INTERSTATE REALTY MANAGEMENT COMPANY v. PF HOLDINGS, LLC.

Filing 15

MEMORANDUM OPINION FILED. Signed by Judge Jerome B. Simandle on 6/2/17. (js)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW JERSEY

INTERSTATE REALTY MANAGEMENT
COMPANY,
Plaintiff,

HONORABLE JEROME B. SIMANDLE

Civil Action
No. 16-4095 (JBS/JS)

v.
PF HOLDINGS, LLC,

MEMORANDUM OPINION

Defendant.

SIMANDLE, District Judge:
This matter comes before the Court on Plaintiff Interstate
Realty Management Company’s (“IRM”) motion to amend judgment
[Docket Item 12]. This Court previously granted Plaintiff’s
motion for default judgment and entered judgment in favor of
Plaintiff and against PF Holdings, LLC (“PF Holdings”) in the
amount of $316,841.70. Plaintiff now seeks to amend the judgment
pursuant to Fed. R. Civ. P. 59(e) to add two additional
defendants, PF Roosevelt LLC and Roosevelt GA LLC. For the
reasons that follow, Plaintiff’s motion must be denied.
The Court finds as follows:
1.

Factual and Procedural Background. For the purposes of

this motion, it suffices to note the following. Plaintiff filed
a Complaint [Docket Item 1] on July 7, 2016, alleging that
Plaintiff and PF Holdings entered into an agreement by which IRM

would manage an apartment development for Defendant in Florida,
in exchange for a monthly fee, but that Defendant has not paid
the amount owed under the terms of the agreement. (Compl. ¶¶ 615.) Defendant filed no response to Plaintiff’s Complaint, and
the Clerk of Court accordingly entered default against Defendant
on September 9, 2016. Plaintiff’s motion for default judgment
followed, which this Court granted on January 4, 2017 [Docket
Items 10 & 11]. To date, PF Holdings has not filed a response to
any of Plaintiff’s filings.
2.

Plaintiff now seeks to amend the judgment pursuant to

Fed. R. Civ. P. 59(e) to add two additional entity defendants as
necessary parties, information it contends it only learned when
it began post-judgment discovery. Plaintiff asserts that PF
Roosevelt, LLC (“PF Roosevelt”) and Roosevelt GA, LLC
(“Roosevelt GA”) received management services provided by IRM to
PF Holdings for an apartment development in Florida and are
liable for the same amounts as PF Holdings as set forth in the
Complaint.
3.

According to the documents referenced in the affidavit

of Sandy Cipollone (“Cipollone Cert.”) [Docket Item 12-2], PF
Holdings was the original purchaser, on August 6, 2013, of the
Roosevelt Gardens apartment development in Florida (“the
Property”). The Fourth Amendment to the Purchase Contract,

2

executed in September 2014, notes the following: (i) “PF
Holdings assigned its rights under the [Purchase] Agreement to
[PF Roosevelt]” and “PF Holdings or one of PF Holdings’
principals is a member of [PF Roosevelt]”; and (ii) “[PF
Roosevelt] desires to cause Roosevelt GA to purchase the
Improvements” on the Property in order to carry out tax-exempt
bond financing and for PF Roosevelt “to purchase solely the
Land.” (Fourth Amendment to Purchase and Sale Agreement [Exhibit
A to Cipollone Cert.] at ¶¶ B & D.) On December 17, 2014, the
seller of the Property executed a special warranty deed
conveying the improvements on the Property to Roosevelt GA and a
special warranty deed conveying the land at the Property to PF
Roosevelt. (Deeds [Exhibit B to Cipollone Cert.].) As set forth
in the Complaint, in the meantime, on October 1, 2014, IRM and
PF Holdings entered into the management agreement for the
Roosevelt Garden Apartments at the Property. (Compl. ¶ 9.)
4.

Plaintiff’s filings in connection with this motion

have been served by certified and ordinary mail upon Roosevelt
GA at an address in Jacksonville, Florida; upon PF Roosevelt by
means of its registered agent in Flemington, New Jersey and in
Davie, Florida; and upon PF Holdings to addresses in Newark, New
Jersey and Brooklyn, New York. (See Proof of Service [Docket

3

Item 13] at ¶¶ 4-8 and Exhibits A, B, C & D.) None of these
parties have filed a response to Plaintiff’s motion.1
5.

Standard of Review. Generally, there are four basic

grounds upon which a Rule 59(e) motion may be granted: (1) to
correct manifest errors of law or fact upon which the judgment
was based; (2) to present newly-discovered or previously
unavailable evidence; (3) to prevent manifest injustice; and (4)
an intervening change in the prevailing law. See 11 Charles A.
Wright, Arthur R. Miller & Mary Kay Kane, Federal Practice and
Procedure § 2810.1; see also Harsco v. Zlotnicki, 779 F.2d 906,
909 (3d Cir. 1985), cert. denied, 476 U.S. 1171 (1986). A motion
to amend judgment must be filed without 28 days after the entry
of the judgment. Fed. R. Civ. P. 59(e).2
6.

Discussion. Plaintiff seeks, under the rubric of a

Rule 59(e) motion, to amend the judgment to impose liability
upon two alleged related or successor entities that have never
been named in the pleadings. The sole named defendant, which was
duly served and as to which default was entered under Rule
55(a), was PF Holdings. While a Rule 59(e) amendment to a

1

Any opposition would have been due by February 21, 2017.

2

Plaintiff’s motion was filed on February 1, 2017, exactly 28
days after the entry of the January 4, 2017 Judgment.
4

judgment may be proper to correct a typographical error in the
name of the defendant, see 4 Charles Alan Wright & Arthur R.
Miller, Federal Practice and Procedure § 2817, there is not
authority under Rule 59(e) to identify new parties and new
allegations of their liability that have not been set forth in
pleadings. Simply mailing a motion to amend under Rule 59(e) to
these parties who are strangers to the litigation, as Plaintiff
has done here, cannot take the place of naming these new
defendants in an amended complaint,3 serving the amended
complaint as required under Rule 4, Fed. R. Civ. P., and
presenting these parties with what due process requires: notice
and an opportunity to be heard before a court that has acquired
personal jurisdiction over the new defendants. Until these
procedures have been accomplished, this Court cannot adjudicate
the rights of the absent parties. The Court holds that a
Plaintiff may not utilize a motion to amend a judgment under
Rule 59(e) for the purpose of adding new parties, adding new
bases for the liability of the new parties, and enlarging the

3

Plaintiff’s motion herein is unopposed, as noted. The lack of
opposition from a party that is not before the Court under a
proper pleading and service of process, does not imply consent
to the amended judgment. These unnamed defendants, PF Roosevelt
and Roosevelt GA, were under no duty to respond to the notice of
this motion.
5

existing judgment to include the new parties. Accordingly,
Plaintiff’s motion will be denied.
7.

Amended Pleadings. This Court will, however, in the

alternative, grant Plaintiff leave to file an Amended Complaint
naming the new defendants and setting forth the factual grounds
on which liability is sought to be imposed against them. If
liability is sought to be imposed as successors to Defendant PF
Holdings, the Amended Complaint shall set forth the basis for
such a claim. From the documents referenced in the present
motion, supra, it would appear that such a claim would be
plausible and would satisfy the requirements of Rule 15(a)(2),
Fed. R. Civ. P., permitting an amendment to a pleading with
leave of court which is to be freely granted when justice so
requires. A court has authority to permit an amendment to a
pleading even after judgment has been entered. Fletcher-Harlee
Corp. v. Pote Concrete Contractors, Inc., 482 F.3d 247, 252 (3d
Cir. 2007). Based upon the certification submitted by Plaintiff
in connection with this motion, the Court has no difficulty
concluding that justice requires such an amendment here.
Plaintiff learned, after judgment was entered and upon
inspecting its own files, that the two new entities, PF
Roosevelt and Roosevelt GA, also allegedly had interests in the
improvements and land, respectively, at the Roosevelt Gardens

6

apartment complex where Plaintiff rendered its services. There
is no just reason to deny Plaintiff the right to pursue claims
against these alleged successor entities. Therefore, leave to
amend the Complaint will be granted. Any such Amended Complaint
shall be filed within fourteen (14) days hereof.
8.

The accompanying Order shall be entered.

June 2, 2017
Date

s/ Jerome B. Simandle
JEROME B. SIMANDLE
U.S. District Judge

7