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Alexander v. Southeastern Wholesale Corp.

United States District Court, E.D. Virginia, Norfolk Division

February 26, 2014

ANDRE ALEXANDER, Plaintiff,
v.
SOUTHEASTERN WHOLESALE CORP., Bay Auto.

REPORT & RECOMMENDATION

TOMMY E. MILLER, Magistrate Judge.

This matter comes before the Court on Plaintiff's Motion for Default Judgment in favor of Plaintiff, Andre Alexander, and against Bay Auto, Southeastern Wholesale Corp, d/b/a Bay Auto Wholesale ("Bay Auto"). Plaintiff filed this Motion for Default Judgment on December 12, 2013. ECF No. 58. On December 18, 2013, the matter was referred to the undersigned United States Magistrate Judge pursuant to the provisions of 28 U.S.C. §§ 636(b)(1)(B) and (C) and Rule 72 of the Rules of the United States District Court for the Eastern District of Virginia. ECF No. 62. Pursuant to Federal Rule of Civil Procedure 55(b), Bay Auto having failed to appear, plead, or otherwise defend the instant action, the Court RECOMMENDS that Plaintiff's motion be GRANTED and damages be awarded.

I. PROCEDURAL HISTORY

Plaintiff filed this suit on April 22, 2013 against Defendants Bay Auto and Jason D. Adams, Inc. ("Adams").[1] ECF No. 1. On July 8, 2013, Plaintiff filed an amended complaint. ECF No. 33. On July 30, 2013, Plaintiff filed a second amended complaint. ECF No. 44. On August 26, 2013, Bay Auto's counsel, J. Brian Donnelly, Esq., filed a motion to withdraw on the grounds that he had been discharged. ECF No. 48. The motion was referred to the undersigned on August 27, 2013, and a hearing was held on September 6, 2013, ECF No. 51, after which the undersigned granted Mr. Donnelly's motion to withdraw. ECF No. 55.

On September 11, 2013, Joseph C. Brown, Jr., Bay Auto's President, submitted a letter with this Court on Bay Auto's behalf. ECF No. 52. This letter consists of a handwritten note on a copy of the letter in which Mr. Brown letter discharged Mr. Donnelly. Id. The note effectively offers the contents of the letter as Bay Auto's Answer to Plaintiff's Second Amended Complaint. Id. Plaintiff filed the instant Motion for Default Judgment and Damages on December 12, 2013. ECF No. 58. The motion was assigned to the undersigned on December 18, 2013. On December 23, 2013, Mr. Brown submitted another letter on Bay Auto's behalf in response to Plaintiff's motion. ECF No. 67. On December 30, 2013, Mr. Brown submitted a third letter on Bay Auto's behalf requesting an evidentiary hearing on damages. ECF No. 68. Mr. Brown's letters were entered subject to defect and not considered to be responsive pleadings because Bay Auto is a corporation and a corporation must be represented by licensed counsel. Rowland v. Cal. Men's Colony, Unit II Men's Advisory Council , 506 U.S. 194, 201-02 (1993) ("It has been the law for the better part of two centuries... that a corporation may appear in the federal courts only through licensed counsel.").

On January 7, 2014, Bay Auto was ordered to correct the defects in its purported pleadings within thirty days or have the documents stricken from the record. ECF No. 70. Thirty days have elapsed and Bay Auto has not corrected the defects in its pleadings. Therefore, Bay Auto has not appeared, pled, or otherwise defended the instant action in any way cognizable by this Court. Plaintiff's Motion for Default Judgment and Damages is now ripe for decision.

II. JURISDICTION AND VENUE

Based on the facts of this case, the Court holds both subject matter jurisdiction over the case and personal jurisdiction over the defendant. Similarly, venue is proper.

A. Subject Matter Jurisdiction

A federal district court has subject matter jurisdiction over claims that arise from federal law. 28 U.S.C. § 1331 (2012). Plaintiff's first cause of action arises under the Motor Vehicle Information and Cost Savings Act of 1976 ("the Odometer Act") as amended and recodified at 49 U.S.C. Section 32701. Pl.'s 2d Am. Compl., at 1. Because this cause of action arises under a federal statute, this Court holds proper subject matter jurisdiction.

A federal district court has supplemental subject matter jurisdiction over state law claims that are part of the same case or controversy as claims over which it holds original jurisdiction under 28 U.S.C. Section 1331. 28 U.S.C. § 1367(a) (2012). Plaintiff's third and fourth causes of action arise under the Virginia Consumer Protection Act (VCPA) of 1977, Va. Code § 59.1-196 et seq. (2013), and Virginia common law, respectively.[2] Because each of these causes of action arises from the same transaction as Plaintiff's federal Odometer Act cause of action, this Court holds proper supplemental jurisdiction.

B. Personal Jurisdiction

Personal jurisdiction over a defendant is established when a defendant has sufficient "minimum contacts with [the forum state] such that the maintenance of the suit does not offend traditional notions of fair play and substantial justice, '" Int'l Shoe Co. v. Washington , 326 U.S. 310, 316 (1945) (quoting Milliken v. Meyer , 311 U.S. 457, 463 (1941)), and when the defendant is subject to the personal jurisdiction of the courts of general jurisdiction of the forum state. See Fed.R.Civ.P. 4(k)(1)(A). Additionally, there must be "effective service of process" to provide this Court with personal jurisdiction. See Int'l Shoe Co. , 326 U.S. at 316-17.

The statutory and constitutional requirements for personal jurisdiction are satisfied here. Bay Auto is a commercial business located in Virginia Beach, Virginia, 2d Am. Compl., ¶ 2, and it therefore has sufficient contact with the forum state, and is subject to the jurisdiction of Virginia courts of general jurisdiction. See Va. Code § 8.01-328.1. Service of process was also proper. The Federal Rules of Civil Procedure permit service of process in accordance with the laws of the forum state. Fed.R.Civ.P. 4(e)(1) & (h)(1). Virginia designates "[a] corporation's registered agent [as] the corporation's agent for service of process." Va. Code § 13.1-637 (2001). Plaintiff's private process server served Bay Auto's registered agent on May 2, 2013, in Virginia Beach, Virginia. ECF No. 5. Accordingly, this Court has personal jurisdiction over Bay Auto.

C. Venue

Venue is proper in this district. Venue is proper in a district when the defendant resides in the district; or when "a substantial part of the events or omissions giving rise to the claim occurred." 28 U.S.C. § 1391(b) (2012). Bay Auto's registered address is in Virginia Beach and a substantial part of the events giving rise to the claim occurred there. Accordingly, venue is proper.

III. FINDINGS OF FACT

1. On August 24, 2010, Plaintiff agreed to purchase a 2003 Dodge Ram Pickup from Bay Auto for $13, 375.00. Pl.'s 2d Am. Compl., ¶ 18, ECF No. 44.

2. At the time of the purchase, Bay Auto certified that the vehicle's odometer reading of 29, 586 miles was the actual mileage on the vehicle to the best of its ...


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