United States District Court, D. Kansas
TAWANA M. BEECHAM, Plaintiff,
v.
XPO LOGISTICS, et al., Defendants.
MEMORANDUM AND ORDER
JULIE
A. ROBINSON CHIEF UNITED STATES DISTRICT JUDGE
Plaintiff
Tawana M. Beecham filed this action against Defendants XPO
Logistics (“XPO”), Tony Dillon, and Staffmark,
alleging discrimination based on sex, race, and age, and
retaliation, in violation of Title VII and the Kansas Human
Rights Act. Amidst a rash of filings on April 30, 2018, the
Court granted a Clerks Entry of Default against XPO (Doc. 22)
per its typical practice when an answer has not been filed
within twenty-one days of service.[1] The Court signed the
order-but it was not docketed-prior to XPO's counsel
entering their appearance in the case (Docs. 20 and 21). On
that same afternoon, XPO's counsel appeared at a motion
conference before Magistrate Judge Gwynne E. Birzer (Doc.
23).
Before
the Court is XPO's Motion to Set Aside Clerks Entry of
Default and Leave to File Answer Out of Time (Doc. 24).
Plaintiff takes “no position” with regard to the
relief sought in this motion and does not plan to file a
response.[2] For the reasons stated below, the Court
grants the motion.
I.
Discussion
XPO
moves to set aside the Clerks Entry of Default pursuant to
Fed.R.Civ.P. 55(c), which allows the Court to “set
aside an entry of default judgment for good cause.”
Under Rule 55(c), courts principally consider the following
factors in determining whether good cause exists: (1) whether
the default was the result of culpable conduct by the
defendant; (2) whether the plaintiff would be prejudiced by
setting aside the default; and (3) whether the defendant
presents a meritorious defense.[3] “These factors are not
‘talismanic' and the court may consider other
factors.”[4] The standard is “fairly liberal
because ‘[t]he preferred disposition of any case is
upon its merits and not by default
judgment.'”[5]
XPO
also moves for leave to file its answer out of time under
Fed.R.Civ.P. 6(b)(1)(B). Under Rule 6(b)(1)(B), a court may
excuse a party's failure to act within a specified time
“if the party failed to act because of excusable
neglect.” In determining whether the failure to act was
the product of excusable neglect, courts consider the
following non-exhaustive list of factors: “[1] the
danger of prejudice to the [nonmoving party], [2] the length
of the delay and its potential impact on judicial
proceedings, [3] the reason for the delay, including whether
it was within the reasonable control of the movant, and [4]
whether the movant acted in good faith.”[6] The “good
cause” that must be shown under Rule 55(c) to set aside
an entry of default is a less exacting standard than the
“excusable neglect” required for relief from a
default judgment under Rule 60(b) or for an extension of a
missed deadline under Rule 6(b)(1)(B).[7] Accordingly, the
Court first determines whether XPO has shown “excusable
neglect” for failing to timely answer before assessing
whether it has shown “good cause” for setting
aside the clerks entry of the default.[8]
A.
Leave to File Answer out of Time
1.
Prejudice to Plaintiff
The
first factor the Court evaluates in determining whether the
defendant's failure to answer was the result of excusable
neglect is the degree of prejudice to Plaintiff. As XPO
notes, discovery has not yet begun in this case, no
scheduling order has been filed, and Plaintiff must litigate
this case on the merits against the other Defendants because
Plaintiff has alleged that Defendants are jointly and
severally liable to her. XPO's failure to timely answer
did prejudice Plaintiff insofar as Plaintiff was compelled to
file a motion for default judgment. The Court finds, however,
that the total effect of the prejudice on Plaintiff as a
result of XPO's default is light at this stage of the
litigation. Thus, this factor weighs in favor of granting XPO
leave to answer out of time.
2.
Length of the Delay
The
Court next considers the length of the delay. XPO's
deadline to file an answer was April 2, 2019. XPO did not
file an answer, Plaintiff filed a Motion for Default Judgment
on April 25, 2019, [9] and the Court granted a Clerks Entry of
Default on April 30, 2019.[10] Although there is no
definitive timeframe for measuring when a delay becomes too
lengthy for purposes of a motion for leave to file out of
time, this Court has previously held that a delay of less
than two months was “relatively
innocuous.”[11] Additionally, as explained above, a
scheduling order has not yet been entered, so the delay will
have a relatively minimal impact on this litigation.
Accordingly, this factor weighs in favor of granting XPO
leave to answer out of time.
3.
Reason for Delay
The
third factor the Court analyzes is the reason for the delay
and whether it was within XPO's reasonable control. XPO
contends that at the time of service, it was in the process
of permanently closing its facility in Gardner, Kansas, the
office where XPO was served. The individual who was served in
this case, Omar Torres, was laid-off soon after the Complaint
was served, and for reasons unknown to XPO, he did not
communicate the service to XPO or its counsel. XPO and its
counsel were actively engaged in the defense of this case
during its administrative phase, including settlement
discussions, but they were never contacted regarding
XPO's failure to answer. When XPO learned it had been
served, it promptly took steps to litigate the case. The
Court finds that XPO did not knowingly disregard its deadline
to answer, and finds this factor also weighs in favor of
granting XPO leave to file its answer out of time.
4.
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