Justices probe when 'culpable conduct' merits refusing to set aside default
Counsel debated whether Ninth Circuit precedents require intentional misconduct or allow default relief when legally sophisticated parties simply missed an answer. The bench pressed distinctions between 'unsophisticated' parties and those with counsel.
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During argument the bench repeatedly questioned both sides about the definition of "culpable conduct" under the MID C / Ninth Circuit framework. Appellant counsel argued culpability should mean intent to take advantage of the judicial system and not mere notice or carelessness; he warned that equating culpability with constructive notice would turn the test into strict liability.
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