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Chief Judge Stark sets aside entry of default, allows sanctions

In Princeton Digital Image Corporation v. Nordstrom.com LLC, et al., C.A. No. 13-408-LPS (D. Del. Aug. 16, 2016), Chief Judge Leonard P. Stark granted Plaintiff’s motion to set aside the Clerk’s entry of default, but also awarded sanctions to third-party intervenor Adobe for Plaintiff’s failure to answer its complaint in this action.

Defendants in this action are customers of Adobe, and Adobe had successfully moved to intervene in this and related suits due to its customers’ requests for indemnity. Id. at 2. Adobe then filed a complaint in intervention in this and related cases. While Plaintiff answered the complaint and counterclaimed in related suits, it did not do so in this action. Consequently, the Clerk had entered default against Plaintiff. Id. at 2-3.

The Court granted Plaintiff’s motion to set aside the entry of default, but required Plaintiff to “only assert[] defenses that are identical to those asserted in the Related Suits,” except that Plaintiff was prohibited from asserting a counterclaim that had already been dismissed in the related actions. Id. at 4. The Court explained that “[g]iven the identicality of the claims and defenses in this case and the claims and defenses in the Related Suits, there are no significant concerns of inefficiency or prejudice that would warrant deciding the issues in this case in Adobe’s favor based solely on [Plaintiff’s] default.” Id. at 4-5.

The Court also agreed with Adobe that monetary sanctions were warranted “in light of [Plaintiff’s] culpable conduct in failing to answer Adobe’s complaint in this action. Therefore, the parties shall meet and confer and attempt to agree on the amount [Plaintiff] must pay Adobe as a monetary sanction. If no agreement can be reached, the parties shall present their competing proposals” to the Court. Id. at 5.

Princeton Digital Image Corporation v. Nordstrom.com LLC, et al., C.A. No. 13-408-LPS (D. Del. Aug. 16, 2016)

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