United States District Court, District of Columbia
L. FRIEDRICH, UNITED STATES DISTRICT JUDGE
the Court is the plaintiff's Motion for Default Judgment,
Dkt. 27. For the reasons that follow, the Court will grant
plaintiff filed this action on June 7, 2017, Dkt. 1, to
collect civil penalties and interest assessed against the
defendants under 31 U.S.C. §§ 5314, 31 U.S.C. 5321,
and 31 U.S.C. 3717 for their willful failure to report
interests in foreign bank accounts in 2008 and 2009.
Id. The plaintiff attempted to serve each defendant
but was unable to do so because the defendants had left the
country. Pl.'s Mot. for Default J. at 2, Dkt. 27-1. The
defendants then signed service waivers on February 26, 2018
that provided for an answer deadline of March 1, 2018. Dkts.
16, 17. Because the Court received the waivers after that
deadline had already passed, the Court extended the answer
deadline until April 20, 2018. Minute Order of Apr. 6, 2018.
The Clerk of Court filed an entry of default as to both
defendants on April 25, 2018, Dkt. 21, because they still had
not filed an answer or other response to the complaint.
the parties worked to “negotiate an amicable settlement
of this case.” Status Report at 2, Dkt. 26. The parties
were unable to settle, and the defendants continued not to
answer or otherwise respond to the complaint. On December 7,
2018 the plaintiff filed this motion for default judgment,
ruling on the plaintiff's motion, the Court gave the
defendants yet another opportunity to respond. On December
18, 2018-when the defendants had still not responded to the
complaint or to the plaintiff's motion for default
judgment-the Court ordered the defendants to show cause on or
before January 8, 2019 as to why the Court should not enter a
default judgment in favor of the plaintiff. Minute Order of
Dec. 18, 2018. As of February 4, 2019, the defendants still
have not filed any response to the complaint, the clerk's
entry of default, the plaintiff's motion for default
judgment, or the Court's show cause order.
of the Federal Rules of Civil Procedure empowers a federal
district court to enter a default judgment against a
defendant who fails to defend its case. Fed.R.Civ.P.
55(b)(2); Keegel v. Key West & Caribbean Trading
Co., 627 F.2d 372, 375 n.5 (D.C. Cir. 1980). While
federal policy generally favors resolving disputes on their
merits, default judgments are appropriate “when the
adversary process has been halted because of an essentially
unresponsive party.” Mwani v. bin Laden, 417
F.3d 1, 7 (D.C. Cir. 2005) (internal quotation marks
omitted). Ultimately, “[t]he determination of whether
default judgment is appropriate is committed to the
discretion of the trial court.” Int'l Painters
& Allied Trades Indus. Pension Fund v. Auxier Drywall,
LLC, 531 F.Supp.2d 56, 57 (D.D.C. 2008).
a default judgment is a two-step process. First, the
plaintiff must request that the Clerk of Court enter default
against a party who has “failed to plead or otherwise
defend.” Fed.R.Civ.P. 55(a). The Clerk's entry of
default establishes the defendant's liability for the
well-pleaded allegations in the complaint. Boland v.
Providence Constr. Corp., 304 F.R.D. 31, 35 (D.D.C.
2014). Second, if the plaintiff's claim is not for a
“sum certain, ” the plaintiff must apply to the
court for a default judgment. Fed.R.Civ.P. 55(b). At that
point, the plaintiff “must prove his entitlement to the
relief requested using detailed affidavits or documentary
evidence on which the court may rely.” Ventura v.
L.A. Howard Constr. Co., 134 F.Supp.3d 99, 103 (D.D.C.
2015) (alterations adopted and internal quotation marks
ruling on a motion for default judgment, a court “is
required to make an independent determination of the sum to
be awarded.” Fanning v. Permanent Sol. Indus.,
Inc., 257 F.R.D. 4, 7 (D.D.C. 2009) (internal quotation
marks omitted). In performing that inquiry, the court has
“considerable latitude.” Ventura, 134
F.Supp.3d at 103 (internal quotation marks omitted). The
court may conduct a hearing to determine damages,
Fed.R.Civ.P. 55(b)(2), but it is not required to do so
“as long as it ensures that there is a basis for the
damages specified in the default judgment, ”
Ventura, 134 F.Supp.3d at 103 (alterations adopted
and internal quotation marks omitted).
judgment is appropriate in this case because of the
“absence of any request to set aside the default or
suggestion by the defendant[s] that [they] ha[ve] a
meritorious defense.” Fanning, 257 F.R.D. at 7
(citation and internal quotation marks omitted). And due to
the Clerk's entry of default, the defendants are deemed
liable for the well-pleaded allegations in the complaint.
Boland, 304 F.R.D at 35.
“[t]he clerk's entry of default alone is enough to
establish the defendant's liability, ”
id., the Court still must independently determine
the amount of damages. Ventura, 134 F.Supp.3d at
103. Here, § 5321(a)(5)(C) provides for the imposition
of civil penalties against taxpayers who willfully fail to
comply with § 5314(a) in the amount of the greater of
$100, 000 or 50% of the balance in the relevant bank accounts
at the time of the violation. This penalty is subject to
interest and further penalties under 31 U.S.C. § 3717.
support of its motion for default judgment, the plaintiff has
submitted (1) the declaration of Sean P. O'Donnell,
counsel for the plaintiff, Dkt. 27-2; and (2) the declaration
of Nancy Beasley, the assigned Foreign Bank Account Reporting
Act Penalty Coordinator for the IRS in Detroit, Michigan,
Dkt. 27-3. The declarations and their accompanying exhibits,
see Dkt. 27, set forth the plaintiff's
calculations, detailing the principal, interest, and penalty
fees owed by each defendant. ...