Opinion
Case No.16-cv-06647-JSC
03-08-2017
NEXREP, LLC, Plaintiff, v. ALIPHCOM, Defendant.
ORDER REASSIGNING CASE AND REPORT AND RECOMMENDATION RE: MOTION FOR DEFAULT JUDGMENT
Re: Dkt. No. 16
Plaintiff NexRep, LLC alleges that Defendant ALIPHCOM, d.b.a Jawbone ("Jawbone") failed to pay for services that NexRep provided under the parties' contract. (Dkt. No. 1 ¶ 9.) In a two-count complaint, NexRep brings claims for breach of contract and unjust enrichment. (Id. ¶¶ 10-19.) The Clerk of Court entered default against Jawbone on December 28, 2016 after it failed to appear or otherwise defend itself in this matter. (Dkt. No. 14.) Now pending before the Court is NexRep's unopposed motion for default judgment pursuant to Federal Rule of Civil Procedure 55(b)(2) . (Dkt. No. 16.) NexRep moves for an award of compensatory damages, attorneys' fees, prejudgment interest, and costs. (Dkt. No. 1 at 4.) A hearing was scheduled for February 16, 2017, but vacated. (Dkt. No. 17.)
Because the defendant-in-default has not consented to the jurisdiction of a magistrate judge under 28 U.S.C. § 636(c), this matter must be reassigned to a District Judge. For the following reasons, the Court recommends that NexRep's motion be GRANTED as set forth below.
BACKGROUND
The following facts are taken from the complaint and the declarations of Joshua Koh and John Stewart filed in support of NexRep's motion for default judgment. (Dkt. Nos. 1, 16-1; 16- 6.)
Record citations are to material in the Electronic Case File ("ECF"); pinpoint citations are to the ECF-generated page numbers at the top of the documents.
On July 29, 2013, NexRep entered into a Master Service Agreement ("MSA") with Jawbone. (Dkt. No. 1-1; Dkt. No. 16-6 ¶ 9.) Under the MSA, NexRep agreed to provide services to Jawbone for an initial term of three years. (Dkt. No. 1-1 ¶ 3.) NexRep and Jawbone executed a Statement of Work the same day which defined the scope of services NexRep agreed to provide. (Dkt. No. 1-2 ¶ 1; Dkt No. 16-2 ¶ 1.) Specifically, NexRep agreed to provide customer support for Jawbone's actual or potential customers and other End Users. (Dkt. No. 1-2 ¶ 1.) In exchange, Jawbone agreed to pay "all undisputed [c]harges specified in the [statement of work] . . . and all applicable [t]axes and [r]egulatory [f]ees relating to the [s]ervices." (Dkt. No. 1-1 ¶ 5.) NexRep agreed to invoice Jawbone on a weekly basis, and Jawbone agreed to pay within forty-five days after receiving invoice. (Id.)
NexRep performed all duties and obligations under the parties' agreement, but Jawbone failed to pay NexRep for its services. (Dkt. No. 1 ¶ 9.) In accord with the MSA, NexRep submitted an invoice to Jawbone reflecting the week's balance on June 27, 2016. (Dkt. No. 16-9 at 2.) Jawbone neither paid nor responded to any subsequent invoice. NexRep continued working for almost three more months, sending invoices on a weekly basis before discontinuing services on September 12, 2016. (Dkt. No. 16-9 at 13.)
NexRep initiated this action on November 16, 2016. (Dkt. No. 1.) On November 21, 2016, NexRep attempted to serve Jawbone through its registered agent for service of process, CT Corporation System. (Dkt. No. 16-1 ¶ 4; see also Dkt. No. 8 (summons issued to Jawbone "c/o CT Corporation System").) CT Corporation System, doing business as "BizFilings by CT," responded with a letter on November 22, 2016 indicating that it had resigned as the agent for service of process for Jawbone. (Dkt. No. 11; see also Dkt. No. 16-3 at 2 (CT Corporation System's Resignation Notice).)
NexRep then hired Nationwide Legal, a process server, to serve Jawbone through personal service on their Chief Executive Officer, Hosain Rahman. (Dkt. No. 16-1 ¶ 6.) On December 1, 2016, Nationwide Legal personally served Rahman at 2171 Jackson Street, San Francisco, California 94115. (Dkt. No. 12; Dkt. No. 16-1 ¶ 6.)
Jawbone failed to appear or respond to the complaint, so NexRep requested entry of default, which the Clerk entered against Jawbone on December 28, 2016. (Dkt. No. 14.) NexRep's motion for default judgment followed. (Dkt. No. 16.)
DISCUSSION
A. Jurisdiction and Service of Process
When a party seeks entry of default judgment, courts have a duty to examine their own jurisdiction—both subject matter and personal. In re Tuli, 172 F.3d 707, 712 (9th Cir. 1999)(internal citation omitted). Here, the Court may exercise subject matter jurisdiction pursuant to 28 U.S.C. Section 1332 because there is complete diversity among parties and the amount in controversy exceeds $75,000. NexRep is a limited liability company, formed under the laws of Delaware with its principal place of business in Maine. (Dkt. No. 16-2 ¶ 2.) NexRep has three members: two are domiciled in Maine, and one in New Jersey. (Dkt. No. 20.) Jawbone is incorporated in California with its principal place of business in California. (Dkt. No. 16-2 ¶ 3.) The amount in controversy is met because NexRep is seeking $782,725 in damages and $5,440 in attorneys' fees and costs. (Dkt No. 16 at 10; Dkt. No. 16-2 ¶ 1.) Personal jurisdiction is satisfied because NexRep served summons on Jawbone in California. (Dkt No. 16-1 ¶ 6.); Burnham v. Sup. Ct., 495 U.S. 604, 620-21 (1990). Thus, the Court has jurisdiction.
The Court must also assess whether the defendant against whom default judgment is sought was properly served with notice of the action. Penpower Tech. Ltd. v. S.P.C. Tech., 27 F. Supp. 2d 1083, 1088 (N.D. Cal. 2008) (internal quotation marks and citation omitted). NexRep served the summons and complaint on Jawbone by personally serving its chief executive officer, Hosain Rahman. (Dkt. No. 16-1 ¶ 6.) This constitutes proper service on Jawbone. See Fed. R. Civ. P. 4(e)(1) (providing for service pursuant to the law of the state in which the district court is located); Cal. Code Civ. P § 416.10(a), (b) (a summons and complaint may be served on a corporation by delivering a copy of the documents to the "president, chief executive officer, or other head of the corporation"); see, e.g., Tech. Licensing Co., Inc. v. Noah Co. LLC, No. C-11- 3498 EMC, 2012 WL 3860758, at *2 (N.D. Cal. Sep. 5, 2012) (finding service proper where defendant was chief executive officer).
B. Default Judgment is Appropriate
After entry of default, a court may grant default judgment on the merits of the case. Fed. R. Civ. P. 55 . "The district court's decision whether to enter a default judgment is a discretionary one." Aldabe v. Aldabe, 616 F.2d 1089, 1092 (9th Cir. 1980). Courts consider the following factors in determining whether to enter default judgment:
(1) the possibility of prejudice to the plaintiff, (2) the merits of plaintiff's substantive claim, (3) the sufficiency of the complaint, (4) the sum of money at stake in the action; (5) the possibility of a dispute concerning material facts; (6) whether the default was due to excusable neglect, and (7) the strong policy underlying the Federal Rules of Civil Procedure favoring decisions on the merits.Eitel v. McCool, 782 F.2d 1470, 1471-72 (9th Cir. 1986). Upon entry of default, the factual allegations of the complaint related to liability are accepted as true and deemed admitted by the non-moving party. TeleVideo Sys., Inc. v. Heidenthal, 826 F.2d 915, 917-18 (9th Cir. 1987).
The majority of the Eitel factors support default judgment in this case.
1. Possibility of Prejudice
The first Eitel factor considers whether the plaintiff will suffer prejudice if default judgment is not entered. Eitel, 782 F.2d at 1471. If NexRep is left without remedy if default judgment is denied, this factor weighs in favor of default judgment. See e.g., Allegro Consultants, Inc. v. Wellington Techs., Inc., No. 13-cv-02204-BLF, 2016 WL 1623941, at *2 (N.D. Cal. Apr. 25, 2016)_(finding possibility of prejudice weighed in favor of default judgment because plaintiff would lose the ability to recoup unpaid balance in breach of contract action). Here, like Allegro, NexRep's only recourse is default judgment because Jawbone has failed to respond to the complaint.
Thus, the first factor weighs in favor of default judgment.
2. Merits of Plaintiff's Substantive Claims/Sufficiency of the Complaint
The second and third Eitel factors address the merits and sufficiency of NexRep's claims as pleaded in the complaint. Courts often analyze these two factors together. See Dr. JKL Ltd. v. HPC IT Educ. Ctr., 749 F. Supp 2d 1038, 1048 (N.D. Cal. 2010). In analyzing the second and third Eitel factors, the Court accepts as true all well-pleaded allegations regarding liability. See Fair Hous. of Marin v. Combs, 285 F.3d 899, 906 (9th Cir. 2002)(internal citation omitted).
a. What Law Applies to Plaintiff's Claims
Before addressing the merits of NexRep's claims, the Court must determine what law applies to NexRep's claims. The parties' contract contains a choice-of-law provision indicating that New York law applies. (Dkt. No. 16-2 ¶ 17.) In its motion for default judgment, NexRep relies on New York law for all causes of action and relief sought. (Dkt. No. 16 at 7-9.)
Federal courts sitting in diversity look to the law of the forum state when making choice of law determinations. See Fields v. Legacy Health Sys., 413 F. 3d 943, 950 (9th Cir. 2005)(internal citation omitted). In determining whether a choice of law provision is enforceable, a court must first determine "whether the chosen state has a substantial relationship to the parties or their transaction, or . . . whether there is any other reasonable basis for the parties' choice of law." Nedlloyd Lines B.V. v. Super. Ct., 3 Cal. 4th 459, 466 (1992). If neither test is met, the inquiry ends and the Court is not required to enforce the parties' choice of law. Id.
A substantial relationship between the chosen state and the contracting parties exists if "one of the parties is domiciled in the chosen state." Id. at 467 (internal citation omitted). Further, "if one of the parties resides in the chosen state, the parties have a reasonable basis for selecting that state." Id.; see also In re Marriage of Crosby & Grooms, 116 Cal. App. 4th 201, 211 (Cal. Ct. App. 2004) (holding there was no reasonable basis for choosing Idaho law when neither party resided in the state). Neither a substantial relationship nor reasonable basis exists for selecting New York Law because neither party resides or is domiciled in New York. (Dkt. No. 16-2 ¶¶ 2-3.) In addition to the lack of residence and domicile, the record does not contain any information to support a reasonable basis for selecting New York law. The complaint does not allege any contractual negotiations occurred in New York, none of the facts alleged in the instant motion are connected to New York, and the choice of law section of the MSA is the only place where New York is mentioned.
Because no substantial relationship or reasonable basis exists, the parties' choice of law is unenforceable. Accordingly, the Court will apply California law to NexRep's claims.
b. Breach of Contract
Under California law, the elements of a breach of contract claim are: "(1) the existence of the contract, (2) plaintiff's performance or excuse for nonperformance, (3) defendant's breach and (4) the resulting damages to the plaintiff." Oasis West Realty, LLC v. Goldman, 51 Cal. 4th 811, 821 (2011) (internal citation omitted.).
Here, accepting the complaint's allegations as true, the parties entered into a valid, enforceable contract where NexRep agreed to provide technical support to Jawbone's customers for a three year period, and Jawbone agreed to pay. (Dkt. No. 16-2 ¶ 5.) NexRep honored this contract, but discontinued services because Jawbone breached the contract by failing to pay—amounting to an outstanding balance of $782,725. (Dkt. No. 16-2 at 59.) These allegations are legally sufficient to entitle NexRep to judgment against Jawbone on the breach of contract claim. See Paramount Citrus Co-op., Inc. v. H & M Produce Inc., No. 1:08-cv-01210-AWI-SMS, 2008 WL 4716764, at *5 (E.D. Cal. Oct. 24, 2008) (internal citations omitted).
c. Unjust Enrichment
Generally, unjust enrichment applies only in the absence of an adequate remedy at law. See Paracor Fin., Inc. v. Gen. Elec. Capital Corp., 96 F.3d 1151, 1167 (9th Cir. 1996). If two parties possess a valid and enforceable written contract, the plaintiff is not typically permitted to proceed on a claim in quasi-contract. See Cal. Med. Ass'n, Inc. v. Aetna U.S. Healthcare of Cal., Inc., 94 Cal. App. 4th 151, 172 (2001); see also Pinel v. Aurora Loan Servs., LLC, 814 F. Supp. 2d 930, 944 (N.D. Cal. 2011). NexRep and Jawbone entered into a valid and enforceable contract, so NexRep cannot prevail on a claim of unjust enrichment as a stand-alone cause of action. Accordingly, NexRep is not entitled to default judgment on its unjust enrichment claim and that claim should instead be dismissed so final judgment may be entered. See Rasmussen v. Dublin Rarities, No. 14-1534 PJH, 2015 WL 1133189, at *11 (N.D. Cal. Feb. 27, 2015); see also Levine v. Blue Shield of Cal., 189 Cal. App. 4th 1117, 1138 (2010) (concluding trial court properly sustained dismissal of unjust enrichment claim as independent cause of action).
Thus, these factors weigh in favor of granting default judgment on the breach of contract claim but not the unjust enrichment claim.
3. Amount of Money at Stake
The fourth Eitel factor balances the amount of money at stake in the claim with the seriousness of the defendant's conduct. PepsiCo, Inc. v. Cal. Sec. Cans, 238 F. Supp. 2d 1172, 1176 (C.D. Cal. 2002). "When the money at stake is substantial, default judgment is discouraged." Bd. of Trs. v. Core Concrete Constr., Inc., No. 11-02532 LB, 2012 WL 380304, at *4 (N.D. Cal. Jan. 17, 2012) (internal citation omitted). However, when "the sum of money at stake is tailored to the specific misconduct of the defendant, default judgment may be appropriate." Id. (internal citation omitted). In determining whether the amount at stake is reasonable, courts consider a plaintiff's declarations, calculations, and other documentation of damages. Truong Giang Corp. v. Twinstar Tea Corp., No. 06-cv-03594 JSW, 2007 WL 1545173, at *12 (N.D. Cal. May 29, 2007)(internal citation omitted).
NexRep requests money damages in the amount of $782,725, which represents the value of the services NexRep performed that Jawbone did not pay. NexRep also seeks prejudgment interest, and $5,440 in attorneys' fees and costs. The amount at stake, though significant, appears reasonably proportionate to the harm caused by Jawbone's breach. See Canadian Nat'l Ry. Co. v. Phoenix Logistics, Inc., No. 11-cv-04589 EMC, 2012 WL 1376978, at *2 (N.D. Cal. Apr. 19, 2012) (finding default warranted where plaintiff's damages were "limited to the damages that would be reasonably expected to put Plaintiff in the same position had Defendant fulfilled its contractual obligations."). And indeed, other courts in this District have awarded more than NexRep requests in breach of contract cases on default judgment. See Mitsui O.S.K. Lines, Ltd. v. CB Freight Int'l, Inc., No. 4:16-cv-05002-KAW, 2016 WL 7650677, at *8 (N.D. Cal. Dec. 16, 2016) (awarding $1,056,854 in damages for breach of contract). NexRep's request is reasonable, supported by declaration, documentation, and flows directly from Jawbone's breach of contract. This factor weighs in favor of default judgment.
4. Possibility of Dispute Involving Material Facts
The fifth Eitel factor considers the possibility that material facts may be in dispute. Eitel, 782 F.2d at 1471-72. Where, as here, a plaintiff has filed a well-pleaded complaint alleging the elements necessary to establish its claims, and the Clerk has entered default upon defendant's failure to answer, a court may find the possibility of a dispute as to material facts is unlikely. See Capitol Records v. Barrera, No. 06-07212-JSW, 2007 WL 1113949, at *3 (N.D. Cal. Apr. 13, 2007); Elektra Entm't Grp., Inc. v. Crawford, 226 F.R.D. 388, 393 (C.D. Cal. 2005). NexRep properly served Jawbone's chief executive officer, but Jawbone failed to appear and respond to the complaint, and the Clerk entered default accordingly. NexRep's well-pleaded allegations, accepted as true, sufficiently allege a breach of contract. TeleVideo Sys., 826 F.2d at 917-18. The record reflects Jawbone's silence despite opportunities to respond, so there is little possibility of a dispute of material facts. Therefore, this factor weighs in favor of default judgment.
5. Excusable Neglect
The sixth Eitel factor considers whether the defendant's default may have been due to excusable neglect. Eitel, 782 F.2d at 1471. Jawbone was properly served on December 1, 2016. Despite awareness of the lawsuit, Jawbone has not appeared in this matter, and nothing in the record suggests failure to appear is based on excusable neglect. See Shanghai Automation Instrument Co., Ltd. v. Kuei, 194 F. Supp. 2d 995, 1005 (N.D. Cal. 2001).
6. Policy Favoring Decision on the Merits
Finally, the seventh Eitel factor reflects the policy that generally disfavors default judgments because "cases should be decided upon their merits whenever reasonably possible." Eitel, 782 F. 2d at 1471-72. "However, the mere existence of [Rule] 55(b) indicates that this preference, standing alone, is not dispositive." PepsiCo, 238 F. Supp. 2d at 1177. Although this factor weighs against default, it is not alone dispositive nor does it weigh against granting default given the impossibility of deciding a case on its merits when defendant fails to answer. See Willamette Green Innovation Ctr., LLC v. Quartis Capital Partners, No. 13-cv-00848-JSC, 2014 WL 5281039, at *13 (N.D. Cal. Jan. 21, 2014)(internal citation omitted).
A majority of the Eitel factors support entry of default judgment against Jawbone. Accordingly, NexRep is entitled to default judgment on the breach of contract claim.
C. Relief Sought
Having determined that the motion should be granted, the Court turns to the matter of the relief to which NexRep is entitled. NexRep seeks compensatory damages as well as prejudgment interest, attorneys' fees, and costs. (Dkt. No. 16 at 9-10.)
1. Money Damages
In assessing the appropriate amount of damages on default judgment, the Court does not presume the truth of any factual allegations related to the amount of damages. TeleVideo Sys., 826 F.2d at 917-18. Thus, NexRep is required to prove all damages sought in the complaint, and the Court must ensure the amount is reasonable and demonstrated by the evidence through testimony or written affidavit. Fed. R. Civ. P. 55(b); Televideo Sys., 826 F.2d at 917-18; Bd. of Trs. of the Boilermaker Vacation Trust v. Skelly, Inc., 389 F. Supp. 2d 1222, 1226 (N.D. Cal. 2005); PepsiCo Inc., 238 F. Supp. 2d at 1175 (internal citation omitted). NexRep requests monetary damages in the amount of $782,785.00: Jawbone's unpaid balance for services over a three-month period. In support of its request, NexRep submits the declaration of John Stewart along with weekly billing statements sent by NexRep to Jawbone from June 27, 2016 through September 12, 2016. (Dkt. No. 16-9 at 2-13.) Each statement includes NexRep's total billable hours and rate of pay, a weekly system maintenance charge, and a total weekly amount due. (Id.) Because the record contains every invoice NexRep sent to Jawbone for payment during the relevant period, which includes a summary for why payment is sought, NexRep has sufficiently demonstrated damages.
2. Prejudgment Interest
NexRep also requests prejudgment interest on $782,725 since September 12, 2016, the date on which it ceased working with Jawbone. Under the MSA, NexRep and Jawbone agreed any failure to pay would result in 1% interest. (Dkt. No. 16-2 ¶ 5.) Such interest provisions are enforceable. See Family Tree Produce, Inc. v. Bautista, No. SA CV 13-00364-DOC, 2013 WL 6733576, at *5 (C.D. Cal. Dec. 13, 2013) (enforcing 1.5% per month prejudgment interest rate in contract). Courts may award prejudgment interest on contract claims where damages are certain or "capable of being made certain by calculation." Cal. Civ. Code § 3287(a). The test for determining certainty under Section 3287(a) is whether "the defendant actually knows the amount owed or could have computed the amount from reasonably available information." Children's Hosp. & Med. Ctr. v. Bonta, 97 Cal. App. 4th 740, 774 (2002). Here, Jawbone's absence makes attributing knowledge difficult. However, the record establishes that NexRep sent weekly invoices to Jawbone, so the amount could be computed from reasonably available information. Therefore, NexRep's claims are certain, and pre-judgment interest in the amount of $3,678.81 is appropriate. Accordingly, NexRep is entitled to a total of $786,403.81 including damages and prejudgment interest.
3. Attorneys' Fees and Costs
Under California law, reasonable attorney's fees and costs are available to the prevailing party in a contract action if the contract specifically provides for such an award. Cal. Civ. Code § 1717; see also Kona Enters., Inc. v. Estate of Bishop, 229 F.3d 877, 883 (9th Cir. 2000) ("A federal court sitting in diversity applies the law of the forum state regarding an award of attorneys' fees.") The MSA contains an attorneys' fee provision, which reads: "In any action or proceeding to enforce rights under this Agreement, the prevailing party shall be entitled to recover in addition to any other costs or damages awarded, all costs of litigation, including, but limited to expert witness' fees and attorney's fees." (Dkt. No. 16-2 ¶ 18.) Accordingly, NexRep is entitled to reasonable attorneys' fees.
a. Attorneys' Fees
NexRep seeks $5440 in costs and attorneys' fees. (Dkt. No. 16 at 10.) "[A] court assessing attorneys['] fees begins with a touchstone or lodestar figure, based on the careful compilation of the time spent and reasonable hourly compensation of each attorney . . . involved in the presentation of the case." Ketchum v. Moses, 24 Cal. 4th 1122, 1131-32 (2001) (internal citation omitted).
In determining the reasonable hourly rate, the district court should be guided by "the rate prevailing in the community for similar work performed by attorneys of comparable skill, experience, and reputation." Chalmers v. City of Los Angeles, 796 F.2d 1205, 1210-11 (9th Cir. 1986), amended on other grounds by 808 F.2d 1373 (9th Cir. 1987). The relevant community for purposes of determining the prevailing market rate is generally the "forum in which the district court sits." Camacho v. Bridgeport Fin. Inc., 523 F.3d 973, 979 (9th Cir. 2008) (internal citation omitted). In terms of reasonable amount of time spent, courts should only award fees based on "the number of hours reasonably expended on the litigation" and should exclude "hours that are excessive, redundant, or otherwise unnecessary." Hensley v. Eckerhart, 461 U.S. 424, 433 (1983). "There is no precise rule or formula for making these determinations [,]" and "[t]he court necessarily has discretion in making this equitable judgment." Id. at 436-37.
i. Reasonable Hourly Rate
The first step in the lodestar analysis requires the court to determine a reasonable hourly rate for the fee applicant's services. This determination involves examining the "rate prevailing in the community for similar work performed by attorneys of comparable skill, experience, and reputation." Cotton v. City of Eureka, 889 F. Supp. 2d 1154, 1161 (N.D. Cal. 2012) (internal citation omitted); see also Camacho, 825 F.3d at 979. The "relevant community" for the purposes of the instant application is the Northern District of California. See Barjon v. Dalton, 132 F. 3d 496, 500 (9th Cir. 1997). "The fee applicant has the burden of producing satisfactory evidence ... that the requested rates are in line with those prevailing in the community[.]" Jordan v. Multnomah Cnty., 815 F.2d 1258, 1263 (9th Cir. 1987)_(internal citation omitted). In addition to affidavits from the fee applicant himself, other evidence of the prevailing market rate may include affidavits from other area attorneys or examples of rates awarded to counsel in previous cases. See Cotton, 889 F. Supp. 2d at 1167 (internal citations omitted). However, the actual rate that the fee applicant charged is not evidence of the prevailing market rate. Id. (internal citation omitted).
NexRep seeks a fee award based on a rate of $450 per hour for attorneys Randolph Gaw and Joshua Ko. (Dkt. No. 16-1 ¶ 11.) Mr. Gaw has practiced law for 15 years and has previously received attorney fee awards ranging from $400-$1000 per hour. (Id.) Mr. Ko has practiced for 12 years and has experience as general counsel in addition to his litigation experience. (Id.) While NexRep has not submitted any evidence relating to the prevailing rates in this District for attorneys' fees, other courts in this District have determined an hourly rate of $450 was reasonable in a similar case where counsel possessed less experience. See US Foods, Inc. v. Lalla Holding Corp, No. 13-cv-02328-HRL, 2014 WL 4809073, at *2-3 (N.D. Cal. Oct. 15, 2014)(finding $450 per hour fee reasonable in a default judgment action arising from breach of contract where attorney possessed seven years of experience). Based on fees awarded in comparable actions in this District and a review of the Ko Declaration, the Court concludes the requested hourly rate of $450 is reasonable.
b. Reasonableness of Time Spent
The second lodestar factor concerns the reasonable number of hours counsel spent prosecuting the case. If the requested number of hours is greater than the number of hours reasonable competent counsel would have billed, then the court should reduce the requested number of hours accordingly. Hensley, 461 U.S. at 434 (internal citation omitted).
During the life of this litigation, NexRep's counsel billed 11.2 hours. (Dkt. No. 16-1 ¶ 13.) Mr. Gaw spent 2.9 hours on this case in drafting the complaint, attending to service of process, drafting the request for entry of default, and drafting the motion for default judgment. (Id.) Mr. Ko devoted 8.3 hours to drafting the complaint and the motion for entry of default judgment and its supporting papers. In a similar default judgment case involving failure to pay, a court within this district determined 53 hours of work was reasonable because counsel provided sufficient detail of time spent. McMillan Data Comm. Inc. v. AmeriCom Auto. Serv. Inc., No. 14-cv-03127-JD, 2015 WL 4380965, at *12 (N.D. Cal. Jul. 16, 2015). Although NexRep did not provide detailed accounting of time spent, 11.2 hours' work on a default judgment matter does not appear excessive or unreasonable.
3. Costs
NexRep seeks $400 recoup the cost of filing fees. (Dkt. No. 16-1 ¶ 14.) Under the Federal Rules, the prevailing party in an action is generally entitled to recover certain costs, unless "a court order provides otherwise." Fed. R. Civ. P. 54(d) (1). Civil Local Rule 54-3(a) (1) provides that an award of the clerks filing fee is "allowable if paid by claimant." Vectren Communications Services v. City of Alameda, No. C 08-3137 SI, 2014 WL 3612754, at *2 (N.D. Cal. Jul. 22, 2014) (awarding prevailing party $455 for filing fee). The record reflects that NexRep paid a filing fee, so recovery of $400 is appropriate.
CONCLUSION
For the foregoing reasons, this case should be REASSIGNED to a district judge and the Court RECOMMENDS GRANTING the motion for default judgment. The Court further recommends NexRep be awarded actual damages and prejudgment interest in the amount of $786,325.54, attorneys' fees in the amount of $5,040, and $400 in costs.
Plaintiff shall serve a copy of this Report and Recommendation on Jawbone within three business days from the filing and date of this report and recommendation and shall file a proof of service with the Court.
Any party may file objections to this report and recommendation with the district court judge within 14 days after being served with a copy. See 28 U.S.C. § 636(b)(1)(B); Fed. R. Civ. P. 72(b); Civ. L. R. 72-3. Failure to file objections within the specified time may waive the right to appeal the District Court's ultimate order.
IT IS SO ORDERED. Dated: March 8, 2017
/s/_________
JACQUELINE SCOTT CORLEY
United States Magistrate Judge