Edrich v. Festinger

Filing 26

MEMORANDUM AND ORDER. For the reasons discussed in the attached Memorandum and Order, the Court denies 17 Defendant's motion for judgment on the pleadings and grants 16 Plaintiff's motion for summary judgment. The Court therefore rene ws the Judgment in the amount of $302,042 with interest at the rate of nine percent per annum from November 15, 1994 for a period of twenty years, and renews the lien for a period of ten years from the date of this Memorandum and Order. The Clerk of Court is directed to enter judgment for Plaintiff and to close this case. Ordered by Judge Margo K. Brodie on 8/17/2017. (Daugherty, Shannon)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF NEW YORK
------------------------------------------------------------GEORGE EDRICH,
Plaintiff,

MEMORANDUM & ORDER
12-CV-4069 (MKB)

v.
SAMUEL FESTINGER,
Defendant.
------------------------------------------------------------MARGO K. BRODIE, United States District Judge:
Plaintiff George Edrich commenced this action against Defendant Samuel Festinger on
August 15, 2012, seeking a ten-year renewal of a November 15, 1994 state court money
judgment in the sum of $302,042 (the “Judgment”) pursuant to New York Civil Procedure Law
and Rules (“CPLR”) section 5014. (Compl. ¶ 10, Docket Entry No. 1.) Plaintiff moves for
summary judgment pursuant to Rule 56 of the Federal Rules of Civil Procedure, (Pl. Mot. for
Summ. J. (“Pl. Mot.”), Docket Entry No. 16; Pl. Mem. in Supp. of Pl. Mot. (“Pl. Mem.”), Docket
Entry No. 16-12), and Defendant cross-moves for judgment on the pleadings pursuant to Rule
12(c) of the Federal Rules of Civil Procedure, (Def. Mot. for J. on the Pleadings (“Def. Mot.”),
Docket Entry No. 17; Def. Mem. in Supp. of Def. Mot. (“Def. Mem.”), Docket Entry No. 17-2).
For the reasons discussed below, the Court grants Plaintiff’s motion for summary judgment and
denies Defendant’s motion for judgment on the pleadings.

I.

Background
a.

The Judgment

On November 15, 1994, Sequa Corporation (“Sequa”), a non-party to this action,
obtained the Judgment in New York State Supreme Court, New York County, in the amount of
$302,042 jointly and severally against Defendant, Judy Winograd and six corporate entities:
Delek Petro Fuel Oil Co., Inc., K Enterprises Corp., B.Q.E. Fuel Transport, Inc., Petrolite, Inc.,
Citifuel, Inc., and Regional Petroleum and Trucking Corp. (Compl. ¶ 5; Judgment, annexed to
Compl. as Ex. 1.) The Judgment was filed and docketed in the Office of the County Clerk, New
York County on November 15, 1994. (Compl. ¶ 5; Judgment.)
b.

Procedural history
i.

Property dispute

Plaintiff and Defendant have been involved in a dispute for many years over a property
located at 607 Avenue K in Brooklyn, New York (the “Property”). (New York Supreme Court,
Kings County Decision dated Sept. 20, 2013 at 4 (“Kings County Decision”), Docket Entry No.
7.) Defendant purchased the Property, but title to the Property was held in the name of
Defendant’s sister, who was Plaintiff’s wife. (Id. at 3.) Upon the death of Defendant’s sister,
title passed to Plaintiff. (Id.)
Plaintiff failed to pay the mortgage and as a result, in 2002 the mortgage-holder,
Independence Community Bank, began foreclosure proceedings against the Property. (Id. at 4.)
While the foreclosure proceedings were pending, Independence Community Bank assigned the
mortgage to MMAL Corp. (“MMAL”). (Id.) MMAL discontinued the foreclosure proceeding
and commenced a new foreclosure proceeding against the Property on March 8, 2006. (Id.) On

2

June 14, 2007, the court granted partial summary judgment to MMAL.1 (Id.)
ii.

Kings County Action and procedural history

On March 9, 2010, Sequa assigned the Judgment to Plaintiff, which assignment was filed
in the Office of the County Clerk., New York County. (Compl. ¶ 7; Assignment of Judgment,
Docket Entry No. 16-5; Agreement to Assign Judgment, Docket Entry No. 16-6.) On June 11,
2010, Plaintiff initiated an action against Defendant and MMAL, seeking turnover of the
mortgage and the note associated with the Property in satisfaction of the Judgment in New York
Supreme Court, Kings County (the “Kings County Action”). (Kings County Decision at 3–4.)
Plaintiff argued that Defendant was MMAL’s alter ego and that Defendant therefore held title to
the Property after the foreclosure and the state court could pierce the corporate veil to allow
Plaintiff to satisfy the Judgment against Defendant by turning over the Property held by MMAL.
(Id. at 5.) Defendant argued, among other things, that Plaintiff could not enforce the Judgment
against him because Plaintiff purchased the Judgment from Sequa with the sole purpose of
bringing the lawsuit against Defendant, which violates New York Judiciary Law section 489’s
prohibition against champerty. (Id. at 10–11.)
While the Kings County Action was pending, Plaintiff filed the instant action on August
15, 2012, seeking to renew the Judgment. (See generally Compl.) On October 24, 2012,
Defendant filed a letter requesting a pre-motion conference in anticipation of moving to (1) stay
the action pending resolution of the Kings County Action and (2) dismiss the action for failure to
state a claim and for failure to join necessary parties. (Def. Letter dated Oct. 5, 2012, Docket

1

In 2003, Defendant also commenced a state court action against Plaintiff and certain of
Defendant’s family members seeking, among other things, to impose a constructive trust on the
Property. (Kings County Decision at 4.) The state court granted summary judgment to Plaintiff.
(Id.)
3

Entry No. 5.) At a conference on December 5, 2012, the Court stayed the case pending the state
court’s decision in the Kings County Action. (Min. Entry dated Dec. 5, 2012.)
On October 28, 2013, Plaintiff filed with the Court the September 20, 2013 decision in
the Kings County Action. (See generally Kings County Decision.) In the Kings County
Decision, the state court rejected Defendant’s argument that enforcement of the judgment
violated champerty and held that Plaintiff “clearly acquired the Sequa judgment in order to
enforce the rights it conferred against Defendant, a legitimate and non-champertous purpose.”
(Id. at 10.) However, the state court granted summary judgment to Defendant because Plaintiff
failed to establish that Defendant had any possessory interest in the mortgage and note associated
with the Property. (Id. at 11–14.)
In view of the Kings County Decision, the Court requested briefing from the parties as to
whether the Court should grant the relief sought in the Complaint. (Order dated Oct. 29, 2013.)
Plaintiff filed a letter arguing that he was entitled to the relief sought in the Complaint but also
indicating that he intended to appeal the Kings County Decision. (Letter dated Dec. 2, 2013,
Docket Entry No. 8.) Defendant did not respond to the Court’s October 29, 2013 Order or
Plaintiff’s December 2, 2013 letter.
Several months later, on July 10, 2014, the Court entered an order lifting the stay and
granting Plaintiff leave to move for default judgment in view of Defendant’s failure to answer the
Complaint or respond to the Court’s orders. (Order dated July 10, 2013.) By letter dated
February 19, 2016, Plaintiff notified the Court that the New York State Supreme Court, Appellate
Division, Second Department affirmed the Kings County Decision and requested that the Court
direct Defendant to answer the Complaint or set a date for a conference. (Pl. Letter dated Feb.
19, 2016, Docket Entry No. 13.) The Court held a conference on June 9, 2016, during which the
4

Court directed Defendant to answer the Complaint and ordered the parties to agree on a briefing
schedule for Plaintiff’s anticipated motion for judgment on the pleadings. (Min. Entry dated
June 9, 2016.) Defendant answered the Complaint on July 12, 2016, and the parties moved for
summary judgment and judgment on the pleadings several months later. (Answer, Docket Entry
No. 14; Pl. Mot.; Def. Mot.)
iii. Oral argument
On June 16, 2017, the Court heard oral argument from the parties in support of their
respective motions for summary judgment and judgment on the pleadings. (Min. Entry dated
Jun. 16, 2017.) At oral argument, the Court declined to sua sponte dismiss Defendant’s
champerty defense as barred by collateral estoppel and instead addressed the merits of
Defendant’s champerty claim. Defendant argued, among other things, that the Court should not
grant summary judgment in Plaintiff’s favor because further discovery was necessary to
determine whether Plaintiff was “engaged directly or indirectly in the business of collection and
adjustment of claims,” in order to resolve the champerty issue.2
After hearing arguments, the Court ordered Plaintiff to submit an affirmation indicating
whether he is “engaged directly or indirectly in the business of collection and adjustment of
claims,” in order to resolve the champerty issue and also ordered supplemental briefing. (Id.;
Def. Letter dated June 30, 2017 (“Def. Letter”), Docket Entry No. 24; Pl. Letter dated July 7,
2017 (“Pl. Letter”), Docket Entry No. 25.) By Affidavit dated June 17, 2017, Plaintiff stated that
“[o]ther than the judgment at issue in this case, [he has] never purchased or otherwise taken
assignment of a judgment or claim in New York or any other state” and is “not in the business of

2

The Court also explained that CPLR section 5014 — not CPLR section 211(b) which
was the statute that both parties briefed in support of their respective motions — is the applicable
statute to determine whether Plaintiff was entitled to renewal of the Judgment.
5

buying and selling claims or judgments and [he is] not in the debt collection business.” (Aff. of
George Edrich (“Edrich Aff.”) ¶¶ 3–4, Docket Entry No. 23.)
II. Discussion
a.

Standards of review
i.

Summary judgment

Summary judgment is proper only when, construing the evidence in the light most
favorable to the non-movant, “there is no genuine dispute as to any material fact and the movant
is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a); Davis v. Shah, 821 F.3d 231,
243 (2d Cir. 2016); see also Cortes v. MTA NYC Transit, 802 F.3d 226, 230 (2d Cir. 2015). The
role of the court “is not to resolve disputed questions of fact but only to determine whether, as to
any material issue, a genuine factual dispute exists.” Rogoz v. City of Hartford, 796 F.3d 236,
245 (2d Cir. 2015) (first quoting Kaytor v. Elec. Boat Corp., 609 F.3d 537, 545 (2d Cir. 2010);
and then citing Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249–50 (1986)). A genuine issue
of fact exists when there is sufficient “evidence on which the jury could reasonably find for the
plaintiff.” Anderson, 477 U.S. at 252. The “mere existence of a scintilla of evidence” is not
sufficient to defeat summary judgment. Id. The court’s function is to decide “whether, after
resolving all ambiguities and drawing all inferences in favor of the non-moving party, a rational
juror could find in favor of that party.” Pinto v. Allstate Ins. Co., 221 F.3d 394, 398 (2d Cir.
2000).
ii.

Judgment on the pleadings

“In deciding a Rule 12(c) motion, [courts] ‘employ[ ] the same . . . standard applicable to
dismissals pursuant to [Rule] 12(b)(6). Thus, [courts] will accept all factual allegations in the
[c]omplaint as true and draw all reasonable inferences in [the plaintiff’s] favor.’” L-7 Designs,
6

Inc. v. Old Navy, LLC, 647 F.3d 419, 429 (2d Cir. 2011) (second, third and fifth alteration in
original) (quoting Johnson v. Rowley, 569 F.3d 40, 43 (2d Cir. 2009)); Cleveland v. Caplaw
Enters., 448 F.3d 518, 521 (2d Cir. 2006) (“The standard for addressing a Rule 12(c) motion for
judgment on the pleadings is the same as that for a Rule 12(b)(6) motion to dismiss for failure to
state a claim.” (citation omitted)). “To survive a Rule 12(c) motion, the complaint must contain
sufficient factual matter to ‘state a claim to relief that is plausible on its face.’” Graziano v.
Pataki, 689 F.3d 110, 114 (2d Cir. 2012) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570
(2007)). “A claim is plausible ‘when the plaintiff pleads factual content that allows the court to
draw the reasonable inference that the defendant is liable for the misconduct alleged.’” Matson
v. Bd. of Educ. of City Sch. Dist. of N.Y., 631 F.3d 57, 63 (2d Cir. 2011) (quoting Ashcroft v.
Iqbal, 556 U.S. 662, 678 (2009)) (discussing Rule 12(b)(6)); see also Pension Ben. Guar. Corp.
ex rel. St. Vincent Catholic Med. Ctrs. Ret. Plan v. Morgan Stanley Inv. Mgmt. Inc., 712 F.3d 705,
717–18 (2d Cir. 2013). However, the court need not accord “a legal conclusion couched as a
factual allegation” the same presumption of truthfulness. N.J. Carpenters Health Fund v. Royal
Bank of Scot. Grp., PLC, 709 F.3d 109, 120 (2d Cir. 2013) (quoting Iqbal, 556 U.S. at 678).
b.

Necessary parties

Defendant argues, without any legal authority, that the seven other judgment debtors
listed on the Judgment are necessary parties to this action pursuant to Rule 19(a) of the Federal
Rules of Civil Procedure and that the action cannot proceed without the absent parties.3 (Def.
Mem. 10–11; Def. Letter 4.) The Court disagrees.

3

Although Defendant argues that he does not seek dismissal of the action under Rule
19(b) but instead seeks the mandatory joinder of the absent parties pursuant to Rule 19(a)
because they are necessary to this proceeding, (Def. Letter 4), this representation is inconsistent
with his initial moving papers, (Def. Mem. 10 (“The Complaint Should be Dismissed For Failure
to Join Necessary Parties”)).
7

Rule 19 of the Federal Rules of Civil Procedure “recognizes exceptional circumstances in
which a plaintiff’s choice of parties or forum must give way because of an absent party’s interest
in the outcome of the action or involvement in the underlying dispute.” Marvel Characters, Inc.
v. Kirby, 726 F.3d 119, 132 (2d Cir. 2013). Rule 19(a)(1) specifies the circumstances under
which a party is necessary to an action:
A person who is subject to service of process and whose joinder will
not deprive the court of subject-matter jurisdiction must be joined as
a party if:
(A) in that person’s absence, the court cannot accord
complete relief among existing parties; or
(B) that person claims an interest relating to the subject of
the action and is so situated that disposing of the action
in the person’s absence may
(i)

as a practical matter impair or impede the
person’s ability to protect the interest; or

(ii)

leave an existing party subject to a substantial
risk of incurring double, multiple or
otherwise inconsistent obligations because of
the interest.

Fed. R. Civ. P. 19(a)(1). The party moving for compulsory joinder has the burden of showing
that joinder is appropriate. See Allen ex. rel. Allen v. Devine, 670 F. Supp. 2d 164, 168 (E.D.N.Y.
2009) (first citing Joseph S. v. Hogan, 561 F. Supp. 2d 280, 311 (E.D.N.Y. 2008); and then citing
M.C. v. Volumtown Bd. of Educ., 178 F.R.D. 367, 369 (D. Conn. 1998)).
If a party is necessary but unable to be joined, a court must “determine whether, in equity
and good conscience, the action should proceed among the existing parties or should be
dismissed,” Fed. R. Civ. P. 19(b) — otherwise known as determining whether a party is
“indispensable,” see Marvel Characters, 726 F.3d at 133. In making this decision, a court should
consider: “(1) whether a judgment rendered in a person’s absence might prejudice that person or
8

parties to the action, (2) the extent to which any prejudice could be alleviated, (3) whether a
judgment in the person’s absence would be adequate, and (4) whether the plaintiff would have
adequate remedy if the court dismissed the suit.” Id. at 133 (citing CP Sols. PTE, Ltd. v. Gen.
Elec. Co., 553 F.3d 156, 159 (2d Cir. 2009) (per curiam)). “If a party does not qualify as
necessary under Rule 19(a), then the court need not decide whether its absence warrants
dismissal under Rule 19(b).” Viacom Intern., Inc. v. Kearney, 212 F.3d 721, 724 (2d Cir. 2000)
(citation omitted).
Here, Defendant has not met his burden of showing that the absent parties are necessary
under Rule 19(a)(1)(A) or (B), and the Court therefore rejects his argument for compulsory
joinder. The parties are not necessary parties under Rule 19(a)(1)(A) because the Court can
afford complete relief to Plaintiff against Defendant in the absence of the other judgment debtors.
See Fed. R. Civ. P. 19(a)(1)(A); Arkwright–Boston Mfrs. Mut. Ins. Co. v. New York, 762 F.2d 205,
209 (2d Cir. 1985) (“[T]he term complete relief refers only to relief as between the persons
already parties, and not as between a party and the absent person whose joinder is sought.”
(citation and internal quotation marks omitted)). The only relief Plaintiff seeks in the Complaint
is renewal of the Judgment and the Court may grant him renewal against Defendant in the
absence of the other jointly and severally liable judgment debtors. See, e.g., In re Norstan
Apparel Shops, Inc., 367 B.R. 68, 84 (Bankr. E.D.N.Y. 2007) (finding that absent parties were
not necessary to afford “complete relief” because the relief sought in the complaint could be
granted against the defendant); Premier Capital, LLC v. Best Traders, Inc., 930 N.Y.S.2d 249,
251 (App. Div. 2011) (granting renewal judgment against only one of several judgment debtors
because the other debtors were not properly served in the action).
Nor are the parties necessary parties under Rule 19(a)(1)(B) because no absent party
9

“claims an interest relating to the subject of the action.” Fed. R. Civ. P. 19(a)(1)(B). Instead,
Defendant seeks to assert the interest on behalf of the absent parties, which is insufficient to
satisfy the rule as it is the absent parties who are required to claim an interest in the action. See
Peregrine Myan. Ltd. v. Segal, 89 F.3d 41, 49 (2d Cir. 1996) (“[The defendant’s] attempt to assert
on behalf of the [absent party] its supposed concern about the dilution of its interest . . . falls
outside the language of the rule. It is the absent party that must ‘claim an interest.’”); Kunina v.
7 W. 82 LLC, No. 15-CV-4755, 2015 WL 7075966, at *2–3 (S.D.N.Y. Nov. 12, 2015) (“In order
to qualify as a necessary party under Rule 19(a)(1)(B), the absent party . . . must claim an interest
relating to the subject of the action. [The absent party] has not done so. Without a self-claimed
interest in the action, a party is not necessary under either prong of Rule 19(a)(1)(B).” (citations
omitted)); Reit v. Post Props., Inc., No. 09-CV-5455, 2010 WL 743533, at *3 (S.D.N.Y. Feb. 24,
2010) (“Nor is Rosario a necessary party under Fed. R. Civ. P. 19(a)(1)(B) because, among other
reasons, ‘[i]t is the absent party [i.e., Rosario] that must “claim an interest,” and no [such] party
has done so here.’” (alterations in original) (collecting cases)). The failure of the absent parties
to claim an interest is particularly compelling here, where the absent parties include Defendant’s
ex-wife and a dissolved corporate entity that appears to have been owned by Defendant. (Pl.
Letter 3–4; New York State Department of State Corporate Dissolution Records, Docket Entry
No. 25-2.)
Defendant argues that the absent judgment debtors would be harmed if the Court renews
the Judgment against only Defendant because Defendant may be entitled to indemnification from
the absent judgment debtors. (Def. Mem. 11.) Defendant provides no legal support for his claim
that he will be entitled to pursue any actions against the absent parties, and, as discussed below,
because the Judgment will not be renewed against the absent parties, Defendant cannot support
10

such a claim. See N.Y. C.P.L.R. § 211(b) (“A money judgment is presumed to be paid and
satisfied after the expiration of twenty years from the time when the party recovering it was first
entitled to enforce it.”).
Similarly unavailing is Defendant’s argument that the absent parties will “suffer a loss or
be put at risk of suffering a loss” because the Judgment “will show up in title searches against”
the absent parties. (Def. Letter 4). As discussed below, there will not be a renewed Judgment as
to the absent parties. See, e.g., Premier Capital, LLC, 930 N.Y.S.2d at 251 (granting renewal
judgment against individual judgment debtor but noting that the judgment was not renewed as to
the remaining judgment debtors who were never served in the action). Therefore, no renewed
Judgment could show up in a title search against the absent parties.
Thus, under the facts of this case, the absent parties are not necessary within the meaning
of Rule 19(a)(1)(A) or (B). The Court therefore rejects Defendant’s argument that the Court
must join the absent judgment debtors to this action.
c.

Defendant’s champerty arguments

The Court also rejects Defendant’s argument that Plaintiff’s claim must be dismissed on
the theory that it is prevented by Judiciary Law section 489 which prohibits champerty. (Def.
Mem. 6–9.) At oral argument, the Court rejected Defendant’s champerty defense because the
champerty statute only applies to individuals who are “engaged directly or indirectly in the
business of collection and adjustment of claims,” N.Y. Jud. Law § 489(1), and there was no
evidence before the Court that Plaintiff’s conduct fell within the statute. Defendant argued that
further discovery was necessary to determine whether Plaintiff “engaged directly or indirectly in
the business of collection and adjustment of claims.” The Court therefore ordered Plaintiff to
submit an affidavit regarding whether he was engaged in the business of collection or adjustment
11

of claims. (Min. Entry dated Jun. 16, 2017.) Plaintiff filed an affidavit on June 19, 2017,
affirming that he was not engaged in the “business of buying and selling claims or judgments,”
or “in the debt collection business” and that the only judgment Plaintiff has ever purchased or
been assigned is the disputed Judgment in this case. (Edrich Aff. ¶¶ 3–4.)
Although Defendant agreed at oral argument that if Plaintiff affirmed that he was not in
the business of selling claims or judgments Defendant’s champerty defense would fail,
Defendant now argues that the affidavit “only partially addresses the test for determining
champerty.” (Def. Letter 3.) Specifically, Defendant argues that Plaintiff’s submission should
have “negated the statutory language” but instead Plaintiff only states that he is not directly
engaged in the business of collection and adjustment of claims and includes no allegations that
he is not indirectly engaged in any such business. (Id.) The Court is not persuaded by
Defendant’s argument.
New York Judiciary Law section 489 provides in relevant part that:
No person or co-partnership, engaged directly or indirectly in the
business of collection and adjustment of claims, and no corporation
or association, directly or indirectly, itself or by or through its
officers, agents or employees, shall solicit, buy or take an
assignment of, or be in any manner interested in buying or taking an
assignment of a bond, promissory note, bill of exchange, book debt,
or other thing in action, or any claim or demand, with the intent and
for the purpose of bringing an action or proceeding thereon; . . . .
N.Y. Jud. Law § 489(1) (emphasis added). Plaintiff’s affirmation sufficiently tracks the language
of the statute for the Court to find that Plaintiff is not “engaged directly or indirectly in the
business of collection and adjustment of claims.” (Id.) Moreover, Defendant cannot now
complain that he has had inadequate opportunity to discover whether Plaintiff is engaged either
directly or indirectly in the business of collection and adjustment of claims when the parties have
been involved in litigation for over a decade, and the instant action has been ongoing for five
12

years. See generally Trebor Sportswear Co., Inc. v. The Ltd. Stores, Inc., 865 F.2d 506, 511–12
(2d Cir. 1989) (“The nonmoving party must have ‘had the opportunity to discover information
that is essential to his opposition’ to the motion for summary judgment. But the trial court may
properly deny further discovery if the nonmoving party has had a fully adequate opportunity for
discovery.” (citation omitted)).
Accordingly, for the reasons discussed on the record during the June 16, 2017 oral
argument and based on Plaintiff’s representation that he is not engaged in the business of debt
collection and adjustment of claims, the Court rejects Defendant’s champerty defense. See
Alexander v. Unification Church of Am., 634 F.2d 673, 676–77 (2d Cir. 1980) (affirming a
district court decision finding that section 489 was not applicable in part because it only applies
to individuals “engaged directly or indirectly in the business of collection and adjustment of
claims” and the relevant parties were not engaged in the business of collecting claims), overruled
on other grounds by PSI Metals, Inc. v. Firemen’s Ins. Co. of Newark, N.J., 839 F.2d 42, 43 (2d
Cir. 1988); Cardarelli v. Scodek Constr. Corp., 758 N.Y.S.2d 188, 190 (App. Div. 2003) (holding
that there was no violation of section 489 because the defendants “failed to establish that plaintiff
was in the business of the collection and adjustment of claims”); Traktman v. City of New York,
582 N.Y.S.2d 808, 809 (App. Div. 1992) (“Despite the fact that the plaintiff has commenced
litigation on several assigned claims, the evidence presented fails to establish that the plaintiff is
engaged in the business of collecting claims or that the plaintiff took the assignment for the
purpose of bringing an action.”); Seldon v. Flomenhaft, No. 13194/05, 2006 WL 162965, at *3
(N.Y. Civ. Ct. Jan. 20, 2006) (“Absent any evidence that [the plaintiff] is ‘engaged directly or
indirectly in the business of collection and adjustment of claims,’ he cannot be found to have
violated Judiciary Law [section] 489 by obtaining an assignment . . . and prosecuting it.”).
13

d.

Renewal of the Judgment

In New York State the procedure for obtaining the renewal of a judgment is governed by
CPLR section 5014 (“section 5014”), which provides:
Except as permitted by section 15-102 of the general obligations
law, an action upon a money judgment entered in a court of the state
may only be maintained between the original parties to the judgment
where:
1. ten years have elapsed since the first docketing[4] of the
judgment; or
2. the judgment was entered against the defendant by default
for want of appearance and the summons was served other
than by personal delivery to him or to his agent for service
designated under rule 318, either within or without the state;
or
3. the court in which the action is sought to be brought so
orders on motion with such notice to such other persons as
the court may direct.
An action may be commenced under subdivision one of this section
during the year prior to the expiration of ten years since the first
docketing of the judgment. The judgment in such action shall be
designated a renewal judgment and shall be so docketed by the clerk.

4

The reference to “first docketing” in section 5014 refers to the time “immediately after
filing of the judgment-roll.” David D. Siegel, Practice Commentary N.Y. C.P.L.R. § 5014;
David D. Siegel, N.Y. Prac. § 517 (5th ed.) (“The docketing of a judgment is practically
automatic when rendered in the supreme court or a county court, because the county clerk is ex
officio the clerk of those courts and anything she does as court clerk she does as county clerk as
well. So, when a judgment in an action in one of those courts is entered and docketed, and the
judgment-roll is filed — events that occur at just about the same time — the judgment
immediately becomes a lien on the judgment debtor’s local real property. . . . The lien lasts [ten]
years — measured not from the time of docketing, but from the filing of the judgment-roll,
which is essentially the moment the judgment was entered. As indicated, that moment and the
moment of docketing are the same in a supreme court or county court action, but not with a
lower court judgment, such as one of a city court.” (citing N.Y. C.P.L.R. §§ 5018(a), 5203(a),
5017(a))).
14

The lien of a renewal judgment shall take effect upon the expiration
of ten years from the first docketing of the original judgment.
N.Y. C.P.L.R. § 5014.5
To obtain relief pursuant to section 5014, a plaintiff must make “a prima facie showing of
its entitlement to a renewal judgment by offering evidentiary proof that it was the original
judgment creditor’s assignee, and that no part of the judgment has ever been satisfied.” Premier
Capital, LLC, 930 N.Y.S.2d at 251 (citing Schiff Food Prods. v. M&M Import Export, 924
N.Y.S.2d 158, 159 (App. Div. 2011)); Rose v. Gulizia, 961 N.Y.S.2d 286, 287–88 (App. Div.
2013) (“The plaintiff here established her prima facie entitlement to judgment as a matter of law
awarding her a renewal judgment pursuant to CPLR 5014(1) by demonstrating the existence of
the prior judgment, that the defendant was the judgment debtor, that the judgment was docketed
at least nine years prior to the commencement of this action, and that the judgment remains
partially or completely unsatisfied.”). In response, a defendant may “raise a triable issue of
fact.” Schiff Food Prods., 924 N.Y.S.2d at 160 (citing Pangburn v. Klug, 664 N.Y.S.2d 71, 72
(App. Div. 1997)). If he fails to do so, a plaintiff will be entitled to the renewal judgment. Id.
i.

Section 5014 allows for renewal of a judgment

As a threshold matter, Defendant argues that section 5014 only allows for the extension

5

Courts treat applications pursuant to this provision as seeking relief pursuant to
summary judgment. See, e.g., Schiff Food Prods. v. M&M Import Export, 924 N.Y.S.2d 158,
159 (App. Div. 2011) (granting “plaintiff’s motion, in effect, for summary judgment on the
complaint,” and remitting the matter to the lower court “for the entry of an appropriate renewal
judgment in accordance herewith”); Premier Capital, LLC v. Best Traders, Inc., 930 N.Y.S.2d
249, 250 (App. Div. 2011) (addressing “an action for a renewal judgment pursuant to CPLR
5014, which was commenced by a motion for summary judgment in lieu of complaint,” and
modifying the lower court’s denial of the plaintiff’s motion by granting plaintiff’s motion for
summary judgment in part); see also ACLI Gov’t Sec. v. Rhoades, No. 97-CV-2471, 1998 WL
142347, at *1 (S.D.N.Y. Mar. 26, 1998) (granting summary judgment to a plaintiff seeking to
renew a money judgment under section 5014(1)).
15

of a lien and not the extension of a judgment, relying on the purpose of section 5014 as
articulated in Gletzer v. Harris, 12 N.Y.3d 468, 473 (2009). (Def. Letter 2 n.2.)
Contrary to Defendant’s argument, Gletzer does not preclude the extension of a judgment
under section 5014. In Gletzer, the New York Court of Appeals held that a judgment and lien
renewed pursuant to section 5014 becomes effective when it is granted and does not apply
retroactively to the date of filing. Gletzer, 12 N.Y.3d at 476 (holding that a renewal judgment
initiated by a judgment creditor after the initial judgment lien had lapsed was effective only from
the date of the renewal judgment, and not nunc pro tunc from the date the initial judgment lien
lapsed). The court also explained, as Defendant acknowledges, that the New York Legislature
“enacted CPLR 5014 to allow a judgment creditor to apply for a renewal of the judgment lien.”
Id. at 473. However, neither the language from the decision in Gletzer nor the plain language of
section 5014 precludes application of section 5014 to a judgment. Id. at 475 (explaining that
section 5014 “enables the judgment creditor to sue on the old judgment and thereby acquire a
new judgment and a fresh [ten] year lien” (quoting 10 Carmody-Wait 2d § 67:4 (2009))); In re
Vinieris, 391 B.R. 707, 711 (Bankr. S.D.N.Y. 2008) (“Nothing in the plain language of CPLR
[section] 5014 supports the Debtor’s argument that the lien, but not the judgment, may be
extended by bringing an action under CPLR [section] 5014 on the judgment within twenty
years.”).
Indeed, as Defendant admits, both before and after the decision in Gletzer, several courts
have held that section 5014 provides for the extension of a judgment, in addition to the extension
of a lien. (Def. Letter 2 n.2); In re Vinieris, 391 B.R. at 713 (concluding that “CPLR § 5014 not
only extends the lien but the judgment as well”); Emerald Inv’rs Ltd. v. TOMS, 19 N.Y.S.3d 421,
421–22 (App. Div. 2015) (“We reject defendant’s contention that under CPLR 5014, the lien on
16

real property resulting from the docketing of a renewal judgment cannot extend beyond the
[twenty]–year statute of limitations applicable to the original judgment. A renewal judgment
provides a judgment creditor with both a new [twenty]–year judgment and a corresponding
[ten]–year lien.” (citations omitted)); see also Anchor Sav. Bank v. Parker, No. 13164/05, 2006
WL 162965, at *1 (N.Y. Sup. Ct. Jan. 20, 2006) (“[A] judgment creditor is able to obtain a new
twenty-year judgment, and new ten-year lien on real property, through an action against the
debtor to renew the judgment even if the creditor’s lien had lapsed because he waited longer than
the minimum ten-year period for renewing the lien.”); First Nat. Bank of Long Island v. Brooks,
No. 10130/03, 2003 WL 23009241, at *2 (N.Y. Cty. Ct. Sept. 22, 2003) (“By starting afresh and
obtaining a judgment in this action, however, the plaintiff will obtain a new [twenty-]year
judgment, and a new ten[-]year lien.” (quoting Quarant v. Ferrara, 445 N.Y.S.2d 885, 887 (Sup.
Ct., Queens Cty. 1981))). As Professor David D. Siegel explains in discussing section 5014:
Although a New York money judgment has a life of [twenty]
years, it is a lien against real property for only [ten]. After the [ten]
years have expired without satisfaction of the judgment, the creditor
is permitted to sue on it afresh so as to get a new judgment and hence
a new [ten]-year lien.
David D. Siegel, N.Y. Prac. § 434 (5th ed.) (emphasis added) (citations omitted). Defendant
argues that, based on the plain reading of section 5014, the Court must reject case law permitting
the renewal of a judgment in addition to the renewal of a lien pursuant to section 5014. The
Court has no basis to reject the decisions by the New York state courts interpreting New York
law where Defendant points to no contrary law but only the statement in Gletzer which does not
contradict or preclude the relief sought in this case. See generally In re Vinieris, 391 B.R. at 712
(“While [In re Buchardt, 114 B.R. 362, 363 (Bankr. N.D.N.Y. 1990) and Gletzer v. Harris, 854
N.Y.S.2d 10, 14 (App. Div. 2008), aff’d 12 N.Y.3d 468, 473 (2009)] do explain the purpose of
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CPLR [section] 5014 regarding extension of statutory liens, the cases do not hold that a ‘renewal
judgment’ is only an action to renew the lien.”).
ii.

Plaintiff makes out a prima facie showing that he is entitled to
renewal of the Judgment

Plaintiff has established that he is entitled to a renewal of the Judgment — he filed a
timely application for renewal, submits evidentiary proof that he owns the Judgment and
represents that the Judgment remains unsatisfied.
First, Plaintiff’s request for renewal is timely. The Judgment was filed and docketed by
the Office of the County Clerk, New York County on November 15, 1994, and this action was
filed on August 15, 2012 — after ten years had elapsed since the first docketing of the Judgment.
Because Plaintiff filed the Complaint after ten years had elapsed since the first docketing of the
Judgment, the application for a renewal of the Judgment is timely.6 See In re Vinieris, 391 B.R.
at 711 (section 5014 allows an action to be filed either during the year prior to the expiration of
the ten years or after ten years have elapsed since the first docketing of the judgment); Guerra v.
Crescent St. Corp., 991 N.Y.S.2d 343, 344 (App. Div. 2014) (“[A]n action for a renewal
judgment is not time-barred even when it is commenced more than [ten] years after the original

6

Defendant’s argument that the Judgment cannot be renewed because as of the date of
Defendant’s most recent briefing “the 1994 Judgment has expired” pursuant to CPLR section
211(b) is unavailing. (Def. Letter 2.) As an initial matter, a judgment does not “expire” pursuant
to section 211(b), rather a judgment is presumed satisfied after it has been enforceable for twenty
years and the presumption “may be availed of under an allegation that the action was not
commenced within the time limited.” N.Y. C.P.L.R. § 211(b). The fact that the Judgment has
been enforceable for over twenty years as of the date of this decision does not make Plaintiff’s
request for a renewal of the Judgment untimely. The relevant date to determine whether a
petition is timely is the date the petition was filed, in this case August 15, 2012, and not the date
the court adjudicates the petition. See generally Gletzer v. Harris, 12 N.Y.3d 468, 477 (2009)
(explaining that the date a renewal of a judgment is granted is separate and apart from the date a
request for renewal is filed). In addition, this case would have been determined prior to the time
the Judgment “expired” had the parties not requested a stay of the proceeding pending litigation
of the Kings County Action and the subsequent appeal of the Kings County Decision.
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judgment was docketed.”); Premier Capital, LLC, 930 N.Y.S.2d at 251 (finding a petition for
renewal judgment timely filed even though it was made more than ten years after the judgment
was docketed); Schiff Food Prods., 924 N.Y.S.2d at 159–60 (“Accordingly, this action for a
renewal judgment was not time-barred even though it was commenced more than [ten] years
after the judgment was docketed.”); First Nat. Bank of Long Island, 2003 WL 23009241, at *2
(“In the instant case, the plaintiff/judgment creditor waited well beyond the minimum [ten] year
period, thus allowing his prior lien to lapse. By starting afresh and obtaining a judgment in this
action, however, the plaintiff will obtain a new [twenty] year judgment, and a new ten year
lien.”).
Second, Plaintiff submitted proof that the original judgment creditor, Sequa, assigned the
Judgment to Plaintiff. Plaintiff attached to its motion for summary judgment a copy of the
Judgment and the assignment of the notarized Judgment showing that Steven R. Lowson was the
Vice President of Sequa on the day he signed the assignment of the Judgment. (Judgment;
Assignment of Judgment; Agreement to Assign Judgment.) This is sufficient to show that
Plaintiff owns the Judgment. See Premier Capital, LLC, 930 N.Y.S.2d at 251 (“Moreover, the
plaintiff made a prima facie showing of its entitlement to a renewal judgment by offering
evidentiary proof that it was the original judgment creditor’s assignee, and that no part of the
judgment has ever been satisfied.” (citation omitted)); The Cadle Co. v. Biberaj, 763 N.Y.S.2d
751, 752 (App. Div. 2003) (“Plaintiff submitted a copy of the original judgment filed in New
York County and a certified copy of the assignment of such judgment . . . entered in the Supreme
Court State of New York in and for New York County, New York . . . . Such evidence was
sufficient to warrant granting plaintiff’s motion for summary judgment and directing entry of a
renewal judgment pursuant to CPLR 5014(1).”).
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Defendant argues that, because Plaintiff is not an original party to the Judgment as
required by the text of section 5014, section 5014 does not apply. (Def. Letter 2–3.) In view of
the relevant New York State law interpreting section 5014, the Court finds the argument
unpersuasive. Although the New York Court of Appeals has not addressed the issue, several
Appellate Division courts have found that despite section 5014’s explicit language limiting
renewal to only the “original parties to the judgment,” it applies equally to the original assignee
of the judgment.7 See, e.g., Premier Capital, LLC, 930 N.Y.S.2d at 250 (finding original
judgment creditor’s assignee entitled to section 5014 renewal); Chase Lincoln First Bank, N.A. v.
Dehaan, 933 N.Y.S.2d 151, 152 (App. Div. 2011) (finding an assignee is “an original party” for
the purpose of renewal); The Cadle Co., 763 N.Y.S.2d at 752 (“An assignee of a judgment is an
“original party” to the judgment for the purpose of renewing a judgment lien.”); Emerald Inv’rs
Ltd. v. TOMS, No. 150359/2014, (N.Y. Sup. Ct. July 1, 2014), WebCivil Supreme,
https://iapps.courts.state.ny.us/fbem/DocumentDisplayServlet?documentId=KQJCgVPbhTGW6j
6CZy5mBg==&system=prod (renewing judgment for assignee of the original judgment) aff’d
19 N.Y.S. 3d 421 (App. Div. 2015); but see Saxe v. Peck, 124 N.Y.S. 14, 16 (App. Div. 1910)
(holding that the predecessor statute to section 5014 did not apply where a judgment had been
assigned).

7

Where, as here, a state’s highest court has not directly addressed an issue, the Court is
bound by the decision of the state’s appellate courts, unless there is evidence that the state’s
highest court would rule differently. See V.S. v. Muhammad, 595 F.3d 426, 432 (2d Cir. 2010)
(holding that a federal court “is bound to apply the law as interpreted by a state’s intermediate
appellate courts unless there is persuasive evidence that the state’s highest court would reach a
different conclusion.” (citing Pahuta v. Massey–Ferguson, Inc., 170 F.3d 125, 134 (2d Cir.
1999))); see also Greenberg v. Greenberg, 646 F. App’x 31, 31 (2d Cir. 2016) (“In the absence
of any statement by the state’s highest court,” federal courts are “bound to apply the law as
interpreted by a state’s intermediate appellate courts unless there is persuasive evidence that the
state’s highest court would reach a different conclusion.” (quoting V.S., 595 F.3d at 432)).
20

Finally, Plaintiff asserts that the Judgment remains “wholly unsatisfied” as stated in his
affidavit accompanying the motion for summary judgment. (Compl. ¶ 10; Pl. Mem. 1; Pl. Reply
5, Docket Entry No. 19; Pl. Aff. ¶ 5, Docket Entry No. 16-9); see Baiz v. Baiz, 780 N.Y.S.2d 770,
770 (App. Div. 2004) (discussing a prior grant of a renewal judgment where the plaintiff
“assert[ed]” that the judgment had only been partially satisfied and the judgment was renewed
for the unsatisfied amount); Emerald Inv’rs Ltd., No. 150359/2014 (renewing judgment where
the plaintiff only asserted that the judgment had not been satisfied).
Accordingly, Plaintiff has established a prima facie claim for renewal of the Judgment.
See, e.g., Rose, 961 N.Y.S.2d at 287–88 (“The plaintiff here established her prima facie
entitlement to judgment as a matter of law awarding her a renewal judgment pursuant to CPLR
5014(1) by demonstrating the existence of the prior judgment, that the defendant was the
judgment debtor, that the judgment was docketed at least nine years prior to the commencement
of this action, and that the judgment remains partially or completely unsatisfied.”); Emerald
Inv’rs Ltd., No. 150359/2014 (finding the plaintiff established a prima facie entitlement to
renewal of a judgment where the plaintiff asserted that the judgment had not been satisfied and
presented “the [j]udgments and assignments of judgments along with proof of filings at the
Clerk’s office”).
Defendant argues that there are disputed issues of material fact that preclude summary
judgment because there are unknown material facts regarding whether (1) the Vice President of
Sequa had authority to allow the assignment on Sequa’s behalf and (2) any part of the Judgment
has been satisfied. (Def. Mem. 11–12.) Defendant’s attempt to create issues of disputed facts
where there are none is rejected. In view of the fact that the assignment of Judgement was
signed by Sequa’s Vice President and notarized, and the affidavit from Plaintiff that the
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Judgment remains wholly unsatisfied, Defendant’s speculation as to whether the Vice President
of Sequa had authority to assign the Judgment and that more evidence is needed to show that the
Judgement is wholly unsatisfied is insufficient to create a disputed issue of material fact to
preclude summary judgment in Plaintiff’s favor. See, e.g., Emerald Inv’rs Ltd., 19 N.Y.S.3d
at 422 (“Defendant failed to raise a triable issue of fact as to a bona fide defense to the action.
He offered no more than unsubstantiated, conclusory allegations of fraud with respect to the
validity of the assignments of the original money judgments.”).
Accordingly, Plaintiff has established that he is entitled to renewal of the Judgment and
Defendant has failed to rebut Plaintiff’s case. The Court therefore grants Plaintiff’s motion for
summary judgment and renews the Judgment in the amount of $302,042 with interest at the rate
of nine percent per annum from November 15, 1994 for a period of twenty years, and renews the
lien for a period of ten years from the date of this Memorandum and Order.
III. Conclusion
For the foregoing reasons, the Court denies Defendant’s motion for judgment on the
pleadings and grants Plaintiff’s motion for summary judgment. The Clerk of Court is directed to
enter judgment for Plaintiff and to close this case.
SO ORDERED:
s/ MKB
MARGO K. BRODIE
United States District Judge
Dated: August 17, 2017
Brooklyn, New York

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