EAST ST. LOUIS – Belleville lawyer George Ripplinger entered an appearance for difficult clients in time to rescue them from a $3.7 million default judgment, District Judge Stephen McGlynn ruled on Feb. 18.
McGlynn vacated an entry of default against Tracey Keiser and Robert Frazier of California, and denied a motion to enter judgment.
Two lawyers previously quit defending Keiser and Frazier against fraud and defamation claims due to communication breakdown and failure to pay.
McGlynn wrote, “While the defaulted defendants do not have the best history of timely locating new counsel, there is no evidence that the default was willful or the result of gross negligence.”
He warned Ripplinger and his clients that he would not tolerate a lack of cooperation and communication.
McGlynn wrote, “Furthermore, district courts are not required to impose a lesser sanction, or ‘warning shot,’ prior to the entry of default.”
Keiser and Frazier, wife and husband, handled health insurance for Southern Illinois Motor Express through Keiser Group and KG Administrative Services.
Southern Illinois Motor Express, a trucking company in Cutler with 170 employees, sued them and their entities in December 2018.
Plaintiff counsel Giles Howard of St. Louis alleged that Keiser and Frazier failed to process claims of more than 20 employees in 2016 and 2017.
He claimed Southern Illinois Motor Express terminated them and Frazier stated he wouldn’t process pending claims until the company paid runoff fees.
Howard claimed Frazier told employees their claims weren’t paid because Southern Illinois Motor Express hadn’t paid amounts it owed.
He wrote, “These statements by the employees and representatives of the Keiser defendants are and at all times were false.”
Keiser, Frazier, and their entities didn’t respond, so Southern Illinois Motor Express moved for entry of default and the court clerk entered it.
Daniel Watkins of Santa Ana, Calif., entered an appearance for Keiser and Frazier in February 2019 and moved to set aside the entries.
He blamed a receptionist “who filed the complaint in an unknown location and failed to give the complaint to anyone at KG Administrative Services.”
Magistrate Judge Gilbert Sison set the entries aside.
Four months later, Watkins withdrew.
Sison advised Keiser and Frazier that they could represent themselves, but their entities needed counsel.
He set a hearing but Keiser and Frazier didn’t appear, so he ordered them to show cause why he shouldn’t impose sanctions.
A day before his deadline, Vikram Sohal of Encino, Calif., entered an appearance and filed declarations of apology from his clients.
Sison vacated the show cause order.
Sohal withdrew within a year.
Last fall, when McGlynn joined the court, the case passed to him.
He gave the entities 21 days to retain counsel and when they didn’t, Southern Illinois Motor Express moved for entry of default against them.
The clerk entered it on Dec. 9.
Keiser and Frazier failed to appear for a hearing on that date, and Southern Illinois Motor Express moved to enter default against them and strike their pleadings.
McGlynn granted the motion on that date.
Plaintiff counsel Howard moved for final judgment of $3,719,899.63 on Dec. 21, claiming the defaults of defendants admitted their guilt.
Two days later Ripplinger appeared.
He opposed final judgment on Dec. 27, and moved to set aside the default entries and reinstate the pleadings.
Howard opposed the motion on Jan. 6, claiming it “fails to identify any good cause, or any cause for that matter, for vacating the defaults.”
He wrote, “Put simply, neither the court nor plaintiffs should have to continue to endure this never ending gamesmanship by the Keiser entities.”
McGlynn wiped the slate clean, finding defendants showed good cause for default, quick action to correct it, and a meritorious defense to the complaint.
He wrote, “Default judgments are generally disfavored as they are inconsistent with the federal courts’ preference for resolving disputes on the merits.”
McGlynn advised Ripplinger, Keiser, and Frazier that they should now be aware of ramifications of their inaction.