United States District Court, D. Colorado
JON A. GOODWIN, Plaintiff,
v.
MARCIA ANN BRUGGEMAN HATCH, SEAMUS JOHN PAUL HATCH, MICHAEL DOUGLAS BOCK, GUNDERSON DETTMER STOUGH VILLENEUVE FRANKLIN & HACHIGIAN, LLP, ROBERT V. GUNDERSON, JR., SCOTT CHARLES DETTMER, THOMAS F. VILLENEUVE, DANIEL JURG NIEHANS, DANIEL E. O'CONNOR, KENNETH ROBERT McVAY, IVAN ALEXANDER GAVIRIA, DANIEL E. O'CONNOR, JOHNSON & JOHNSON LLP, NEVILLE LAWRENCE JOHNSON DOUGLAS LOWELL JOHNSON, JONATHAN MARTIN TURCO, LAN PHONG VU, DIANA BIAFORA SPARAGNA, TINA LOUISE SCATUORCHIO-GOODWIN, BARRY STEVEN LEVIN, MATHEW LLOYD LARRABEE, ROBERT A. ESPEN, DAVID MARK JARGIELLO, RAMSEY & EHRLICH LLP, MILES FREDRICK EHRLICH, ISMAIL JOMO RAMSEY, FOLGER LEVIN KAHN, LLP, MICHAEL ALEXNDER KAHN, JOHN DANIEL SHARP, DENELLE MARIE DIXON-THAYER, LEWIS ROCA ROTHGERBER CHRISTIE, LLP, FREDRICK JAMES BAUMANN, No.-KLM Judge Christine M. Arguello ALEX C. MYERS, HELLER EHRMAN CALIFORNIA, VLG INVESTMENTS LLC, VLG INVESTMENTS 2006 LLC, VLG INVESTMENTS 2007 LLC, VLG INVESTMENTS 2008, LLC, HEWM INVESTORS, LLC, HEWM INVESTORS II, LLC, HEWM/VLG INVESTMENTS, LLC, DOES 1 - 100, Defendants.
ORDER AFFIRMING AND ADOPTING THE MAY 14, 2018, ORDER
AND RECOMMENDATION OF UNITED STATES MAGISTRATE JUDGE
CHRISTINE M. ARGUELLO UNITED STATES DISTRICT JUDGE
This
matter is before the Court upon the May 14, 2018, Order and
Recommendation by United States Magistrate Judge Kristen L.
Mix (Doc. # 122), in which she addressed Defendants VLG
Investments LLC, VLG Investment 2006 LLC, VLG Investments
2007 LLC, VLG Investments 2008 LLC, HEWM Investors, LLC, HEWM
Investors II, LLC, and HEWM/VLG Investments,
LLC's[1] (collectively, the “Moving
Defendants”) Motion to Set Aside Default Under Federal
Rule of Civil Procedure 55(c) and to Dismiss Under Rules
12(b)(2) and 12(b)(5) (for purposes of this Order only, the
“Motion”) (Doc. # 115). Magistrate Judge Mix
granted Moving Defendants' request to set aside the
Clerk's entry of default against them (Doc. # 110) and
recommended that this Court grant Moving Defendants'
Motion to Dismiss for lack of personal jurisdiction. (Doc. #
122 at 2.) Plaintiff Jon Goodwin timely objected to
Magistrate Judge Mix's Order and Recommendation. (Doc. #
124.) Moving Defendants subsequently replied in support of
the Order and Recommendation. (Doc. # 125.)
For the
reasons described herein, Plaintiff's Objection is
overruled. The Court affirms and adopts the Magistrate
Judge's Order and Recommendation.
I.
BACKGROUND
The
Court extensively explained the factual and procedural
background of this case in its previous Order. (Doc. # 97.)
Magistrate Judge Mix's Order and Recommendation also
detailed this background. (Doc. # 122.) The Recommendation is
incorporated herein by reference. See 28 U.S.C.
§ 636(b)(1)(B); Fed.R.Civ.P. 72(b). The Court therefore
recounts only the facts necessary to address Moving
Defendants' Motion.
Plaintiff
first named Moving Defendants in this action on July 14,
2016. (Doc. # 41.) Pursuant to Rule 4(m), Plaintiff was
therefore required to serve Moving Defendants by October 12,
2016. See Fed. R. Civ. P. 4(m). Plaintiff filed a
Second Amended Complaint, now the operative Complaint, on
August 19, 2016. (Doc. # 83.) Plaintiff served Moving
Defendants on November 2, 2016, but did not file proofs of
service on or around that date.
On
November 4, 2016, Magistrate Judge Mix issued an Order to
Show Cause, directing Plaintiff to show cause why his claims
were not barred by claim preclusion, issue preclusion, and/or
the Rooker-Feldman doctrine. (Doc. # 90 at 5-6.) The
Magistrate Judge simultaneously stayed the case in its
entirety, pending a ruling on her Order to Show Cause.
(Id. at 6.) Some thirteen months later, on December
11, 2017, Magistrate Judge Mix discharged the Order to Show
Cause and recommended that the Court dismiss the gross
majority of Plaintiff's claims. (Doc. # 93 at 33-35.)
This
Court adopted the Magistrate Judge's Recommendation and
lifted the stay on January 12, 2018, despite Plaintiff's
Objection (Doc. # 94) to it. (Doc. # 97.) Pursuant to the
Court's Order, only the following claims remain:
1. Claims 1, 3, 6, 7, and 8 against the Doe Defendants;
2. Claims 2, 4, 5, 9, 10, 11, 14, 17, and 23 against the Doe
Defendants, VLG Investments LLC, VLG Investments 2006 LLC,
VLG Investments 2007 LLC, VLG Investments 2008 LLC, HEWM
Investors LLC, HEWM Investors II LLC, and HEWM/VLG
Investments LLC;
3. Claim 26 against [all] Defendants.
(Id. at 17.)
Three
days before this Court dismissed most claims and lifted the
stay however, on January 9, 2018, Magistrate Judge Mix issued
a second Order to Show Cause. (Doc. # 95.) She explained that
it “ha[d] come to the Court's attention that
[Moving Defendants] ha[d] not been served . . . in this
action, and therefore, are not proper parties to this
litigation.” (Id. at 1.) She noted that the
service deadline as to Moving Defendants was October 12,
2016, pursuant to Rule 4(m). (Id.) The Magistrate
Judge ordered Plaintiff to “show cause why th[e] Court
should not recommend that the case against [Moving]
Defendants . . . be dismissed pursuant to [Rule] 4(m)”
and to “file proofs of service, or respond in writing .
. ., on or before February 6, 2018.” (Id. at
3.)
In
response to this second Order to Show Cause, Plaintiff filed
on February 4, 2018, six proofs of service on Moving
Defendants, all of which reflect service on Moving Defendants
on November 2, 2016-approximately three weeks
after the October 12, 2016, deadline
pursuant to Rule 4(m). (Doc. ## 98-103.)
The
next day, February 5, 2018, Plaintiff filed Motions for Entry
of Default as to Moving Defendants. (Doc. ## 104-09.)
Plaintiff asserted in each motion that he had served Moving
Defendants on November 2, 2016, and that Moving Defendants
had failed to answer the Complaint by November 23, 2016.
E.g., (Doc. # 104-1.) Plaintiff did not disclose
that Moving Defendants were first named in the lawsuit on
July 14, 2016, or that Rule 4(m) had required him to serve
Moving Defendants by October 12, 2016. See
(id.) The Clerk of the Court granted Plaintiff's
Motion for Entry of Default and entered default against
Moving Defendants on the same day, February 5, 2018. (Doc. #
110.)
On
February 6, 2018, Counsel David L. Stanton entered a limited
appearance on behalf of Moving Defendants for purposes of
moving to set aside the entry of default judgment against
them and to dismiss the Complaint against Moving Defendants
for lack of jurisdiction. (Doc. # 111.) Also on February 6,
2018, Plaintiff responded to the Magistrate Judge's
second Order to Show Cause concerning Rule 4(m), arguing that
he had not been able to identify an agent for service of
process for Moving Defendants. (Doc. # 112.)
Ten
days later, on February 16, 2018, Moving Defendants filed the
Motion at issue in this Order, their Motion to Set Aside
Default Under Federal Rule of Civil Procedure 55(c) and to
Dismiss Under Rules 12(b)(2) and 12(b)(5). (Doc. # 115.)
Moving Defendants first asserted that because
“Plaintiff's service of [Moving] Defendants was
indisputably beyond the [October 12, 2016] deadline allowed
under Rule 4(m), ” the Clerk's entry of default
judgment against Moving Defendants (Doc. # 110) was in error
and must be set aside. (Doc. # 115 at 15.) Second, Moving
Defendants argued that the claims against them must be
dismissed for lack of personal jurisdiction pursuant to Rule
12(b)(2). (Id.)
Plaintiff
timely filed his Response in opposition to Moving
Defendants' Motion on March 2, 2018. (Doc. # 119.) Moving
Defendants replied on March 16, 2018. (Doc. # 120.)
The
Magistrate Judge issued her Order and Recommendation on the
Motion on May 14, 2018, ordering that the Clerk's entry
of default against Moving Defendants be vacated, and
recommending that the Court dismiss claims against Moving
Defendants for lack of personal jurisdiction. (Doc. # 122 at
12.)
Plaintiff
timely objected to the Magistrate Judge's Order and
Recommendation on May 29, 2018 (Doc. # 124), and Moving
Defendants replied in support of it on June 12, 2018 (Doc. #
125).
II.
STANDARDS OF REVIEW
A.
REVIEW OF A RECOMMENDATION
When a
magistrate judge issues a recommendation on a dispositive
matter, Fed.R.Civ.P. 72(b)(3) requires that the district
judge “determine de novo any part of the
magistrate judge's [recommended] disposition that has
been properly objected to.” An objection is properly
made if it is both timely and specific. United States v.
One Parcel of Real Property Known As 2121 East 30th
Street, 73 F.3d 1057, 1059 (10th Cir.1996). In
conducting its review, “[t]he district judge may
accept, reject, or modify the recommended disposition;
receive further evidence; or return the matter to the
magistrate judge with instructions.” Fed.R.Civ.P.
72(b)(3).
B.
PRO SE PLAINTIFF
Plaintiff
proceeds pro se. The Court, therefore, reviews his
pleading “liberally and hold[s] [it] to a less
stringent standard than those drafted by attorneys.”
Trackwell v. United States, 472 F.3d 1242, 1243
(10th Cir. 2007) (citations omitted). However, a pro
se litigant's “conclusory allegations without
supporting factual averments are insufficient to state a
claim upon which relief can be based.” Hall v.
Bellmon, 935 F.2d 1106, 1110 (10th Cir. 1991). A court
may not assume that a plaintiff can prove facts that have not
been alleged, or that a defendant has violated laws in ways
that a plaintiff has not alleged. Associated Gen.
Contractors of Cal., Inc. v. Cal. State Council of
Carpenters, 459 U.S. 519, 526 (1983); see also
Whitney v. New Mexico, 113 F.3d 1170, 1173-74 (10th Cir.
1997) (a court may not “supply additional factual
allegations to round out a plaintiff's complaint”);
Drake v. City of Fort Collins, 927 F.2d 1156, 1159
(10th Cir. 1991) (a court may not “construct arguments
or theories for the plaintiff in the absence of any
discussion of those issues”). Nor does pro se
status entitle a litigant to an application of different
rules. See Montoya v. Chao, 296 F.3d 952, 957 (10th
Cir. 2002).
III.
DISCUSSION
A.
MAGISTRATE JUDGE MIX'S ORDER TO SET ASIDE ENTRY OF
DEFAULT JUDGMENT
Moving
Defendants first argued in their Motion that the entry of
default against them “should be set aside for good
cause because they were premised on indisputably late service
by Plaintiff.” (Doc. # 115 at 4.) Magistrate Judge Mix
agreed and ordered that the Clerk's entry of default be
vacated. (Doc. # 122 at 4-6, 12.)
1.
Magistrate Judge Mix Had Authority to Set Aside the Entry
of Default
Plaintiff
first objects that Magistrate Judge Mix did not have the
authority to grant Moving Defendants' Motion as to the
entry of default against Moving Defendants and that by doing
so, the Magistrate Judge “subjugate[ed] . . . the
authority of this Court's Article III judge.” (Doc.
# 124 at 10.) Plaintiff rejects the Magistrate Judge's
interpretation of Ashby v. McKenna, 331 F.3d 1148,
1152 (10th Cir. 2003), which the Magistrate Judge cited and
summarized as “indicating appropriateness of a
Magistrate Judge entering an order under 28 U.S.C. §
636(b)(1)(A) on a motion to set aside clerk's entry of
default” (Doc. # 122 at 5-6). (Doc. # 124 at 10.)
Plaintiff argues that Ashby “did not conclude
that a magistrate judge has the authority to vacate or deny
vacation of default”; rather, Ashby indicated
“that a magistrate judge can affirm the action of a
court clerk . . . denying a motion for default when a motion
to dismiss by a defendant is pending before a court.”
(Id.) Plaintiff also argues that Moving
Defendants' request to set aside the entry of default
“is dispositive and, pursuant to [28 U.S.C. §
636(b)], ” only a district court judge has authority to
adjudicate dispositive motions. (Id.)
This
Court finds that the Magistrate Judge acted within her
authority in setting aside the entry of default against
Moving Defendants; Plaintiff's Objection fails. The
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