Hooper-Haas v. Ziegler Holdings, LLC, 2012 U.S. App. LEXIS 16783

Ziegler Holdings purchased the right to civil possession of a Vieques beachfront residence and agreed to four years of monthly payments, insurance, and a $5,000 attorney-fees indemnity.
In June 2010 Ziegler stopped paying, alleging misrepresentations; Hooper-Haas et al. sued in Puerto Rico and then removed to the district court in Puerto Rico.
The district court issued a scheduling order requiring pretrial memoranda and discovery disclosures, warning of sanctions for noncompliance, including default.
Ziegler missed the November 2 deadline, failed to meet discovery, and did not disclose materials; the December 15 conference was aborted, and default was sought.
On January 13, 2011 the district court entered default against Ziegler, struck its answer and counterclaim, and found willful misconduct.
After reconsideration was denied, an evidentiary hearing in May 2011 awarded declaratory relief, possession, and damages including balance of the purchase price, interest, fees, and insurance premiums.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Was the default sanction proper under the circumstances?	Hooper-Haas argues sanction appropriate due to persistent noncompliance.	Ziegler contends sanctions were too severe or improperly chosen.	Default sanction affirmed as proper.
Did the district court err by granting relief beyond that requested in the complaint?	Plaintiffs claim requested relief limited to void deed, possession, and attorneys' fees.	Ziegler argues relief may extend to appropriate remedies after default.	Yes; relief beyond the complaint was improper; strike excess items and remand.
Whether due process was violated by the post-default damages hearing allowing testimony on damages or liability?	Ziegler asserts process violations in damages proceedings.	Hooper-Haas contends appellant had opportunity to present damages and contest issues.	Due process not violated; remand for revised judgment limited to declaratory relief, possession, and attorneys' fees.
Should the court consider the 2007 Rule 54(c) amendment in defining scope of relief in a default judgment?	Plaintiffs rely on the text change to expand scope to pleadings.	Ziegler argues amendment broadens relief scope.	Court leaves question open; in this case the complaint limited relief and the judgment exceeded that relief.

Tower Ventures, Inc. v. City of Westfield, 296 F.3d 43 (1st Cir. 2002) (disobedience of court orders supports sanctions)
Remexcel Managerial Consultants, Inc. v. Arlequín, 583 F.3d 45 (1st Cir. 2009) (balance between merits and orderly administration of justice)
KPS & Assocs., Inc. v. Designs by FMC, Inc., 318 F.3d 1 (1st Cir. 2003) (framework for evaluating sanctions and defaults)
Companion Health Servs., Inc. v. Kurtz, 675 F.3d 75 (1st Cir. 2012) (abuse of discretion standard for default sanctions)
Benitez-Garcia v. Gonzalez-Vega, 468 F.3d 1 (1st Cir. 2006) (dismissal with prejudice overly harsh where no advance warning)
Bonilla v. Trebol Motors Corp., 150 F.3d 77 (1st Cir. 1998) (default may allow challenges to relief, but not liability)
Robson v. Hallenbeck, 81 F.3d 1 (1st Cir. 1996) (disobedience of scheduling order inherently prejudicial)
Blanchard v. Cortés-Molina, 453 F.3d 40 (1st Cir. 2006) (respect for pleadings limits in default judgments)
Young v. Gordon, 330 F.3d 76 (1st Cir. 2003) (case-by-case factors for sanctions; totality of circumstances)
Global NAPs, Inc. v. Verizon New Eng. Inc., 603 F.3d 71 (1st Cir. 2010) (egregious misconduct supports default where warranted)
Wright, Miller & Kane, 10A Wright et al., Fed. Prac. & Proc. Civ. 3d § 2688 () (collection of cases on liability post-default and damages)