United States District Court, E.D. Michigan, Northern Division
ORDER DISMISSING SHOW AND GRANTING MOTION FOR DEFAULT
L. LUDINGTON United States District Judge
24, 2016, Defendant Trans Union removed this case from the
70-1st Division District Court for Saginaw County, Michigan.
ECF No. 1. Plaintiff Yeska's complaint alleges violations
of the Fair Credit Reporting Act related to certain
“trade lines” that Yeska opened in order to pay
for college. Yeska admits that he never made any payments on
the lines, but disputes the reporting of those trade lines on
his credit reports. All pretrial matters were referred to
Magistrate Judge Patricia T. Morris. ECF No. 6. Although only
Trans Union was served prior to removal, the other Defendants
were subsequently served. Defendant American Student
Assistance Corporation (“ASAC”) did not file an
answer to the complaint after being served. On August 24,
2016, Plaintiff Yeska filed a request for a clerk's entry
of default. ECF No. 33. The same day, the clerk's office
entered a default as to Defendant ASAC.
8, 2017, the Court entered a stipulated order which dismissed
all claims against Defendant Trans Union, LLC, with
prejudice. ECF No. 47. Because Defendant ASAC was the only
remaining Defendant and Yeska had not moved for default
judgment, the Court ordered Yeska to show cause why the case
should not be dismissed for failure to prosecute. ECF No. 48.
On May 22, 2017, Yeska filed a motion for default judgment
against Defendant ASAC. ECF No. 49. Yeska also file a
response to the show cause. ECF No. 50. Because Yeska is now
prosecuting the defaulted Defendant, the show cause will be
dismissed. And, because Yeska is seeking reasonable damages,
the motion for default judgment will be granted.
judgment by default may be entered against a defendant who
has not pleaded or otherwise defended against an action.
Fed.R.Civ.P. 55(b). Before a default judgment may enter, a
party first must obtain a default. Fed.R.Civ.P. 55(a). Once a
default is entered, the defendants are considered to have
admitted the well pleaded allegations in the complaint,
including jurisdiction. Ford Motor Company v. Cross,
441 F.Supp.2d 837, 845 (E. D. Mich. 2006) (citing
Visioneering Construction v. U.S. Fidelity and
Guaranty, 661 F.2d 119, 124 (6th Cir. 1981)). Here,
Plaintiff properly obtained a default against Defendant ASAC,
and the clerk certified that a notice of default was served
on Defendant ASAC.
party secures the entry of default, the party may apply for a
default judgment. Fed.R.Civ.P. 55(b). In reviewing an
application for a default judgment, “[t]he court may
conduct hearings or make referrals … when, to enter or
effectuate judgment, it needs to: (A) conduct an accounting;
(B) determine the amount of damages; (C) establish the truth
of any allegation by evidence; or (D) investigate any other
matter.” Fed.R.Civ.P. 55(b)(2). While the well-pleaded
factual allegations in the complaint are taken as true when a
defendant is in default, damages are not. Ford Motor
Company, 441 F.Supp.2d at 848 (citing Thomson v.
Wooster, 114 U.S. 104 (1885)). The Court must determine
the propriety and amount of the default judgment where the
damages sought are not for a sum certain. See Fed.
R. Civ. P. 55(b). “Ordinarily, the District Court must
hold an evidentiary proceeding in which the defendant has the
opportunity to contest the amount [of damages].”
Antoine v. Atlas Turner, Inc., 66 F.3d 105, 110 (6th
Cir. 1995) (internal quotation and citation omitted).
However, Rule 55 gives the court the discretion to determine
whether an evidentiary hearing is necessary, or whether to
rely on detailed affidavits or documentary evidence to
determine damages. Stephenson v. El Batrawi, 524
F.3d 907, 916 (8th Cir. 2008).
complaint, Yeska alleges that ASAC negligently violated the
Fair Credit Reporting Act (“FCRA”), 15 U.S.C.
§ 1681 et seq. ECF No. 1. Generally, Yeska
alleges that several credit reporting agencies left
delinquent trade lines on his credit files past the seven
year time limit allowed by the FCRA. Despite Yeska's
attempts to get the “errant trade lines” removed
from his credit files, Defendants did not do so. Although
Defendant ASAC was specifically informed that Yeska was
challenging the accuracy of the information that ASAC was
providing to the credit reporting agencies, ASAC did not
“conduct a proper reinvestigation of Mr. Yeska's
dispute.” Compl. at 9.
allegations are sufficient to establish a willful violation
of the FCRA. However, under § 1681n(a)(1)(A),
Yeska's damages are capped at $1, 000. Because Yeska is
seeking reasonable damages, there is no need for an
evidentiary hearing. Yeska will be awarded $1, 000 in
further seeks $2, 222 in attorney fees. § 1681n(a)(3) of
the FCRA allows for recovery of reasonable attorney fees in
“any successful action.” Here, Yeska has
prevailed and so his counsel is entitled to attorney fees.
The starting point in determining the reasonableness of
attorneys' fees is the “lodestar” method.
Wayne v. Vill. of Sebring, 36 F.3d 517, 531 (6th
Cir. 1994). Under this method, a reasonable rate is
calculated by multiplying “the number of hours
reasonably expended” by “a reasonable hourly
rate.” Id. (quoting Hensley v.
Eckerhart, 461 U.S. 424, 434 (1983)) (internal quotation
marks omitted). “Next, the resulting sum should be
adjusted to reflect the result obtained.” Id.
(internal quotation marks omitted). Adjustments may be made
“to reflect relevant considerations peculiar to the
subject litigation.” Adcock-Ladd v. Sec'y of
Treasury, 227 F.3d 343, 349 (6th Cir. 2000).
has attached relatively detailed billing records to his
motion and so no evidentiary hearing is necessary.
See Mot. Judg., ECF No. 49, Ex. 1. Yeska seeks
payment for only 12.2 hours of billing, which is facially
reasonable. 1.9 of those hours were billed by attorneys
Shackleford and Schwartz at $300 per hour. 10.3 hours were
billed by paralegals at a rate of $140 per hour. Yeska is
also seeking recovery of $210 in costs incurred in litigating
this case. Considering the procedural history of the case,
12.2 hours is a reasonable amount of time to bill. The
billing rates are also very competitive when compared to the
median billing rates for Michigan attorneys practicing
consumer law. See 2014 Economics of Law Practice
Survey, ECF No. 49, Ex. 3 (listing the median billing rate
for consumer law attorneys at $335 per hour). Because Yeska
has prevailed in his suit and is requesting reasonable
attorney fees, he will be awarded $2, 222 in attorney fees.
it is ORDERED that Plaintiff Yeska's
motion for entry of default judgment, ECF No. 49, is