United States District Court, N.D. Iowa, Cedar Rapids Division
TRUSTEES OF THE IOWA IRON WORKERS HEAVY HIGHWAY DEFINED BENEFIT PENSION FUND, TRUSTEES OF THE IRON WORKERS HEAVY HIGHWAY DEFINED CONTRIBUTION PLAN, and TRUSTEES OF THE NORTHEAST IOWA IRON WORKERS LOCAL 89 JOINT APPRENTICESHIP TRAINING COMMITTEE TRUST, Plaintiffs,
CALACCI CONSTRUCTION CO. INC., and MPCC, LLC d/b/a INTERSTATE REINFORCING STEEL, Defendants.
A. ROBERTS, UNITED STATES MAGISTRATE JUDGE
matter before the Court is the Motion to Set Aside Default
Entry filed by Defendants Calacci Construction Co., Inc.
(“Calacci”) and MPCC, LLC filed September 23,
2019. (Doc. 11.) Plaintiffs Trustees of the Iowa Iron Workers
Heavy Highway Defined Benefit Pension Fund, Trustees of the
Iron Workers Heavy Highway Defined Contribution Plan, and
Trustees of the Northeast Iowa Ironworkers Local 89 Joint
Apprenticeship Training Committee Trust
(“Plaintiffs”) filed their resistance on
September 27, 2019. (Doc. 13.)
filed their Complaint on June 20, 2019. (Doc. 1.) Plaintiffs
allege Defendants breached terms of a collective bargaining
agreement that required them to make contributions to the
Plaintiff entities. Personal service of the Summons and
Complaint was made on June 27, 2019 by service upon John
Calacci, the owner, operator and president of Calacci
Construction Co., Inc. and MPCC, LLC d/b/a Interstate
Reinforcing Steel (“IRS”). (Doc. 11-2 at 2 ¶
1.) Defendants were required to move or plead on or before
July 18, 2019, but failed to do so. On August 12, 2019
Plaintiffs applied for entry of a default against Defendants
pursuant to Federal Rule of Civil Procedure 55(a). (Doc. 7.)
On August 13, 2019, the Clerk of Court entered such a default
against Defendants. (Doc. 8.) On September 9, 2019 Plaintiffs
filed a Motion for Default Judgment. (Doc. 9.) Approximately
two weeks later (and more than a month after a default had
been entered), Defendants filed the instant motion to set the
The Parties' Positions
seek to set aside the default, arguing that, pursuant to
Federal Rule of Civil Procedure 60(b), there is good cause to
do so. Defendants argue that because a default judgment has
not yet been entered a more lenient standard for good cause
applies. Here, Defendants argue they are not blameworthy or
culpable but are, at worst, ignorant of the legal process.
Mr. Calacci, states that he believed his partial payment and
efforts to resolve pending issues with Plaintiffs put the
lawsuit “on hold.” (Doc. 11-2 ¶ 4.) Mr.
Calacci states he did not forward the Complaint to his
lawyers because he believed he was resolving the problem by
himself in communication with Plaintiffs' attorney.
(Id. ¶¶ 3-5.) Defendants contend they have
a meritorious defense, which they do not describe other than
to indicate that they “disagree with Plaintiffs
regarding the amounts Plaintiffs allege Defendants owe the
various funds.” (Doc. 11-1 at 3.) Defendants further
contend Plaintiffs will not be prejudiced if the Court allows
the suit to proceed on its merits. (Id. at 4.)
contend the excuses Defendants have offered for failing to
timely file an Answer are implausible. First, Plaintiffs
point out that Mr. Calacci is no neophyte with respect to
litigation. Plaintiffs offer a list of cases where Mr.
Calacci or his businesses had been sued in state and federal
courts since August 8, 2018, including instances where he or
his business had been defaulted. (Doc. 13-1.) There are nine
pending cases and eight closed cases during this time.
(Id.) Plaintiffs also point to several lawsuits,
including ongoing lawsuits, where Mr. Calacci's
businesses are represented by various lawyers. (Doc. 13 at
affidavit of Plaintiffs' counsel, Jennifer Germaine,
paints a different picture of what actions Mr. Calacci took
after having been served with the Complaint. Her affidavit
reflects on his veracity, as well as on the reasonableness of
Mr. Calacci's belief the lawsuit “was on
hold.” (Doc. 13-2.) Ms. Germaine reports she has not
had any contact with Mr. Calacci. Rather, more than a month
after Mr. Calacci was served with the Complaint, Ms. Germaine
was contacted by Miron, a contractor who wanted to employ IRS
on a project and who wanted to verify whether IRS was current
on their payments to Plaintiffs. (Id. at 2 ¶
3.) In the subsequent email exchange involving the
contractor's representative, the business manager for the
Ironworkers Local 89 Union, and Ms. Germaine, a joint check
agreement was established that permitted Miron to use IRS and
its union ironworkers for the project. (Id. ¶
4.) Mr. Calacci was not involved in communications with Ms.
Germaine in connection with this joint check agreement.
(Id. ¶ 5.) Ultimately, IRS was able to complete
the work for Miron, but the instant litigation was not
discussed. (Id. ¶6.)
contend Defendants have not shown good cause for setting
aside the default. First, they contend that because Mr.
Calacci has experience with litigation and is represented by
multiple attorneys, he had no reasonable basis to believe the
case would be delayed because of his partial payment.
Plaintiffs further contend there is no meritorious defense
because the damages sought are based on hours worked and
reported to the Plaintiffs by the Defendants, themselves, at
the contribution rates set forth in the collective bargaining
agreement. Finally, Plaintiffs contend they will be
prejudiced if the default is set aside because of the
numerous cases pending against Defendants, presumably as
shown in Exhibit 1. Plaintiffs desire to proceed with
collection before Defendants are insolvent.
do not argue that the default was improperly entered or that
it had not, in fact, defaulted because of its failure to
timely move or plead. Therefore, the principal question is
whether there is “good cause” to set aside the
default entered against Defendants. The Court may “set
aside an entry of default for good cause.” Fed.R.Civ.P.
55(c).; see also Johnson v. Dayton Elec. Mfg. Co.,
140 F.3d 781, 783 (8th Cir. 1998). The showing necessary to
set aside a default entry is not as stringent as that
necessary to vacate a default judgment. Id. at 784.
The Eighth Circuit Court of Appeals has explained
[t]here is a “judicial preference for adjudication on
the merits, ” Oberstar v. F.D.I.C., 987 F.2d
494, 504 (8th Cir. 1993), and it is likely that a party who
promptly attacks an entry of default, rather than waiting for
grant of a default judgment, was guilty of an oversight and
wishes to defend the case on the merits.
Id. To determine whether good cause exists, the
Court should weigh “whether the conduct of the
defaulting party was blameworthy or culpable, whether the
defaulting party has a meritorious defense, and whether the
other party would be prejudiced if the default were
excused.” Id. (citation omitted); see also
Stephenson v. El-Batrawi,524 F.3d 907, 911-12 (8th Cir.
2008). The Court focuses heavily on the blameworthiness of
the defaulting party and seeks to “distinguish between
contumacious or intentional delay or disregard for deadlines
and procedural rules, and a ‘marginal failure' to
meet pleading or other deadlines.” Dayton
Elec., 140 F.3d at 784. The Eighth Circuit notes it has