United States District Court, D. Kansas
R. Alexander Acosta, Secretary of Labor, United States Department of Labor, Plaintiff,
China Garden, Inc. d/b/a China Garden Buffet; and Yong Lin, Defendants.
MEMORANDUM & ORDER
W. LUNGSTRUM UNITED STATES DISTRICT JUDGE
Secretary of the United States Department of Labor filed suit
against defendants in August 2014 alleging that defendants
failed to comply with the overtime and minimum wage
requirements of the Fair Labor Standards Act. Defendants
answered the complaint, but counsel for defendants was
permitted to withdraw in August 2015 after satisfying the
requirements of Local Rule 83.5.5(a). Judge O'Hara
directed substitute counsel to enter an appearance and
cautioned the corporate defendant that it could not appear
“pro se” and was required to obtain counsel.
Before the deadline to secure new counsel, the Secretary
moved to stay the case pending the investigation and
potential prosecution of criminal charges against Mr. Lin.
Judge O'Hara granted the stay in September 2015.
December 3, 2018, Judge O'Hara granted the
Secretary's motion to lift the stay and set a status
conference for December 14, 2018. Judge O'Hara cautioned
defendants that if they failed to appear at the conference,
in person or through counsel, the court would favorably
entertain a motion for default judgment under Federal Rule of
Civil Procedure 16(f)(1)(A). Neither defendant appeared, in
person or through counsel. The Secretary then filed this
motion-a motion for default judgment pursuant to Federal Rule
of Civil Procedure 55(b)(2).
a week of the filing of that motion, new counsel entered an
appearance on behalf of both defendants and filed a response
to the motion for default judgment. In that response, counsel
for defendants explains that Mr. Lin is incarcerated, that
counsel recently met with Mr. Lin with the aid of an
interpreter, and that counsel conducted an on-site
investigation of the corporate defendant. Counsel for
defendants asserts his belief that there are meritorious
defenses to the claims in the complaint and urges that he
will be fully engaged in the processing of this case. Counsel
has further explained that Mr. Lin did not appear at the
scheduling conference because of his incarceration and that
he did not adequately delegate any of his responsibilities
with respect to the corporate defendant. According to
counsel, Mr. Lin has now authorized his sister, who does not
speak English, to handle all administrative and legal matters
on behalf of the corporate defendant. The Secretary has not
filed a reply to defendants' response.
motion for default judgment is denied. To begin, the
Secretary's motion is expressly brought pursuant to Rule
55(b)(2) despite Judge O'Hara's direction to file the
motion pursuant to Rule 16(f). Federal Rule of Civil
Procedure 55 envisions a two-step process for obtaining a
default judgment. Meyers v. Pfizer, Inc., 581
Fed.Appx. 708, 710 (10th Cir. 2014). First, the party wishing
to obtain a default judgment must apprise the court that the
opposing party has failed to plead or otherwise defend by
requesting “by affidavit or otherwise” that the
clerk enter default on the docket. Id.; Fed.R.Civ.P.
55(a). Second, following an entry of default by the clerk,
the party entitled to a judgment by default shall apply to
the clerk or the court under Rule 55(b), depending on the
nature of the relief requested. Meyers, 581
Fed.Appx. at 708 & n.3. The court cannot enter default
judgment under Rule 55(b)(2) because no entry of default has
been requested or entered under Rule 55(a). See id.
Judge O'Hara clearly contemplated was the filing of a
motion for default judgment as a sanction under Rule 16(f).
Rules 16(f) and 37(b)(2)(C) of the Federal Rules of Civil
Procedure permit a court to enter a default judgment when a
party disobeys a court order. See Derma Pen, LLC v.
4EverYoung Limited, 736 Fed.Appx. 741, 745 (10th Cir.
2018). Because a default judgment, like dismissal,
“represents an extreme sanction, ” it is
“appropriate only in cases of willful
misconduct.” See id. (citing Ehrenhaus v.
Reynolds, 965 F.2d 916, 920 (10th Cir. 1992)). Before
imposing a default judgment as a sanction, “a court
should ordinarily consider a number of factors, ”
including: (1) “the degree of actual prejudice to the
defendant;” (2) “the amount of interference with
the judicial process;” (3) “the culpability of
the litigant;” (4) “whether the court warned the
party in advance that dismissal of the action would be a
likely sanction for noncompliance;” and (5) “the
efficacy of lesser sanctions.” See id. at
745-46 (citing Ehrenhaus, 965 F.2d at 921).
“Only when the aggravating factors outweigh the
judicial system's strong predisposition to resolve cases
on their merits is dismissal [or default judgment] an
appropriate sanction.” Id. (citations and
the Secretary's motion was filed under Rule 55(b)(2), it
contains no reference to the Ehrenhaus factors let
alone any application of those factors to this case. But the
record reflects that default judgment is not an appropriate
sanction at this juncture. Defendants in this case have faced
unusual obstacles that have prevented the efficient
processing of the case- including significant language
barriers, a lengthy stay of this case pending criminal
charges, and the incarceration of the individual defendant
and owner of the corporate defendant. But they have now
retained counsel (and did so within one month of the order
lifting the stay) and counsel indicates both an ability to
process this case diligently and the willingness of his
clients to assist in that regard. Without question, the
appropriate approach at this time is to have Judge O'Hara
schedule a status conference to move this case forward on the
IS THEREFORE ORDERED BY THE COURT THAT
plaintiff's motion for default judgment (doc. 64) is