Baronius Press Ltd v. Faithlife Corporation
2:22-cv-01635
| W.D. Wash. | Feb 6, 2023Background
- Baronius Press filed a copyright and related state-law complaint and amended complaint in November 2022; service was effected Nov. 23, 2022 and Faithlife’s response was due Dec. 14, 2022.
- Faithlife did not timely respond; plaintiff moved for entry of default and the Clerk entered default on Dec. 21, 2022.
- Faithlife filed a motion to set aside the entry of default the same day; Faithlife’s CEO avowed the registered agent received service Nov. 23, 2022, physical papers reached Faithlife’s Bellingham office Nov. 28, and the CEO did not see the papers until Dec. 15.
- After discovering the filing, Faithlife engaged counsel, appeared, and promptly moved to vacate default; plaintiff thereafter moved for default judgment.
- The Court applied Ninth Circuit “good cause” factors (culpability, meritorious defense, prejudice), found no culpable conduct, found meritorious defenses sufficient at the pleadings stage, and found no tangible prejudice to plaintiff.
- The Court vacated the entry of default, struck the default-judgment-related motions as moot, denied Faithlife’s request for an extra 60 days, and ordered Faithlife to answer or otherwise respond within 14 days.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Faithlife’s failure to answer was culpable | Faithlife had notice and intentionally failed to respond | Faithlife did not receive meaningful notice at the company level and its delay was inadvertent | Not culpable — delay not devious, willful, or in bad faith |
| Whether Faithlife has a meritorious defense | Default should stand; plaintiff did not concede merits | Faithlife alleges defenses and factual allegations that, if true, defeat claims | Meritorious defenses sufficiently alleged; factor favors vacatur |
| Whether vacating default would prejudice plaintiff | Delay could allow Faithlife to hide assets and impair recovery | Allegations of asset concealment speculative; brief delay causes no tangible harm | No substantial prejudice; vacatur appropriate |
| Whether Faithlife should get 60 additional days to respond | N/A | Requests 60 days to answer after vacatur | Request denied; Court ordered response within 14 days |
Key Cases Cited
- United States v. Signed Pers. Check No. 730 of Yubran S. Mesle, 615 F.3d 1085 (9th Cir.) (articulates three-factor "good cause" test for setting aside default)
- TCI Grp. Life Ins. Plan v. Knoebber, 244 F.3d 691 (9th Cir. 2001) (culpability standard: actual/constructive notice and intentional failure to answer)
- Franchise Holding II, LLC v. Huntington Restaurants Grp., Inc., 375 F.3d 922 (9th Cir. 2004) (defendant bears burden to show relief from default warranted)
- Westchester Fire Ins. Co. v. Mendez, 585 F.3d 1183 (9th Cir. 2009) (default judgments are disfavored)
- Bateman v. United States Postal Serv., 231 F.3d 1220 (9th Cir. 2000) (good faith inquiry when setting aside judgment/default)
- Henderson v. United States, 517 U.S. 654 (U.S. 1996) (function of service is to provide notice)