United States District Court, S.D. Georgia, Savannah Division
BUILDER SERVICES GROUP, INC. d/b/a GALE CONTRACTOR SERVICES, Plaintiff,
TOPSHELF BUILDER SPECIALTIES, INC., and RICHARD L. QUARLES, JR., Defendants.
WILLIAM T. MOORE, JR. UNITED STATES DISTRICT COURT JUDGE.
the Court is Plaintiff's Motion for Default Judgment.
(Doc. 30.) In its motion, Plaintiff Builder Services Group,
Inc. ("BSG") requests that this Court enter default
judgment against Defendant Richard Quarles, Jr. because he
has failed to file any responsive pleadings in this case.
(Id.) In response to Plaintiffs motion, Defendant
Quarles, has filed an answer (Doc. 32), which this Court
liberally construes as a motion to set aside default. After
careful consideration, Defendant's motion is
DENIED, and Plaintiff s Motion for Default
Judgment is GRANTED.
MOTION TO SET ASIDE DEFAULT
April 8, 2019, the Clerk entered default against Defendant
Quarles. (Doc. 18.) To set aside an entry of default, this
Court must consider whether Defendant Quarles has established
"good cause." Fed.R.Civ.P. 55(c); see also
Sealey v. Branch Banking and Tr. Co., 2:17cv7 8
5-MHT-SMD, 2019 WL 14340 65, at *1 (N.D. Ala. Feb. 21, 2019)
("After the clerk enters default, but before entry of
default judgment, the court may exercise its discretion to
set aside an entry of default for good cause." (internal
quotation omitted)). Courts considering whether a party has
demonstrated good cause have noted that the good cause
standard is a "liberal one" and often
"var[ies] from situation to situation."
Compania Interamericana Export-Import, S.A. v.
Compania Dominicana de Aviacion, 88 F.3d 948,
951 (11th Cir. 1996). Under this discretionary standard,
consider whether the default was culpable or willful, whether
setting it aside would prejudice the non-moving party, and
whether the defaulting party may have a meritorious defense.
Depending on the circumstances, courts have also considered
factors such as whether the public interest was implicated,
whether there was significant financial loss to the
defaulting party, and whether the defaulting party acted
promptly to correct the default.
Perez v. Wells Fargo H.A., 774 F.3d 1329, 1337 n.7
(11th Cir. 2014) (internal citations and quotations omitted).
case, the Court finds that Defendant Quarles has failed to
demonstrate good cause to set aside default. (See
Doc. 32.) On May 6, 2019, this Court excused Defendant
Quarles's failure to file any responsive pleading in
another case Plaintiff BSG filed against Defendant Quarles.
(CV418-160, Doc. 35.) In that order, the Court provided that
Defendant Quarles should be given "the benefit of the
doubt" because he was acting pro se and may have been
confused about the dismissal of another defendant in that
case. (Id.) The Court, however, warned that
"Defendant Quarles is put on notice that his pro se
status is no excuse to avoid this action or the rules of this
this Court's leniency and warning to Defendant Quarles in
a nearly identical case, Defendant Quarles failed to file any
responsive pleading in this case until July 2, 2019-nearly
four months after the complaint was filed. (Doc. 32.) The
Clerk entered default against Defendant Quarles in this case
on April 8, 2019. (Doc. 18.) In the related case, this Court
provided its warning to Defendant Quarles on May 6, 2019.
(CV418-160, Doc. 35.) Given the ample filings in this case
and the warnings provided in Plaintiff's other case,
there is simply no excuse for Defendant's failure to file
a timely response. Moreover, Defendant has not provided any
sufficient basis in his answer for this Court to set aside
the entry of default. Accordingly, this Court will not set
aside the entry of default against Defendant Quarles.
MOTION FOR DEFAULT JUDGMENT
this Court has found that Defendant Quarles failed to file a
timely responsive pleading in this case, the Court will now
consider the merits of Plaintiff's Motion for Entry of
Default Judgment (Doc. 30) . Under Federal Rule of Civil
Procedure 55, a party can only obtain default judgment
through a two-step process. First, "[w]hen a party
against whom a judgment for affirmative relief is sought has
failed to plead or otherwise defend, and that failure is
shown by affidavit or otherwise, the cleric must enter the
party's default." Fed.R.Civ.P. 55(a). After a
clerk's entry of default, the moving party may request an
entry of default judgment. Fed.R.Civ.P. 55(b). "[B]efore
entering a default judgment for damages, the district court
must ensure that the well-pleaded allegations in the
complaint, which are taken as true due to the default,
actually state a substantive cause of action and that there
is a substantive, sufficient basis in the pleadings for the
particular relief sought." Tyco Fire & Sec, LLC
v. Alcocer, 218 F. App' x 860, 863 (11th Cir. 2007).
previously established, the Clerk entered default against
Defendant Quarles on April 8, 2019. (Doc. 18.) Accordingly,
this Court must now consider whether there is a sufficient
basis in Plaintiff's complaint to warrant an entry of
default judgment. In its complaint, Plaintiff asserts six
substantive causes of action against Defendant Quarles. These
claims include: (1) breach of contract, (2) tortious
interference with contractual, customer, and business
relations, (3) misappropriation of trade secrets under 18
U.S.C. § 1831, (4) misappropriation of trade secrets
under O.C.G.A. § 10-1-760, (5) violations of the Georgia
Computer Systems Protection Act, O.C.G.A. § 16-9-90, and
(6) breach of fiduciary duty. (Doc. 1.) The Court will review
each of these claims in turn.
Plaintiff asserts that Defendant Quarles breached a
confidentiality agreement that he signed while employed with
Plaintiff BSG. (Doc. 1 at ¶¶ 97-115.) Under
O.C.G.A. § 13-8-53, non-competition agreements are
enforceable against employees who "[c]ustomarily and
regularly engage in making sales or obtaining orders"
provided that the "restrictions are reasonable in time,
geographic area, and scope of prohibited activities." In
this case, Plaintiff has sufficiently alleged that Defendant
Quarles was a sales representative who "was responsible
for selling insulation, fireplaces, garage doors, gutters,
mirrors, shelving, and shower doors." (Doc. 1 at ¶
33.) Additionally, the complaint provides that Defendant
Quarles signed a confidentiality agreement which prohibited
him from soliciting BSG customers or competing with BSG in
the Savannah area during his employment and 18 months after
the end of his employment. (Id. at ¶¶ 16-2
9.) Finally, the complaint provides that Defendant Quarles
violated this agreement by contacting Plaintiff BSG's
customers and soliciting business after his termination.
(Id. at ¶¶ 59-83.) Based on these
allegations, that are deemed admitted through Defendant's
default, the Court finds that default judgment should be
entered with respect to Plaintiffs breach of contract claim
against Defendant Quarles.
complaint, Plaintiff also alleges that Defendant Quarles
committed tortious interference with contractual, customer
and business relations. (Id. at ¶¶
116-23.) "Georgia law permits recovery in tort for a
third party's interference, without legal justification
or privilege, with another's contractual or business
relations." U.S. Capital Funding VI, Ltd. v.
Patterson Bankshares, Inc., 137 F.Supp.3d 1340, 1370
(S.D. Ga. 2015). To recover under this claim, a plaintiff
(1) improper action or wrongful conduct by the defendant
without privilege; (2) the defendant acted purposely and with