United States District Court, D. Maryland
DEBORAH K. CHASANOW United States District Judge.
pending and ready for resolution in this federal interpleader
action are two motions for default judgment filed by
Plaintiff Mutual of America Life Insurance Company
(“Plaintiff”) against Defendants Matilda Dawson
and Karen Leftride. (ECF Nos. 51; 52). The issues have been
briefed, and the court now rules, no hearing being deemed
necessary. Local Rule 105.6. For the following reasons,
Plaintiff's motions will be DENIED without prejudice to
April 15, 2016, Plaintiff filed this interpleader action,
pursuant to 28 U.S.C. § 1335, to resolve competing
claims over amounts payable pursuant to annuity contracts
issued by Plaintiff and held by Verneda Pigott. (ECF No. 1).
The complaint names as defendants eight individuals,
including Ms. Dawson and Ms. Leftride; the Estate of Verneda
R. Pigott; and the Living Trust of Verneda Pigott.
(Id. ¶¶ 3-14).
Leftride was served on April 23, 2016. (ECF Nos. 13; 52-2).
She did not file an answer or a responsive pleading. Upon
Plaintiff's motion (ECF No. 31), the Clerk entered
default against Ms. Leftride on November 7 (ECF No. 43).
Service was made upon Linda Thompson, who is authorized to
accept service on behalf of Ms. Dawson, on May 26. (ECF Nos.
37; 51-2; 51-3). Ms. Dawson did not file an answer or a
responsive pleading. Upon Plaintiff's motion (ECF No.
38), the Clerk entered default against Ms. Dawson on November
22 (ECF No. 46). On February 7, 2017, Plaintiff moved for
default judgment against Ms. Dawson and Ms. Leftride. (ECF
Nos. 51; 52). Neither defendant has participated in this
action, before or after the entries of default.
Standard of Review
Fed.R.Civ.P. 55(a), “[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.” The court may then enter a default judgment
upon motion by the non-defaulting party under Fed.R.Civ.P.
55(b)(2). “In an interpleader action, a default
judgment forfeits ‘any claim of entitlement' the
defaulting party might assert to the interpled
property.” Legacy Inv. & Mgmt., LLC v.
Susquehanna Bank, No. WDQ-12-2877, 2013 WL 6990367, at
*2 (D.Md. Oct. 2, 2013) (quoting Guardian Life Ins. Co.
of Am. v. Spencer, No. 5:10CV00004, 2010 WL 3522131, at
*3 (W.D.Va. Sept. 8, 2010)); see also Nationwide Mut.
Fire Ins. Co. v. Eason, 736 F.2d 130, 133 n.4
(4th Cir. 1984).
United States Court of Appeals for the Fourth Circuit has a
“strong policy” that “cases be decided on
their merits, ” Dow v. Jones, 232 F.Supp.2d
491, 494 (D.Md. 2002) (citing United States v. Shaffer
Equip. Co., 11 F.3d 450, 453 (4th Cir.
1993)), but default judgment may be appropriate where a party
is unresponsive, see S.E.C. v. Lawbaugh, 359
F.Supp.2d 418, 421 (D.Md. 2005) (citing Jackson v.
Beech, 636 F.2d 831, 836 (D.C. Cir. 1980)). A
defendant's default does not automatically entitle the
plaintiff to entry of a default judgment; rather, that
decision is left to the discretion of the court. See
Lewis v. Lynn, 236 F.3d 766, 767 (5th Cir.
2001). While the well-pleaded allegations in a complaint as
to liability are taken as true upon entry of default,
Lawbaugh, 359 F.Supp.2d at 422, “it remains
for the Court to determine whether the unchallenged factual
allegations support a claim and the relief sought, ”
Legacy Inv., 2013 WL 6990367, at *2 (internal
quotation marks and citation omitted).
complaint alleges that the current beneficiaries of record
under the three annuity contracts at issue in this action are
Defendants Nadine Smith, Patricia Doxey, and the Estate. (ECF
No. 1 ¶ 21). These beneficiary designations were made on
April 14, 2015, by Defendant Craig Seymour as guardian for
Ms. Pigott, and are contested by Defendant Kim Marie St.
Amant, personal representative of the Estate and trustee of
the Living Trust, on the ground that Mr. Seymour did not have
proper authority as guardian to effectuate a change in the
beneficiary designations. (Id. ¶¶ 21, 24).
The immediately preceding beneficiary designation, dated
October 23, 2013, was also made by Mr. Seymour as guardian.
(Id. ¶ 25). Ms. Leftride and Ms. Dawson were
designated as beneficiaries on the October 23 form, as were
Ms. Smith, Ms. Doxey, Mr. Seymour, Defendant Lillian
Robinson, and Defendant Sylvia Coleman. (ECF No. 1-11).
court noted in denying without prejudice Ms. St. Amant's
motion for default judgment in the form of a declaratory
judgment that Mr. Seymour's beneficiary designations are
null and void, many of the defendants may be affected by the
disposition of the designations executed by Mr. Seymour. (ECF
No. 50, at 1). One of those defendants is Ms. Coleman, who
was also named only in the October 23 beneficiary designation
and whose estate has not yet been served. While entry of
default judgment may be appropriate after all parties have
been served and the parties have been realigned, to enter
default judgment against only some of the beneficiaries under
the October 23 designation risks an incongruous result in
this case. Accordingly, although Ms. Leftride and Ms. Dawson
have been properly ...