United States District Court, M.D. Florida, Fort Myers Division
OPINION AND ORDER 
POLSTER CHAPPELL, UNITED STATES DISTRICT JUDGE
matter comes before the Court on the Government's Motion
for Default Judgment filed on April 26, 2017. (Doc. 37).
Defendants Douglas Winland, Sherry Jean Hetz, Newline
Holdings, LLC (“Newline”), DABTLC5, LLC
(“DABTLC5”), and the State of Florida have not
filed a response and the time to do so has expired.
Therefore, the Motion is ripe for review.
case arises from Winland's failure to pay tax liabilities
in the amount of $1, 115, 884.38,  plus ongoing interest and
penalties. (Doc. 37 at 9). The Government alleges that,
between September and November 2007, the IRS assessed tax
liabilities against Winland for the 1998 through 2003 and
2006 tax years (“2007 Tax Assessments”). (Doc. 1
at ¶ 15). Later, on August 24, 2009, the IRS made
additional tax assessments against Winland for the 2004 and
2005 tax years (“2009 Tax Assessments”). (Doc. 1
at ¶ 15). To collect on these obligations, the
Department of the Treasury sent Winland several notices and
demands for payment. (Docs. 1 at ¶¶ 16, 41(f); 37-2
at 4-64). But Winland did not pay. (Doc. 1 at ¶ 17). Tax
liens were thus created based upon the unpaid 2007 and 2009
Tax Assessments (respectively, the “2007 Tax
Lien” and the 2009 “Tax Lien”)
(collectively the “Tax Liens”), and the
Government recorded them on October 2, 2008 and November 23,
2009 in Howard County, Maryland. (Doc. 1 at ¶ 22). The
Department of the Treasury also filed notices of federal tax
liens in Lee County Florida against Winland on May 7, 2014,
and against Hetz as Winland's “transferee and/or
nominee” with respect to a residence located at 3510
N.W. 47th Street, Cape Coral, Florida 33993 (the
“Subject Property”) on December 9, 2014. (Doc. 1
at ¶¶ 36-37).
time of the 2007 Tax Assessments, Winland was the sole owner
of a property located in Howard County, Maryland (the
“Maryland Property”). (Doc. 1 at ¶ 21). In
January of 2008, Winland sold the Maryland Property for $188,
246.43. (Doc. 1 at ¶ 23). Then, on February 21, 2008,
Winland deposited $180, 246.43 into a joint checking account
he shared with Hetz, with whom he also shared a close
romantic relationship. (Doc. 1 at ¶¶ 25, 41(b)).
One week later, Hetz withdrew $150, 000.00 from the shared
account and purchased a Certificate of Deposit
(“CD”) in her name alone. (Doc. 1 at ¶ 26).
On October 10, 2008, the value of Hetz's CD was $152,
390.60. (Doc. 1 at ¶ 27). But by December 10, 2008, the
CD's value had decreased to $102, 994.80. (Doc. 1 at
December 19, 2008, Hetz redeemed the CD and made two deposits
into her personal checking account: one for $103, 073.92 and
one for $40, 000.00. (Doc. 1 at ¶ 28). Days later, Hetz
used $120, 289.33 from her personal checking account to
acquire the Subject Property via a special warranty deed that
listed both herself and Winland as co-grantees. (Doc. 1 at
¶¶ 5, 29-30). The parties' ownership interests
were not specifically enumerated. (Doc. 1 at ¶ 30).
a year later, on August 24, 2009, the IRS issued the 2009 Tax
Assessment. (Doc. 1 at ¶ 33). Then, on October 29, 2009,
Winland executed a quitclaim deed on the Subject Property to
Hetz in return for $10.00. (Doc. 1 at ¶ 34). Despite the
transfer, Winland continued to reside at the Subject Property
until he was later incarcerated for an unrelated series of
events. (Doc. 1 at ¶ 44(g)).
on these allegations, the Government filed a four count
Complaint against Winland that requested that the outstanding
tax liabilities be reduced to judgment, the foreclosure of
the Tax Liens on the Subject Property, that the Court set
aside Winland's transactions leading up to and regarding
the Subject Property as fraudulent, and for a determination
that Hetz holds the Subject Property as Winland's
nominee. (Doc. 1). Given the possibility that other entities
would claim an interest in the property, the Complaint also
included Hetz, Hart, Newline, DABTLC5, and the State of
Florida. (Doc. 1 at ¶¶ 7-11).
Government then served Newline on February 13, 2017 (Doc.
13), Hart and the State of Florida on February 21, 2017 (Doc.
14, 16), Hetz on February 23, 2017 (Doc. 15), DABTLC5 on
March 2, 2017 (Doc. 17), and Winland on March 7, 2017 (Doc.
22). Hart timely filed an Answer. (Doc. 18). On April 7,
2017, the Government filed a joint stipulation with Hart as
to the priority of interests and the distribution of proceeds
from the prospective sale of the Subject Property. (Doc. 32).
Thereafter, when Winland, Hetz, Newline, DABTLC5, and the
State of Florida (collectively, the “Default
Defendants”) failed to act, the Government obtained
clerk's defaults. (Doc. 24, 25, 29, 30). Now, the
Government seeks default judgments against the Default
of the Federal Rules of Civil Procedure establishes a
two-step procedure for obtaining default judgment. First,
when a defendant fails to plead or otherwise defend a
lawsuit, the clerk of the court must enter a clerk's
default against the defendant. See Fed. R. Civ. P.
55(a). Second, after receiving the clerk's default, the
court can enter a default judgment provided the defendant is
not an infant or incompetent. SeeFed. R. Civ. P.
55(b)(2); see also Solaroll Shade & Shutter
Corp. v. Bio-Energy Sys., Inc. 803 F.2d 1130, 1134 (11th
Cir. 1986) (stating a default judgment may be entered
"against a defendant who never appears or answers a
complaint, for in such circumstances the case never has been
placed at issue.").
said, a court may enter a default judgment only if "the
well-pleaded allegations in the complaint, which are taken as
true due to the default, actually state a substantive cause
of action and that there is a substantive, sufficient basis
in the pleadings for the particular relief sought."
Tyco Fire & Sec., LLC v. Alcocer, 218
F.App'x 860, 863 (11th Cir. 2007). The upshot of this
rule is that “the defendant is not held to admit facts
that are not well-pleaded or to admit conclusions of
law.” Nishimatsu Constr. Co., Ltd. v. Houston
Nat'l Bank, 515 F.2d 1200, 1206 (5th Cir.
1975). Consequently, when considering a motion
for default judgment, courts must "examine the
sufficiency of plaintiff's allegations to determine
whether the plaintiff is entitled to" relief.
See PNC Bank, N.A. v. Starlight Props. &
Holdings, LLC, No. 6:13-cv-408, 2014 WL 2574040, at *1
(M.D. Fla. June 9, 2014) (citation omitted).
COUNT I: ...