govinfo:USCOURTS-tnwd-2_24-cv-02639-0

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IN THE UNITED STATES DISTRICT COURT 
FOR THE WESTERN DISTRICT OF TENNESSEE 
WESTERN DIVISION 
 
JDJ INNOVATIONS, LLC, 
JEFFREY D. JERGE, 
 
Plaintiffs, 
 
v. 
 
BERKSHIRE HATHAWAY DIRECT 
INSURANCE COMPANY, 
 
 
 
 
 
 
 
 
 
 
 
 
 

 
Defendant. 
 
 
 
 ORDER GRANTING MOTION FOR DEFAULT JUDGMENT (Doc. 11) AND 
DENYING DEFENDANT’S MOTION TO SET ASIDE CLERK’S ENTRY OF 
DEFAULT (Doc. 18) 
 
This case, originally assigned to Judge Mark Norris, was filed in 2024. Docs. 1, 2. In 
October 2024, Plaintiffs filed a Motion for Default Judgment against Defendant Berkshire 
Hathaway Direct Insurance Company d/b/a Biberk Insurance Company, which this Order will refer 
to as Berkshire Insurance or Defendant. Doc. 11. After a lengthy delay and two separate misfilings 
for noncompliance with the rules (Docs. 15, 17), Defendant filed a response in opposition to default 
judgment in which it also improperly embedded a motion to set aside entry of default. Judge Norris 
transferred the matter to the undersigned in March 2026. Doc. 23. 
 For the reasons that follow, the Court DENIES Defendants Motion to Set Aside Entry of 
Default and GRANTS the Motion for Default Judgment. Judgment on liability is hereby 
ENTERED in favor of Plaintiffs. The Court REFERS this matter to Magistrate Judge Charmiane 
G. Claxton for a timely (1) hearing concerning remedies and (2) report and recommendation 
concerning the proper remedies. PageID
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BACKGROUND 
 Plaintiffs filed this lawsuit in September 2024, claiming that Berkshire Insurance is in 
breach of a contract of insurance requiring it to defend Plaintiffs in an underlying lawsuit and 
arbitration. Doc. 1 . Specifically, Plaintiffs took out a policy under which Berkshire Insurance 
would serve as Plaintiffs’ insurer for Professional Liability and Errors and Omissions, but 
Berkshire Insurance refused to defend Plaintiffs when they were named in an Arbitration Demand 
filed by PartsBase, Inc. and alleging violation of various duties in connection with a soured 
contractual relationship. Doc. 1 at 2. Based on the claimed breach, Plaintiffs sought a judgment 
declaring Berkshire Insurance ’s coverage and payment obligations, requiring reimbursement of 
attorney fees and expenses, and imposing damages (including statutory and punitive damages for 
reckless or bad faith denial of coverage). Doc. 1 at 9-10. 
 In this litigation, Plaintiffs served Defendant on September 18, 2024. Doc. 7 at 2. After 
Defendant failed to timely respond, Plaintiffs on October 15, 2024, moved for entry of default. 
Doc. 9. The Clerk entered default the next day, October 16. Doc. 10. 
 On October 21, 2024, Plaintiffs filed the Motion for Default Judgment at issue here, serving 
Defendant by mail as Defendant had not yet appeared . Doc. 11 at 4. Defendant did nothing for 
fifty-three days, after which two counsel s filed notices of appearance on behalf of Defendant on 
December 13, 2024. And then Defendant again went silent. 
 After 53 additional days elapsed—for a total of 106 days from the Motion for Default and 
139 days from the filing of the lawsuit —Defendant finally attempted substantive action: On 
February 4 it filed a Response to Motion for Default Judgment, in which it improperly embedded 
a Motion to Set Aside Clerk’s Entry of Default. See LR 7.2(a); Doc. 14. Defendant’s filing of this 
document was twice rejected for improper captioning (Docs. 15, 17) before a corrected version PageID
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was accepted by the Clerk on February 6, 2025. Doc. 18. Judge Norris transferred the case to the 
undersigned on March 5, 2026. Doc. 23. 
ANALYSIS 
I. Defendant’s Motion to Set Aside Entry of Default is DENIED. 
The United States Court of Appeals for the Sixth Circuit has instructed courts to consider 
three factors in determining whether a defendant has shown “good cause” justifying setting aside 
an entry of default: “(1) whether the default was willful, (2) a set -aside would prejudice plaintiff, 
and (3) the alleged defense was meritorious.” Fed. R. Civ. P. 55(c) (first quoted material); Dassault 
Systemes S.A. v. Childress, 663 F.3d 832, 839 (6th Cir. 2011) (second quoted material). Due to a 
preference for resolving cases on their merits, the standard is applied in a “forgiving” manner, 
resolving “any doubts” about ambiguous or disputed facts” in favor of the defendant. Id. at 841. 
Still, lest the rule be that only those who never participate can be subject to default, there must be 
limits. And, if there are limits, the governing factors here do not show good cause. 
First, consider the issue of willfulness. Defendant did not submit a substantive filing until 
its first Opposition to Motion for Default Judgment filed 139 days after the complaint. Defendant 
tries to explain this away as the result of a mailroom mix-up that snagged the properly served 
complaint before it reached the right people. Doc. 18 at 2; Doc. 18-4 at 1-2; cf. Maples v. Thomas, 
565 U.S. 266 (2012) (in habeas case challenging death penalty where defendant’s counsel claimed 
mailroom mix-up prevented timely filing, holding that failure excuses procedural default only if 
the attorney effectively abandoned his client). Berkshire Insurance claims it “immediately retained 
counsel” when it learned of the lawsuit and default (Doc. 18 -4 at 2), but that would only explain 
the 53 days’ delay to December 13, 2014 —and not the 53 days’ delay that followed until 
Defendant finally filed an opposition to Plaintiff’s Motion for Default Judgment. Doc. 14. PageID
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Defendant’s additional delay of nearly two months after learning it had defaulted is difficult to 
understand and certainly inconsistent with good faith participation in the affected proceedings. 
Compare Krowtoh II LLC v. ExCelsius Int'l Ltd., 330 F. App'x 530, 536 (6th Cir. 2009) (“By acting 
quickly to set aside the default, Defendants have given evidence of respect for the court’s process, 
favoring leniency for Defendants.”). Defendant offers no explanation for the additional delay, 
which in the circumstances of this case indicates that, even if Defendant did not have an actual 
“intent to thwart judicial proceedings,” it at minimum acted with “a reckless disregard for the effect 
of its conduct on those proceedings.” Krowtoh., 330 F. App'x at 536 (quoting Shepard Claims 
Service, Inc. v. William Darrah & Assocs. , 796 F.2d 190, 194 (6 th Cir. 1986). This factor thus 
supports denial of Defendant’s embedded motion to set aside default. 
 Second, the Court must consider the prejudice to Plaintiffs of excusing the default—“‘the 
future prejudice that will result from reopening the judgment, not prejudice that has already 
resulted from defendant's conduct.’” Hernandez v. Telelink, LLC, 2019 WL 5086128, at *2 (N.D. 
Ohio Oct. 10, 2019) (quoting Dassault Systemes, 663 F.3d at 842). Delay and increased costs are 
not alone enough to refuse a motion to set aside. See Hernandez, 2019 WL 5086128, at *2 (N.D. 
Ohio Oct. 10, 2019) . But here there is more : This litigation concerns, in part, a duty to defend 
under an insurance policy, so that lifting the default and reopening litigation of this case would 
keep Plaintiffs from receiving one of the very things they claim to have paid for, while at the same 
time putting them at risk of being unable to fund the underlying litigation and thus potentially 
altering the settlement calculus in a way that disadvantages them. Opening default would set things 
back, placing Plaintiffs at risk or further at risk in the underlying litigation. This factor likewise 
militates against reopening default. PageID
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 Third, Defendant has not show n that it has a meritorious defense. To show a meritorious 
defense, a defendant “does not need to demonstrate that the defense is likely to succeed on the 
merits. Rather, the inquiry is whether ‘there is some possibility that the outcome of the suit after a 
full trial will be contrary to the result achieved by the default.’” Hernandez, 2019 WL 5086128, at 
*3 (quoting $22,050.00 U.S. Currency, 595 F.3d at 326) (other quotations omitted). “[C]onclusory 
assertions may be sufficient to establish the ‘hint of a suggestion’ needed to present a meritorious 
defense.” Dassault Systemes, 663 F.3d at 843. Still, Defendant has not offered even that: Defendant 
simply states it has a meritorious defense and gestures broadly to documents attached to its filing, 
without even the most cursory explanation of the supposedly meritorious defense. See Doc. 18 at 
2-3. Again, if there are limits on how forgiving the standard will be, they are exceeded here —the 
standard surely and at minimum requires the movant to engage with it . Thus, this factor also 
supports denial of the motion to set aside default. 
For these reasons, Defendant’s improperly embedded Motion to Set Aside Default is 
DENIED. 
II. Plaintiffs’ motion for default judgment is GRANTED. 
Apart from its failed arguments seeking to set aside default, Defendant offers no argument 
in opposition to Plaintiff’s motion for entry of default judgment. Commentators have identified “a 
number of factors” that a court may consider in deciding whether to enter default judgment: 
the amount of money potentially involved; whether material issues of fact or issues 
of substantial public importance are at issue; whether the default is largely 
technical; whether plaintiff has been substantially prejudiced by the delay involved; 
and whether the grounds for default are clearly established or are in doubt. 
10A Charles A. Wright et al., Federal Practice and Procedure § 2685 (4th ed.). What has been said 
so far in this Order makes clear that many of these factors support entry of default judgment: the 
grounds for default are clearly established and plain as day; plaintiff would be prejudiced by PageID
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continued delay and for similar reasons has been substantially prejudiced by the delay that has 
already occurred; and the delay—106 days’ worth and certainly 53 days ’ worth—is so extensive 
and unjustified that it cannot fairly be called “technical” unless all untimeliness is to be dismissed 
with that label. And, while not yet addressed, this insurance coverage dispute appears to involve 
not questions of fact, but rathe r questions of law concerning the meaning of an insurance policy , 
which will determine whether it provides coverage on the undisputed facts. Doc. 22 at 5. Moreover, 
because this Court’s judgment would apply only as between these parties, the case presents no 
issue of substantial public importance —this case does not, for example, involve a class action 
against a governmental policy, resolution of which might, as a practical matter, dictate policy 
beyond the named parties. Finally, the dispute appears to involve roughly $1,000,000 (Doc. 1-1 at 
4), which is a lot of money, but no so large an amount as to cause this factor to swallow up all the 
other factors weighing in favor of entry of a default judgment. 
CONCLUSION 
 For the foregoing reasons, the Court DENIES Defendants Motion to Set Aside Entry of 
Default and GRANTS the Motion for Default Judgment. Judgment on liability is hereby 
ENTERED in favor of Plaintiffs. The Court REFERS this matter to Magistrate Judge Charmiane 
G. Claxton for a timely (1) hearing concerning remedies and (2) report and recommendation 
concerning the proper remedies. 
IT IS SO ORDERED, this 28th day of May, 2026. 
 
s/ Brian Lea________________________________ 
BRIAN C. LEA 
UNITED STATES DISTRICT JUDGE PageID
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