United States of America v. Framing CAT, LLC

IN THE UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF TEXAS
DALLAS DIVISION
UNITED STATES OF AMERICA, 	§
§
Plaintiff, 	§
§
V. 	§ 	No. 3:25-cv-595-L-BN
§
FRAMING CAT, LLC, 	§
§
Defendant. 	§
FINDINGS, CONCLUSIONS, AND RECOMMENDATION OF THE
UNITED STATES MAGISTRATE JUDGE
Plaintiff United States of America, on behalf of the U.S. Department of Labor
Occupational Safety and Health Administration (“OSHA”), filed this action against
Defendant Framing CAT, LLC to enforce a debt that originated from civil penalties
that OSHA assessed against Framing CAT for workplace-safety violations. See Dkt.
No. 1.
United States District Judge Sam A. Lindsay referred this lawsuit to the
undersigned United States magistrate judge for pretrial management under 28
U.S.C. § 636(b). See Dkt. No. 5.
A summons return was filed on July 17, 2025. See Dkt. No. 9. And, pursuant
to the United States’s request, the Clerk of Court entered default the next day. See
Dkt. Nos. 10 & 11. The United States then moved for default judgment. See Dkt. No.
12. And, for the reasons and to the extent set out below, the Court should grant the
motion for default judgment.
Legal Standards
When a defendant has “failed to plead or otherwise defend” an action, the Court
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may enter a default judgment if the plaintiff establishes the following prerequisites:
(1) the defendant was served with the summons and complaint and default was
entered; (2) the defendant is not “a minor or incompetent person”; and (3) the
defendant is not in the military. FED R. CIV. P. 55(b)(2); see also 50 U.S.C. § 3931(a),
(b) (providing “[p]rotection [for] servicemembers against default judgments”).
In this circuit, there is a required three-step procedure to obtain a default
judgment: (1) default by the defendant; (2) entry of default by the Clerk of the Court;
and (3) entry of default judgment by the district court. See N.Y. Life Ins. Co. v. Brown,
84 F.3d 137, 141 (5th Cir. 1996) (defining “the terms regarding defaults”).
Even though the United States Court of Appeals for the Fifth Circuit favors
resolving 	cases 	on 	their 	merits 	rather 	than 	granting 	default 	judgments, 	this
preference 	is 	“counterbalanced 	by 	considerations 	of 	social 	goals, 	justice, 	and
expediency, a weighing process [that] lies largely within the domain of the trial
court’s discretion.” Rogers v. Hartford Life & Accident Ins. Co., 167 F.3d 933, 936 (5th
Cir. 1999).
In consideration of these competing preferences, the Court takes a two-part
approach in determining whether to grant entry of default judgment. See Nishimatsu
Constr. Co. v. Hous. Nat’l Bank, 515 F.2d 1200, 1206 (5th Cir. 1975) (requiring a
“sufficient basis in the pleadings for the judgment entered”); see also Lindsey v. Price
Corp., 161 F.3d 886, 893 (5th Cir. 1998) (stating “relevant factors” in determining
whether default judgment is appropriate).
First, the Court considers the following six non-exhaustive factors to decide
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whether default judgment is appropriate: (1) “whether the default was caused by a
good faith mistake or excusable neglect”; (2) “whether there has been substantial
prejudice”; (3) “the harshness of a default judgment”; (4) whether there are “material
issues 	of 	fact”; 	(5) 	“whether 	the 	grounds 	for 	a 	default 	judgment 	are 	clearly
established”; and (6) whether the Court would be “obliged to set aside the default on
the defendant’s motion.” Lindsey, 161 F.3d at 893.
And default judgment may be appropriate where a defendant fails to follow
court orders. See McGrady v. D’Andrea Elec., Inc., 434 F.2d 1000, 1001 (5th Cir. 1970)
(upholding a default judgment due to a defendant’s “delay and failure to comply with
court rules”).
Next, the Court must assess the merits of the plaintiff’s claims and find a
“sufficient basis in the pleadings for the judgment entered.” Nishimatsu, 515 F.2d at
1206; see also Escalante v. Lidge, 34 F.4th 486, 493 (5th Cir. 2022) (“[E]ven if a
defendant defaults, a court may still deny default judgment if the plaintiff has failed
to state a claim on which relief can be granted.” (citing Lewis v. Lynn, 236 F.3d 766,
767-68 (5th Cir. 2001) (per curiam))).
Under Federal Rule of Civil Procedure 8(a)(2), a pleading must “contain a short
and plain statement of the claim showing the pleader is entitled to relief.” F ED R. CIV.
P. 8(a)(2).
This requirement “give[s] the defendant fair notice of what the … claim is and
the grounds upon which it rests.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007).
By defaulting, the defendant is deemed to admit “the plaintiff’s well-pleaded
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allegations of fact” and is not deemed to “admit allegations that are not well-pleaded
or to admit conclusions of law.” Nishimatsu, 515 F.2d at 1206.
The factual allegations, assumed to be true, need only “be enough to raise a
right to relief above the speculative level.” Twombly, 550 U.S. at 555. So detailed
allegations are not required, but “the pleading must present more than an unadorned,
the defendant-unlawfully-harmed-me accusation.” Ashcroft v. Iqbal, 556 U.S. 662,
678 (2009).
“A default judgment … establishes the defendant’s liability. But it does not
establish the amount of damages.” United States v. Shipco Gen., Inc., 814 F.2d 1011,
1014 (5th Cir. 1987).
So, “in the context of a default judgment, unliquidated damages normally are
not awarded without an evidentiary hearing … [except] where the amount claimed is
a liquidated sum or one capable of mathematical calculation.” See James v. Frame, 6
F.3d 307, 310 (5th Cir. 1993). A sum capable of mathematical calculation is one that
can be “computed with certainty by reference to the pleadings and supporting
documents alone.” Id. at 311. Thus, affidavits submitted to support a claim for
mathematically 	calculable 	damages 	“must 	be 	sufficiently 	detailed 	to 	establish
necessary facts.” United Artists Corp. v. Freeman, 605 F.2d 854, 857 (5th Cir. 1979).
Two other caveats also apply. “[A] ‘party is not entitled to a default judgment
as a matter of right, even where the defendant is technically in default.’ In fact,
‘[d]efault judgments are a drastic remedy, not favored by the Federal Rules and
resorted to by courts only in extreme situations.’” Lewis, 236 F.3d at 767 (citations
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omitted).
And, 	before 	it 	may 	enter 	default 	judgment, 	“the 	district 	court 	has 	an
affirmative duty to look into its jurisdiction both over the subject matter and the
parties.” Sys. Pipe & Supply, Inc. v. M/V Viktor Kurnatovskiy, 242 F.3d 322, 324 (5th
Cir. 2001) (quoting Williams v. Life Savings & Loan, 802 F.2d 1200, 1203 (10th Cir.
1986)); see also Ruhrgas AG v. Marathon Oil Co., 526 U.S. 574, 583-84 (1999) (federal
courts have independent duty to examine their own subject matter jurisdiction).
Analysis
I. 	The Court has jurisdiction over the subject matter of this lawsuit and
the defaulting defendant.
Deciding the motion for default judgment “begins, as it must, by examining the
Court’s jurisdiction.” Wattiker v. Elsenbary Enters., Inc., No. 3:22-cv-940-B-BN, 2023
WL 5167023, at *3 (N.D. Tex. May 19, 2023) (cleaned up; quoting Hammerschmidt v.
Garland, 54 F.4th 282, 287 (5th Cir. 2022)), rec. accepted, 2023 WL 5167019 (N.D.
Tex. June 13, 2023); accord Louisiana v. U.S. Dep’t of Energy, 90 F.4th 461, 466 (5th
Cir. 2024) (“Jurisdiction is always first.” (citation omitted)).
The United States is the plaintiff, so the Court has subject-matter jurisdiction
under 28 U.S.C. § 1345.
And the penalties underlying the debt that Framing CAT owes were incurred
for its operations in this judicial district. See, e.g., Dkt. No. 1 at 6 & 18 (providing that
Framing CAT’s office address and the inspection cite were both in Mesquite, Texas).
II. 	The procedural requirements for default judgment have been met.
The United States properly served Framing CAT under Federal Rules of Civil
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Procedure 4(h)(1)(A) and 4(e)(1) and Texas Civil Practice and Remedies Code §
17.026(a).
Rule 4(h) “describes the process for serving a corporation, partnership, or
association”; “[i]f the association is served within a judicial district of the United
States, it may be served ‘in the manner prescribed by Rule 4(e)(1) for serving an
individual.’” Pathway Senior Living LLC v. Pathways Senior Living LLC, No. 3:15-
cv-2607-M, 2016 WL 1059536, at *2 (N.D. Tex. Mar. 17, 2016) (quoting F ED . R. CIV.
P. 4(h)(1)(A), (B)). And Rule 4(e)
explains that to serve an individual, the individual may be served by
“following state law for serving a summons in an action brought in
courts of general jurisdiction in the state where the district is located or
where service is made.” Thus, under 4(e)(1), the Court looks to the Texas
Rules of Civil Procedure to propriety of service. Texas law designates
the Secretary of State as an agent for service of process for registered
business entities where “the registered agent of the entity cannot with
reasonable diligence be found at the registered office of the entity.” TEX.
BUS . O RGS . CODE A NN . § 5.251.
Id.
The United States “exercised reasonable diligence in attempting personal
service on [Framing CAT’s] registered agent.” Id. (citing Ingram Indus., Inc. v. U.S.
Bolt Mfg., Inc., 121 S.W.3d 31, 34 (Tex. App. – Houston [1st Dist.] 2003)); see Dkt. No.
6. So the United States “properly accomplished service by mailing the Complaint and
Summons, by certified mail, return receipt requested, to the Secretary of State.”
Pathway, 2016 WL 1059536, at *2 (citing TEX. C IV. PRAC. & REM. C ODE ANN . §
17.026(a); Campus Investments, Inc. v. Cullever, 144 S.W.3d 464, 466 (Tex. 2004)); see
also Dkt. Nos. 6 & 7. And the United States “has conclusively demonstrated that the
Secretary of State forwarded process to [Framing CAT].” Pathway, 2016 WL 1059536,
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at *2 (citing Capitol Brick, Inc. v. Fleming Mfg. Co., 722 S.W.2d 399, 401 (Tex. 1986));
see Dkt. No. 9.
The Clerk entered default on July 18, 2025. See Dkt. No. 11. And Framing CAT
is not a natural person, so it is neither in the military service, a minor, nor
incompetent. See Dkt. No. 12, ¶ 6.
III. 	The allegations support default judgment as to the claim asserted.
As to the debt underlying this lawsuit, the United States alleges
On 	October 	4, 	2021, 	OSHA 	conducted 	an 	inspection 	of
Defendant’s operations at a job site in Mesquite, Texas. See Citation and
Notification of Penalty, attached as Exhibit A and incorporated by
reference.
On or about November 1, 2021, OSHA assessed civil penalties
against 	the 	Defendant 	for 	workplace 	safety 	violations 	under 	the
Occupational Safety and Health Act of 1970, 29 U.S.C. §§ 651 et seq.,
and its implementing regulations. Id.
Specifically, pursuant to its authority in 29 U.S.C. § 666, OSHA
issued one citation for two penalties related to employees failing to wear
hard hats and Defendant’s failure to protect employees from potentially
falling from rafters. The penalties for this citation totaled $6,437.00. See
Exhibit A, at 6-7.
Defendant 	and 	OSHA 	entered 	into 	an 	informal 	settlement
agreement for this citation in or around December 2021. See Informal
Settlement Agreement, attached as Exhibit B and incorporated by
reference (hereinafter the “Agreement”). The Agreement reduced the
original penalty amount from $6,437.00 to $3,862.20, conditioned upon
the Defendant correcting the cited violations and providing evidence to
OSHA of such corrective actions.
By entering into the Agreement, the Defendant waived its right
to contest the penalties imposed. See Exhibit B.
OSHA referred the debt for this citation to the U.S. Department
of Treasury for collection in May 2022. See Certificate of Indebtedness
at 1, attached as Exhibit C and incorporated by reference.
To date, the Treasury Department has collected nine payments
from the Defendant totaling $1,950.00 towards this citation. Of this
amount, $1,042.28 was applied to the principal, while the remainder
was applied to interest, penalties and fees.
Defendant owes the United States $4,038.18 for this citation,
which includes a principal amount of $2,819.92, plus administrative
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fees, penalties (accruing at a rate of 6% per annum), and interest
(accruing at a rate of 1% per annum) in the amount of $1,218.26 through
August 29, 2024. See Exhibit C, at 1.
On October 4, 2021 OSHA conducted an inspection of Defendant’s
operations at a separate job site in Mesquite, Texas. See Citation and
Notification of Penalty, attached as Exhibit D and incorporated by
reference.
On or about November 1, 2021, OSHA assessed civil penalties
against 	the 	Defendant 	for 	workplace 	safety 	violations 	under 	the
Occupational Safety and Health Act of 1970, 29 U.S.C. §§ 651 et seq.,
and its implementing regulations. Id. 12. Specifically, pursuant to its
authority in 29 U.S.C. § 666, OSHA issued one citation for one penalty
related to failing to protect an employee from potentially falling from an
aerial lift. This penalty for this citation totaled $2,926.00. See Exhibit
D, at 6.
Notice and demand has been made upon the Defendant. See
Exhibit C, at 2.
Defendant did not contest the issuance of the citation or the
assessment of the penalties, and therefore the cited violations and the
assessed penalties are “not subject to review by any court or agency.” 29
U.S.C. § 659(a).
OSHA referred the debt for this citation to the U.S. Department
of Treasury for collection in April 2022. See Exhibit C, at 2.
To date, the Treasury Department has collected ten payments
from the Defendant totaling $1,800.00 towards this citation. Of this
amount, $1,111.14 was applied to the principal, while the remainder
was applied to interest, penalties and fees.
Defendant owes the United States $2,679.54 for this citation,
which includes a principal amount of $1,814.86, plus administrative
fees, penalties (accruing at a rate of 6% per annum), and interest
(accruing at a rate of 1% per annum) in the amount of $864.68 through
August 29, 2024. See Exhibit C, at 2.
For both citations, the Defendant owes the United States a total
of $6,717.72 for principal, interest, penalties and administrative fees.
See Exhibit C, at 2.
Dkt. No. 1 at 2-4.
As reflected by the attachments to the motion for default judgment – the
proffered OSHA certificates of indebtedness and a declaration from the attorney for
the United States affirming that “no payments or credits have been received or
applied 	to 	Defendant’s 	account 	since 	the 	execution 	of 	the 	Certifications 	of
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Indebtedness included in this appendix” Dkt. No. 12-1 – the total amount that
Framing CAT owed the United States as of July 23, 2025 had grown to $7,114.46, see
id.
IV. 	Consideration of other factors supports default judgment.
Default judgment is a harsh remedy, but, as set out above, the record supports
default judgment. There has not been substantial prejudice against Framing CAT.
There are clearly established grounds for default, as set out above. And there is no
indication that the default was caused by good faith mistake or excusable neglect.
And, so, the Court would not necessarily feel obligated to set aside a default (should
a motion to do so be filed). See Lindsey, 161 F.3d at 893.
V. 	The United States’s claim is for a sum certain, so an evidentiary
hearing is not necessary.
“A default judgment must not differ in kind from, or exceed in amount, what
is demanded in the pleadings.” F ED . R. CIV. P. 54(c). And “[a] hearing to decide
damages 	is 	unnecessary 	if 	the 	amount 	of 	damages 	can 	be 	determined 	with
mathematical calculation by reference to the pleadings and supporting documents.”
United States v. Torres, No. 3:22-cv-1148-S, 2023 WL 2355912, at *2 (N.D. Tex. Jan.
19, 2023) (cleaned up), rec. accepted, 2023 WL 2355930 (N.D. Tex. Mar. 3, 2023).
Here, the United States – through its complaint and the attachments thereto
and the attachments to the motion for default judgment – has carried its burden to
show that, as of July 23, 2025, Framing CAT owed the government $7,114.46 for its
failure to pay the OSHA citations, which includes the principal, pre-judgment
interest, penalties, and fees for each citation. See, e.g., Torres, 2023 WL 2355912, at
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*3.
On this record, a hearing is unnecessary because the amount of
monetary damages is readily ascertainable from Plaintiff’s pleadings
and capable of mathematical calculation. Specifically, Plaintiff has
established its entitlement to a default judgment in the amount of
[$7,114.46], plus post-judgment interest and costs. See 28 U.S.C. §
1961(a) (providing that post-judgment interest is calculated using “the
weekly average 1-year constant maturity Treasury yield, as published
by ... the Federal Reserve System for the calendar week preceding the
date of the judgment.”); FED . R. C IV. P. 54(d)(1) (stating that costs should
be awarded to the prevailing party unless prohibited by a federal
statute, the Federal Rules of Civil Procedure, or a court order).
Id. (citation omitted).
Recommendation
The Court should grant Plaintiff United States of America’s motion for default
judgment [Dkt. No. 12] in the amount of $7,114.46 for unpaid debts as of July 23,
2025, post-judgment interest at the applicable federal rate from the date of judgment
until paid in full, and reasonable court costs.
A copy of these findings, conclusions, and recommendation shall be served on
all parties in the manner provided by law. Any party who objects to any part of these
findings, conclusions, and recommendation must file specific written objections
within 14 days after being served with a copy. See 28 U.S.C. § 636(b)(1); FED . R. CIV.
P. 72(b). In order to be specific, an objection must identify the specific finding or
recommendation to which objection is made, state the basis for the objection, and
specify the place in the magistrate judge’s findings, conclusions, and recommendation
where the disputed determination is found. An objection that merely incorporates by
reference or refers to the briefing before the magistrate judge is not specific. Failure
to file specific written objections will bar the aggrieved party from appealing the
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factual findings and legal conclusions of the magistrate judge that are accepted or
adopted by the district court, except upon grounds of plain error. See Douglass v.
United Servs. Auto. Ass’n, 79 F.3d 1415, 1417 (5th Cir. 1996).
DATED: January 2, 2026
_________________________________________
DAVID L. HORAN
UNITED STATES MAGISTRATE JUDGE
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