Schoenbauer v. Deutsche Bank National Trust Company, 3:20-cv-01901

Plaintiff Tim Schoenbauer sued Deutsche Bank National Trust Company over attempted foreclosure of property at 9364 Forest Hills Blvd., Dallas, TX. Complaint asserted breach of contract, fraud, promissory estoppel, and RESPA claims.
Defendant removed the case from state court to federal court. Plaintiff repeatedly moved for default judgment starting September 2020.
Multiple magistrate recommendations denied Plaintiff's default-judgment motions because he had not shown defendant failed to answer and had not first obtained entry of default; the recommendations explained a party cannot serve process on an opposing party.
The magistrate judge recommended dismissal of Plaintiff’s claims by order dated October 15, 2021.
Plaintiff filed a November 16, 2021 Motion for Rehearing reiterating arguments that he had effectuated service and that removal equated to service (invoking Murphy Bros. and “snap removal” theory).
The magistrate construed the motion as one for reconsideration under Rule 54(b), found no basis to revisit prior rulings, and recommended denial of the motion.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Valid service of process	Schoenbauer: he served Deutsche Bank and counsel; removal shows defendant was served	Deutsche Bank: service was not valid; plaintiff (a party) cannot effect service on defendant	Court: Plaintiff failed to show valid service; prior rulings rejecting his service theory stand
Effect of removal on service ("snap removal")	Schoenbauer: removal before service means defendant accepted service; removal itself proves service (cites Murphy Bros.)	Deutsche Bank: removal does not cure defective service or substitute for constitutional service requirements	Court: Not persuaded; plaintiff conflates notice with service; removal does not constitute valid service
Procedural vehicle for reconsideration	Schoenbauer labeled his filing a rehearing/motion for rehearing	Court/Deutsche Bank: Federal Rules have no ‘‘rehearing’’ motion; must be treated under appropriate rule depending on finality	Court: No final judgment existed; motion treated under Rule 54(b) and denied
Entitlement to default judgment	Schoenbauer: seeks default judgment based on alleged lack of defense	Deutsche Bank: answered/defended; plaintiff did not obtain clerk’s entry of default or prove defendant failed to plead	Court: Plaintiff did not meet prerequisites for default judgment; motions properly denied

Shepherd v. International Paper Co., 372 F.3d 326 (5th Cir. 2004) (explains that Federal Rules do not include a motion for reconsideration and how such motions are treated)
Lavespere v. Niagara Mach. & Tool Works, Inc., 910 F.2d 167 (5th Cir. 1990) (describes treatment of reconsideration motions and availability of relief)
Little v. Liquid Air Corp., 37 F.3d 1069 (5th Cir. 1994) (addresses procedural treatment of post-judgment motions)
McClendon v. United States, 892 F.3d 775 (5th Cir. 2018) (explains when Rule 54(b) applies to non-final orders)
Austin v. Kroger Texas, L.P., 864 F.3d 326 (5th Cir. 2017) (discusses Rule 54(b)’s flexibility to reconsider interlocutory orders)
Cobell v. Jewell, 802 F.3d 12 (D.C. Cir. 2015) (recognizes courts’ inherent power to provide relief from interlocutory orders as justice requires)
Murphy Bros., Inc. v. Michetti Pipe Stringing, Inc., 526 U.S. 344 (U.S. 1999) (defines when service of process is required and its role for invoking court’s jurisdiction)
Douglass v. United Servs. Automobile Ass’n, 79 F.3d 1415 (5th Cir. 1996) (explains consequences of failing to file specific objections to a magistrate judge’s findings)