Frank Brunckhorst Co., LLC v. Castellini

Filing 21

ORDER ADOPTING REPORT AND RECOMMENDATION. The plaintiff's motion for default judgment 13 is denied without prejudice to refiling. Within thirty days of this Order, the plaintiff must refile a motion for default judgment with adequate support a nd arguments. If the plaintiff timely refiles its defaultjudgment motion, the motion will be referred again to Judge Tiscione for a Report and Recommendation. If the plaintiff fails to do so, I will stay this action pending a dispositive or final resolution of the Ohio federal action. Ordered by Judge Ann M. Donnelly on 3/19/2018. (Greene, Donna)

IN CLERK'S OFFICE

US DISTRICT COURT E.D.N.Y.
UNITED STATES DISTRICT COURT

5 MAR I <1 2018 ^

EASTERN DISTRICT OF NEW YORK
-X

FRANK BRUNKHORST CO., LLC,

BROOKLYN OFFICE

Plaintiff,

ORDER ADOPTING REPORT
AND RECOMMENDATION

-against-

17-CV-2324(AMD)
(ST)

WILLIAM CASTELLINI,
Defendant.
-X

Ann M.Donnelly, United States District Judge:
The plaintiff, Frank Brunkhorst Co., LLC,filed this complaint against the defendant,

William Castellini, on April 18, 2017, and later amended it on May 5, 2017. (ECFNos. 1,7.)
The defendant never answered or responded to the complaints, and the plaintiff moved for
default judgment on August 22, 2017. (ECFNo. 13.) On August 30, 2017,1 referred the

plaintiffs motion for defaultjudgment to Magistrate Judge Steven L. Tiscione for a Report and
Recommendation ("R&R"). (Minute Entry, August 30, 2018.)

On February 28, 2018, Judge Tiscione issued a thorough and well-reasoned R&R
recommending that I deny the plaintiffs default judgment motion without prejudice, and order
the plaintiff to refile its motion with adequate support within thirty days. (ECF No. 18.) The
plaintiff now attacks Judge Tiscione's report as "clearly erroneous." For the reasons set forth
below, I reject the plaintiffs arguments and adopt Judge Tiscione's comprehensive R&R in its
entirety.
BACKGROUND

The complaint, in essence, alleges that in March of2006, the defendant induced the

plaintiff to extend credit to Castelberry Provisions, LLC., a non-party in this action, by agreeing

1

to be personally liable for any and all debt that Castelberry owed the plaintiff. (Id., at ^ 8.)
Although the plaintiff sent the defendant five invoices for goods sold and delivered to

Castelberry, totaling $142,150.92, neither Castelberry nor the defendant paid the plaintiff. (Id. at
17, 20, 21.) The plaintiff subsequently commenced this action against the defendant. In May

of 2017, the plaintiff also filed a collection action against Castelberry in the United States

District Court for the Southern District of Ohio. (R&R,ECFNo. 18, at 1; ECF No. 16,at1[3.)
The plaintiff served the defendant at least twice in this case, but the defendant did not

appear or respond. (Mat 3.) As a result, the Clerk entered default on August 22, 2017. (ECF
No. 12.) The plaintiff moved for defaultjudgment against the defendant on August 29, 2017, but
did not submit a memorandum of law with the motion; instead, the plaintiff included an

affidavit—which reiterated the allegations in the complaint—and exhibits including the invoices
that the plaintiff sent to the defendant. (ECF No. 13.) The plaintiff did not file a memorandum
of law in support of its motion until Judge Tiscione directed it to do so, on February 12, 2018.
(ECF No. 17; Minute Entry, January 31, 2018.) The plaintiff also submitted a second affidavit
on February 12, 2018, stating among other things, that it had filed a collection action against
Castelberry in the Southern District of Ohio in May of2017 to recover what Castelberry and the
defendant owed. (ECF No. 16,^ 3.)
Judge Tiscione issued an R&R recommending that I deny the plaintiffs default judgment
motion without prejudice and that I order the plaintiff to refile its motion with adequate support

within thirty days. (ECF No. 18.) In making this recommendation. Judge Tiscione explained
that the plaintiff did not include adequate legal authority demonstrating its entitlement to the

relief requested in its default judgment motion, and that the plaintiff did not clarify whether its
collection action in the Southem District of Ohio could have a preclusive effect on any judgment

entered against the defendant in this case. {Id.) If the plaintiff did not reflle its motion in a

timely manner, Judge Tiscione recommended that I stay the case pending a dispositive or final
resolution of the Ohio action. {Id.)

Judge Tiscione ordered the parties to file objections by March 14, 2018. {Id.) The
plaintiff filed timely objections to the R&R. (ECF No. 20.) The plaintiff served the defendant
with the R&R, but the defendant did not file any objections. (ECF No. 19.)
DISCUSSION

In reviewing a Report and Recommendation, a district court"may accept, reject, or
modify, in whole or in part, the findings or recommendations made by the magistrate judge." 28
U.S.C. § 636(b)(1). A party's objections must be specific; where a party "makes only
conclusory or general objections, or simply reiterates [the] original arguments, the Court reviews
the[R & R] only for clear error." Pall Corp. v. Entegris, Inc., 249 F.R.D. 48, 51 (E.D.N.Y.

2008)(quoting Barratt v. Joie, No. 96 Civ. 324, 2002 WL 335014, at *1 (S.D.N.Y. Mar. 4,
2002)). The district judge must evaluate proper objections de nova and "may accept, reject, or
modify the recommended disposition." Fed. R. Civ. P. 72(b)(3). "[EJven in a de nova review of

a party's specific objections,[however,] the court will not consider 'arguments, case law and/or
evidentiary material which could have been, but were not, presented to the magistrate judge in
the first instance.'" Brown v. Smith, No.09 Civ. 4522, 2012 WL 511581, at *1 (E.D.N.Y. Feb.
15, 2012)(quoting Kennedy v. Adamo, No.02 Civ. 1776, 2006 WL 3704784, at *1 (E.D.N.Y.

Sept. 1, 2006))(alterations omitted). Moreover,"the district court is 'permitted to adopt those
sections of a magistrate judge's report to which no specific objection is made, so long as those
sections are not facially erroneous.'" Sasmor v. Powell, No. 11 Civ. 4645,2015 WL 5458020, at

*2(E.D.N.Y. Sept. 17, 2015)(quoting Batista v. Walker, No.94 Civ. 2826, 1995 WL 453299, at
*1 (S.D.N.Y. July 31, 1995)).

It is well-established that "defaults are generally disfavored and are reserved for rare
occasions," Enron Oil Corp. v. Diakuhara, 10 F.3d 90,96(2d Cir. 1993), and that parties are
required to submit proper memoranda of law with their default motions,"establish[ing] that on

the law it is entitled to the relief it seeks, given the facts as established by the default." Finkel v.
Triple A Grp. Inc., 708 F. Supp. 2d 277, 280(E.D.N.Y. 2010)(citations omitted). See also
Krevat v. Burgers to Go, /«c., No. 13-CV-6258 JS AKT,2014 WL 4638844, at *1(E.D.N.Y.

Sept. 16, 2014)(on a default,"[e]ven if a plaintiffs claims are deemed admitted, a plaintiff must
demonstrate that the allegations set forth in the complaint state valid claims."). The plaintiffs

motion for default judgment did not address the defendant's liability; there was no discussion of

the elements of the claims asserted or the legal sufficiency of the alleged facts in the complaint.
It was not Judge Tiscione's responsibility to make the plaintiffs arguments, especially since the
plaintiff is represented by counsel. Judge Tiscione was absolutely correct to recommend that I
deny the defaultjudgment motion. See, e.g., Pompey v. 23 Morgan II, LLC, No. 16-CV-2065

(ARR)(PK),2017 WL 1102772, at *3(E.D.N.Y. Feb. 13, 2017).'
Nor was Judge Tiscione wrong to recommend a stay if the plaintiff decides not to refile
its motion for defaultjudgment. Given the almost identical nature of this suit and the parallel
Ohio action, there is a possibility that a judgment in the Ohio litigation would have a preclusive

effect on a defaultjudgment entered against the defendant in this case.^ The plaintifffailed to

'1 also reject the plaintiffs attempt to distinguish itself from the plaintiff in Pompey v. 23 Morgan 11, LLC, No. 16CV-2065(ARR)(PK), 2017 WL 1102772(E.D.N.Y. Feb. 13, 2017). {See ECF No. 20, at 6.) The plaintiff has twice
failed to file a proper motion for defaultjudgment—thus, any delay in this case is of its own doing.
- The plaintiff argues that this question "was never raised [in the default judgment motion] given defendant's
default"(ECF No. 20, at 7), but the plaintiffs counsel "raised" the issue by including it in its submission. (ECF No.
14, at ]| 3.) Judge Tiscione recognized that the parallel case might have an impact on this case.

address this issue in its moving papers and Judge Tiscione properly requested additional briefing

on this issue.^ Thus,I adopt the R&R in its entirety.
To be sure, the plaintiff now includes arguments about the legal sufficiency ofits claims

and the effects of the judgment in the parallel Ohio action. Those are some of the arguments that
the plaintiff should have made to Judge Tiscione. Because the plaintiff did not, I do not consider
them. "[A] districtjudge will not consider new arguments raised in objections to a magistrate
judge's report and recommendation that could have been raised before the magistrate but were

not." Jo V. JPMC Specialty Martg., LLC, 131 F. Supp. 3d 53, 59(W.D.N.Y. 2015); Chalasani v.
Daines,no. lO-CV-1978 RRMRML,2011 WL4465408, at *1 (E.D.N.Y. Sept. 26, 2011). See

also Amadasu v. Ngati, No. 05-CV-2585 RRM LB,2012 WL 3930386, at *5-7(E.D.N.Y. Sept.
9, 2012)(declining to consider new legal arguments raised by the plaintiff after the R&R because
the plaintiffs conduct was "anathema to 'the purposes of the Magistrates Act' and 'systemic
efficiencies would be frustrated.'").
CONCLUSION

Accordingly, the plaintiffs motion for defaultjudgment[13] is denied without prejudice
to refiling. Within thirty days of this Order, the plaintiff must refile a motion for default
judgment with adequate support and arguments. If the plaintifftimely refiles its default

judgment motion, the motion will be referred again to Judge Tiscione for a Report and
Recommendation. If the plaintiff fails to do so, I will stay this action pending a dispositive or
final resolution of the Ohio federal action.

^ The plaintiff argues that Judge Tiscione "recommends staying the action pending a dispositive or final resolution
ofthe Ohio action because [the] Plaintiff did not answer the question ... of whether the [Ohio Action] could have a
preclusive effect...." (EOF No. 20, at 7.) The plaintiff misreads the R&R. Judge Tiscione recommended that I
order a stay in this case if the plaintiff did not timely refile its motion for defaultjudgment with adequate support
and legal arguments within thirty days of my Order. (ECF No. 18, at 10.)

so ORDERED.

s/Ann M. Donnelly

AnnfCl. Donnelly
United States District Judge

Dated: Brooklyn, New York
March 19,2018