In the
United States Court of Appeals
For the Seventh Circuit
____________________
No. 15-‐‑1269
CENTRAL ILLINOIS CARPENTERS HEALTH AND WELFARE TRUST
FUND, et al.,
Plaintiffs-‐‑Appellees,
v.
CON-‐‑TECH CARPENTRY, LLC,
Defendant-‐‑Appellant.
____________________
Appeal from the United States District Court
for the Central District of Illinois.
No. 14-‐‑CV-‐‑3293 — Colin S. Bruce, Judge.
____________________
ARGUED NOVEMBER 6, 2015 — DECIDED NOVEMBER 24, 2015
____________________
Before WOOD, Chief Judge, and POSNER and EASTERBROOK,
Circuit Judges.
EASTERBROOK, Circuit Judge. Several multi-‐‑employer
health and welfare funds filed this suit under the Employee
Retirement Income Security Act (ERISA), seeking about
$70,000 in what they labeled delinquent contributions. The
suit was filed on September 25, 2014, and Con-‐‑Tech Car-‐‑
pentry, the assertedly delinquent employer, was served on
2 No. 15-‐‑1269
October 14. Service started a 21-‐‑day period for an answer,
see Fed. R. Civ. P. 12(a)(1)(A)(i), giving Con-‐‑Tech until No-‐‑
vember 4. It did not meet that deadline, and on November 5
plaintiffs filed and served a motion asking the district court
to find Con-‐‑Tech in default.
Con-‐‑Tech did not respond to that motion. After a hearing
on December 1, which Con-‐‑Tech did not attend, Magistrate
Judge Bernthal entered an order finding Con-‐‑Tech in default
and giving plaintiffs 14 days to prove their damages. (Con-‐‑
Tech has not argued that, by entering a default rather than
recommending this step to the district judge, the magistrate
judge exceeded his powers under 28 U.S.C. §636.) At this
point Con-‐‑Tech could have asked the district court to vacate
the default, which under Fed. R. Civ. P. 55(c) it may do for
“good cause.” But Con-‐‑Tech ignored the December 1 order,
as it had ignored the earlier procedural steps.
Plaintiffs filed documents showing to the district judge’s
satisfaction that Con-‐‑Tech was delinquent in payment. Con-‐‑
Tech did not reply to these documents. On January 13, 2015,
the court entered a judgment in the funds’ favor, awarding
them about $70,000 in past-‐‑due contributions, $14,000 in in-‐‑
terest, $7,000 in liquidated damages, $3,000 in audit costs,
and $4,000 in attorneys’ fees.
Meanwhile, Con-‐‑Tech had belatedly begun filing papers.
Counsel for Con-‐‑Tech filed an appearance on December 30,
2014. On the same date he also filed a motion for an exten-‐‑
sion of time to answer the complaint. Given the entry of de-‐‑
fault, however, an answer was not what was required; Con-‐‑
Tech needed to file a Rule 55(c) motion to vacate the default.
Plaintiffs helpfully told Con-‐‑Tech just this in a document
filed on January 5. Instead of filing a Rule 55(c) motion,
No. 15-‐‑1269 3
however, Con-‐‑Tech filed a motion for a stay in favor of arbi-‐‑
tration. So by January 13, when the district judge turned to
the subject of damages, the complaint had not been an-‐‑
swered, a default had been entered, no Rule 55(c) motion
had been filed, and Con-‐‑Tech had not contested the plain-‐‑
tiffs’ evidentiary submissions about relief. And once the dis-‐‑
trict court entered its judgment, the time to seek relief for
“good cause” under Rule 55(c) expired.
Rule 55(c) says that to set aside a default judgment a liti-‐‑
gant must file a motion under Fed. R. Civ. P. 60(b). The re-‐‑
quirements under that rule are steeper (for example, relief
under Rule 60(b)(1) depends on excusable neglect), and ap-‐‑
pellate review is deferential. See, e.g., Moje v. Federal Hockey
League, LLC, 792 F.3d 756 (7th Cir. 2015).
Con-‐‑Tech filed a Rule 60(b) motion on January 15. The
motion also invoked Rule 55(c), but too late. Con-‐‑Tech told
the district judge that it had not ignored the suit but had in-‐‑
stead started negotiating with plaintiffs’ lawyers, seeking a
satisfactory settlement. The judge replied that Con-‐‑Tech may
not have ignored the plaintiffs’ demands, but that it had ig-‐‑
nored the litigation. The judge observed that it is impossible
to handle a suit in which a litigant unilaterally decides to
march to the beat of its own drum. A defendant can both file
an answer and try to negotiate a settlement; doing the latter
does not eliminate the need to do the former. The judge de-‐‑
nied the Rule 60(b) motion, and Con-‐‑Tech appealed.
Con-‐‑Tech repeats in this court the argument the district
judge rejected, but the district court did not abuse its discre-‐‑
tion in holding Con-‐‑Tech to the Civil Rules’ requirements.
Con-‐‑Tech could have filed an answer and asked the district
court to stay the litigation while the parties negotiated. It
4 No. 15-‐‑1269
was not free to keep silent and hope that the equivalent of a
stay would be afforded retroactively. Con-‐‑Tech’s brief in this
court ignores the need to show excusable neglect; it argues
instead that it had “good cause” for proceeding as it did.
That’s the Rule 55(c) standard, and we have explained why
Rule 55(c) is not now relevant. Con-‐‑Tech has forfeited its
opportunity to make an argument under the applicable legal
standard. At all events, its conduct was not “neglect” of any
kind. Con-‐‑Tech made a deliberate decision to disregard the
pending suit. No district judge has to put up with that, or
excuse it in retrospect.
Con-‐‑Tech thinks that plaintiffs were not chivalrous in
seeking a default judgment while negotiations continued,
and that may be so, but Con-‐‑Tech could have protected itself
easily—and district judges are entitled to protect the judicial
system from litigants such as Con-‐‑Tech who choose to play
by their own rules. Con-‐‑Tech also complains that plaintiffs’
motions were served on non-‐‑lawyers (Con-‐‑Tech’s corporate
officers and agents for service of process) and should have
been sent to counsel. Yet until counsel files an appearance,
which did not happen until December 30, adverse parties are
supposed to serve the litigant itself, just as plaintiffs did.
Fed. R. Civ. P. 5(b). Plaintiffs went beyond their legal re-‐‑
quirements, for “[n]o service is required on a party who is in
default for failing to appear.” Fed. R. Civ. P. 5(a)(2).
In this court, Con-‐‑Tech maintains that it was legally re-‐‑
quired to spurn the judicial process. It asserts that, if it had
filed an answer or any other substantive paper, it would
have waived its right to arbitrate under the Federal Arbitra-‐‑
tion Act (which it mistakenly invokes, although 29 U.S.C.
§1401(a)(1), part of the Multiemployer Pension Plan
No. 15-‐‑1269 5
Amendment Act, is the governing statute). Nonsense. True,
a litigant cannot attempt to prevail in court, then seek arbi-‐‑
tration only as a fallback. See, e.g., Sharif v. Wellness Interna-‐‑
tional Network, Ltd., 376 F.3d 720, 726 (7th Cir. 2004); Cabine-‐‑
tree of Wisconsin, Inc. v. Kraftmaid Cabinetry, Inc., 50 F.3d 388,
391 (7th Cir. 1995); St. Mary'ʹs Medical Center of Evansville, Inc.
v. Disco Aluminum Products Co., 969 F.2d 585, 589 (7th Cir.
1992). But nothing prevents a defendant from filing an an-‐‑
swer that demands arbitration and offers other reasons why
plaintiffs should not receive judicial relief. See, e.g., Kawasaki
Heavy Industries, Ltd. v. Bombardier Recreational Products, Inc.,
660 F.3d 988, 993–98 (7th Cir. 2011).
Con-‐‑Tech’s remaining arguments have been considered
but do not require discussion. All but one concern the mer-‐‑
its, which the district court did not reach. The one exception
is a contention that the district court did not have “jurisdic-‐‑
tion” to award damages that could benefit a non-‐‑party. That
is an argument about the real party in interest, see Fed. R.
Civ. P. 17(a), not about subject-‐‑matter jurisdiction.
AFFIRMED