The Sands Harbor Marina Corp. et al v. Wells Fargo Insurance Services of Oregon, Inc.

Filing 132

MEMORANDUM & ORDER denying 94 Motion for Default Judgment; granting 109 Motion to Amend/Correct/Supplement; granting in part 114 Motion for Reconsideration; granting in part 117 Motion for Reconsideration. For the foregoing reasons, th e T&N Defendants' motion to amend/correct/supplement is GRANTED, and Section VI the February Order is deemed AMENDED to reflect that the T&N Defendants' also moved to dismiss Plaintiffs' state law claims. The T&N Defendants' and Plaintiffs' motion for reconsideration are GRANTED IN PART and the Court DEFERS RULING IN PART. Furthermore, the Court's referral Order is VACATED, and Plaintiffs' motion for default is DENIED with leave to renew. If Plaintiffs wish to renew their motion for default, they must do so within forty-five (45) days of the date of this Memorandum and Order. Thereafter, the motion will be referred for a report and recommendation regarding liability only as against the EVMC Defendants. If Plaintiffs do not renew their motion for default, any party may file a brief letter motion seeking reconsideration of the state law claims and referring the Court to the prior submissions in this regard. So Ordered by Judge Joanna Seybert on 9/18/2013. C/ECF (Valle, Christine)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF NEW YORK
---------------------------------------X
THE SANDS HARBOR MARINA CORP.,
SANDS HARBOR MARINA LLC, THE SANDS
HARBOR MARINA OPERATING CORP.,
SANDS HARBOR MARINA OPERATING LLC,
GREG W. EAGLE, PINE CREEK RANCH,
LLC, and UNIVERSITY 1248, LLC,
Plaintiffs,

MEMORANDUM & ORDER
09-CV-3855(JS)(WDW)

-against–
WELLS FARGO INSURANCE SERVICES OF
OREGON, INC., WELLS FARGO BANK,
N.A., EVMC REAL ESTATE CONSULTING,
INC., LARRY ESACOVE, THE ESTATE OF
AIDA ESACOVE, DAVID P. GUILOT,
ANTHONY B. CHOPRA, TISDALE &
NICHOLSON, LLP, JEFFREY A. TISDALE,
GUY C. NICHOLSON, and MICHAEL D.
REIS,
Defendants.
---------------------------------------X
APPEARANCES
For Plaintiffs:
Roy A. Klein, Esq.
Law Offices of Roy A. Klein
352 Broad Hollow Road, Suite 144
Melville, NY 11747
For Wells Fargo
Defendants:

Jura C. Zibas, Esq.
Wilson Elser
150 East 42nd Street, 21st Floor
New York, NY 10017
Peter J. Biging, Esq.
Samuel Christopher Watkins, Esq.
Sanem Ozdural, Esq.
Lewis, Brisbois, Bisgaard & Smith, LLP
77 Water Street, Suite 2100
New York, NY 10005

For T&N Defendants:

Gregory John Radomisli, Esq.
Martin, Clearwater & Bell

220 East 42nd Street
New York, NY 10028
For Defendant Reis:

Michael F. Bachner, Esq.
Scott James Splittgerber, Esq.
Bachner & Herskovits, P.C.
26 Broadway, Suite 2310
New York, NY 10004
Howard S. Weiner, Esq.
Bachner & Associates, P.C.
39 Broadway, Suite 1610
New York, NY 10006

For remaining
Defendants:

No appearances.

SEYBERT, District Judge:
Currently, the following motions are pending before
the Court: (1) a motion by Plaintiffs the Sands Harbor Marina
Corp.,

Sands

Harbor

Marina

LLC,

the

Sands

Harbor

Marina

Operating Corp., Sands Harbor Operating LLC, Greg W. Eagle, Pine
Creek

Ranch,

LLC,

and

University

1248,

LLC

(collectively

“Plaintiffs”) for default judgment against Defendants EVMC Real
Estate Consultants, Inc., Larry Esacove, and the Estate of Aida
Esacove (collectively the “EVMC Defendants”) (Docket Entry 94),
which has been referred to Magistrate Judge William D. Wall; (2)
a motion by Defendants Tisdale & Nicholson, LLP (“Tisdale &
Nicholson”),

Jeffrey

A.

Tisdale

(“Tisdale”),

and

Guy

C.

Nicholson (“Nicholson” and together with Tisdale and Tisdale &
Nicholson, the “T&N Defendants”) to amend/correct/supplement the
Court’s February 19, 2013 Memorandum and Order (the “February

2

Order”) (Docket Entry 109); (3) a motion by the T&N Defendants
for reconsideration of the Court’s February Order (Docket Entry
114);

and

(4)

Plaintiffs’

motion

for

reconsideration

Court’s February Order (Docket Entry 117).

of

the

For the following

reasons, Plaintiffs’ motion for default is DENIED with leave to
renew, Plaintiffs’ motion for reconsideration is GRANTED IN PART
and the Court DEFERS RULING IN PART, the T&N Defendants’ motion
to amend/correct/supplement is GRANTED, and the T&N Defendants’
motion for reconsideration is GRANTED IN PART and the Court
DEFERS RULING IN PART.
BACKGROUND
The

Court

presumes

familiarity

with

the

underlying

facts of this case, which are detailed in the February Order.
Briefly, Plaintiffs commenced this action primarily for alleged
violations of the Racketeer Influenced and Corrupt Act of 1970
(“RICO”), as codified by 18 U.S.C. § 1961 et seq.

Plaintiffs

also raised various state law claims.
The Court’s February Order dismissed Plaintiff’s RICO
claims against the T&N Defendants, the Wells Fargo Defendants,
and Michael D. Reis.

In Section VI of that Opinion, the Court

declined pendent jurisdiction over Plaintiff’s state law claims.
The

T&N

Defendants

now

move

to

amend/correct/

supplement the February Order to the extent that Section VI did
not explicitly acknowledge that they, in addition to some of the
3

other defendants, had moved to dismiss the state law claims.
The T&N Defendants and Plaintiffs also move for reconsideration
of

the

February

Order

to

the

extent

that

it

dismissed

Plaintiff’s state law claims without prejudice.
DISCUSSION
The T&N Defendants’ motion to amend/correct/supplement
is essentially one for reconsideration, and therefore the Court
will first address the relevant standard of review on a motion
for reconsideration before addressing the three pending motions
for reconsideration, followed by a discussion of the pending
motion for default.
I. Reconsideration Motions
A. Legal Standard
Motions for reconsideration may be brought pursuant to
Rules 59(e) and 60(b) of the Federal Rules of Civil Procedure
and Local Rule 6.3.
WL

812999,

at

*2

See Wilson v. Pessah, No. 05-CV-3143, 2007
(E.D.N.Y.

Mar.

14,

2007).

A

motion

for

reconsideration is appropriate when the moving party believes
that

the

Court

overlooked

decisions”

that

Shamis

Ambassador

v.

would

(S.D.N.Y. 1999).

important

have

“matters

influenced

Factors

Corp.,

the
187

or
prior

F.R.D.

controlling
decision.
148,

151

The Court may also reconsider an order or

judgment where there was “mistake, inadvertence, surprise, or
excusable neglect.”

FED. R. CIV. P. 60(b).
4

Reconsideration is not a proper tool to repackage and
relitigate arguments and issues already considered by the Court
in deciding the original motion.

See United States v. Gross,

No. 98-CR-0159, 2002 WL 32096592, at *4 (E.D.N.Y. Dec. 5, 2002)
(“A party may not use a motion to reconsider as an opportunity
to reargue the same points raised previously.”).
proper to raise new arguments and issues.

Nor is it

See Lehmuller v. Inc.

Vill. of Sag Harbor, 982 F. Supp. 132, 135 (E.D.N.Y. 1997).
Reconsideration

may

only

be

granted

when

the

Court

did

not

evaluate decisions or data that might reasonably be expected to
alter the conclusion reached by the Court.

Wechsler v. Hunt

Health Sys., 186 F. Supp. 2d 402, 410 (S.D.N.Y. 2002).
B.

Motions for Reconsideration
Here, the T&N Defendants move for reconsideration of

the February Order, essentially asserting that the Court should
render a decision on the merits of Plaintiffs’ state law claims
against them.

More specifically, they maintain that the Court

erred in not dismissing Plaintiffs’ state law claims against
them

with

prejudice.

(T&N

Docket Entry 116, at 1.)

Defs.’

Br.

for

Reconsideration,

They also seek reconsideration of the

February Order as the Court did not explicitly acknowledge that
they

had

moved

for

dismissal

of

the

state

law

claims.

Similarly, Plaintiffs move for reconsideration of the February
Order insofar as the Court declined pendent jurisdiction over
5

Plaintiffs’

state

prejudice.

law

claims

and

dismissed

them

without

In contrast to the T&N Defendants’ motion, however,

Plaintiffs maintain that the Court erred in declining pendent
jurisdiction because the Court has subject matter jurisdiction
pursuant

to

28

U.S.C.

§

1332

due

to

the

diversity

of

the

parties.
Before

turning

to

the

merits

of

the

substantive

motions for reconsideration, the Court will first address the
T&N Defendants’ motion to amend/correct/supplement the February
Order (T&N Defs.’ Mot. to Amend, Docket Entry 109), which the
Court has characterized as one for reconsideration.

As part of

that

the

motion,

inadvertently

the

T&N

failed

Defendants

to

mention

assert

that

they

that
had

Court

moved

for

dismissal of Plaintiffs’ state law claims in their motion to
dismiss.

(T&N Defs.’ Mot. to Amend at 1.)

appropriate

ground

for

reconsideration,

the

As this is an
T&N

Defendants’

motion is GRANTED.
Furthermore, the Court notes that the T&N Defendants
are correct that they did seek dismissal of Plaintiffs’ state
law

claims

Docket

against

Entry

61,

them.
at

(See

39-44.)

T&N

Defs.’

Accordingly,

Mot.

to

insofar

Dismiss,
as

the

February Order did not explicitly state that the T&N Defendants

6

moved to dismiss the state law claims,1 the Court HEREBY AMENDS
the February Order to reflect such.
Thus,
mind,

the

with

Court

reconsideration.

that
turns
In

apparently
to

the

their

minor

clarification

remaining

motion,

the

motions
T&N

in
for

Defendants

essentially assert that the Court erred in failing to address
Plaintiffs’ state law claims on the merits.
T&N

Defendants’

arguments

center

around

At their core, the

the

notion

that

the

February Order “results in manifest injustice because defendants
are potentially forced to defend against claims that represent a
mere fraction of the second amended complaint.”

(T&N Defs.’ Br.

for Reconsideration at 1; see id. (“The interests of justice
require that this Court examine the state law claims, especially
when a vast majority of the second amended complaint has already
been dismissed, and plaintiffs would not benefit from a third
attempt to craft cognizable claims.”).)
This
inadvertence

or

argument,
oversight

however,
by

the

does

not

Court.

point

to

any

Rather,

the

T&N

Defendants themselves had argued that the Court decline pendent
jurisdiction over Plaintiffs’ state law claims.

(See T&N Defs.’

Mot. to Dismiss at 43 (“Alternatively, if this Court dismisses
the plaintiffs’ federal claims against the moving defendants, it
The T&N Defendants affirmatively recognize that such
acknowledgement in the February Order has no “practical effect
in this action.” (T&N Defs.’ Br. to Amend at 1.)
1

7

should decline to exercise supplemental jurisdiction over the
plaintiffs’ state law claims . . . .”).)

Accordingly, the T&N

Defendants’ motion for reconsideration in this regard is DENIED.
The

remainder

of

the

T&N

Defendants’

motion

for

reconsideration anticipates Plaintiffs’ argument that the Court
retains jurisdiction over the state law claims due to diversity
jurisdiction.

Such a prediction was accurate, as Plaintiffs’

subsequently moved for reconsideration of the February Order on
that very ground.2
Notably, however, while the parties have briefed the
issue of whether the Court retains subject matter jurisdiction
over the state law claims due to diversity jurisdiction, the
retention of federal question jurisdiction due to the default of
the EVMC Defendants has never been adequately addressed by the
parties.

At this stage, while the motion for default is still

pending, the Court retains federal question jurisdiction.

If

Judge Wall ultimately finds that the EVMC Defendants are liable
to

Plaintiffs

jurisdiction.

on

Plaintiffs’

RICO

claims,

the

Court

retains

If Judge Wall determines that the EVMC Defendants

Notably, Plaintiffs moved for reconsideration of the February
Order on March 6, 2013. The Court entered its February Order on
February 19, 2013. As such, Plaintiffs’ motion for
reconsideration is untimely. See LOCAL CIV. R. 6.3 (requiring
that a party wishing to file a motion for reconsideration do so
within fourteen days “after the entry of the Court’s
determination of the original motion.”).) The Court, however,
will consider Plaintiffs’ untimely submission as an implicit
request for an extension of time and GRANTS such request.
2

8

are not liable to Plaintiffs under RICO, it will be necessary to
address

whether

Plaintiffs

have

adequately

pled

diversity

jurisdiction, as the parties have briefed in their currently
pending reconsideration motions.
Accordingly,

the

T&N

Defendants’

motion

for

reconsideration and Plaintiffs’ motion for reconsideration are
GRANTED IN PART and the Court DEFERS RULING IN PART.
II.

Motion for Default
Judge Wall has appropriately stayed a decision on the

motion for default judgment against the EVMC Defendants because
quantification
reconsideration.

of

damages

hinges

on

the

motions

for

However, in reviewing the parties’ submissions

and the docket in this case, it is apparent that Plaintiffs’
motion papers seeking default judgment fail to address how, if
at all, the EVMC Defendants differ from the other defendants and
whether Plaintiffs have adequately pled the elements of each of
their claims against the EVMC Defendants.
A party’s default constitutes an “admi[ssion of] all
‘well-pleaded’ factual allegations contained in the complaint.”
City of N.Y. v. Mickalis Pawn Shop, L.L.C., 645 F.3d 114, 137
(2d Cir. 2011) (quoting Vt. Teddy Bear Co. v. 1-800 Beargram
Co., 373 F.3d 241, 246 (2d Cir. 2004)); accord Cablevision Sys.
N.Y.C. Corp. v. Lokshin, 980 F. Supp. 107, 111 (E.D.N.Y. 1997).
Thus, “a district court may not enter a default judgment unless
9

the

plaintiff’s

relief.”

complaint

states

a

valid

facial

claim

for

Mickalis Pawn Shop, 645 F.3d at 137 n.23 (collecting

cases from other circuits).
Here,
briefed
claim

whether

for

each

Defendants.

It

however,
their
of
is

Plaintiffs

allegations

their
not

causes
this

have

are
of

not

sufficient

action

Court’s

sufficiently
to

against

obligation

state
the

to

a

EVMC

“make

a

party’s arguments for it or fill in the blanks on that party’s
behalf,” Bey v. New York, No. 11-CV-3296, 2013 WL 3282277, at *6
(E.D.N.Y. June 25, 2013) (internal quotation marks and citation
omitted); cf. Sioson v. Knights of Columbus, 303 F.3d 458, 460
(2d Cir. 2002) (stating that the Circuit will generally decline
to

scour

the

record

for

evidence

to

support

a

party’s

arguments).
Accordingly, the Court’s Order referring Plaintiffs’
motion for default (Docket Entry 98) is VACATED and Plaintiffs’
motion for default is DENIED with leave to renew.
CONCUSION
For the foregoing reasons, the T&N Defendants’ motion
to

amend/correct/supplement

February

Order

is

deemed

is

GRANTED,

AMENDED

to

and

Section

reflect

that

VI

the

the

T&N

Defendants’ also moved to dismiss Plaintiffs’ state law claims.

10

The

T&N

Defendants’

and

Plaintiffs’

motion

for

reconsideration are GRANTED IN PART and the Court DEFERS RULING
IN PART.
Furthermore, the Court’s referral Order is VACATED,
and

Plaintiffs’

renew.

motion

for

default

is

DENIED

with

leave

to

If Plaintiffs wish to renew their motion for default,

they must do so within forty-five (45) days of the date of this
Memorandum and Order.
for

a

report

and

Thereafter, the motion will be referred

recommendation

regarding

liability

only

as

against the EVMC Defendants.
If Plaintiffs do not renew their motion for default,
any party may file a brief letter motion seeking reconsideration
of the state law claims and referring the Court to the prior
submissions in this regard.

SO ORDERED
/s/ JOANNA SEYBERT______
Joanna Seybert, U.S.D.J.
DATED:

September
18 , 2013
Central Islip, New York

11