United States District Court, E.D. Wisconsin
SHARON A. VANDER MEER-WEISS, Plaintiff,
KROGER COMPANY, Defendant.
DECISION AND ORDER GRANTING MOTION TO SET ASIDE
DEFAULT AND MOTION FOR LEAVE TO ANSWER, FILE A MOTION, OR
JOSEPH, UNITED STATES MAGISTRATE JUDGE.
April 19, 2019, the Clerk of Court entered default against
Kroger Company in favor of Sharon A. Vander Meer-Weiss. The
Kroger Co. now appears, arguing the wrong entity was name as
a defendant in this action, and moves to set aside the
default and for leave to answer, file a motion, or otherwise
plead. For the reasons further explained below, the
defendant's motion is granted.
29, 2018, Sharon A. Vander Meer-Weiss filed a complaint
against her former employer, Kroger Company. (Docket # 1.)
Vander Meer-Weiss alleged that she was terminated from her
employment due to her age and disability, in violation of the
Age Discrimination in Employment Act (“ADEA”), 29
U.S.C. §§ 621 to 634, the Americans with
Disabilities Act (“ADA”), 42 U.S.C.§§
12112 to 12117, and the Wisconsin Fair Employment Act
(“WFEA”). After screening her complaint, I found
that she failed to state a claim under the ADEA and that she
could not proceed on her WFEA claim. I granted Vander
Meer-Weiss leave to file an amended complaint. (Docket # 4.)
Vander Meer-Weiss filed an amended complaint, proceeding
solely on her ADA claim. (Docket # 5.) Upon screening the
amended complaint, I ordered the United States Marshals
service to serve the amended complaint upon the defendant.
(Docket # 6.)
return of service form was docketed indicating that
“Kroger Company” was served care of its
registered agent, CT Corporation Service Company on October
22, 2018. (Docket # 10.) After approximately five months with
no activity, I issued an order stating that Vander Meer-Weiss
must either move for default judgment, or the action would be
dismissed for failure to prosecute. (Docket # 11.) Vander
Meer-Weiss subsequently moved for default, and the clerk
entered default on April 19, 2019. (Docket # 12.) On April
22, 2019, I issued an order stating that Vander
Meer-Weiss' request for the entry of default was
insufficient for the entry of default judgment because she
did not comply with Fed.R.Civ.P. 55(b). (Docket # 13.) Vander
Meer-Weiss filed an amended motion for default judgment,
requesting back pay in the amount of $45, 593.60, future pay
in the amount of $376, 147.20, punitive damages in the amount
of $1.5 million, and compensatory damages in the amount of
$1.5 million. (Docket # 14.)
evidentiary hearing on Vander Meer-Weiss' motion was
scheduled and postponed several times. (Docket # 16, Docket #
19, Docket # 21.) On September 4, 2019, Vander Meer-Weiss was
warned that she would receive no further adjournments of the
evidentiary hearing and the hearing was scheduled for October
10, 2019. (Docket # 21.) On September 26, 2019, the Court
received a letter from Rosalyn Darinski, who stated that she
received a subpoena to appear at Vander Meer-Weiss'
evidentiary hearing but had no knowledge of the case. (Docket
# 22.) On October 9, 2019, counsel for “The Kroger
Co.” entered an appearance in this case and moved to
postpone the evidentiary hearing to allow the defendant an
opportunity to review the case and respond accordingly.
(Docket # 26.) On October 10, 2019, both counsel for The
Kroger Co. and Vander Meer-Weiss appeared at the hearing.
(Docket # 30.) I granted The Kroger Co.'s motion to stay
the evidentiary hearing and allowed it an opportunity to file
a responsive pleading. (Id.) Presently before me is
The Kroger Co.'s motion to set aside the default and for
leave to answer, file a motion, or otherwise plead. (Docket #
31.) Vander-Meer Weiss opposes the motion. (Docket # 39)
Motion to Set Aside Default
seeking to vacate an entry of default prior to the entry of
final judgment must show: (1) good cause for the default; (2)
quick action to correct it; and (3) a meritorious defense to
the complaint. Fed.R.Civ.P. 55(c); Cracco v. Vitran Exp.,
Inc., 559 F.3d 625, 630 (7th Cir. 2009). While the same
test applies for motions seeking relief from default judgment
under both Rule 55(c) and Rule 60(b), the test “is more
liberally applied in the Rule 55(c) context.”
United States v. Di Mucci, 879 F.2d 1488, 1495 (7th
Cir. 1989). The Seventh Circuit has a well-established policy
favoring trial on the merits over default judgment.
Cracco, 559 F.3d at 631. Kroger argues that it meets
all of the requirements for setting aside the entry of
default. I will address each element in turn.
Kroger Co. must first show good cause to set aside the
default. In Sims v. EGA Prod., Inc., 475 F.3d 865,
868 (7th Cir. 2007), the Seventh Circuit stated that Rule
55(c) requires “‘good cause' for the judicial
action, not ‘good cause' for the defendant's
error; as used in this Rule, the phrase is not a synonym for
‘excusable neglect.'” Two years later,
however, the Seventh Circuit in Cracco found that a defendant
seeking to set aside a default under Rule 55(c) had to show
“good cause for the late submission of its
answer.” 559 F.3d at 631. In Cracco, the court
determined that because the defendant did not willfully
ignore the pending litigation and failed to respond to the
summons and complaint through inadvertence, it established
good cause. Id. “Reading these decisions
together, the court first looks to the defendant's excuse
for the default, then looks to whether there is ‘good
cause' for judicial action to set aside a default, such
as when a default judgment would yield an unjust award of
damages.” See United States f/u/b/o Venture Elec.
Contractors, Inc. v. Liberty Mut. Ins. Co., No.
17-CV-1473, 2018 WL 4120175, at *6 (E.D. Wis. Aug. 29, 2018).
Kroger Co. argues that Vander Meer-Weiss worked for
Roundy's Supermarkets, Inc. (Declaration of Jessica
Offenbacher ¶ 3, Docket # 33), a wholly owned subsidiary
of The Kroger Co. (Declaration of Dorothy Roberts
(“Roberts Decl.”) ¶ 3, Docket # 34). The
Kroger Co. asserts that there is no separate legal entity
called “Kroger Company, ” as Vander Meer-Weiss
named in her complaint. (Roberts Decl. ¶ 3.) It argues
that the U.S. Marshals Service served the wrong agent for
service of process when it served “Kroger
Company” c/o CT Corporation Service Company.
(Def.'s Br. at 4, Docket # 32.) Thus, The Kroger Co.
contends that it was never served with a Summons or Complaint
in this matter. (Roberts Decl. ¶ 6.)
Meer-Weiss argues that because The Kroger Co. was aware of
her EEOC claim and did not dispute her claim for unemployment
benefits, it should have known about her lawsuit. (Pl.'s
Br. at 2, Docket # 39.) While Vander Meer-Weiss asserts that
“Kroger Company” was served with her complaint
(Docket # 39 at 2), she does not counter defendant's
assertion that “The Kroger Co.” was never served
with her complaint. The Kroger Co. clearly had notice of
Vander Meer-Weiss' discrimination claim-Vander Meer-Weiss
filed an EEOC charge and “The Kroger Co.” was
copied on Vander Meer-Weiss' right to sue letter. (Docket
# 39-1 at 4.) But there is a difference between knowing
someone has a potential lawsuit and actually being served
with a lawsuit. For all The Kroger Co. knew, Vander
Meer-Weiss chose not to pursue her claim any further. And the
fact that The Kroger Co. did not contest her unemployment
benefits has no bearing on its notice of this lawsuit.
find that The Kroger Co. has demonstrated “good
cause” for setting aside the default. The Kroger Co.
was not willfully ignoring the pending litigation; rather,
Vander Meer-Weiss named the wrong entity ...