ROH v. SAWANT et al

Filing 63

MEMORANDUM OPINION. Signed by Judge Michael A. Shipp on 7/29/2016. (km)

RECEIVED
NOT FOR PUBLICATION

JUL 29 2016

UNITED STATES DISTRICT COURl\r 8:30
DISTRICT OF NEW JERSEY
WILLIAM T. WALSH CLER~

SAMUEL ROH,
Plaintiff,
Civil Action No. 13-2251 (MAS) (TJB)

v.
MEMORANDUM OPINION
SUNEEL SAWANT, et al.,
Defendants.

SHIPP, District Judge
This matter comes before the Court on Plaintiffs second motion for default judgment
against Defendants Suneel Sawant ("Mr. Sawant"), ATI Holding, and Advanced Technologies
International Corp. ("Defendant Companies'') 1 (collectively, with Mr. Sawant, "Defendants").
(ECF No. 58~) Mr. Sawant filed opposition on January 19, 2016 (ECF No. 61), and Plaintiff replied
(ECF No. 62). The Court has carefully considered the parties' submissions and decides the matter
without oral argument pursuant to Local Civil Rule 78.1. For the reasons stated below, Plaintiffs
motion is denied.

I.

Background
Plaintiff previously moved for default judgment against Mt. Sawant on October 2, 2013.

(ECF No. 18.) Mr. Sawant cross moved to set aside the entry of default (ECF No. 22), and by

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0n April 9, 2014, Plaintiff moved for default judgment against Defendant Companies. (ECF
No. 33.) By order dated November 5, 2014, the Court denied Plaintiffs motion and stated
"Plaintiff may file a renewed motion for default judgment as to the Defendant Companies at the
conclusion of the case against [Mr.] Sawant, the appearing party." (Mem. Order 3, Nov. 5, 2014,
ECF No. 48.) As the case against Mr. Sawant is ongoing, the motion sub judice is denied with
respect to the Defendant Companies.

order dated May 22, ·2014, the Court vacated the entry of default and ordered Mr. Sawant to answer
or otherwise respond to the Complaint by June 13, 2014. (ECF No. 34.) Mr. Sawant answered on
June 12, 2014. (ECF No. 36.) On July 27, 2014, after Mr. Sawant allegedly failed to answer
Plaintiffs interrogatories, Plaintiff moved for sanctions against Mr. Sawant and moved to compel
discovery. (ECF No. 38.) The Honorable Tonianne J. Bongiovanni, U.S.M.J., denied the motion
for sanctions and granted the motion to compel discovery, requiring Mr. Sawant to produce the
requested discovery by September 5, 2014. (ECF No. 44.) On May 4, 2015, Plaintiff moved to
extend discovery because of alleged continued difficulties with obtaining discovery from Mr.
Sawant. (ECF No. 49.) Judge Bongiovanni subsequently extended discovery to June 8, 2015.
(ECF No. 50.)

On May 19, 2015, however, Mt. Sawartt's counsel, Jeremy Esakoff, Esq.

("Esakoff'), moved to withdraw from this case. (ECF No. 52.) The Court granted Esakoff s
motion, which was unopposed. (ECF No. 53.) Thereafter, Judge Bongiovanni instructed Mr.
Sawant to contact Plaintiffs counsel within ten days and to retain new counsel within thirty days
to avoid being deemed prose. (ECF No. 54.) Mr. Sawant failed to retain counsel or to contact
Plaintiff. Accordingly, by order dated November 1, 2015, Judge Bongiovanni stated, "in light of
the Defendant's repeated failures to abide by the direction of the Court, the Plaintiff is permitted
to move for default judgment and whatever sanctions deemed appropriate" ("November Order"
Nov. 1, 2015, ECF No. 57.)
II.

Discussion

Federal Rule of Civil Procedure 37 authorizes a court to impose sanctions for failure to
provide discovery or obey court orders. Fed. R. Civ. P. 37(b)(2). Where such failures have
occurred, entry of default judgment maybe an appropriate remedy. Fed. R. Civ. P. 37(b)(2)(A)(vi).
The Court's consideration of whether to render default judgment against a disobedient party is

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governed by the following factors set forth in Pou/is v. State Farm Fire & Casualty Co:, 74 7 F .2d
863, 868 (3d Cit. 1984):
(1) the extent of the party's personal responsibility; (2) the prejudice
to the adversary caused by the failure to meet scheduling orders and
respond to discovery; (3) a history of dilatoriness; (4) whether the
conduct of the party or the attorney was willful or in bad faith;
( 5) the effectiveness of sanctions other than dismissal, which entails
an analysis of alternative sanctions; and (6) the meritoriousness of
the claim or defense.

Id.
In the present case, Judge Bongiovanni's November Order provided that "in light of

Defendant's repeated failures to abide by the direction of the Court, the Plaintiff is permitted to
move for default judgment and whatever sanctions deemed appropriate." (Order Nov. 1, 2015
(emphasis added).) Here, Plaintiff did not file a moving brief pursuant to Local Civil Rule 7.l(d). 2
In addition, it appears from the Court's review of Plaintiff's certifications and reply brief in support
of his default judgment motion that Plaintiff has teargued for default judgment pursuant to Rule
55, as opposed to Rule 37. Based on a careful consideration of Judge Bongiovanni's November
Order and the procedural and substantive posture of this matter, however, the Court finds
consideration pursuant to Rule 3 7 appropriate. As such, the Court will consider the Pou/is factors.
With respect to the first Poulis factor, Mr. Sawant has failed to comply with the Court's
orders. Because he is entirely responsible for this failure to comply, the first factor weighs in favor
of granting default judgment. The second Pou/is factor also weighs in favor of default judgment.
The delays that have been suffered by Plaintiff because of Mr. Sawant's refusal or inability to
defend his case present some inherent prejudice to Plaintiff. "Prejudice may ... take the form of

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Local Civil Rule 7.1 (d)( I) provides that"[ n ]o application will be heard unless the moving papers
and a brief, prepared in accordance with L.Civ.R. 7.2 ... are filed with the Clerk. ... The brief
shall be a separate document for submission to the Court." L. Civ. R. 7.l(d)(l).
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extra costs, repeated delays, and having to file additional motions due to abusive behavior by the
other party." Miller v. Advocare, LLC, No. 12-1069, 2013 WL 2242646, at *3 (citing Williams v.
Sullivan, No. 08-1210, 2011WL2119095, at *6 (D.N.J. May 20, 2011)). This is a case from 2013
that is still in the fact discovery stage and Plaintiff has been required to file applications and incur
additional costs to address the discovery violations. Accordingly, the second factor weighs in
favor of default judgment. 3
The third Pou/is factor also weighs in favor of default judgment because Mr. Sawant has
demonstrated a history of dilatoriness, as reflected in the background section of this Memorandum
Opinion. As to the fourth Pou/is factor, the Court does not find that Mr. Sawant's conduct has
been in bad faith. Nevertheless, the Court finds that Mr. Sawant's conduct has been willful. Judge
Bongiovanni entered orders in this matter with which Mr. Sawant failed to comply. Although Mr.
Sawant has proffered excuses for his repeated failures to comply,4 none of these demonstrates an
"

inability to comply. See Donnelly v. Johns-Manville Sales Corp., 677 F.2d 339, 342 (3d Cir. 1982)
(where the defendant's excuses-including: (1) not being able to reach its lawyer; (2) not being
told how to find a lawyer who could handle the case; (3) finding other, more appropriate, lawyers
to be too busy to take the case-demonstrated a "failure to move with the dispatch ... required ... ,"
rather than inability); Hunt-Ruble v. Lord, Worrell & Richter, Inc., No. 10-4520, 2012 WL
2340418, at *5 (D.N.J. June 19, 2012) (finding that "a consistent failure to obey orders ofthe court,
'at the very least, renders [a party's] actions willful."') (quoting Martino v. Solaris Health Sys.

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If Mr. Sawant fails to comply with any further Court orders, Plaintiff will have the opportunity
to set forth the specific nature of any prejudice he has suffered in a renewed default judgment
application supported by a moving brief that sets forth and discusses the Pou/is factors.
·

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In the affidavit that Mr. Sawant submitted in opposition to Plaintiffs motion, he claims that he

was unable to participate in the proceedings because of his divorce, bad business decisions, and
lack of a pertnanent address. (Def.'s Opp'n Br.~ 3-5, ECF No. 61.)
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Corp., No. 04-6324, 2007 WL 1959226, at *5 (D.N.J. June 29, 2007)). In the absence of an
adequate- explanation, the Court finds that Mr. Sa:want's actions were willful.
The fifth Pou/is factor, however, weighs in favor of denying default judgment. Mr. Sawant
has appeared in the matter. In addition, Mr. Sawant has indicated that he will participate in the
matter. Furthermore, Mr. Sawant noted that he has suffered significant financial losses resulting
from business decisions relating to the Consulting Agreement. Here, the Court finds that lesser
sanctions would likely be effective. See generally Northstar Fin. Cos., Inc. v. Nocerino, No. 115151, 2013 WL 6061349 (E.D. Pa. Nov. 18, 2013) (where the defendants were, upon plaintiff's
first two motions for Rule 37 default judgment based on repeated discovery failures, sanctioned
$1000 and $5000 respectively, only upon the third motion were the defendants sanctioned with
default judgment after ignoring one of the sanctioning orders). The Court will defer the imposition
of alternative monetary sanctions until the conclusion of the matter.
Finally, the sixth Pou/is factor also appears to weigh in favor of denying default judgment.
Plaintiff claims that Mr. Sawant breached the Consulting Agreement by failing to pay Plaintiff his
annual salary. (Am. Compl. if 76, ECF No. 15.) In his opposition brief, Mr. Sawant asserts that:
(1) Plaintiff failed to fulfill his contractual obligations within the contract term; and (2) "there was
never a clear agreement any [sic] to employ [Plaintiff]." (Def.'s Opp'n Br.~ 8, ECF No. 61.)5
With respect to Mr. Sawant's assertion that Plaintiff failed to perform his obligations pursuant to
the Consulting Agreement, courts presume that when parties enter into a bilateral contract, "the
law considers the promises to be constructively conditional on one another." 14 Williston on

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Plaintiff argues that: (1) regardless of whether Mr. Sawant employed Plaintiff or merely
contracted with Plaintiff is irrelevant because of the express language of the agreement; and
(2) what Mr. Sawant characterizes as the contract term is actually the term before the duration of
which the contract cannot be terminated. (PL 's Reply Br. 6, ECF No. 62.)
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Contracts § 43: 1 (4th ed. 2005); see also Weisman v. N.J. Dep 't ofHuman Servs., 982 F. Supp. 2d
386, 391 (D.N.J. 2013) (holding that under New Jersey law, "[a] material breach to a bilateral
contract excuses the other party from performing its future obligations under that contract").
Therefore, because Mr. Sawant claims that Plaintiff failed to perform his obligations within the
contract term, Mr. Sawant, at the very least, presents a meritorious defense to Plaintiffs claim.

III.

Conclusion
Here, the majority of the Pou/is factors weigh in favor of default judgment. Nevertheless,

in light of Plaintiffs failure to file a moving brief pursuant to Local Civil Rule 7.1, Mr. Sawant's
pro se status, and available alternative sanctions, the Court will deny Plaintiffs motion without
prejudice. The Court cautions Mr. Sawant, however, that absent compelling circumstances, the
Court shall not excuse his failure to comply with future orders issued in this case. The Court will
enter an Order consistent with this Memorandum Opinion.

s/ Michael A. Shipp
MICHAEL A. SmPP
UNITED STATES DISTRICT JUDGE

Dated: July 29, 2016

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