United States District Court, D. Arizona
MICHAEL T. LIBURDI JUDGE
JPMorgan Chase Bank NA moves for default judgment against
Defendants U.S. Metal Buildings Corp. (“U.S.
Metal”) and U.S. Building Systems Corp. (“U.S.
Building”) pursuant to Fed.R.Civ.P. 55(b)(2). (Doc.
19.) Neither Defendant has filed a response. For the reasons
stated below, Plaintiff's motion is granted.
case arises out of Defendants' alleged breach of a lease
agreement (the “Lease”) involving commercial real
estate in Tempe, Arizona. (Doc. 1.) Plaintiff filed its
Complaint on March 1, 2019. (Id.) The Complaint
states that on or about January 12, 2012, BREOF BNK 2
Southwest, LLC (“BREOF”) entered into the Lease,
as landlord, with U.S. Building as tenant. On or about
January 14, 2013, U.S. Building and U.S. Metal executed an
“Assignment and Assumption of Lease and Consent to the
Landlord, ” which transferred the tenant obligations to
U.S. Metal but did not release U.S. Building from liability.
(Id. ¶ 14-15.) The Lease was extended through
July 31, 2018 (the “Amendment”). (Id.
¶ 18-19.) Plaintiff states that it is the
successor-in-interest to BREOF in connection with the Lease.
(Id. ¶ 20.) Plaintiff also states that
Defendants failed to make any rent payments beginning August
1, 2016. (Id. ¶ 21.) The Complaint prays for
relief in the form of late rent payments, reimbursement of
rental incentives, liquidated damages, and attorneys'
fees and costs. (Id. ¶ 24-25.)
failed to file an answer, a motion to dismiss, or any other
response to the Complaint. Upon application (Doc. 14), the Clerk
of the Court entered default against Defendants on June 19,
2019. (Doc. 15.) Plaintiff filed the pending motion on
September 18, 2019. (Doc. 19.) Defendants have failed to
default has been entered and a defendant fails to move to set
aside the default, the Court may enter a default judgment.
Fed.R.Civ.P. 55(b)(2). Following an entry of default, the
Complaint's factual allegations-other than those relating
to the amount of damages-are taken as true. See Fair
Housing of Marin. v. Combs, 285 F.3d 899, 906 (9th Cir.
2002). The entry of default judgment is within the
Court's discretion. Aldabe v. Aldabe, 616 F.2d
1089, 1092 (9th Cir. 1980).
determining whether default judgment is appropriate, the
Court considers the following factors: “(1) the
possibility of prejudice to the plaintiff, (2) the merits of
plaintiff's substantive claim, (3) the sufficiency of the
complaint, (4) the sum of money at stake in the action; (5)
the possibility of a dispute concerning material facts; (6)
whether the default was due to excusable neglect, and (7) the
strong policy underlying the Federal Rules of Civil Procedure
favoring decisions on the merits.” Eitel v.
McCool, 782 F.2d 1470, 1471-72 (9th Cir. 1986). The
Court will address these factors in turn.
Possible Prejudice to Plaintiff
first Eitel factor weighs in favor of granting the
motion because Plaintiff will be prejudiced if default
judgment is not entered. The record reflects that Plaintiff
gave proper notice (Docs. 2, 11, 12), but Defendants have not
responded to this action. If the motion is not granted,
Plaintiff “will likely be without other recourse for
recovery.” PepsiCo, Inc. v. Cal. Sec. Cans.,
238 F.Supp.2d 1172, 1177 (C.D. Cal. 2002).
Merits of Plaintiff's Claim
second Eitel factor also weighs in favor of granting
the motion. This factor requires a plaintiff to “state
a claim on which the [plaintiff] may recover.”
PepsiCo, Inc., 238 F.Supp.2d at 1175. Plaintiff has
alleged that Defendants breached the underlying Lease. (Doc.
1.) To prevail on a breach of contract claim under Arizona
law, “a plaintiff must show a contract, a breach of
contract, and damages.” Best W. Int'l, Inc. v.
Patel, 523 F.Supp.2d 979, 988 (D. Ariz. 2007)
(citing Graham v. Asbury, 112 Ariz. 184, 185
(1975)). Based on the facts described above and in the
Complaint, Plaintiff has pled a prima facia case that
Defendants breached the Lease.