United States District Court, D. Arizona
Rosemary Marquez, United States District Judge
before the Court is Plaintiffs' “Motion to Court
for Entry of Default Judgment and Request for Monetary
Relief” as to Defendants El Rio Bakery and Carlos
Guillermo Vargas Mendoza. (Docs. 29, 30.) For the reasons
explained below, the Court will grant Plaintiffs' Motion
and award the requested relief.
filed a Complaint on March 7, 2018 (Doc. 1) and the operative
Amended Complaint on June 24, 2018 (Doc. 12). Plaintiffs
allege that Defendants El Rio Bakery and its owner, Defendant
Carlos Guillermo Vargas Mendoza, failed to pay Plaintiffs for
all hours worked, failed to pay overtime, and retaliated
against Plaintiffs after they complained. (Doc. 12.)
Plaintiffs raise claims for overtime violations under the
Fair Labor Standards Act (“FLSA”), 29 U.S.C.
§ 207(a); failure to pay the minimum wage in compliance
with the Arizona Minimum Wage Act (“AMWA”),
A.R.S. § 23-362, et. seq.; failure to make
timely wage payments under the Arizona Wage Act
(“AWA”), A.R.S. § 23-351; retaliation in
violation of the FLSA, 29 U.S.C. § 215(a)(3);
retaliation in violation of the AMWA, A.R.S. §
23-364(B); and common law unjust enrichment. (Id.)
Service was executed upon Defendants El Rio Bakery and Vargas
Mendoza on August 28, 2018. (Docs. 15, 16.)
Defendant filed an Answer to Plaintiff's Amended
Complaint. (Doc. 12.) On September 14, 2018, Defendant Vargas
Mendoza gave notice via counsel that he had filed a Chapter
13 Bankruptcy Petition. (Doc. 17.) The Court ordered briefing
as to whether the automatic stay provision of 11 U.S.C.
§ 362 applied to Defendants in light of the pending
bankruptcy petition. (Doc. 18.) Both parties agreed that the
stay provision applied only to Defendant Vargas Mendoza, the
debtor in the bankruptcy petition, and not to Defendant El
Rio Bakery. (Docs. 19, 20.) On December 17, 2018, the Court
provided Defendant El Rio Bakery an extension of time to file
its Answer, but no Answer was filed. (Doc. 21.)
January 2, 2019, Plaintiffs requested entry of default
against Defendant El Rio Bakery pursuant to Rule 55(a) of the
Federal Rules of Civil Procedure. (Doc. 22.) Default was
entered as to Defendant El Rio Bakery by the Clerk of Court
on that same day. (Doc. 23.) On February 19, 2019, the
Bankruptcy Court dismissed Defendant Vargas Mendoza's
Chapter 13 Petition, thus lifting the automatic stay pursuant
to 11 U.S.C. § 362(c)(2)(B). (Doc. 26.) Default was then
entered as to Defendant Vargas Mendoza after he failed to
timely file an Answer. (Docs. 26, 27.) On April 4, 2019,
Plaintiffs moved for entry of default judgments against both
Defendant El Rio Bakery and Defendant Vargas Mendoza. (Docs.
August 20, 2019, the Court ordered that Defendants show cause
as to why default judgment should not be entered against
them. (Doc. 32.) The Court also provided Plaintiffs an
opportunity to submit additional evidence and argument on the
issue of damages. (Id.) Plaintiffs submitted
additional evidence and argument. (Doc. 36.) Defendants did
not respond to the Court's Order to Show Cause.
Default Judgment Standard
party's default has been entered, the district court may
grant default judgment against that party. See Fed.
R. Civ. P. 55(b)(2); Aldabe v. Aldabe, 616 F.2d
1089, 1092 (9th Cir. 1980). A defendant's default does
not automatically entitle the plaintiff to a court-ordered
judgment. Aldabe, 616 F.2d at 1092. Rather, a court
has discretion whether to grant or deny relief. Id.
The Ninth Circuit has identified several factors, discussed
below, which a court should consider in adjudicating a motion
for default judgment. Eitel v. McCool, 782 F.2d
1470, 1471-72 (9th Cir. 1986).
Defendants have failed to appear in this action, the Court
has an “affirmative duty to look into its jurisdiction
over both the subject matter and the parties” before
granting entry of default judgment. In re Tuli, 172
F.3d 707, 712 (9th Cir. 1999). Both subject matter and
personal jurisdiction are proper in this case.
Court has original federal question jurisdiction over
Plaintiffs' FLSA claims. 28 U.S.C. § 1331. The Court
also has supplemental jurisdiction over Plaintiffs'
claims arising under Arizona law because those claims are so
substantially related to Plaintiffs' FLSA claims that
they form part of the same “case or controversy.”
28 U.S.C. § 1367(a).
Court also has jurisdiction over the parties. Defendants
Vargas Mendoza and El Rio Bakery were residents of Tucson,
Arizona when the events complained of occurred and this
action was filed. (Doc. 12 ¶¶ 16-20.) Defendants
conducted business in Arizona, and this case concerns their
alleged failure to comply with various employment statutes as
applied to their Arizona employees. (Id.) Personal
service was properly executed against Defendants on August
28, 2019. (Docs. 15, 16.)
the Court finds that it has jurisdiction over the subject
matter and the parties.
The Eitel Factors Counsel in Favor of the Entry of
Eitel, the Ninth Circuit laid out seven factors that
may be considered by courts exercising discretion as to the
entry of a default judgment:
(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
782 F.2d at 1471-72. In applying the Eitel factors,
“the factual allegations of the complaint, except those
relating to the amount of damages, will be taken as
true.” Geddes v. United Fin. Grp., 559 F.2d
557, 560 (9th Cir. 1977). The Court will discuss each factor
Possibility of Prejudice to the Plaintiff
served Defendants with their Amended Complaint in August
2018. (Docs. 15, 16.) Defendants have failed to answer. In
the absence of a default judgment, Plaintiffs will
“likely be without other recourse for recovery.”
Young Poong USA Corporation v. Young Poong Paper Mfg
Co., No. CV-17-02434-PHX-DMF, 2018 WL 4177942, at *4 (D.
Ariz. July 3, 2018) (quoting PepsiCo, Inc. v. Cal. Sec.
Cans., 238 F.Supp.2d 1172, 1177 (C.D. Cal. 2002). The
possibility of prejudice to plaintiffs therefore weighs in
favor of the entry of default judgment.
Merits and Sufficiency of Complaint
seek damages on their claims for overtime violations under
the FLSA, failure to pay the minimum wage in compliance with
the AMWA, and retaliation in violation of the FLSA and AMWA.
The Court addresses each claim below.
Overtime Violations Under the Fair Labor Standards Act
overtime provisions of the FLSA provide that employers must
pay one and one-half the regular hourly rate of compensation
for hours worked beyond a regular forty-hour workweek. 29
U.S.C. § 207(a)(1). To state a plausible claim of an
overtime violation under FLSA, a plaintiff must do more than
“present generalized allegations asserting
violations” of the overtime provisions. Landers v.
Quality Commc'ns, Inc. 771, F.3d 638, 646 (9th Cir.
2014), cert. denied, 135 S.Ct. 1845 (2015). Rather,
under the post-Twombly and Iqbal standard,
a plaintiff must plead specific factual allegations
“that there was at least one workweek in which they
worked in excess of forty hours and were not paid overtime
wages.” Id. Here, Plaintiffs' complaint
meets this burden because each Plaintiff specifies at least
one week in which he or she worked a specific number of