Reese v. Hannah

IN THE UNITED STATES DISTRICT COURT

FOR THE SOUTHERN DISTRICT OF WEST VIRGINIA

CHARLESTON DIVISION

ANTHONY REESE,

Plaintiff,

v. CIVIL ACTION NO. 2:23-cv-00805

TODD HANNAH, et al.,

Defendants.

MEMORANDUM OPINION AND ORDER

Pending before the Court are Defendants Todd Hannah, Zachary Winters, and

the City of Dunbar’s (“Moving Defendants”) Motion to Set Aside Entry of Default and

for Leave to File Answer Out of Time, [ECF No. 11], and Plaintiff Anthony Reese’s

Motion to Affirm Entry of Default and Request for Evidentiary Hearing to Enter

Judgment, [ECF No. 13]. For the reasons discussed below, Moving Defendants’

motion is GRANTED, and the entry of default is SET ASIDE. Further, Plaintiff’s

motion is DENIED as moot.

I. Background

Plaintiff commenced this civil action on December 21, 2023, by filing a

complaint against Defendants Todd Hannah, Zachary Winters, John/Jane Doe, and

the City of Dunbar (“The City”), a political subdivision of the State of West Virginia.

[ECF No. 1]. The 42 U.S.C. § 1983 complaint alleges excessive force violations, as well

as outrageous conduct and civil conspiracy claims, against the individually named

defendants. at 7–8, 15–17. As to Defendant City of Dunbar, the Complaint states

claims for negligent training, negligent supervision, and liability. at 9–13.

Defendant City of Dunbar was served on December 27, 2023, with its answer

due on January 17, 2024. [ECF No. 6]. Defendants Winters and Hannah were served

on December 28, 2023, with their respective answers due on January 18, 2024. [ECF

Nos. 4, 5]. None of the three Moving Defendants answered by the respective

deadlines. On January 26, 2024, I ordered the Clerk to enter default against Moving

Defendants for failure to answer. [ECF No. 7]. The Clerk entered a default on that

same date. [ECF No. 9].

On February 6, 2024, Moving Defendants filed the present Motion to Set Aside

Default and for Leave to File Answer Out of Time. [ECF No. 11]. Moving Defendants

explain that although the individually named defendants believed that the Complaint

had been forwarded to the City of Dunbar’s insurance coverage provider, there was a

communications mistake, and the City did not, in fact, transmit the Complaint to the

insurance carrier. [ECF No. 12, at 2]. Based on this mistaken belief, Moving

Defendants ask the court to set aside its entry of default and allow them to file their

answers.

Plaintiff responded in opposition. [ECF No. 15]. Plaintiff argues that

“Defendants have not shown good cause for setting aside the default judgment1

1 Although Plaintiff states multiple times throughout his response that the court should not set aside

“default judgment,” I find it necessary to clarify that the Clerk of Court has not entered default

judgment against Moving Defendants under Rule 60 of the Federal Rules of Civil Procedure. Rather,

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entered in this matter” because (1) their meritorious defenses are speculative and

conclusory; (2) Defendants did not act with reasonable promptness; (3) Plaintiff would

be prejudiced in incurring “the time, expense, and emotional stress of having to

litigate a case where liability is clear;” (4) Defendants have a history of dilatory

actions; and (5) no less drastic sanctions are available. at 5.

Further, pursuant to the court’s January 26, 2024, order, Plaintiff filed his own

motion to affirm the entry of default and set a date and time to conduct an evidentiary

hearing with respect to damages. [ECF No. 13].

II. Legal Standard

Rule 55(c) of the Federal Rules of Civil Procedure states that a court “may set

aside entry of default for good cause.” In assessing a motion to set aside an entry of

default, a district court is to consider (1) whether the moving party has a meritorious

defense to the action; (2) whether the moving party acted with reasonable

promptness; (3) the personal responsibility of the defaulting party; (4) any unfair

prejudice to the non-moving party; (5) whether there is a history of dilatory action;

and (6) the availability of sanctions less drastic.

, 616 F.3d 413, 417 (4th Cir. 2010);

, 439 F.3d 198, 204–05 (4th Cir. 2006).

The Fourth Circuit has “repeatedly expressed a strong preference that, as a

general matter, defaults be avoided and that claims and defenses be disposed of on

as directed by the court, the Clerk only entered an entry of default against Moving Defendants

pursuant to Rule 55(a) of the Federal Rules of Civil Procedure.

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their merits.” , 616 F.3d at 417; , 411 F.2d 123, 130 (4th

Cir. 1969) (stating that “any doubts about whether relief should be granted should be

resolved in favor of setting aside the default so that the case may be heard on the

merits”). As such, the “good cause” standard for setting aside an entry of default

pursuant to Rule 55(c) is less onerous than the “excusable neglect” standard for

setting aside a default judgment pursuant to Rule 60(b). , 616 F.3d at 420.

III. Discussion

Moving Defendants assert that the parties have been in communication but

were unable to reach an agreement concerning the entry of default. [ECF No. 12, at

2]. Further, Plaintiff has responded in opposition and has requested for an entry of

default judgment and an evidentiary hearing on damages. Thus, in proceeding to the

merits of the motion, I find that the factors weigh in favor of setting aside the

entry of default.

A. Meritorious Defense

“A meritorious defense requires a proffer of evidence which would permit a

finding for the defaulting party or which would establish a valid counterclaim.”

, 2:18-CV-1410, 2019 WL 691405, at *2 (S.D. W. Va.

Feb. 19, 2019) (quoting ,

843 F.2d 808, 812 (4th Cir. 1988)); , 673 F.2d 725,

727 (4th Cir. 1982) (“[A]ll that is necessary to establish the existence of a meritorious

defense is a presentation or proffer of evidence, which, if believed, would permit either

the Court or the jury to find for the defaulting party.”). The underlying concern is

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“whether there is some possibility that the outcome after a full trial will be contrary

to the result achieved by the defendant.” , 843 F.2d

at 812 (quoting 10 C. Wright, A. Miller & M. Kane, §

2697, p. 531 (2d ed. 1983)) (internal markings omitted). The party may not rely solely

on conclusory statements but instead must allege facts that support the existence of

such defense. , No. 3:07-CV-760, 2008 WL 1944033, at *3 (E.D.

Va. May 1, 2008). “As applied, this standard is a low bar.” (citing

, , 843 F.2d at 812).

Moving Defendants articulate what they believe to be a meritorious defense to

the allegations; in particular, they state that they will likely seek a qualified

immunity defense because the individuals are government officials. [ECF No. 12, at

4]. Defendants explain how a government official may be “entitled to qualified

immunity when his ‘conduct does not violate clearly established statutory or

constitutional rights of which a reasonable person would have known.” (citing

, 81 F.3d 429, 433 (4th Cir. 1996)) (internal citations omitted).

Moving Defendants also suggest that they may seek other defenses, such as the intra-

corporate conspiracy doctrine and the bar. [ECF No. 12, at 4–5].

In their initial motion and memorandum in support,2 Moving Defendants did not

allege facts in support of any of these other defenses. However, without expressing

2 I note that Moving Defendants, in their reply brief, do allege facts with regard to a defense based on

the bar. [ECF No. 17, at 3–4]. As stated with the other alleged defenses, I

express no opinion as to the merits of this defense but simply note that Moving Defendants allege

further facts in support of their argument that they have a meritorious defense.

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any opinion as to the likelihood of success of the qualified immunity defense, I find

that the Moving Defendants have submitted a sufficient proffer of evidence indicating

the existence of a meritorious defense. This factor weighs in favor of setting aside the

entry of default against Defendants Hannah and Winters. Defendant City of Dunbar

cannot claim qualified immunity as a defense as it is not a government official,

, 445 U.S. 622 (1980), and the City has not pleaded facts

in support of its own meritorious defense. This factor does not support setting aside

default as to Defendant City of Dunbar.

B. Reasonable Promptness

Reasonably prompt action is “gauged in light of the facts and circumstances of

each occasion.” , 673 F.2d 725, 727 (4th Cir. 1982). Courts

have found reasonable promptness to exist where the period between the entry of

default and the subsequent motion to vacate was two weeks.

, 843 F.2d at 812; , No.

2:18-cv-01493, 2019 WL 1670984, at *2 (S.D. W. Va. Apr. 17, 2019) (finding

reasonable promptness when the party filed a motion to set aside default one week

after receiving notice of the entry of default).

Plaintiff states that any of Moving Defendants’ arguments that they did not

know about this incident, the “potential claims, the lawsuit, or the default judgment

lack credibility.” [ECF No. 15, at 10]. However, Moving Defendants do not claim that

they were unaware of the incident or the lawsuit. [ECF No. 11]. Instead, they

admit that they knew of the lawsuit but mistakenly believed that the City had

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transmitted the Complaint to the insurance coverage provider, who would be filing

an answer on their behalf. at 2. It was only after the entry of default that Moving

Defendants realized that there had been a communications issue and that their

answers had not been filed. at 5.

Here, I find that Moving Defendants acted with reasonable promptness. The

return receipt indicates that the entry of default was delivered to Moving Defendants

on January 29, 2024. [ECF Nos. 10, 14]. Within days of realizing the Complaint had

not been forwarded to the City’s insurance coverage provider, Moving Defendants

retained counsel and filed the present motion to set aside default on February 6, 2024.

[ECF No. 11]. This period of time is well within a reasonable range outlined by many

courts.3 I find that this factor weighs in favor of setting aside the entry of default as

to all Moving Defendants.

C. Personal Responsibility

The Court must also consider the personal responsibility of the defaulting

party. , 439 F.3d at 204–05. “[A]ny doubt as to the propriety of giving relief

must be resolved in the movant's favor when the movant bears no personal

responsibility for the error which led to the default.”

, 843 F.2d at 811 (citing , 673 F.2d 725 (4th Cir. 1982)).

3 Plaintiff also argues that Defendants did not act with reasonable promptness because Defendants

were aware that the City had been notified of Plaintiff’s intent to pursue a claim in December of 2022.

[ECF No. 15, at 2, 10]. However, that is not the proper test for reasonable promptness. Instead, courts

grant relief “where the defaulting party acts with reasonable diligence

” , 2019 WL 1670984, at 1 (emphasis added). Even though Defendants allegedly

received notice of the potential for a lawsuit in December of 2022, the lawsuit was not actually filed

until December 21, 2023. As such, Defendants acted with reasonable promptness in seeking to set

aside the default.

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Here, the individually named Defendants contacted the City’s Chief of Police

and were left “with the impression that the City had already transmitted the matter

to the City’s coverage provider,” and the City’s Clerk believed the Complaint had been

transmitted as well. [ECF No. 12, at 6]. Thus, although Defendant City of Dunbar

bears some responsibility for this communication mistake, there is no evidence that

the individually named Defendants were personally responsible for the delay. This

factor weighs in favor of setting aside the entry of default for Moving Defendants

Hannah and Winters.

D. Prejudice

Next, “delay in and of itself does not constitute prejudice to the opposing party.”

, 616 F.3d 413, 418 (4th Cir.

2010). Rather, “[t]he non-defaulting party bears the burden of showing prejudice.”

, 2:23-cv-543, 2023 WL 7311203, at *3 (S.D. W. Va. Nov. 6,

2023) (citing , 112

F.R.D. 685, 691 (M.D.N.C. 1986)).

Plaintiff, who has the burden of showing prejudice, claims that he would suffer

prejudice “if required to litigate a claim where there is clear liability.” [ECF No. 15,

at 14]. The liability, he alleges, is “clear” based on the allegations set forth in the

Complaint and exhibits as well as the alleged history of Moving Defendants.4

4 Notably, Plaintiff spends considerable time discussing how two of the Moving Defendants were

defendants in another civil action in the Southern District of West Virginia. Plaintiff alleges here that

“liability in this case is clear, as established by . . . the history of Defendants Winters and the City of

Dunbar in excessive force and negligence claims, especially in the case.” [ECF No. 15, at 14]. The

fact that a Plaintiff alleged claims against these Defendants in a completely different

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Plaintiff states that he would be prejudiced if forced to expend “thousands of dollars

in costs for experts, depositions, trial, and other associated expenses, not to mention

the passing of time that would impact the Plaintiff in a further negative manner.”

at 15.

First, I do not find that such a short delay in time constitutes prejudice to the

opposing party. , 616 F.3d at 418 (“[T]he issue is

one of , not merely the existence of delay.”). Further

Plaintiff cannot claim that he would be prejudiced by the costs typically associated

with lawsuits because he assumed that burden when filing this lawsuit. “[A]s obvious

as it may be, it bears mention that no cognizable prejudice inheres in requiring a

plaintiff a defendant’s liability, a burden every plaintiff assumes in every

civil action filed in every federal court.” at 419 (emphasis in original). I do not find

that Plaintiff has met his burden of showing prejudice, and this factor weighs in favor

of setting aside an entry of default.

E. Dilatory Action

Plaintiff alleges that Moving Defendants failed to take steps when they knew

of the claim for such a long period of time. However true that may be, the lawsuit was

not filed, and Moving Defendants were not actually served, until December of 2023.

Thus, there is nothing that indicates any previous history of dilatory action by any of

matter—which later settled—has absolutely no bearing on whether the entry of default should be set

aside in this case. The court rejects any principle which states that a party who has been sued before

must be liable now. Such principle would undermine the entirety of the litigation process as well as

the role and duty of the courts. Courts instead have a strong policy in “favor of merits-based

adjudication.” , 616 F.3d at 418.

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the Moving Defendants. This factor also weighs in favor of setting aside the entry of

default as to all Moving Defendants.

F. Less Drastic Sanctions

Finally, the Fourth Circuit’s “extensive line of decisions” demonstrate that

Rule 55 “must be ‘liberally construed in order to provide relief from the onerous

consequences of defaults and default judgments.” Lolatchy v. Arthur Murray, Inc.,

816 F.2d 951, 953 (4th Cir. 1987) (quoting Tolson v. Hodge, 411 F.2d 123, 130 (4th

Cir. 1969)). Here, less drastic sanctions—while inappropriate in this case—are

nonetheless available. See, eg, id (finding an award of fees and costs is an

appropriate lesser sanction when a party defaults). This factor also weighs in favor

of setting aside the default for all Moving Defendants.

IV. Conclusion

For the foregoing reasons, Moving Defendant’s Motion to Set Aside Default and

for Leave to File Answer Out of Time, [ECF No. 11,] is GRANTED. The court

ORDERS that the Entry of Default [ECF No. 9] against Defendants Hannah,

Winters, and City of Dunbar be SET ASIDE. Because I am setting aside default, I

DENY as moot Plaintiffs Motion to Affirm Entry of Default, [ECF No. 13]. Moving

Defendants must answer Plaintiff's Complaint or file a Rule 12 motion within ten

days from the entry of this order. The court DIRECTS the Clerk to send a copy of this

Order to counsel of record and any unrepresented party.

ENTER: February 29, 2024

Z

fom STATES DISTRICT JUDGE