SALIM I. SINDHI, Plaintiff - Appellee
KUNAL R. RAINA, Defendant-Appellant
from the United States District Court for the Northern
District of Texas
STEWART, Chief Judge, and WIENER and HIGGINSON, Circuit
E. STEWART, CHIEF JUDGE:
Sindhi ("Sindhi") sued Kunal Raina
("Raina") for allegedly misappropriating
confidential software, asserting copyright infringement
claims under 17 U.S.C. §§ 501-505, as well as trade
secret claims under the Texas Uniform Trade Secrets Act, Tex.
Civ. Prac. & Rem. Code Ann. §§ 134A.002-005
(West Supp. 2016). After ignoring several district court
orders and warnings, the district court entered a default
judgment against Raina, who now appeals. Because the district
court did not abuse its discretion in entering a default
judgment against Raina, we AFFIRM.
October 5, 2015, Sindhi sued Raina, a former employee, for
allegedly stealing source code from his online newspaper
content management system ("CMS"), and then using
the software to create a competing CMS business. On June 2,
2016, Sindhi served Raina, an Indian national and permanent
resident of India, through the Hague Service Convention.
Later, on June 21, Raina responded by filing a motion to
dismiss for lack of personal jurisdiction. Raina did not,
however, comply with three local rules. The first local rule,
N.D. Tex. Civ. R. 7.4, required Raina to file a statement of
interested persons; the second, N.D. Tex. Civ. R. 83.9(b),
required Raina's attorney to be admitted to practice
before the Northern District of Texas or apply for admission
pro hac vice; and the third, N.D. Tex. Civ. R.
83.10(a), required Raina to retain local counsel. On
September 29, the district court notified Raina that he had
not complied with these local rules and issued two orders-one
requiring Raina to file a statement of interested persons,
and the other requiring him to comply with the admission and
local counsel requirements. The district court gave him 21
days to comply.
the 21 days elapsed, Raina had not complied with, or
otherwise responded to, the district court's orders. On
October 24, the district court issued two more orders,
warning Raina that he had 14 days to comply with the
court's local rules; otherwise, the district court would
strike Raina's responsive pleadings and enter a default
judgment against him without additional warning. Raina did
not comply. So, on November 8, the district court struck
Raina's motion to dismiss and entered an interlocutory
default judgment against him. Shortly thereafter, the
district court entered an interlocutory permanent injunction.
did not respond until April 2017. On April 24, Raina filed a
motion to set aside the district court's entry of
default. In his motion, Raina argued that the district court
did not have personal jurisdiction over him, making the
default judgment void under Federal Rule of Civil Procedure
60(b)(4). On September 20, the district court denied
this motion, finding that Raina had minimum contacts with
Texas, the forum state, in the form of ongoing contractual
October 25, Raina filed another motion to set aside the
default judgment, this time under Rule 55(c). The district
court again denied the motion. Then, on November 6, the
district court entered a final judgment and corresponding
permanent injunction against Raina.
now appeals, contending that the district court erred in
entering a default judgment against him and failing to vacate
it. Raina also contests the district court's entry of
final default judgment, permanent injunction, and decision to
exercise personal jurisdiction over him.
review both the entry of a default judgment and the district
court's denial of a motion to vacate a default judgment
"for abuse of discretion." Wooten v. McDonald
Transit Assocs., Inc., 788 F.3d 490, 495 (5th Cir. 2015)
(citations omitted). Factual determinations that support the
district court's default decision "are reviewed for
clear error." Lacy v. Sitel Corp., 227 F.3d
290, 292 (5th Cir. 2000).
of the seriousness of a default judgment, and although the
standard of review is abuse of discretion, even a slight
abuse of discretion may justify reversal." Id.
Default judgments involve competing policy interests. On one
hand, we have "'adopted a policy in favor of
resolving cases on their merits and against the use of
default judgments.'" Wooten, 788 F.3d at
496 (quoting In re Chinese-Manufactured Drywall Prods.
Liab. Litig., 742 F.3d 576, 594 (5th Cir. 2014)).
"On the other, this policy is 'counterbalanced by
considerations of social goals, justice and expediency, a
weighing process that lies largely within the domain of the
trial judge's discretion.'" Id.
(quoting In re Chinese-Manufactured Drywall, 742
F.3d at 594).
appeal, Raina challenges three primary sets of decisions.
First, he argues that the district court erred by entering a
default judgment against him and then denying his motions to
vacate the entry of default. Second, he argues that the
district court erred by entering a final default judgment
against him. Finally, he challenges, in his notice of ...