Badalamenti v. Country Imported Car Corp. et al
ORDER granting 60 Motion for Extension of Time to File; granting 64 Motion to Substitute Party. ; denying 65 Motion for Reconsideration ; granting 70 Motion to Substitute Party. SO ORDERED that plaintiffs motions for an extension of time within which to serve a summons and the amended complaint upon M. Caruso and to substitute Michael Caruso, as executor of the last will of Vincent Caruso, as defendant in place of V. Caruso, deceased, are granted; and M. Caruso's motion for reconsideration is denied. Ordered by Judge Sandra J. Feuerstein on 12/5/2012. (Florio, Lisa)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF NEW YORK
CV -1 0-4993(SJF)(WDW)
-againstCOUNTRY IMPORTED CAR CORP. d/b/a
BMW OF THE HAMPTONS AND MINI OF THE
HAMPTONS, LOCAL 210 UNITY WELFARE FUND,
TRUSTEES OF LOCAL 210 WELFARE FUND,
DOMINICK FORMISANO, as Plan Administrator of
Unity Welfare Fund, MICHAEL CARUSO and
IN CLERK'S OFFICE
US DISTRiCT COliRT E 0 NY
i::. LP.1 ,i.J OFFICL
On October 29, 2010, plaintiff John Badalamenti ("plaintiff') commenced this action
against defendant Country Imported Car Corp., d/b/a BMW of the Hamptons and Mini of the
Hamptons ("Country Imported"); Local210 Unity Welfare Fund and Trustees ofLoca1210
Welfare Fund (collectively, "the Fund"); Dominick Formisano ("Formisano"), as plan
administrator of Unity Welfare Fund; and Michael Caruso ("M. Caruso") and Vincent Caruso
("V. Caruso") (collectively, "the Carusos"), pursuant to, inter alia, Sections 409 and 502 of the
Employee Retirement Income Security Act of 1974 ("ERISA"), 29 U.S.C. §§ I 001, et seq., and
Sections 191-c and 193 of the New York Labor Law ("NYLL"). On December I, 2010, plaintiff
filed an amended complaint against the same defendants, inter alia, asserting an additional claim
against the Fund pursuant to Section 510 of ERISA. Pending before the Court are: (1) plaintiffs
motions (a) for an extension of time to serve the summons and amended complaint upon M.
Caruso (Doc. No. 60) and (b) to substitute M. Caruso, as executor ofthe last will of V. Caruso,
for V. Caruso, deceased (Doc. Nos. 64 and 70); and (2) M. Caruso's motion for reconsideration
of an April 23, 2012 order setting aside the judgment dismissing this case. For the reasons set
forth below, plaintiffs motions are granted and M. Caruso's motion is denied.
In his amended complaint, plaintiff seeks, inter alia: (l) penalties based upon
Formisano's failure to produce requested documents (first claim for relief pursuant to Section
502(a)(l)(A) of ERISA against Formisano only); (2) payment of benefits, attorney's fees and
costs (second claim for relief pursuant to Section 502(a)(l)(B) of ERISA against Formisano and
the Fund and seventh claim for relief pursuant to Section 510 of ERISA against the Fund); (3)
damages, including restitution and disgorgement, for breach of fiduciary duty (third and fourth
claims for relief pursuant to Sections 409 and 502 of ERISA against Formisano and the Fund and
all defendants except Country Imported, respectively); and (4) damages for willfully (a) failing to
pay plaintiff earned commissions in violation of Section 191-c of the NYLL and (b) making
unlawful deductions from plaintiffs paycheck in violation of Section 193 of the NYLL (fifth and
sixth causes of action, respectively, against Country Imported and the Carusos). The executed
summonses filed by plaintiff on February 2, 2011 indicate, in pertinent part: (l) that V. Caruso
was personally served with a summons, complaint and "civil cover sheet" on November 2, 2010;
and (2) that M. Caruso was served with a summons and the amended complaint by delivering
copies of each to "Kathy Gallagher- Assistant" ("Gallagher"), a person of suitable age and
discretion, at his "actual place of business," located at 876A Millstone Road, Sag Harbor, New
York ("the Millstone address"), on January 6, 2011, and by mailing copies thereof to him on
January II, 2011.
On February 2, 2011, Forrnisano and the Fund moved to dismiss the amended complaint
pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure. That motion was referred to
the Honorable William D. Wall, United States Magistrate Judge, for a report and
On February 9, 20 II, upon plaintiff's motion, the Clerk of the Court entered the default
ofV. Caruso. On July 17, 2011 and July 19, 2011, plaintiff moved for default judgments against
V. Caruso and M. Caruso, respectively. Those motions were also referred to Magistrate Judge
Wall for reports and recommendations. 1
By order dated September 28,2011, I adopted Magistrate Judge Wall's report and
recommendation, dated August 30, 2011, and denied Forrnisano's and the Fund's motion to
dismiss. On October II, 2011, Formisano and the Fund filed their answer to the amended
complaint. On November I 0, 20 II, Forrnisano and the Fund filed an amended answer to the
On January 25, 2012, Magistrate Judge Brown issued an electronic order with respect to
plaintiff's motions seeking default judgments against the Carusos, inter alia: (I) advising (a) that
there was no indication on the Court's docket that V. Caruso had ever been served with the
amended complaint and (b) that there was no Clerk's entry of default as toM. Caruso; and (2)
directing plaintiff (a) to provide proof of service of the amended complaint upon V. Caruso and
(b) to secure the requisite Clerk's entries of default by February I, 2012. On February I, 2012,
This action was subsequently reassigned to the Honorable Gary R. Brown, United
States Magistrate Judge, before any reports and recommendations issued on plaintiffs motions
for default judgments against the Carusos.
plaintiff responded to Magistrate Judge Brown's order by indicating, inter alia: (1) that V.
Caruso had never been served with the amended complaint; and (2) that the request for a Clerk's
entry of default against M. Caruso was improperly attached to the motion seeking entry of a
default judgment against M. Caruso. See Fed. R. Civ. P. 55(a); Local Civ. R. 55.1, 55.2. On that
same date, I vacated the order referring the motions for default judgments against the Carusos to
the Magistrate Judge.
By order dated February 22, 2012: (1) plaintiffs motions for default judgments against
the Carusos were denied; and (2) the parties were directed to file, inter alia, a motion for
substitution pursuant to Rule 25(a) of the Federal Rules of Civil Procedure on or before May 24,
2012, since it had come to the Court's attention that V. Caruso had passed away on January 18,
On February 23, 2012, a pretrial conference was held before me at which counsel for
plaintiff and for Formisano and the Fund ("defense counsel") were present and M. Caruso
appeared pro se. During that conference, a further pretrial conference was scheduled to be held
before me on March 26, 2012 at 11 :15 a.m. Nonetheless, plaintiffs counsel failed to appear at
the March 26, 2012 pretrial conference, as a result of which I granted defense counsel's motion
to dismiss this case for failure to prosecute. Judgment was entered in favor of defendants on
March 28, 2012.
By order dated April23, 2012, I granted plaintiffs motion to set aside the judgment and
reopened this case, conditioned upon plaintiffs counsel's agreement to pay the costs incurred by
defense counsel in connection with his appearance at the March 26, 2012 conference. Defense
counsel was directed to submit a bill for costs.
Pending before the Court are: (I) plaintiffs motions (a) for an extension of time to serve
a summons and the amended complaint upon M. Caruso (Doc. No. 60) and (b) to substitute M.
Caruso, as executor ofthe last will ofV. Caruso, for V. Caruso, deceased (Doc. Nos. 64 and 70);
and (2) M. Caruso's motion for reconsideration of the April23, 2012 order setting aside the
judgment dismissing this case for failure to prosecute.
M. Caruso's motion for reconsideration was timely served upon counsel for all parties
that appeared in this action on May 3, 2012. See Local Civ. R. 6.3 (A "notice of motion for
reconsideration or reargument of a court order determining a motion shall be served within
fourteen (14) days after the entry of the court's determination of the original motion***. There
shall be served with the notice of motion a memorandum setting forth concisely the matters or
controlling decisions which counsel believes the court has overlooked.") In determining a
motion for reconsideration, the court should consider: (I) whether there has been "an intervening
change of controlling law;" (2) whether there is new evidence presented that was not previously
available on the original motion; and (3) whether there is a "need to correct a clear error or
prevent manifest injustice." Virgin Atlantic Airways. Ltd. v. National Mediation BoarQ, 956
F.2d 1245, 1255 (2d Cir. 1992); see also Anwar v. Fairfield Greenwich Ltd., 283 F.R.D. 193,
195-96 (S.D.N.Y. 2012); McGuiness v. East West Industries, 857 F. Supp. 2d 259,267
(E.D.N.Y. 2012). "[R]econsideration will generally be denied unless the moving party can point
to controlling decisions or data that the court overlooked-- matters, in other words, that might
reasonably be expected to alter the conclusion reached by the court." Shrader v. CSX Transp.
Inc., 70 F.3d 255, 257 (2d Cir. 1995); see also Anwar, 283 F.R.D. at 196. It is within the sound
discretion of the district court whether or not to grant a motion for reconsideration. See King
County. Wash. v. IKB Deutsche Industriebank AG, 863 F. Supp. 2d 317, 319 (S.D.N.Y. 2012);
Butto v. Collecto Inc., 845 F. Supp. 2d 491, 494 (E.D.N.Y. 2012).
Although plaintiffs notice of motion seeking to set aside the judgment indicated that M.
Caruso had until April 13, 2012 within which to serve papers in opposition thereto, I granted
plaintiffs motion at a status conference on April 12, 2012, prior to the filing of M. Caruso's
opposition papers. Accordingly, M. Caruso's motion for reconsideration is granted.
Nonetheless, upon consideration ofM. Caruso's papers in opposition to plaintiffs motion to set
aside the judgment, I adhere to my original determination to set aside the judgment for the
reasons set forth below.
Failure to Serve M. Caruso
M. Caruso contends that plaintiffs failure to properly serve him with the summons and
amended complaint, coupled with plaintiffs failure to appear at the March 26,2012 pretrial
conference and to obtain a Clerk's certificate of default upon moving for a default judgment
against him, justified the dismissal of the amended complaint for failure to prosecute.
M. Caruso contends that he was never properly served with the amended complaint and
submits affidavits from himself and Gallagher indicating, inter alia, that Gallagher has not
worked for him or any of his businesses since June 9, 2010; and that the Millstone address was
Gallagher's personal residence at all relevant times, at which M. Caruso neither lived nor
worked. In addition, Gallagher states: (I) that she told the process server that she did not work
forM. Caruso, he did not live at the Millstone address and she would not accept service on his
behalf; (2) that the process server did not leave any papers with her; and (3) that she never
received any mail at the Millstone address that was addressed to M. Caruso or anyone else in
connection with this action.
Plaintiff contends that service of the amended complaint upon M. Caruso was proper
because, according to the process server's affidavit of service, Gallagher identified herself to the
process server as M. Caruso's assistant. (Memorandum in Support of Motion for an Order
Extending the Time for Service upon M. Caruso ["Plf. Mem."], at 2). Nonetheless, plaintiff
seeks an extension of time to effect service upon M. Caruso "in the interest of avoiding the time
and expense of a traverse hearing." (Plf. Mem., at 3).
Rule 4(c) of the Federal Rules of Civil Procedure provides, in relevant part, that "[t]he
plaintiff is responsible for having the summons and complaint served within the time allowed by
Rule 4(m) ***"and Rule 4(1) of the Federal Rules of Civil Procedure requires proof of service,
in the form of a server's affidavit, to be made to the court, unless service is waived in accordance
with Rule 4(d).
Rule 4(m) of the Federal Rules of Civil Procedure provides, in relevant part, as follows:
"If a defendant is not served within 120 days after the complaint is filed, the
court- on motion or on its own after notice to the plaintiff- must dismiss the
action without prejudice against that defendant or order that service be made
within a specified time. But if the plaintiff shows good cause for the failure, the
court must extend the time for service for an appropriate period. * * *"
Thus, pursuant to Rule 4(m), "[i]fthe plaintiff fails to serve a defendant within 120 days
of the filing of the complaint, the court, upon motion or sua sponte, must either dismiss the
action [against that defendant] without prejudice or order that service be made within a specified
time." Thomas v. Shinseki, No. 09-cv-4900, 2011 WL 4753525, at* 3 (E.D.N.Y. Oct. 6, 2011).
"[D]istrict courts have discretion to grant extensions, and may do so even in the absence of 'good
cause."' Meilleur v. Strong, 682 F.3d 56, 61 (2d Cir. 2012), cert. denied, 2012 WL 4373190
(Nov. 26, 2012); see also Gerena v. Korb, 617 F.3d 197,201 (2d Cir. 2010).
Rule 4(e) of the Federal Rules of Civil Procedure provides that an individual defendant
may be served pursuant to the law of the State where either the district court is located or service
is made; or by personal service, leaving copies of the summons and complaint "at the
individual's dwelling or usual place of abode with someone of suitable age and discretion who
resides there," or delivering copies of the summons and complaint to an authorized agent for
service of process. Since the process server's affidavit of service indicates that M. Caruso was
served by leaving copies of the summons and amended complaint at his "actual place of
business," service would only be proper if made pursuant to New York law.
Section 308 of the New York Civil Practice Law and Rules provides, in relevant part, that
an individual may be served "by delivering the summons within the state to a person of suitable
age and discretion at the actual place of business, dwelling place or usual place of abode of the
person to be served and by either mailing the summons to the person to be served at his or her
last known residence or by mailing the summons by first class mail to the person to be served at
his or her actual place of business* * *." Section 308(6) defines "actual place of business" to
include "any location that the defendant, through regular solicitation or advertisement, has held
out as its place of business."
"New York courts have construed 'actual place of business' to include (I) a place where
the defendant regularly transacts business, or (2) an establishment that the defendant owns or
operates, where there is a clear identification of the work performed by her with that place of
business." TAGC Management. LLC v. Lehm
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