United States District Court, E.D. Louisiana
LOUIS R. KOERNER, JR
VIGILANT INSURANCE COMPANY
ORDER AND REASONS
M. AFRICK UNITED STATES DISTRICT JUDGE.
the Court is a motion filed by CMR Construction & Roofing,
LLC to set aside the entry of default and to reconsider the
partial default judgment that has been entered against it.
For the following reasons, the Court grants the motion.
suit against Vigilant Insurance Company was removed to this
Court on July 27, 2016. On November 14, 2016, Koerner filed a
second amended complaint joining CMR as a defendant and
alleging claims of breach of warranty, breach of contract,
detrimental reliance, redhibition, and negligence.
summons was issued to CMR's registered agent in Louisiana
on December 14, 2016, meaning that CMR's answer was due
on January 4, 2017. After CMR failed to appear, Koerner
obtained an entry of default from the Clerk on January 18,
2017. On February 21, 2017, Koerner and Vigilant entered a
joint stipulation dismissing Koerner's claims against
Vigilant without prejudice. On March 9, 2017, this Court
granted in part Koerner's motion for entry of a default
judgment against CMR. Judgment was entered against CMR for
the sum of $497, 257.71, although no final judgment was
55(c) of the Federal Rules of Civil Procedure sets forth the
standard for setting aside the Clerk's entry of default.
It provides that “[t]he court may set aside an entry of
default for good cause.” To determine whether good
cause exists, courts consider a number of factors including:
(1) whether the default was willful, (2) whether setting the
default aside would prejudice the adversary, and (3) whether
a meritorious defense is presented. Buckley v. Donohue
Indus. Inc., 100 F. App'x 275, 278 (5th Cir. 2004).
These three factors are not “exclusive” or
“talismanic, ” and the Court can consider other
factors including whether the “public interest was
implicated, ” whether “there was a significant
financial loss to the defendant, ” and whether
“the defendant acted expeditiously to correct the
default.” In re Dierschke, 975 F.2d 181,
183-84 (5th Cir. 1992).
courts disfavor resolving cases through default judgments and
have a strong policy in favor of decisions on the merits.
See Lindsey v. Prive Corp., 161 F.3d 886, 893 (5th
Cir. 1998). “[E]ntries of default are serious; where
there are no intervening equities, any doubt should be
resolved in favor of the movant to the end of securing a
trial upon the merits.” Effjohn Int'l Cruise
Holdings, Inc. v. A&L Sales, Inc., 346 F.3d 552, 563
(5th Cir. 2003) (internal quotation marks omitted).
54(b) of the Federal Rules of Civil Procedure sets forth the
standard for reconsideration of interlocutory orders. See
Austin v. Kroger Texas, L.P., No. 16-10502, 2017 WL
1379453, at *8 (5th Cir. Apr. 14, 2017). Because the Court
only entered a partial default judgment against CMR, its
order was interlocutory and must be considered under Rule
54(b). See Halliburton Co. Benefits Comm. v. Graves,
191 F.App'x 248, 250 (5th Cir. 2006) (partial judgment is
an interlocutory order). “Under Rule 54(b), the trial
court is free to reconsider and reverse its decision for any
reason it deems sufficient, even in the absence of new
evidence or an intervening change in or clarification of the
substantive law.” Id. at 9 (internal quotation
Court first considers CMR's request to vacate the
Clerk's entry of ...