Case 1:16-cv-00654-CMH-TCB Document 28 Filed 12/23/16 Page 1 of 10 PageID# 151

UNITED STATES DISTRICT COURT

FOR THE EASTERN DISTRICT OF VIRGINIA
ALEXANDRIA DIVISION
_______________________________________
)
JOHN BOAL PHOTOGRAPHY, LLC,
)
)
Plaintiff
)
)
v.
)
)
HANNOVER HOUSE, INC.,
)
)
ERIC PARKINSON,
)
in his individual capacity,
)
)
Defendants.
)
_______________________________________)

Civil No. 1:16-cv-00654-CMH/TCB

PLAINTIFFS OPPOSITION TO
DEFENDANTS MOTION TO SET ASIDE ENTRY OF DEFAULT, TO DENY MOTION
FOR DEFAULT JUDGMENT, AND FOR LEAVE TO FILE ANSWER
Plaintiff John Boal Photography, LLC (Plaintiff), by and through counsel, hereby
submits its Opposition to Defendants Hannover House, Inc. (Hannover House) and Eric
Parkinson (Parkinson), collectively referred to as the Defendants, Motion to Set Aside Entry
of Default, to Deny Motion for Default Judgment and for Leave to File an Answer on the grounds
Defendants have not shown good cause nor a meritorious defense, and asks this Court to grant
Plaintiffs pending Motion for Default Judgment.
I.

INTRODUCTION
Hannover House had actual notice of this suit, and publically blogged about the suit since

June 2016; and willfully failed to participate in this litigation ignoring all deadlines and extensions
set by this Court, including the ones they themselves requested and received (until the recent

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December 15 filings to set aside default). Defendants openly and notoriously transact business in
Arkansas as Hannover House despite their extensive efforts to obscure their current corporate
registration, admit to having failed to pay Plaintiff for his services past due since August of 2015,
and have violated his copyright ownership by openly publishing such photos, which are still
available on Twitter and Facebook as of the date of this Opposition, without grant of copyright
ownership to Defendants.
Defendants lack good cause to set aside entry of default and lack a meritorious defense,
and Plaintiff respectfully requests that this Court grant default judgment in favor of Plaintiff and
deny all other pending Motions by Defendants.
II.

RELEVANT FACTS
Upon information and belief, Hannover House conducts business in the state of Arkansas,

including acting through its CEO Parkinson. Defendants used an Arkansas address on its public
website as both the contact us and corporate information. See Exhibit A (also available at
www.hannoverhouse.com (last visited December 23, 2016)). Defendants did not object to use of
Defendants Arkansas address on Plaintiffs invoice. Docket Nos. 15 & 20-3.
Defendants both communicated to this Court using its Arkansas address and made no
representation that it had previously domesticated in Wyoming. Docket No. 8. As recently as
November 11, 2016, Hannover House held itself out as moving its corporate headquarters from
one Arkansas address to another Arkansas address on its own press release announcing the in-state
move, with no mention of being a Wyoming corporation. See Exhibit B, also available at
http://www.otcmarkets.com/stock/HHSE/news/Hannover-House-Announces-New-ExecutiveOffices?id=144644&b=y (last visited December 23, 2016). Further, a google search shows

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Hannover House headquarters as located in Springdale, AR. See Google Search,

www.google.com (last visited December 23, 2016) (search Hannover House Inc.).
Upon such information and belief, Plaintiff, through counsel, searched the Arkansas
Secretary of State database and found the revoked Arkansas registration information for Hannover
House, which listed Parkinson as the last registered agent of record. It appears that Defendants
failed to timely file annual report and pay annual fees to maintain their registration and did not
properly update the Arkansas Secretary of State with current address to receive service of process
on behalf of Defendants, nor update Arkansas with notice of termination of registration. See
Exhibit C. Plaintiff had no knowledge Hannover House was registered as a Wyoming domestic
corporation due to Defendants repeated, extensive, and exclusive representations as an Arkansas
business.
Plaintiff cannot reasonably be expected to conduct a fifty state search in order to identify
Hannover Houses domestic corporate state of filing, especially considering Defendants failure
to properly transfer corporate domicile and notify the Arkansas Secretary of State with proper
address for services of process. Additionally, Plaintiff cannot be penalized for Hannover Houses
failure to properly register in accordance with Arkansas law as it relates to foreign corporations
transacting business in Arkansas, or Hannovers failure to properly notify Arkansas of its change
of registration to Wyoming and its extensive efforts to conceal its current registration. Hannover
clearly continued to conduct business from an Arkansas location, which a foreign corporation
would be required to register as doing, and they patently failed to do so. Defendants now
improperly misrepresent their claim that Hannover House is not the same corporation as the
Hannover House Inc. with the Arkansas revoked corporate registration. Mere change of corporate
domicile, or failure to properly register corporate status in Arkansas, does not create a new

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corporation absolving Hannover House of corporate liabilities in Arkansas, especially since

Defendants continue to transact business in Arkansas.
Plaintiff served Hannover House and Parkinson at their Arkansas business address, and
Plaintiff through counsel served Defendants the Complaint and all filings to this date as provided
in the certificates of service. As of June 29, 2016, the Defendants blogged on its public website
that it had received actual notice of the suit and was aware it had not yet paid Plaintiffs invoice:
HHSE was named in a vendor lawsuit for an event photographer HHSE has decided to tender
the services payment ($1000) on behalf of the production company, and otherwise respond and
defend as may be appropriate. See Exhibit D Blog Post June 29 2016 at 6(c) DC Photographer
(note, Defendants did not tender payment nor respond or defend as appropriate as it claimed it
would do in the blog post); Summons Returned Executed (Docket No. 5), Summons Returned
Executed (Docket No. 6).
On August 16, 2016, no answer having been filed by either Defendant, the Court ordered
that Plaintiff obtain a default from the Clerk and directed Plaintiff to file a motion for default
judgment. Docket No. 7. On August 23, 2016, Defendants submitted a letter to this Court
requesting an extension of time in which to file an answer. Docket No. 8. On August 25, 2016, the
Court granted Defendants an extension of 20 days to file an answer. Docket No. 9. Despite this
extension, Defendants again failed to file an answer by the extended response deadline of
September 14, 2016. On September 29, 2016, this Court entered default as to both Defendants.
Defendants, through counsel, waited an additional 75 days to now file an untimely motion
to set aside the properly entered entry of default, to deny Plaintiffs pending motion for default
judgment, and for leave to file an answer.

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III.

ARGUMENT
To set aside a default, Fed. R. Civ. P. 55(c) requires that a motion to set aside a default

shall be granted only if good cause is shown. In this case, Defendants lack good cause necessary
to set aside entry of default as well as a meritorious defense, and the Motion to Set Aside should
be denied. Defendants failure to respond were deliberate attempts to deny Plaintiff judgment.
A. Defendants lack a meritorious defense
Defendants admit to having failed to pay Plaintiff the $1,000 owed for photography
services, and despite extensive communication about and requests by Plaintiff for such payment,
have now created a new story about having paid the wrong party. Defendants have failed to allege
facts of any written agreement to transfer copyright ownership to the photographs in question, and
yet Defendant claim to have a meritorious defense to the copyright claims under various theories,
each of which lack a meritorious defense.
1. Plaintiffs copyright claims are valid and Defendants used Plaintiffs
photographs without valid transfer of copyright.
Plaintiff has a good faith valid claim of copyright infringement by the Defendants
photographs registered to its sole member/owner, John Boal, whose personal services form the
basis of the John Boal Photography LLC (Plaintiff), to which Boals interests and rights are
assigned, and the LLC exploits and enforces those rights. Boal, the original author of the
photographs in question, grants all rights of exploitation and enforcement to his photographs to
Plaintiff, of which Boal is the sole member and owner. Plaintiff has valid claim to bring this suit
to enforce such copyright.
Defendants work for hire argument lacks a meritorious defense for several reasons,
including Defendants admission of failing to pay Plaintiff for his services, lack of a writing

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granting work for hire ownership pursuant to 17 U.S.C. 204(a), and continued use of Plaintiffs
photographs in violation of copyright. Plaintiffs unpaid invoice makes no express grant to
Defendants of copyright ownership, nor a work for hire agreement. Therefore, Plaintiff has not
granted any such transfer of copyright ownership under work for hire and Defendants lack a
meritorious defense.
2. Hannover House cannot use its domestic Wyoming corporate status as a
defense.
Hannover House represented itself as an Arkansas corporation to Plaintiff through all of its
business practices, its public website and press releases along with failing to correct or object to
Plaintiffs use of the Arkansas address on Defendants invoice, and on the address on letters
Hannover sent to this Court.
Arkansas law requires Hannover House register as a foreign corporation to transact
business in Arkansas. Hannover House continues to operate its business in Arkansas by its own
extensive admissions and conduct, apparently with a lapsed or revoked corporate registration.
Exhibit C. This means Hannover House did not properly notice the Arkansas Secretary of State
with any move of corporate domicile. Further, [a] foreign corporation may not transact business
in [Arkansas] until it obtains a certificate of authority from the [Arkansas] Secretary of State.
Arkansas Code Annotated 4-27-1501 (2016).
Hannover House has acted in bad faith by concealing its Wyoming corporate status from
this Court and the public, including on all its communications and documents, corresponding to
this Court from its Arkansas address, and not raising the issue in that prior communication.
Meanwhile, Hannover House is openly and notoriously transacting business in Arkansas, including
issuing a November press release about moving its corporate headquarters from one Arkansas

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address to another on its own press release, with no mention of being a Wyoming corporation.
Exhibit B. Defendant cannot go to such extraordinary lengths to appear as an Arkansas
incorporated entity and then be rewarded for concealing its true corporate character through a
deliberate failure to comply with state laws.
3. As a result, Parkinson CEO is liable for all corporate acts due to Hannover
Houses failure to properly register as a foreign corporation.
Pursuant to Arkansas law, [a]ll persons purporting to act as or on behalf of a corporation,
knowing there was no incorporation under this chapter, are jointly and severally liable for all
liabilities created while so acting. Arkansas Code Annotated 4-27-204 (2016); See American
Hardwood Lumber Co. v. T.J. Ellis & Co., 115 Ark. 524 (1914) (holding liability specifically
applies where a foreign corporation employs an agent who did business for it within the state).
Here, Hannover House operates with revoked Arkansas corporate status while continuing
to represents itself as an Arkansas corporation, and reaches out from the state of Arkansas to do
business with Plaintiff, a Virginia company. Defendants also use an Arkansas address on its letter
head to this Court (Docket No. 8), did not object to its use on Plaintiffs invoice (Docket Nos. 15
& 20-3), and uses the Arkansas corporate address on its website (Exhibit A) and recent press
releases made to the general public as discussed above. Exhibit B. Hannover House has in all
respects acted and represented itself as doing business in Arkansas, and Plaintiff cannot be
expected to know that Defendant is also engaged in other extensive activity in one or more
jurisdictions, in addition to skirting its financial obligations and ignoring orders of this Court.

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B. Defendants have not acted with reasonable promptness nor shown personal
responsibility.
Defendants actions have willfully ignored all notices and filings despite actual notice and
receipt of all process. Defendants counsel claims its uncertain whether Defendant received this
Courts notices; however, presumably, this Court mailed such notices to the same address
Parkinson used on Hannover Houses letter filed with this Court (Docket No. 8).
Defendants counsel incorrectly claims Plaintiff did not even attempt to serve its
Complaint for more than one month after filing. Docket No. 20 at 7-8. Plaintiff made multiple
attempts of service (June 13 request for waiver of service was mailed as well as a copy of the
complaint and formal Summons and Complaint mailed on July 19, 2016 and all other filings as
certified with this Court). Additionally, Plaintiff, through counsel, sent a courtesy copy of the
Motion for Default Judgment to Hannover Houses corporate counsel on September 30 2016 (as
identified by Hannover House in its letter to the Court) in an effort to ensure Hannover House
received notice of these proceedings, though its blog post of June 29 clearly shows the filings were
discussed by its CEO and registered agent Parkinson.
This Court already provided Defendants one extension to file an answer in August, and
Defendants willfully failed to file such answer despite the extension. While Defendants counsel
fails to make note of such docket entries in its brief summary of the filing history (Docket 20 at
7), Defendants have shown they lack personal responsibility, or respect for this Courts orders, and
have not acted with reasonable promptness. Surely, taking 5 months, since blogging about this suit
in June, to find local counsel and finally file responsive pleadings with this Court is not considered
reasonably prompt nor responsible.

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Defendants cannot publically acknowledge this suit by blogging on their website and now
claim to be both ignorant of its proceedings and still ask this Court to find Defendants acted with
reasonable promptness and personal responsibility. Instead, Plaintiff asks this Court to find
Defendant have failed to do so.
C. Plaintiff has been prejudiced due to Defendants history of dilatory action
Defendant has received all filings and willfully ignored this suit and failed to take serious
the process of this Court, despite extensions granted by the Court. Defendants admit to the breach
of contract, and subsequently the Defendants continued use of the copyrighted photos constitutes
copyright infringement. Defendants had actual knowledge of this suit and publically blogged about
its confidence the suit lacked merit but could not bother to respond to such process and save this
Court the time and resources of formal default process. Instead, Defendants have forced Plaintiff
to proceed with formal default, costing Plaintiff time and attorneys fees.
D. There are no available sanctions less drastic than default.
Defendants willfully ignored the process in this Court, in what seems to be a clever attempt
to evade service of process despite having actual knowledge of all filings in this suit, and having
requested and received an extension from this Court that Defendants subsequently ignored.
Defendants are responsible for their own dilatory actions and cannot evade the normal
consequences therein because oops. Defendant had ample opportunity and only complains now
that the consequences are imminent. The proper outcome here in the ordinary course of judicial
administration is a default judgment in Plaintiffs favor. Defendants offer to accept service of an
amended complaint through counsel as a sanction is not an appropriate, or remotely serious,
remedy for Defendants own conduct.

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In the alternate of default judgment, should this Court deny Plaintiffs Motion for Default
Judgment and grant Defendants Motion to Set Aside, appropriate sanctions should include an
order granting Plaintiff leave to amend its Complaint and an order requiring Defendants pay
Plaintiffs attorneys fees for service to date, filing the Request for Entry of Default, Motion for
Default, and this Opposition to Set Aside Judgment due to Defendants willful waste of this
Courts time and resources.
IV.

CONCLUSION
Plaintiff respectfully asks this Court deny Defendants Motion to Set Aside Entry of

Default, grant Plaintiffs Motion for Default Judgment and deny Motion for Leave to File an
Answer.
Dated: December 23, 2016

Respectfully submitted,

/s/
CHRISTINA SIROIS (VSB No. 84454)
DAN BACKER (VSB No. 78256)
DB Capitol Strategies, PLLC
203 South Union Street, Suite 300
Alexandria, Virginia 22314
Telephone: (571) 207-6451
Fax: (202) 478-0750
csirois@dbcapitolstrategies.com
dbacker@dbcapitolstrategies.com
Counsel for John Boal Photography, LLC

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