REPLY To Opposition To Motion Re 24 MOTION For Default Judgment As To Defendant Sinclair Publishing, Inc. Filed by DANIEL PARISI
REPLY To Opposition To Motion Re 24 MOTION For Default Judgment As To Defendant Sinclair Publishing, Inc. Filed by DANIEL PARISI
)
DANIEL PARISI, et al., )
)
Plaintiffs, )
)
v. ) No. 1:10-cv-00897-RJL
)
LAWRENCE W. SINCLAIR a/k/a “Larry )
Sinclair”, et al., )
)
Defendants. )
)
Plaintiffs, Daniel Parisi, Whitehouse.com Inc., Whitehouse Network LLC, and White
House Communications Inc. (collectively referred to as “plaintiffs”), by counsel, files this reply
memorandum in support of its motion for a default judgment against defendant Sinclair
Publishing, Inc. (“SPI”). No opposition to the motion was timely filed by SPI.1 Defendant,
Amazon.com, Inc. (“Amazon”) did file a response, but it presents no valid reason to deny the
ARGUMENT
Amazon argues that a default judgment should not be entered against one defendant when
other defendants that have appeared remain and inconsistent results “will necessarily arise” from
1
Plaintiffs filed their motion for a default judgment on July 8, 2010. (Dkt. No. 24).
Sinclair served a purported opposition on July 21, 2010 by email and mail. However, the
document has not appeared on the Court’s docket and thus it was not timely filed. Local R. 7(b);
Fed. R. Civ. P. 5(d)(1). In addition, Sinclair failed to sign the response, contrary to Fed. R. Civ.
P. 11(a).
2
No party has questioned the relief sought in plaintiffs’ motion – an award of damages of
$5 million, an accounting and imposition of a constructive trust as to SPI’s proceeds from the
defamatory statements and its ownership of any assets, including copyrights.
Case 1:10-cv-00897-RJL Document 31 Filed 07/28/10 Page 2 of 7
the default judgment. (Dkt. No. 30 at 2). However, this Court has discretion to enter a default
judgment against less than all the defendants under Fed. R. Civ. P. 54(b).3 See, e.g., Curtiss-
Wright Corp. v. General Electric Co., 446 U.S. 1, 8 (1980). Amazon’s reliance on Whelan v.
Abell, 953 F.2d 663 (D.C. Cir. 1992), is misplaced. There, the District Court entered a default
judgment against one defendant in a multiple defendant case. The non-defaulting defendants
went on to be successful in the litigation. The District Court then vacated the default judgment
based on the ruling on the merits in favor of the other defendants. The D.C. Circuit reversed the
District Court’s order vacating the default judgment. Id. at 674-75. The Court of Appeals relied
on Carter v. District of Columbia, 795 F.2d 116 (D.C. Cir. 1986), which held that in cases
involving multiple defendants, a default order that is inconsistent with a judgment on the merits
must be set aside only when liability is truly joint – “that is, when the theory of recovery
requires that all defendants be found liable if any one of them is liable – and when the relief
sought can only be effective if judgment is granted against all.” Whelan, 953 F.2d at 674-75
(discussing Carter).
Here, joint liability is not at issue. While reserving all rights, particularly since there has
not been any discovery, it does not appear that there is joint liability, such that if one defendant
tortuously wronged plaintiffs, then all defendants would be liable. Stiffarm v. Burlington
3
Rule 54(b) provides, in relevant part, that: “When an action presents more than one
claim for relief – whether as a claim, counterclaim, crossclaim, or third-party claim – or when
multiple parties are involved, the court may direct entry of a final judgment as to one or more,
but fewer than all, claims or parties only if the court expressly determines that there is no just
reason for delay.”
-2-
Case 1:10-cv-00897-RJL Document 31 Filed 07/28/10 Page 3 of 7
Northern R. Co., 1996 U.S. App. LEXIS 8529, *10-11 (9th Cir. Apr. 1, 1996) (unpublished op.).
Plaintiffs’ complaint alleges that some defendants may be jointly and severally liable.
(Dkt. No. 1 ¶ 53). In In re Uranium Antitrust Litig., 617 F.2d 1248 (7th Cir. 1980), the plaintiff
sued 29 foreign and domestic corporations for violating the antitrust laws. Plaintiff sought and
obtained default judgments against nine defendants. The Court of Appeals held that default
judgments against less than all of the defendants was not precluded where the alleged liability
was joint and several. The Court explained the difference between “joint” and “several”
liability:
Id. at 1257 (footnotes omitted). The Court went on to find that when the alleged liability is joint
and several, granting a default judgment as to only some of the defendants is proper:
4
Plaintiffs do note, however, that SPI could be liable for the wrongful acts of its officer,
Sinclair. That issue, however, does not prevent the Court from issuing a default judgment
against SPI.
-3-
Case 1:10-cv-00897-RJL Document 31 Filed 07/28/10 Page 4 of 7
Id. Accordingly, the law does not preclude the entry of default judgment against a group of nine
defaulting defendants prior to adjudication on the merits as to the remaining defendants, where
liability is joint and several, as is the case here. Id. at 1258; see also Whelan, 953 F.2d at 674;
Carter, 795 F.2d at 137; International Controls Corp. v. Vesco, 535 F.2d 742, 746-47 n.4
(2d Cir. 1976). Here, given SPI’s utter failure to answer the complaint and Sinclair’s purported
“dissolution” of SPI to avoid having to do so,5 there is no just reason for delay, and a default
Further, Amazon need not worry about being collaterally estopped from raising any
defense or argument since there is no doubt that “default judgments do not have a preclusive
effect.” Casco Marina Development, LLC v. M/V Forrestall, 384 F. Supp. 2d 154, 159 (D.D.C.
2005) (emphasis added). “When a default judgment is entered where the defendant does not
answer or appear to dispute the issue of liability, this fails the ‘actually litigated’ requirement of
collateral estoppel.” Id.; see also Global NAPS, Inc. v. Verizon New England Inc., 2010 WL
1713240, *18 (1st Cir. Feb. 4, 2010) (“default judgment generally is not a judgment on the
merits of the underlying claim in issue preclusion cases because a default judgment does not
decide the merits of that claim.”); Lee by Lee v. United States, 124 F.3d 1291, 1296 (Fed. Cir.
1997) (“When judgment is issued as the result of a default, however, the underlying issues have
not been actually litigated. For that reason, a default judgment cannot serve to preclude the
litigation of issues under the doctrine of collateral estoppel.”); Weinstein v. Islamic Republic of
Iran, 175 F. Supp. 2d 13, 18 (D.D.C. 2001) (“default judgments . . . are normally not given
preclusive effect under the collateral estoppel doctrine because the issues in the cases have not
5
See, e.g., Dkt. No. 23 at 3 (“Defendant Lawrence W. Sinclair a/k/a “Larry Sinclair” and
Defendant Sinclair Publishing, Inc are effective June 29, 2010 one in the same. Sinclair
Publishing, Inc has been dissolved.”).
-4-
Case 1:10-cv-00897-RJL Document 31 Filed 07/28/10 Page 5 of 7
been actually litigated.”); RESTATEMENT (SECOND) OF JUDGMENTS § 27, Comm. (e) (1980)
“A judgment is not conclusive in a subsequent action as to issues which might have been but
were not litigated and determined in the prior action. . . . In the case of a judgment entered by
Thus, a default judgment against SPI would not preclude Amazon – or other defendants
that appear and defend plaintiffs’ claims – from raising any argument or defense. Default would
simply not result in collateral estoppel. As a result, plaintiffs do not oppose Amazon’s request
(Dkt. No. 30 at 2 ¶ 4) that the default judgment specify that the non-defaulting defendants,
including Amazon, will not be held vicariously or jointly liable for any default or damages
attributable to SPI based on this default judgment against SPI, and that the default judgment does
not reflect a determination of any facts or quantification of damages with respect to defendants
As noted above, there has been no opposition filed as to the specific relief sought in
proceeds from the defamatory statements and its ownership of any assets, including copyrights,
to satisfy the judgment. As also set forth above and in the proposed order submitted herewith,
plaintiffs will not seek to hold the non-defaulting defendants liable for payment of SPI’s
damages. Thus, any default judgment should include the relief sought.
Moreover, absent an immediate default judgment, Sinclair and SPI will be able to hide or
strip assets and avoid compensating plaintiffs for SPI’s defamatory and other wrongful conduct.
Sinclair has publicly disclosed he has “dissolved” SPI in an effort to avoid liability. (Dkt. No. 23
at 3; Exs. A-D). He has also asserted that he personally owns SPI’s copyright in the book in
dispute. (Ex. B). Sinclair has written that the copyright on his book, owned by SPI, is for sale.
-5-
Case 1:10-cv-00897-RJL Document 31 Filed 07/28/10 Page 6 of 7
(Ex. C). Moreover, Sinclair seems to be selling or giving away assets. (Exs. C-D). A default
judgment should be entered to preclude SPI and Sinclair from attempting to hide or transfer
assets in a blatant attempt to avoid paying compensation to plaintiffs for SPI’s wrongful acts.
CONCLUSION
For the foregoing reasons, plaintiffs respectfully request that their motion for a default
Kevin M. Bell
PATTON BOGGS LLP
8484 Westpark Drive
McLean, VA 22102
(703) 744-8000
(703) 744-8001 (fax)
-6-
Case 1:10-cv-00897-RJL Document 31 Filed 07/28/10 Page 7 of 7
CERTIFICATE OF SERVICE
I hereby certify that on July 28, 2010, a copy of the foregoing was served on counsel for
the parties that have appeared in the case by the Court’s ECF system and on the following by
Lawrence W. Sinclair
9 Spring Drive
Port Orange, FL 32129
s/ Richard J. Oparil
Richard J. Oparil (DC Bar No. 409723)
-7-