. She estimated that she worked a minimum
of 10.5 hours each day for the six weeks that she worked for
February 2017, Ms. Sergiyenko continued to perform work for
defendant even though she never received a salary or expense
reimbursement. She did so because Mr. McCusker repeatedly
responded to her demands for payment by promising that the
company would pay her soon. But it never did. So, on March
10, 2017, Ms. Sergiyenko ended her employment with defendant
because it had failed to pay her.
Russell Joly's Employment
January 3, 2017, defendant hired plaintiff Russell Joly as
Vice President of Operations and Strategy. Mr. Joly worked
for defendant in its office located in Coffeyville, Texas.
Mr. Joly and defendant entered into a written employment
agreement. It provided that defendant would pay Mr. Joly an
annual salary of $90, 000 plus commissions. Defendant also
agreed to reimburse Mr. Joly's expenses. ...