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PCS Wireless LLC v. Doe

United States District Court, D. New Jersey

October 22, 2019


          OPINION & ORDER

          John Michael Vazqurez, U S.D.J.

         This matter comes before the Court on Plaintiff PCS Wireless LLC's ("Plaintiff' or "PCS") unopposed motion for default judgment as to all Defendants pursuant to Fed.R.Civ.P. 55(b)(2). D.E. 19. The Court reviewed all submissions made in support of the motion and considered the motion without oral argument pursuant to Fed, R. Civ. P. 78(b) and L. Civ. R. 78.1(b). For the reasons stated below, Plaintiffs motion is DENIED.

         I. INTRODUCTION [1]

         In brief, Plaintiff alleges that Defendants are involved in a fraudulent scheme whereby Defendants contact Plaintiffs customers, potential customers, and vendors. Defendants contact those persons using email addresses that are slightly different than the actual email addresses affiliated with Plaintiff. Defendants falsely identify themselves as PCS agents and attempt to defraud the individual they contacted into wiring money or shipping Defendants goods with a PCS account. Compl. ¶¶ 9-14, 22, 90, 122, 126. In furtherance of the fraudulent scheme, Defendants misappropriated and infringed Plaintiffs trademark by using it on fabricated invoices and in the signature line of the fraudulent emails. Id. ¶¶ 3, 35, 36, 52, 92(b).

         On May 16, 2019, Plaintiff filed a Verified Complaint and also requested a temporary restraining order to stop Defendants' alleged illegal conduct. D.E. 1. The Verified Complaint asserts claims for (1) fraud/misrepresentation; (2) violations of the Lanham Act -- false designation of origin, 15 U.S.C. § 1125(a)(1)(A); (3) civil conspiracy; (4) accounting; and (5) constructive trust. D.E. 1. The Court entered a temporary restraining order (the "TRO") and ordered that Defendants show cause on or before May 28, 2019 as to why a preliminary injunction should not be entered.[2] D.E. 3. The Court also granted Plaintiffs request to serve Defendants via alternate means. Id.

         Defendants were served with copies of the Summons, Verified Complaint, and the TRO between May 21 and 23, 2019 via the Court-approved alternate means. D.E. 9. Defendants failed to respond by the return date of the order to show cause. On May 28, 2019, the Court entered a preliminary injunction extending the relief set forth the TRO. D.E. 13. Defendants also failed to answer or otherwise respond to the Verified Complaint. As a result, the clerk of court entered default as to all Defendants on July 8, 2019. Plaintiff subsequently filed this motion for default judgment pursuant to Federal Rule of Civil Procedure 55.


         Federal Rule of Civil Procedure 55 allows for the entry of default against a party that fails to plead or otherwise defend against claims. Fed.R.Civ.P. 55. "The entry of a default judgment is largely a matter of judicial discretion, although the Third Circuit has emphasized that such 'discretion is not without limits, . . . and [has] repeatedly state[d] [its] preference that cases be disposed of on the merits whenever practicable.'" Chanel, Inc. v. Gordashevsky, 558 F.Supp.2d 532, 535 (D.N.J. 2008) (quotingHritz v. Woma Corp., 732 F.2d 1178, 1181 (3d Cir.1984)).

         In entering a default judgment, a court must determine whether (1) it has personal and subject matter jurisdiction; (2) the defendants were properly served; (3) the complaint sufficiently pleads a cause of action; and (4) the plaintiff has proven damages. Days Inns Worldwide, Inc. v. Jinisha Inc., No. 14-6794, 2015 WL 4508413, at *1 (D.N.J. July 24, 2015). Additionally, a court must determine the appropriateness of default judgment by weighing (1) the prejudice suffered by the party seeking default judgment; (2) whether the party subject to the default has a meritorious defense; and (3) the culpability of the party subject to default. Id. at *2.

         HI. ANALYSIS

         A. Service

         "Before the Court can enter default judgment, it must find that process was properly served on the Defendants]." Teamsters Pension Fund of Phila. & Vicinity v. Am. Helper, Inc., No.11-624, 2011 WL 4729023, at *2 (D.N.J. Oct. 5, 2011) (citing Gold Kist, Inc. v. Laurinburg Oil Co., Inc., 756 F.2d 14, 19 (3d Cir. 1985)). Federal Rule of Civil Procedure 4 provides that to serve an individual defendant within the United States, a plaintiff may follow "state law for serving a summons ... in the state where the district court is located or where service is made." Fed.R.Civ.P. 4(e)(1). Pursuant to New Jersey law, "[i]f service cannot be made by any of the modes provided by [the relevant] rule, any defendant may be served as provided by court order, consistent with due process of law." NJ. Ct. R. 4:4-4(b)(3). As discussed, the Court authorized alternate service here because Defendants' whereabouts were unknown. Accordingly, Defendants were served pursuant to the Court-approved methods of service, which included service via email as to all Defendants, in addition to telephoning one Defendant and providing additional notice to another Defendant via Linkedln. D.E. 9.

         Plaintiff pleads that two Defendants are citizens of New York, three are Delaware citizens, and Defendant John Doe 6 a/k/a Abraham Austin is a citizen of Nigeria. Compl. ¶¶ 9-14. The Court assumes that the Defendants who are citizens of New York and Delaware are physically located within the United States. Consequently, service was proper as to these Defendants. Plaintiff, however, pleads no facts as to John Doe 6's physical whereabouts. Given the fact that John Doe 6 is a citizen of Nigeria, the Court assumes that he is not physically located in the United States. Accordingly, John Doe 6 could not be served pursuant to Rule 4(e)(1) because it only applies to service on individuals who are physically present in the country.

         Rule 4(f) governs service of an individual in a foreign country. An individual located outside of the United States may be served pursuant to an "internationally agreed means of service that is reasonably calculated to give notice, such as those authorized by the Hague Convention on the Service Abroad of Judicial and Extrajudicial Documents." Fed.R.Civ.P. 4(f)(1). Nigeria is not a party to an international service of process treaty such as the Hague Convention on the Service Abroad of Judicial and Extrajudicial Documents. See Mada, Edozie & Madu, ...

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