Wingen v. Ventrum Energy Corp.
2:15-cv-02043
| D. Nev. | Nov 13, 2019Background
- Plaintiffs Karen and Philip Wingen sued Ventrum Energy Corp., Salt Creek West Drilling Fund, Ventrum Louisiana LLP, Mackel America Corp., NV America Corp., Andrew T. Van Slee, Mary E. Hill, and Danial Hassanpoor alleging racketeering under NRS 207.400 (filed Oct. 22, 2015).
- The clerk entered defaults against the remaining defendants (various dates); Hassanpoor answered initially but later stopped participating and was defaulted.
- Plaintiffs allege a scheme of material misrepresentations and omissions about well production, manager experience, ownership interests, assets, and investment risk; plaintiffs say they invested $500,000 in SCWDF and $100,000 in Ventrum LA.
- The complaint requested at least $594,086 in compensatory damages and invoked NRS 207.470, which provides for treble damages for violations of NRS 207.400.
- Plaintiffs moved for default judgment but did not submit an itemized accounting of actual damages, attorneys’ fees, or costs; they asked the court to "enter an accounting of their damages."
- The court granted default judgment, held treble damages apply under NRS 207.470 by analogy to federal RICO, and awarded $1,782,258 (treble of $594,086); plaintiffs were ordered to submit a proposed judgment within 14 days.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether default judgment should be entered | Defendants failed to answer or defend; clerk entered defaults | No opposition due to defaults; Hassanpoor had earlier answered but ceased participation | Default judgment granted against all remaining defendants |
| Whether NRS 207.470 requires treble damages | NRS 207.470 parallels federal RICO and permits mandatory trebling | No opposition (defendants defaulted) | Court treats NRS 207.470 like federal RICO and awards treble damages |
| Proper measure and proof of damages | Plaintiffs assert at least $594,086 in compensatory damages (investment allegations) and request an accounting | No opposition (defendants defaulted) | Court finds plaintiffs provided no detailed accounting; uses complaint figure $594,086 and trebles it to $1,782,258 |
| Attorneys' fees and costs | Plaintiffs requested fees/costs but provided no detail or supporting accounting | No opposition (defendants defaulted) | Court did not award fees or costs on the record; directed plaintiffs to submit a proposed judgment consistent with the order |
Key Cases Cited
- Geddes v. United Fin. Group, 559 F.2d 557 (9th Cir. 1977) (on default, factual allegations except damages are taken as true)
- Pope v. United States, 323 U.S. 1 (U.S. 1944) (default judgment principles regarding allegations)
- Davis v. Fendler, 650 F.2d 1154 (9th Cir. 1981) (money default judgment may be entered without hearing when damages are liquidated or mathematically calculable)
- UMG Recordings, Inc. v. Stewart, 461 F. Supp. 2d 837 (S.D. Ill. 2006) (two-step default judgment process: obtain clerk entry of default, then seek default judgment)
- Allum v. Valley Bank of Nevada, 849 P.2d 297 (Nev. 1993) (Nevada Supreme Court noting similarity between NRS 207.470 and federal RICO)
- Hale v. Burkhardt, 764 P.2d 866 (Nev. 1988) (discussion of Nevada racketeering statute)
- Genty v. Resolution Trust Corp., 937 F.2d 899 (3d Cir. 1991) (observing RICO’s mandatory treble damages)
- Jones v. Phipps, 39 F.3d 158 (7th Cir. 1994) (upholding trebling of damages in default judgment under RICO)