Opinion
CASE NO. 04cv0760-LAB (BLM), [Dkt No. 63].
October 21, 2005
ORDER GRANTING MOTION TO DISMISS AMENDED COUNTER-CLAIM AND FOR ENTRY OF DEFAULT AGAINST CORPORATE DEFENDANT
This matter is before the Court on plaintiff and counter-defendant Reno Wilson, Inc.'s Motion For Order Entering Default against defendant and counter-claimant PR Optics, LLC, a New Jersey limited liability corporation d/b/a/ Maxam Eyewear, and for an Order dismissing PR Optic's First Amended Complaint, filed December 22, 2004, in this patent infringement action. PR Optics has filed no opposition, and the deadline to do so has passed. Pursuant to Civil Local Rule 7.1(d)(1), the Court finds the issues appropriate for decision on the papers and without oral argument. In consideration of the moving papers, pertinent authority, and the procedural history of this case, for the reasons set forth below, the Motion For Entry Of Default is GRANTED and PR Optics' First Amended Complaint is DISMISSED.
Plaintiff designs, creates, produces, distributes, and markets sunglasses, specialty eyewear, and related merchandise. The defendant corporation is a former manufacturer of Reno Wilson's products. Plaintiff filed its complaint in this action on April 13, 2004, naming PR Optics and two of its principals, Paul DiFiore and Russell LaCasse, alleging patent infringement, copyright infringement, unfair competition, intentional interference with prospective economic advantage, breach of contract, and misappropriation of trade secrets. Defendants filed an Answer and Counter-Claim through their then-attorney, Nicola A. Pisano, Esq. Plaintiff voluntarily dismissed defendant Paul DiFiore on August 16, 2004. Dkt No. 19. The Court granted in part and denied in part defendants' motion to dismiss on September 15, 2004. Dkt No. 23.
Plaintiff was granted leave to file a First Amended Complaint and did so, alleging the same causes of action, but adding infringement allegations related to three additional patents, and naming only PR Optics and Mr. LaCasse as defendants in accordance with the prior dismissal of Mr. DiFiore. Dkt No. 33. Defendants answered the First Amended Complaint and filed an Amended Counter-Claim on December 22, 2004. Dkt No. 34.
By motion filed March 9, 2005, Mr. Pisano moved to withdraw as defense counsel. Dkt No. 37. The Court denied the motion without prejudice to Mr. Pisano's refiling his motion to provide a foundation for the request and proof that defendants were served with notice of the motion. Dkt No. 45. Counsel refiled his motion in May 2005. Dkt No. 47. Mr. LaCasse executed a substitution of himself pro se in place of representation by Mr. Pisano. Dkt No. 52. By Order entered July 8, 2005, after a hearing at which PR Optics did not appear despite proof notice of the hearing was served, the Court granted Mr. Pisano's motion to withdraw as counsel of record for the entity defendant as well. Dkt No. 53. That Order informed PR Optics that entities may not appear in federal court other than through counsel licensed to practice in this district and set a July 29, 2005 deadline to serve and file substitution of attorney papers. In the event PR Optics failed to timely serve and file a substitution of attorney, the Court instructed plaintiff to move for appropriate relief for the disposition of this action with respect to the entity defendant, and set an Order To Show Cause hearing for August 29, 2005 to consider disposition of the case with respect to PR Optics.
PR Optics did not appear at the August 29, 2005 hearing. The Court continued the hearing to October 31, 2005, ordering plaintiff to file and serve an appropriate dispositive motion with respect to the entity defendant. Dkt No. 60. Plaintiff filed the instant motion on September 26, 2005. The deadline to file opposition has passed, with no response from PR Optics. As noted by plaintiff: "To date, PR optics has failed to comply with this court's order to retain counsel. In fact, PR optics has completely failed to communicate or respond in any way to this court since its prior counsel was relieved." Mot. 2:24-26.
A corporation cannot represent itself pro se in judicial proceedings but rather must proceed through counsel. Rowland v. California Men's Colony, 506 U.S. 194, 202 (1993); United States v. High Country Broadcasting Co., Inc., 3 F.3d 1244, 1245 (9th Cir. 1993) (it is "perfectly appropriate" for a district court to enter a default judgment against a corporation for failure to obey a court Order to retain counsel to represent it for the duration of litigation in which it initially appeared though counsel); see 28 U.S.C. § 1654. PR Optics has been unrepresented in this action since July 8, 2005. PR Optics has ignored the Court's Order to retain new counsel to defend against plaintiff's claims in the First Amended Complaint and to prosecute the claims it raised in its Amended Counterclaim.
"Courts have inherent equitable powers to dismiss actions or enter default judgments for failure to prosecute, contempt of court, or abusive litigation practices." TeleVideo Systems, Inc. v. Heidenthal, 826 F.2d 915, 916 (9th Cir. 1987), citing, inter alia, Roadway Express, Inc. v. Piper, 447 U.S. 752, 764 (1980). These powers "are necessary to enable the judiciary to function." Id.; see also Anheuser-Busch, Inc. v. Natural Beverage Distributors, 69 F.3d 337, 349 (9th Cir. 1995);Phoceene Sous-Marine, S.A. v. U.S. Phosmarine, Inc., 682 F.2d 802, 806 (9th Cir. 1982) (noting "[i]t is firmly established that the courts have inherent power to dismiss an action or enter a default judgment to ensure the orderly administration of justice and the integrity of their orders"); see FED.R.CIV.P. ("Rule") 55(a) ("When a party against whom a judgment for affirmative relief is sought has failed to plead or otherwise defend as provided by these rules and that fact is made to appear by affidavit or otherwise, the clerk shall enter the party's default").
For failure of the plaintiff [or a counter-claimant] to prosecute or to comply with these rules or any order of court, a defendant [or counter-defendant] may move for dismissal of an action or of any claim against the defendant. Unless the court in its order for dismissal otherwise specifies, a dismissal under this subdivision and any dismissal not provided for in this rule, other than a dismissal for failure to join a party under Rule 19, operates as an adjudication upon the merits.
Rule 41(b), (c) ("The provisions of this rule apply to the dismissal of any counterclaim, cross-claim, or third-party claim").
PR Optics has not participated in this litigation since its original counsel withdrew nearly four months ago and has not indicated it has any intention to prosecute or defend this litigation. PR Optics has also disobeyed the Court's Order to appear at the August 29, 2005 hearing and to retain substitute counsel, warranting entry of default against that entity defendant.
For the foregoing reasons, IT IS HEREBY ORDERED:
1. The Amended Counter-Claim filed by PR Optics, LLC is dismissed in its entirety, with prejudice, for failure to prosecute.
2. The Clerk shall enter a default against defendant PR Optics, LLC for failure to retain counsel to defend this action and to prosecute its counter-claim.
3. The October 31, 2005 hearing of the matters raised in the instant motion and disposed of in this Order is off-calendar.