Lee Savoia-McHugh, et al. v. Michael Glass

[PUBLISH]
In the
United States Court of Appeals
For the Eleventh Circuit
____________________
No. 22-13303
____________________
LEE ANNE SAVOIA-MCHUGH,
JOHN SAVOIA-MCHUGH,
Plaintiffs-Appellees,
versus
MICHAEL S. GLASS,
Defendant-Appellant,
PHILIP KRISPIN, et al.,
Defendants.
____________________
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2 Opinion of the Court 22-13303
Appeal from the United States District Court
for the Northern District of Florida
D.C. Docket No. 3:19-cv-02018-MCR-HTC
____________________
Before N EWSOM , BRANCH , and L UCK , Circuit Judges.
BRANCH, Circuit Judge:
Lee Anne and John Savoia-McHugh sued Michael Glass in
July of 2019. Over the next 15 months, Glass did not respond to
the complaint, the amended complaint, written discovery requests,
a motion to compel, or a subpoena. The McHughs requested entry
of a clerk’s default, which was entered. After a magistrate judge
issued an order cautioning Glass that failure to comply with
discovery requests could result in a finding of contempt or
sanctions, Glass engaged counsel. Glass then moved to set aside
the default, arguing that his delayed appearance was not willful,
that he established meritorious defenses, and that setting aside the
default would not prejudice the McHughs. The district court
denied Glass’s motion and later entered a default judgment against
Glass. Glass appealed.
After careful review and with the benefit of oral argument,
we conclude that the district court did not err in denying Glass’s
motion because Glass willfully defaulted. We affirm.
I. Background
The McHughs sued Glass, among others, on July 10, 2019,
alleging misconduct arising from certain real estate investment
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22-13303 Opinion of the Court 3
transactions.1 A legal assistant to the McHughs’ counsel, Debra
Fogarty, signed a declaration saying that she forwarded the
summons and complaint to the process server, Terry Bumgardner,
on July 11, 2019. Bumgardner signed a declaration saying he
“received the Summons and Complaint to be served
upon . . . Glass[]” on July 16, 2019, and “personally served Glass at
his residence” with the summons and complaint on July 18, 2019.2
1 We note that one of the McHughs’ claims was for civil theft under Florida
law. Pursuant to Florida Statute § 772.11(1), “[b]efore filing an action for
damages [for civil theft], the person claiming injury must make a written
demand for $200 or the treble damage amount of the person liable for
damages[.]” Thus, a year earlier, on July 3, 2018, counsel for the McHughs
sent Glass a formal demand letter via e-mail, Federal Express, and certified
mail. The letter demanded “treble damages in the amount of $3,329,520.00”
pursuant to Fla. Stat. § 772.11 within 30 days “based upon the funds
misappropriated by [Glass] from [the McHughs.]” The letter also requested
that Glass advise the McHughs “promptly” if he intended to contest the claims
against him. And it also said that if Glass “fail[ed] to comply with [the] demand
within the time provided, [the McHughs] intend[ed] to vigorously pursue
their full legal remedies[.]” Glass did not respond to the demand letter.
2 While Fogarty’s and Bumgardner’s declarations are unsworn, they carry the
same force as a sworn affidavit under 28 U.S.C. § 1746 because Fogarty and
Bumgardner signed and dated their documents, and “declare[d] under penalty
of perjury that” their statements “[are] true, correct[,] and made in good faith.”
See Furcron v. Mail Ctrs. Plus, LLC, 843 F.3d 1295, 1303 n.2 (11th Cir. 2016)
(clarifying that “[a]n affidavit is made under oath,” while “a declaration is not
sworn, but is subject to the penalty of perjury” and that under § 1746
“declarations are afforded the same legal weight as affidavits, and are treated
accordingly” (alteration in original) (quotations omitted)); Roy v. Ivy, 53 F.4th
1338, 1348 (11th Cir. 2022) (“[U]nder § 1746, a declaration executed within the
United States will substitute for a sworn affidavit if the declarant dates and
subscribes the document as true under penalty of perjury in substantially the
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4 Opinion of the Court 22-13303
Bumgardner also signed a sworn affidavit of service saying he
personally served Glass with the summons and complaint at his
residence.3
The summons informed Glass that the McHughs sued him
and that he was required to respond to the suit:
A lawsuit has been filed against you.
Within 21 days after service of this summons on you
(not counting the day you received it)—or 60 days if
you are the United States or a United States agency,
or an officer or employee of the United States
described in Fed. R. Civ. P. 12(a)(2) or (3)—you must
serve on the plaintiff an answer to the attached
complaint or a motion under Rule 12 of the Federal
Rules of Civil Procedure.4 The answer or motion
must be served on the plaintiff or plaintiff’s
attorney . . . .
If you fail to respond, judgment by default will be
entered against you for the relief demanded in the
following form: ‘I declare (or certify, verify, or state) under penalty of perjury
that the foregoing is true and correct. Executed on (date). (Signature).’”
(quoting 28 U.S.C. § 1746(2)).
3 In his declaration and sworn affidavit of service, Bumgardner also described
Glass’s age, race, height, weight, and hair.
4 Rule 12 provides that a defendant must serve a responsive pleading “within
21 days after being served with the summons and complaint[.]” Fed. R. Civ.
P. 12(a)(1)(A).
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22-13303 Opinion of the Court 5
complaint. You must also file your answer or motion
with the court.
Glass did not respond to the complaint or defend the action in any
way.
Four months later, in November 2019, the McHughs filed an
amended complaint, supplementing allegations of diversity of
citizenship. The amended complaint reiterated the allegations
against Glass. Fogarty attested in her declaration that she mailed
the amended complaint to Glass’s residence via U.S. Mail. Glass did
not respond to the amended complaint.
The McHughs next served requests for the production of
documents and interrogatories upon Glass on June 22 and July 7 of
2020. Glass did not respond to the discovery requests.
On July 9, the McHughs moved for the entry of a clerk’s
default and a default judgment against Glass.5 A clerk’s default was
entered immediately, but the requested judgment was not.6
5 The certificate of service for the motion for default judgment reads: “I
HEREBY CERTIFY that on the 9 th day of July, 2020, a true and correct copy
of the foregoing was filed via the CM/ECF system, which will send a
notification of electronic filing to all counsel or parties of record on the Service
List.” Glass, however, had not yet appeared in the case.
6 Entry of the default must precede entry of a default judgment. Fed. R. Civ.
P. 55(a)–(b). Pursuant to Fed. R. Civ. P. 55(b)(2), in order to determine the
amount of the default judgment when it is not a sum certain (or capable of
computation to make it such), “[t]he court may conduct hearings or make
referrals” to “conduct an accounting;” “determine the amount of damages”
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6 Opinion of the Court 22-13303
The deadline for written discovery passed on August 6, 2020.
The overall discovery deadline was extended to March 31, 2021.
On September 2, 2020, the McHughs filed a motion to
compel Glass “to fully comply with [their] request for documents
and interrogatories[,]” serving Glass via Federal Express to his last
known address. Glass did not respond to the motion to compel.
The next day, according to Bumgardner’s declaration, Bumgardner
“personally served a discovery subpoena” on Glass “at his
residence[.]”
A magistrate judge granted the motion to compel later that
month, ordering Glass to “provide full and complete discovery
responses” within two weeks and expressly cautioning Glass that a
“failure to comply . . . may result in a finding of contempt or other
sanctions.” The magistrate judge directed the clerk to mail a copy
of the order to Glass at his residence.
Upon receiving the magistrate judge’s order, Glass obtained
counsel, who filed a notice of appearance and responded to the
McHughs’ written discovery requests in early October 2020. Then,
on October 12, 2020, Glass moved to set aside the default. He
argued that his delayed appearance in the lawsuit was not
intentional or willful, that he established “several meritorious
defenses,”7 and that setting aside the default would not prejudice
that the defaulting defendant must pay; “establish the truth of any allegation
by evidence;” or “investigate any other matter.”
7 In an attached affidavit, Glass presented four statements as his defenses:
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22-13303 Opinion of the Court 7
the McHughs. Glass attached a sworn affidavit to his motion in
which he claimed that he never received a number of pleadings:
• He claimed that he “was never personally served with
a copy of the Summons and [original] Complaint.”
• He claimed that he “never received a copy of the
Amended Complaint[.]”
• He claimed that he “never received a copy of the
Motion to Compel[.]”
But Glass admitted he received four other legal documents:
• He “received a copy of the [original] Complaint in this
lawsuit via FedEx delivery in or around July 2019.”
• He “received via FedEx delivery copies of
interrogatories and requests for production of
documents” in June 2020.
17. I have reviewed the Amended Complaint filed in this
lawsuit, and I dispute many of the allegations asserted against
me.
18. I absolutely deny that I ever made any false representations
or omissions to the McHughs.
19. I further deny that I committed any act of theft or
conversion of funds provided by the McHughs.
. . .
21. It is my understanding that there [are] a number of legal
defenses that can and should be asserted in response to the
Amended Complaint.
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8 Opinion of the Court 22-13303
• He “received via personal service . . . a subpoena
requesting production of documents” in September
2020.
• He “received via regular mail a copy of the
[magistrate judge’s] Court Order granting the
McHugh[s’] Motion to Compel” in September 2020.
Glass attests that he only understood that “action by [him] was
necessary” after he received the magistrate judge’s order
compelling discovery responses.
The McHughs responded to Glass’s motion to set aside the
default, saying it “must be denied . . . because the record establishes
that he has displayed an intentional, willful[,] and reckless disregard
for these judicial proceedings on multiple levels” and Glass could
not establish “good cause” to set aside the default.
The district court agreed with the McHughs and denied
Glass’s motion to set aside the default. Turning first to what it
called the “factual dispute” of whether Glass was personally served
with the complaint, it noted it need not resolve it because “Glass
admit[ted] he received a copy of the [original] Complaint by FedEx
in July 2019, and thus, he was actually aware of the suit.” The
district court also observed that, despite Glass’s contentions to the
contrary, he was properly served the amended complaint. It
explained that “Glass repeatedly ignored legal papers mailed to
him,” as well as the language of the summons and the subpoena,
which informed him of the consequences of not responding.
Thus, the court concluded that “Glass’s response and appearance,
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22-13303 Opinion of the Court 9
well over a year after he admittedly had actual notice of the case
and three months after [the McHughs] filed a motion for default
and default judgment, [were] too little too late.” The district court
found that Glass “willfully defaulted and displayed an intentional
or reckless disregard for the judicial proceedings[.]” (quotations
omitted).
The district court added that “[c]onsideration of the
additional factors”—whether Glass presented meritorious defenses
and whether allowing Glass to enter the suit would prejudice the
McHughs—did not change its decision. It found that “Glass has
not demonstrated a meritorious defense” because “[h]e offered
only blanket general denials” and “offered no facts to lend
plausibility to his defenses.” And the court said that “to allow Glass
to enter the suit at this late date would cause prejudice to [the
McHughs]” because they would “hav[e] to duplicate their efforts”
in the litigation: “the deadline to serve written discovery between
the parties” had passed and the McHughs had already “expended a
significant amount of time and expense” litigating their case. The
court therefore concluded that Glass could not prevail on the
additional considerations of meritorious defenses and prejudice to
the McHughs.
The McHughs then moved for entry of final default
judgment against Glass, to which Glass did not respond. The
district court granted the motion. This appeal followed.
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10 Opinion of the Court 22-13303
II. Standard of Review
We review a district court’s denial of a motion to set aside
the entry of default for an abuse of discretion. Compania
Interamericana Exp.-Imp., S.A. v. Compania Dominicana de Aviacion,
88 F.3d 948, 951 (11th Cir. 1996). “[T]he abuse of discretion
standard allows a range of choice for the district court, so long as
that choice does not constitute a clear error of judgment.” In re
Rasbury, 24 F.3d 159, 168 (11th Cir. 1994) (quotations omitted). “A
district court abuses its discretion if it applies an incorrect legal
standard, applies the law in an unreasonable or incorrect manner,
follows improper procedures in making a determination, or makes
findings of fact that are clearly erroneous.” Surtain v. Hamlin
Terrace Found., 789 F.3d 1239, 1244 (11th Cir. 2015) (quotations
omitted).
“We review de novo whether the district court had personal
jurisdiction over a nonresident defendant.” Louis Vuitton Malletier,
S.A. v. Mosseri, 736 F.3d 1339, 1350 (11th Cir. 2013).
III. Discussion
On appeal, Glass argues that the district court erred because
his delay in engaging with the litigation was not willful—rather, it
was a misunderstanding. He maintains that, before the magistrate
judge’s order, he did not “understand or appreciate” any action was
required of him. But once he received the magistrate judge’s order,
he explains, he promptly engaged with the litigation. Glass also
challenges the district court’s determination that he did not have
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22-13303 Opinion of the Court 11
meritorious defenses and that the McHughs would be prejudiced
if Glass entered the suit.
We start with whether the default was willful. Pursuant to
Federal Rule of Civil Procedure 55, “[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 clerk must enter the party’s default.” Fed. R. Civ. P.
55(a). A court “may set aside an entry of default for good cause[.]”
Fed. R. Civ. P. 55(c). We have said that “‘good cause’ is not
susceptible to a precise formula, but some general guidelines are
commonly applied.” Compania Interamericana, 88 F.3d at 951.
Courts have considered these three factors: (1) “whether the
default was culpable or willful,” (2) “whether the defaulting party
presents a meritorious defense,” and (3) “whether setting [the
default] aside would prejudice the adversary[.]” Id. “[T]hese
factors are not ‘talismanic[.]’” Id. For example, “courts have
examined other factors including . . . whether the defaulting party
acted promptly to correct the default.”8 Id. “[I]f a party willfully
defaults by displaying either an intentional or reckless disregard for
the judicial proceedings, the court need make no other findings in
denying relief.” Id. at 951–52.
8 Courts have also examined “whether the public interest was implicated” and
“whether there was significant financial loss to the defaulting party.”
Compania Interamericana, 88 F.3d at 951. But we need not examine these two
factors because the parties did not raise them.
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12 Opinion of the Court 22-13303
The district court properly concluded that Glass
intentionally or recklessly disregarded judicial proceedings because
“[he] repeatedly ignored legal papers mailed to him[.]” Glass
denies being personally served with a copy of the summons and
complaint, and he says he never received the amended complaint
or a copy of the motion to compel.9 But he acknowledges receipt
of everything else the McHughs sent him between July 2019 and
September 2020—(1) a copy of the original complaint in July 2019,
(2) written discovery requests in June 2020, and (3) the subpoena
requesting the production of documents in September 2020—all at
the very same address where the process server swears he served
Glass with the summons and original complaint, and where copies
of the amended complaint and motion to compel were mailed.10
9 While Glass says he “never received a copy of the Motion to Compel[,]” the
motion to compel’s certificate of service suggests otherwise. It reads: “I
HEREBY CERTIFY that on the 2nd day of September, 2020, a true and
correct copy of the foregoing was filed . . . by serving a copy of the foregoing
via Federal Express to the last known address of Defendant Michael Glass.”
Pursuant to Federal Rule of Civil Procedure 5, a written motion is properly
served by “mailing it to the person’s last known address—in which event
service is complete upon mailing[.]” Fed. R. Civ. P. 5(b)(2)(C). Because Glass
was mailed a copy of the motion to compel via Federal Express to his last
known address, we conclude that Glass was properly sent the filing. And even
if he was not, Glass’s argument would still fail. Under that same rule, no
service was required on Glass because he was “in default for failing to appear.”
Fed. R. Civ. P. 5(a)(2) (“No service is required on a party who is in default for
failing to appear.”).
10 Interestingly, in his filings before this Court and the district court, Glass
neglects to mention the July 3, 2018 demand letter sent to him via e-mail,
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22-13303 Opinion of the Court 13
From the documents he admits receiving, Glass was clearly aware
that the McHughs had sued him and were expending time and
money pursuing the lawsuit. Yet Glass only obtained counsel after
the magistrate judge threatened him with a finding of contempt.
From Glass’s intentional disregard of a number of legal documents
he received by mail, Federal Express, and personal service over the
course of fifteen months, it is clear that he displayed an intentional
or reckless disregard for the judicial proceedings. Accordingly, we
conclude that the district court did not abuse its discretion in
finding that Glass willfully defaulted, negating a finding of good
cause to set aside the default. In re Rasbury, 24 F.3d at 168; Compania
Interamericana, 88 F.3d at 951.
Glass resists this conclusion for three reasons, none of which
have merit.
First, Glass argues that the district court erred in finding his
default was willful because a “factual dispute exists” as to whether
he was properly served with the summons and original complaint.
He swears he was not personally served with the summons and
original complaint and only received a copy of the original
complaint (without the summons) in the mail. Thus, allegedly
deprived of a summons, he claims he did not have notice of the
lawsuit. But Glass does not win the dispute simply by saying he
was not personally served. We have said that “[w]here, as here, the
defendant submits affidavits” challenging personal jurisdiction,
Federal Express, and certified mail that appraised him of the McHughs’
“[intention] to vigorously pursue their full legal remedies[.]”
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14 Opinion of the Court 22-13303
“the burden traditionally shifts back to the plaintiff to produce
evidence supporting jurisdiction[.]” Meier ex rel. Meier v. Sun Int’l
Hotels, Ltd., 288 F.3d 1264, 1269 (11th Cir. 2002). “Where the
plaintiff’s . . . supporting evidence conflict[s] with the defendant’s
affidavits, the court must construe all reasonable inferences in
favor of the plaintiff.” Id. Here, the plaintiffs met their burden. As
an initial matter, the McHughs filed an affidavit of service from
Bumgardner swearing he “personally served” Glass at his home
address with a copy of the summons and complaint. Glass put the
matter into dispute by submitting an affidavit swearing he “was
never personally served with a copy of the Summons and
Complaint.” In response, however, the McHughs submitted
additional evidence proving service of process. Fogarty signed a
declaration saying that she forwarded the summons and complaint
to Bumgardner, and Bumgardner submitted a second statement
asserting that he “personally served Glass at his residence” and that
“Mr. Glass is a bald, white man, approximately 56 years old,
weighing approximately 220 [pounds] and about 6’01” in height.”
Because the evidence from the McHughs and Glass conflict, the
district court was free to “construe all reasonable inferences” in
favor of the McHughs as the plaintiffs. Meier ex rel. Meier, 288 F.3d
at 1269. On our de novo review, Mosseri, 736 F.3d at 1350, we
conclude that Glass was personally served with the summons and
original complaint.
Our conclusion of personal service is bolstered by what
Glass did not do. At no point—after admittedly receiving several
filings in the case—did Glass move to dismiss the complaint for
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22-13303 Opinion of the Court 15
insufficient service of process under Federal Rule of Civil
Procedure 12, thus forfeiting such a challenge. Fed. R. Civ. P.
12(a)(1)(A)(i) (“A defendant must serve an answer within 21 days
after being served with the summons and complaint[.]”); Fed. R.
Civ. P. 12(b)(5) (defense of insufficient service of process must be
asserted before the responsive pleading); see Hemispherx Biopharma,
Inc. v. Johannesburg Consol. Invs., 553 F.3d 1351, 1360 (11th Cir. 2008)
(stating “[c]hallenges to service of process will be waived . . . if not
raised under [Rule 12,]” and once waived, courts may not “dismiss
on that ground”). Furthermore, Glass failed to raise insufficient
service of process as one of his defenses in his motion to set aside
the default (or any other document). Having waived the defense,
he cannot assert it now.
Second, Glass says the district court erred in finding his
default was willful because he promptly engaged with the litigation
“[w]ithin two weeks of receiving the magistrate judge’s order.” It
is true that, as part of an inquiry into whether there is good cause
to excuse a default, “courts have examined . . . whether the
defaulting party acted promptly to correct the default.” Compania
Interamericana, 88 F.3d at 951. But in the words of the district court,
“[Glass’s] actions [were] far from ‘prompt.’” Even looking only to
the pleadings he admits receiving, fifteen months passed between
when he received a copy of the original complaint via Federal
Express and his counsel’s appearance in this suit. And he admits
receiving a number of other legal documents in between. Thus,
the district court is correct that Glass’s efforts are “too little too
late.”
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16 Opinion of the Court 22-13303
Third, Glass argues that the district court erred in finding his
default was willful because any delay was due to a
misunderstanding as he did not “understand or appreciate” any
action was required of him before receiving the magistrate judge’s
order. We, however, have said that a party’s excuse that he is
“confus[ed]” about his responsibility to respond to litigation does
not satisfy “good cause.” E.E.O.C. v. Mike Smith Pontiac GMC, Inc.,
896 F.2d 524, 529 (11th Cir. 1990). Glass’s excuse is simply not
enough, particularly in light of the pile of legal documents he
admits he received concerning the suit.11 Further, the language of
the summons (with which we have already concluded he was
served) required a response and warned him of the consequence
of not responding. Glass’s intentional disregard of the suit,
therefore, does not satisfy good cause, despite his assertion that he
did not “understand or appreciate” a need to act.
For all these reasons, we conclude that the district court did
not abuse its discretion in finding that Glass willfully defaulted by
attempting to avoid the suit. Because no additional findings are
necessary to deny relief, Compania Interamericana, 88 F.3d at 951–
11 Moreover, a year before the litigation started, counsel for the McHughs sent
Glass a demand letter via e-mail, Federal Express, and certified mail
demanding “treble damages in the amount of $3,329,520.00” pursuant to Fla.
Stat. § 772.11 within 30 days. The letter said that if Glass “fail[ed] to comply
with [the] demand within the time provided, [the McHughs] intend[ed] to
vigorously pursue their full legal remedies[.]”
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22-13303 Opinion of the Court 17
52, we need not address the additional considerations of
meritorious defenses and prejudice to the McHughs.12
12 But considering these two factors would not change our conclusion, as Glass
did not present meritorious defenses and allowing him to participate in the
suit would prejudice the McHughs.
Glass failed to offer anything remotely resembling a meritorious defense. He
only presented four conclusory and superficial statements that (1) he
“dispute[s] many of the allegations asserted against [him];” (2) he “den[ies]
that [he] ever made any false representations or omissions;” (3) he “den[ies]
that [he] committed any act of theft or conversion of funds;” and (4) “there
[are] a number of legal defenses that can and should be asserted in response to
the Amended Complaint.” Accordingly, the district court did not abuse its
discretion in finding that Glass failed to present meritorious defenses. See, e.g.,
Parker v. Scheck Mech. Corp., 772 F.3d 502, 505 (7th Cir. 2014) (“When we say
the defendant must show a ‘meritorious defense’ to the lawsuit, we mean
more than bare legal conclusions[.]”); Marziliano v. Heckler, 728 F.2d 151, 156
(2d Cir. 1984) (concluding that no meritorious defense was presented under
Rule 55(c) because the party “was extremely superficial and unusually
equivocal” when it “merely stated that the fee motion raised ‘substantial issues
of law’” and that a meritorious defense “may” exist).
Turning to whether it would prejudice the McHughs to allow Glass to
participate in the suit, Glass argues that no prejudice exists because costs
incurred by the McHughs would be “simply a cost of litigating the case on the
merits, not an increased cost as a result of the default/delay,” and the district
court “easily could control” any prejudice through “an order with reasonable
discovery limitations[.]” But by arguing that the court could ameliorate any
prejudice to the McHughs, he implicitly concedes that prejudice exists. And
exist it does. Prejudice may exist where a party faces “additional expense
caused by the delay.” 10A Charles Alan Wright & Arthur R. Miller, Fed. Prac.
& Proc. § 2700 (4th ed. 2023) (“The most common type of prejudice is the
additional expense caused by the delay, the hearing on the Rule 55(c) motion,
and the introduction of new issues.”). Setting aside the default would
prejudice the McHughs by forcing them to pay additional costs to restart
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18 Opinion of the Court 22-13303
IV. Conclusion
The district court did not abuse its discretion in denying
Glass’s motion to set aside the default because Glass “willfully
default[ed] by displaying either an intentional or reckless disregard
for the judicial proceedings.” Compania Interamericana, 88 F.3d at
951–52. We therefore affirm.
AFFIRMED.
litigation that had already proceeded over the course of 15 months against
multiple other defendants. Cf. United States v. $22,050.00 U.S. Currency, 595 F.3d
318, 326 (6th Cir. 2010) (concluding prejudice did not exist where plaintiff-
appellee “never explain[ed] how setting aside default . . . would increase
litigation costs to a greater degree than would naturally occur in all cases of
setting aside default”). Furthermore, by the time Glass filed his motion to set
aside the default, the deadline for written discovery had passed and the
McHughs had already conducted several depositions. Thus, the district court
did not abuse its discretion when it concluded that allowing Glass to
participate in the suit at this point would prejudice the McHughs.
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