Barba v. Brimfield

FINDINGS AND RECOMMENDATIONS

Youlee Yim You United States Magistrate Judge

FINDINGS

Plaintiff Dale Barba has brought suit against defendant Lawrence Brimfield, alleging claims for breach of contract, unjust enrichment, breach of fiduciary duty, fraud/negligent misrepresentation, and accounting. Compl., ECF 1. Defendant has not filed an Answer or otherwise appeared in this matter. On November 29, 2022, plaintiff filed a motion for entry of default against defendant (ECF 7), and the Clerk of the Court entered default on December 14, 2022. ECF 9. Plaintiff has now filed a motion for default judgment (ECF 11), which should be GRANTED, and a motion for attorney's fees and costs (ECF 16), which should be GRANTED IN PART for the reasons explained below.

I. Subject Matter Jurisdiction

Federal courts are courts of limited jurisdiction. Kokkonen v. Guardian Life Ins. Co. ofAm., 511 U.S. 375, 377 (1994). “It is to be presumed that a cause lies outside this limited jurisdiction, . . . and the burden of establishing the contrary rests upon the party asserting jurisdiction.” Id. “If the court determines at any time that it lacks subject-matter jurisdiction, the court must dismiss the action.” FED. R. CIV. P. 12(H)(3); see also Fiedler v. Clark, 714 F.2d 77, 78-79 (9th Cir. 1983) (recognizing that the court may sua sponte dismiss an action if it finds that subject matter jurisdiction is lacking).

This court has subject-matter jurisdiction over this case under 28 U.S.C. § 1332(a) because there is complete diversity of citizenship among the parties-plaintiff is a citizen of California and defendant is a citizen of Oregon-and the amount in controversy exceeds $75,000, exclusive of interest and costs.

II. Personal Jurisdiction

A district court “has an affirmative duty” to determine whether it has personal jurisdiction over a defendant before entering a default judgment. In re Tuli, 172 F.3d 707, 712 (9th Cir. 1999). “A judgment entered without personal jurisdiction over the parties is void.” Id.

“Federal courts ordinarily follow state law in determining the bounds of their jurisdiction over persons.” Picot, 780 F.3d at 1211 (quoting Daimler AG v. Bauman, 571 U.S. 117, 125 (2014)); see FED. R. CIV. P. 4(k)(1)(A). Oregon Rule of Civil Procedure (“ORCP”) 4 L confers jurisdiction “in any action where prosecution of the action against a defendant in this state is not inconsistent with the Constitution of this state or the Constitution of the United States.” Thus, Oregon extends jurisdiction to the limits of due process under the United States Constitution. Swank v. Terex Utilities, Inc., 274 Or.App. 47, 57 (2015).

Constitutional due process requires that the defendant “have certain minimum contacts with [the forum] such that the maintenance of the suit does not offend traditional notions of fair play and substantial justice.” Int'l Shoe Co. v. Wash., 326 U.S. 310, 316 (1945) (citations omitted). “In giving content to that formulation, the Court has long focused on the nature and extent of ‘the defendant's relationship to the forum State.'” Ford Motor Co. v. Montana EighthJud. Dist. Ct., 141 S.Ct. 1017, 1024 (2021) (quoting Bristol-Myers Squibb Co. v. Superior Ct. ofCalifornia, San Francisco Cty., 137 S.Ct. 1773, 1779 (2017)). That focus led to the recognition of two kinds of personal jurisdiction: general jurisdiction and specific jurisdiction. Id. (citing Goodyear Dunlop Tires Operations, S.A. v. Brown, 564 U.S. 915, 919 (2011)). General jurisdiction extends to “any and all claims” brought against a defendant, but a court may exercise general jurisdiction only when a defendant is “essentially at home” in the forum state. FordMotor, 141 S.Ct. at 1024 (citation omitted). Individuals are subject to general jurisdiction in their place of domicile. Id. (citing Daimler, 571 U.S. at 137); Milliken v. Meyer, 311 U.S. 457, 463 (1940) (“The state which accords him privileges and affords protection to him and his property by virtue of his domicile may also exact reciprocal duties.”).

Defendant resides in Oregon; therefore, this court has personal jurisdiction over defendant. For the same reason, venue is also proper in this district. 28 U.S.C.A. § 1391(b)(1) (“A civil action may be brought in . . . a judicial district in which any defendant resides, if all defendants are residents of the State in which the district is located[.]”).

III. Service of Process

Before entering a default judgment, the court must “assess the adequacy of the service of process on the party against whom default is requested.” Bank of the West v. RMA Lumber Inc., No. C 07-06469 JSW, 2008 WL 2474650, at *2 (N.D. Cal. June 17, 2008). “[I]n the absence of

proper service of process, the district court has no power to render any judgment against the defendant's person or property unless the defendant has . . . waived the lack of process.” S.E.C.v. Ross, 504 F.3d 1130, 1138-39 (9th Cir. 2007).

Under Federal Rule of Civil Procedure 4(e), service on an individual within this judicial district may be accomplished by following state law or “(A) delivering a copy of the summons and of the complaint to the individual personally; (B) leaving a copy of each at the individual's dwelling or usual place of abode with someone of suitable age and discretion who resides there; or (C) delivering a copy of each to an agent authorized by appointment or by law to receive service of process.”

Plaintiff made seven attempts to serve defendant at his residence, 3798 N Melrose Drive, where a visitor confirmed plaintiff lived. Cody Decl. ¶ 3, ECF 5. Plaintiff also attempted to serve defendant at another business that defendant owns at 4525 SE Division Street. Id., ¶¶ 4-5. Additionally, pursuant to ORCP 7 D(3)(a)(i), plaintiff sent a summons and copy of the complaint via certified mail, return receipt requested, to both plaintiff's residence and business addresses, but it was unclear whether defendant was the person who had signed for them. Id. ¶ 6. Therefore, the court granted plaintiff's request for alternative service by email, to be sent in conjunction with certified mail, return receipt requested, to defendant's last-known mailing address. Order, ECF 6.

Pursuant to the court's order, plaintiff's counsel served defendant via email on November 1, 2022, including the summons and complaint as attachments, as well as the pretrial scheduling order and order granting alternative service. Cody Decl ¶ 4, ECF 8. Defendant responded to the email later that same date, confirming that his address was 3798 N Melrose Drive. Id. ¶ 5, id., Ex. B, ECF 8-2. The following day, plaintiff's counsel mailed copies of the documents

described above, via certified mail, return receipt requested, to the Melrose Drive address, as well as the Division Street address.

Under these circumstances, plaintiff has established that the service of process in this case is adequate.

IV. Damages

Upon entry of default, the factual allegations in the complaint are taken as true, except for the allegations relating to damages. Geddes v. United Fin. Grp., 559 F.2d 557, 560 (9th Cir. 1977). A plaintiff must provide proof for the damages sought. See TWC Int'l, Inc. v. Greene, 889 F.2d 1096 (9th Cir. 1989) (affirming district court's determination of damages based on written affidavit and oral testimony).

Plaintiff moves for default judgment only on his breach of contract claim. Mot. 1, ECF 11. Thus, it is not necessary to assess damages for plaintiff's other claims, such as fraud/negligent misrepresentation.

“To state a claim for breach of contract, plaintiff must allege the existence of a contract, its relevant terms, plaintiff's full performance and lack of breach and defendant's breach resulting in damage to plaintiff.” Slover v. Oregon State Bd. of Clinical Soc. Workers, 144 Or.App. 565, 570 (1996) (citation and quotation marks omitted). Plaintiff alleges his breach of contract claim as follows:

30. By his agreement to become a co-owner of Lines of Man, Brimfield entered a binding and enforceable contract with Barba to, among other things:

a. Contribute to the business in equal measure with Barba;

b. Fairly and honestly account for his dealings with the business, including the value of his contributions to it, as well as the nature and extent of his use of its assets;

c. Devote his best efforts to promoting the success of the business; and,

d. Deal fairly, honestly, and transparently with Barba in all matters associated with the business.

31. Brimfield has materially breached these obligations by his refusal to honestly account for his dealings with Lines of Man; his improper use of company resources for his personal gain; his failure to contribute goods in equal measure with