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Federal Insurance Co. v. Wallace

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

March 4, 2015

FEDERAL INSURANCE COMPANY, Plaintiff,
v.
MARGARET WALLACE, And JOHN DOES I-X, Defendants.

MEMORANDUM OPINION AND ORDER

RAYMOND A. JACKSON, District Judge.

Before the Court is Plaintiff Federal Insurance Company ("Federal Insurance")'s Motion for Default Judgment against Defendants Margaret Wallace ("Wallace") and John Does I-X ("the John Doe Defendants"). ECF No. 11. Defendant did not answer the complaint and has made no filings in this case. The Court held a hearing on this matter on March 2, 2015, at which Defendant Wallace appeared. This matter is now ripe for judicial determination. For the reasons stated herein, Plaintiff's Motion for Default Judgment is GRANTED. It is ORDERED that judgment be entered on behalf of Plaintiff and against Defendant Wallace only, in a total amount of $844, 552.70. The John Doe Defendants are all DISMISSED.

I. FACTUAL AND PROCEDURAL HISTORY

On December 6, 2013, Plaintiff Federal Insurance Company filed a Complaint against Defendant Margaret Wallace and several unknown Defendants alleging (1) Fraud; (2) Conversion; and (3) Misappropriation of Funds. Defendant was an employee of Harris Connect, a fundraising and data solutions company, where she worked in the customer service department. Over time, Harris Connect discovered that Defendant Wallace had issued false refunds to her personal credit cards. As a result of Harris Connect's claim, Federal Insurance paid Harris Connect in the amount of $844, 552.70. Plaintiff alleges that Defendants made intentional and knowing misrepresentations, omissions, and concealments with the intent to induce reliance and defraud Harris Connect.

According to a Status Report Plaintiff submitted, Defendant was found guilty of 35 counts of embezzlement on March 10, 2014. Defendant Wallace was sentenced in the Circuit Court of the City of Chesapeake to (according to the Notice filed by Plaintiff) 105 years with 90 years suspended. ECF No. 8.

On March 20, 2014, the Summons and Complaint were served on Defendant Wallace. Defendant failed to fire an Answer or otherwise defend this action, or to serve a copy of any Answer or other defense upon Plaintiff, Plaintiff's agent, or Plaintiff's attorney of record.

On October 29, 2014, the Clerk of the United States District Court for the Eastern District of Virginia entered default against Defendants. ECF No. 10.

On December 11, 2014, Plaintiff filed the instant Motion for Default Judgment, ECF No. 11. Plaintiff attached an affidavit and a Supplemental Roseboro Warning to its Motion.

On January 9, 2015, Plaintiff filed a Motion for a Hearing on the Default Judgment Motion, ECF No. 12.

On March 2, 2015, the Court held a hearing on Plaintiff's Motion. Defendant Wallace was present at the hearing. Because Defendant Wallace is currently incarcerated, the Court ordered the Virginia Department of Corrections to transport Defendant Wallace to the courthouse for a hearingon the Motion. ECF No. 14. At the hearing, Defendant admitted knowledge of this action and that she had never filed a responsive pleading. Hear'g Tr. at 3. Defendant Wallace has no objection to the Court granting Plaintiff's Motion. Id. at 7.

II. LEGAL STANDARD

The Federal Rules of Civil Procedure require the clerk to enter default against a party from whom affirmative relief is sought when that party has "failed to plead or otherwise defend" its case. Fed.R.Civ.P. 55(a). When a plaintiff's claim is not for a sum certain, as in this case, the plaintiff must apply to the Court for default judgment, and if the party against whom the judgment is sought has appeared previously, that party must be served with written notice at least seven days prior to any hearing. Fed.R.Civ.P. 55(b)(2). Further, Rule 55(b)(2) provides that:

The court may conduct hearings or make referrals-preserving any federal statutory right to a jury trial-when, to enter or ...


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