United States District Court, D. Colorado
COMBINED INSURANCE COMPANY OF AMERICA, an Illinois corporation, Plaintiff,
JENNIFER GLASS, an individual, Defendant/Cross-claim Plaintiff.
ALAN GERBITZ AS PERSONAL REPRESENTATIVE OF THE ESTATE OF RICHARD E. GERBITZ, Defendant/Cross-claim Defendant.
KATHLEEN M. TAFOYA, Magistrate Judge.
This matter comes before the court on Defendant Jennifer Glass's "Motion for Entry of Default Judgment against Defendant Alan Gerbitz" (Doc. No. 19, filed August 15, 2014 [Mot. Default J.]) and "Motion to Strike Defendant Gerbitz's Answer to Complaint in Interpleader and Cross-Claim against Defendant Glass" (Doc. No. 29 [Mot. Strike]), as well as Plaintiff Combined Insurance Company of America's ("Combined") Motion to Dismiss Interpleader Plaintiff (Doc. No. 17, filed Aug. 15, 2014) and Motion for Attorneys' Fees and Costs (Doc. No. 18, filed Aug. 15, 2014).
This is an interpleader action commenced by Combined to determine the proper beneficiary of a $72, 000 Accident Only Life Insurance Policy ("the Policy") issued to Richard E. Gerbitz. Combined initiated this action by filing its Complaint in Interpleader on May 23, 2014. (Doc. No. 1 [Compl.].) The Complaint names Jennifer Glass, individually, and Alan Gerbitz, as personal representative of the Estate of Richard E. Gerbitz, as defendants.
On May 23, 2014, Combined moved to deposit the proceeds from the Policy, along with any applicable interest, into the Registry of the Court pending a determination by the court as to the party or parties entitled to benefit under the Policy. (Doc. No. 2.) The court granted this Motion on June 3, 2014 and directed Combined to deposit the life insurance benefits into the Registry of the Court. (Order, Doc. No. 6.) On August 1, 2014, Combined deposited $73, 150.01 into the Registry of the Court. ( See Doc. No. 11.)
Combined sent Waivers of the Service of Summons to Defendants Glass and Gerbitz on May 29, 2014 and both Defendants signed those waivers on June 10, 2014. ( See Doc. Nos. 7-8, filed July 21, 2014.) Accordingly, pursuant to Federal Rule of Civil Procedure 4(d)(3), Defendants were required to answer or otherwise respond to Combined's Complaint in Interpleader no later than July 28, 2014.
On July 28, 2014, Defendant Glass filed an "Answer to Complaint in Interpleader, Claim to Interpleader Funds, and Cross-Claims against Defendant Alan Gerbitz." (Doc. No. 9 [Glass Answer & Cross-Claim.) Defendant Gerbitz did not answer or otherwise respond on or before July 28, 2014.
On August 1, 2014, Defendant Glass moved for entry of default against Defendant Gerbitz, based on the latter's failure to timely answer or otherwise respond. (Doc. No. 10.) The Clerk entered default against Defendant Gerbitz on August 7, 2014. (Doc. No. 12.) Defendant Glass sent Defendant Gerbitz notice of the default entered against him that same day. ( See Doc. No. 14.)
Defendant Glass's Motion for Default Judgment and Combined's Motion to Dismiss Interpleader Plaintiff and Motion for Attorneys' Fees and Costs were all filed on August 15, 2014. ( See Mot. Default J.; Mot. Dismiss; Mot. Atty.'s Fees & Costs.) Because Combined and Defendant Glass do not oppose each other's motions, no responses or replies were filed.
On September 2, 2014, 26 days after default was entered against him, Defendant Gerbitz, filed a letter with the court stating:
Combined Insurance was provided information by me that indicated Jennifer Glass never had signatory authority on my brother's account. Based on the insurance form, this misrepresentation would be considered fraud and insurance would be denied. How then can entering into a contract with a fraudulent signature, the same party collects the proceeds of the policy?
Only one conclusion can be made in this situation and that Jennifer Glass is ineligible to receive the proceeds of this policy and the assignment be made either to Richard and my father, Clarence Gerbitz or directly to Richard's estate.
(Doc. No. 22.)
Over two months later, on November 24, 2014, Defendant Gerbitz filed a pro se entry of appearance. (Doc. No. 24.) Two days later, on November 26, 2014, Defendant Gerbitz filed a "Request for extension of time to comply." (Doc. No. 25.) The court construed this filing as a motion for extension of time, and denied it without prejudice on December 2, 2014 for failure to comply with Local Rule 7.1(a)'s duty to confer. (Minute Order, Doc. No. 26); see also D.C.COLO.LCivR 7.1(a) (requiring a party to confer or make reasonable good faith efforts to confer with any opposing counsel prior to filing a motion). Defendant Gerbitz did not file a renewed motion for extension of time.
On December 15, 2014, Defendant Gerbitz filed a pro se "Answer to Complaint in Interpleader and Cross-Claim against Defendant Glass." (Doc. No. 28 [Gerbitz Answer & Cross-Claim].) Defendant Glass filed her Motion to Strike Defendant Gerbitz's Answer and Cross Claim on December 26, 2014. ( See Mot. Strike.) Defendant Gerbitz filed a Response to Defendant Glass's Motion to Strike on January 16, 2015 (Doc. No. 33 [Resp. Mot. Strike]) and Defendant Glass filed a reply on January 27, 2015. (Doc. No 35 [Reply Mot. Strike]).
In 2004, Combined issued the Policy to Richard Gerbitz (hereinafter the "Insured"). (Doc. No. 1, ¶ 6, Ex. 1.) The face value of the Policy's death benefit is $72, 000. ( Id., Ex. 1.) The Insured died in an accident on February 1, 2014. ( Id., Ex. 2.) In light of the Insured's death, Combined admits it must pay death benefits under the Policy to the beneficiary or beneficiaries designated by the Insured, or otherwise in accordance with the provisions of the Policy and controlling law. (Id. ¶ 8.)
In 2004, the Insured named Defendant Glass, his "friend, " as the primary beneficiary under the Policy. (Id. ¶ 9, Ex. 3.) He did not name a contingent beneficiary. ( See id. )
Combined first learned of the Insured's death in April 2014 through a claim for benefits filed by the Insured's brother, Defendant Gerbitz. ( Id., ¶ 10, Ex. 4.) Defendant Gerbitz claimed that Defendant Glass should not be the beneficiary under the Policy and that, based on the Insured's attempt to obtain benefits under the policy in November 2010, the Decedent intended to change the beneficiary to himself. ( Id., Ex. 4.) Mr. Gerbitz, acting as the personal representative of the Insured's Estate, claimed that the Estate is entitled to the benefits under the Policy. (Id. )
I. MOTION TO STRIKE
Defendant Glass's Motion to Strike seeks to strike Defendant Gerbitz's Answer because it was untimely filed after default had already been entered. In his Response, Defendant Gerbitz attempts to explain why he did not timely answer or otherwise respond to this action and requests that Defendant Glass's Motion to Strike and Motion for Default Judgment be denied.
In light of Defendant Gerbitz's pro se status, the court elects to treat Defendant Gerbitz's Response to the Motion to Strike as a request to set aside the entry of default. Cf., e.g., Miller v. Bennett, No. 12-cv-02063-MSK-CBS, 2013 WL 5450311, at *8 (D. Colo. Aug. 12, 2013) (treating a combined motion to dismiss or transfer for lack of personal jurisdiction as subsuming a request to set aside an entry of default); Vick v. Wong, 263 F.R.D. 325, 238 (E.D. Va. 2009) (where the defendant submitted an affidavit disputing several of the plaintiff's claims and also asked that her affidavit be considered an opposition to the motion for entry of default judgment, the court elected to treat the defendant's affidavit as a motion to set aside default); Meehan v. Snow, 652 F.2d 274, 276 (2d Cir.1981) ("Even if a default had been entered, opposition to a motion for a default judgment can be treated as a motion to set aside the entry of a default despite the absence of a formal Rule 55(c) motion."). Alternatively, the court finds that it may consider whether to set aside the default sua sponte. Judson Atkinson Candies, Inc. v. Latini-Hoberger Dhimantec, 529 F.3d 371, 386 (7th Cir. 2008) ("Without deciding whether a district court could set aside a default judgment sua sponte, we believe that the district court had the authority to set aside sua sponte an entry of default against [the defendant] for good cause."); Miller v. Madison, No. 1:12-CV-0874 (LEK/CFH), 2013 WL 2181240, at *2 (N.D.N.Y. May 20, 2013) ("Because Rule 55(c) does not refer to a motion requirement, a court may set aside an entry of default sua sponte. ").
"The court may set aside an entry of default for good cause...." Fed.R.Civ.P. 55(c). "[T]he good cause required by Fed.R.Civ.P. 55(c) for setting aside entry of default poses a lesser standard for the defaulting party than the excusable neglect which must be shown for relief from judgment under Fed.R.Civ.P. 60(b)." Dennis Garberg & Assocs., Inc. v. Pack-Tech Int'l Corp., 115 F.3d 767, 775 n.6 (10th Cir. 1997).
The principal factors in determining whether a defendant has met the good cause standard are (1) whether the default was the result of culpable conduct of the defendant; (2) whether the plaintiff would be prejudiced if the default should be set aside; and (3) whether the defendant presents a meritorious defense. Pinson v. Equifax Credit Info. Servs., Inc., 316 F.Appx. 744, 750 (10th Cir. 2009) (citation omitted); Hunt v. Ford Motor Co., 65 F.3d 178 (10th Cir. 1995) (citation omitted). The court need not consider each of these factors and may consider other factors as well. Guttman v. Silverberg, 167 F.Appx. 1, 4 (10th Cir. 2005) (citation omitted). Setting aside an entry of default is addressed to the sound discretion of the court. Nikwei v. Ross Sch. of Aviation, Inc., 822 F.2d 939, 941 (10th Cir.1987). The court's analysis is guided by the principle that "[t]he preferred disposition of any case is upon its merits and not by default." Gomes ...