Company’s effort to vacate default judgment fails

Where a default judgment was entered against a company that failed to timely respond to a complaint, its motion to vacate the default judgment, filed more than 10 months later, was denied. The defaulting party failed to show improper service or excusable neglect.

Background

Plaintiff, the Board of Trustees of the Sheet Metal Workers’ National Pension Fund, alleges that the four defendants – J. Strober & Sons Roofing LLC, Strober and Sons Roofing LLC, Strober & Sons LLC and Strober Roofing and Maintenance LLC – are successors to, or alter egos of, J. Strober & Sons LLC, a bankrupt building and construction employer that was obligated to contribute to the plaintiff’s pension plan while it was still solvent. As such, plaintiff alleges that defendants are jointly and severally liable for J. Strober & Sons LLC’s withdrawal liability.

Defendants never filed a responsive pleading. Accordingly, a final default judgment was entered against defendants on June 2, 2022. More than 10 months later, Strober Roofing and Maintenance LLC, or SRM, appeared in this action. SRM now seeks to set aside the default judgment on grounds of improper service of process and excusable neglect.

Analysis

A successful Rule 60(b) movant must first show: (1) that the motion is timely; (2) that the movant has a meritorious defense and (3) that the nonmovant would not be prejudiced were the judgment to be set aside. These principles, applied here, suggest that SRM satisfies all three threshold conditions.

Given that the threshold requirements are satisfied, the next step is to consider whether SRM has shown any of the six enumerated grounds for relief under Rule 60(b). SRM asserts that service was constitutionally and statutorily improper because SRM’s summons was served only at SRM’s registered address rather than on SRM’s registered agent. This argument fails; the record plainly shows that SRM was properly served under the Constitution, the Federal Rules of Civil Procedure and controlling New Jersey law.

SRM also argues that it should be granted relief because its failure to file a timely response to the complaint is attributable to “excusable neglect” pursuant to Rule 60(b)(1). This argument misses the mark; relief under Rule 60(b)(1) would be inappropriate because SRM does not justify or explain its neglect of service.

SRM admits that the address where the summons was delivered was indeed SRM’s registered address. SRM, it appears, did not check for mail at its registered address, having provided that very address to the state of New Jersey expressly for purposes of service of process. Neither does SRM provide any satisfactory explanation for its failure to check SRM’s mail at its registered address. In summary, the facts reflect that SRM’s carelessness and neglect was all its own. Therefore, there is no excusable neglect on the facts presented, and relief from judgment under Rule 60(b)(1) is not appropriate.

Strober Roofing and Maintenance LLC’s motion to vacate default judgment denied.

Board of Trustees, Sheet Metal Workers’ National Pension Fund v. J. Strober & Sons Roofing LLC, Case No. 1:21-cv-1405, Aug. 22, 2023. EDVA at Alexandria (Ellis). VLW 023-3-498. 12 pp.