Gesualdi et al v. J. H. Reid, General Contractor
DECISION and Order - Based on the foregoing, the Court denies the Defendants 42 motion for relief from the default judgment under Rule 60(b)(1). This case shall remain closed. SEE ATTACHED DECISION for details. So Ordered by Judge Arthur D. Spatt on 2/27/2017. (Coleman, Laurie)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF NEW YORK
THOMAS GESUALDI, LOUIS BISIGNANO, ANTHONY D’AQUILA,
MICHAEL O’TOOLE, BENNY UMBRA, JOSEPH A. FERRARA, SR.,
FRANK H. FINKEL, MARC HERBST, DENISE RICHARDSON, and
THOMAS F. CORBETT as Trustees and fiduciaries of the Local 282
Welfare Trust Fund, the Local 282 Pension Trust Fund, the Local 282
Annuity Trust Fund, the Local 282 Job Training Trust Fund, and the
Local 282 Vacation and Sick Leave Trust Fund,
4:07 pm, Feb 27, 2017
U.S. DISTRICT COURT
EASTERN DISTRICT OF NEW YORK
LONG ISLAND OFFICE
Decision and Order
-againstJ.H. REID, GENERAL CONTRACTOR,
Trivella & Forte LLP
Attorneys for the Plaintiffs
1311 Mamaroneck Ave., Suite 170
White Plains, NY 10605
By: Gina E. Nicotera, Esq.
Jonathan M. Bardavid, Esq., Of Counsel
Tobia & Sorger, LLC
Attorneys for the Defendant
500 Supor Blvd.
Harrison, NJ 07029
By: Ronald L. Tobia, Esq., Of Counsel
SPATT, District Judge:
On August 2, 2016, pursuant to an Order of this Court, a default judgment was entered
against the Defendant J.H. Reid, General Contractor (the “Defendant”), and this case was closed.
Approximately two weeks later, on August 18, 2016, the Defendant filed a motion for relief
from that judgment under Federal Rules of Civil Procedure (“FED. R. CIV. P.”) 55(c) and 60(b)(1).
For the reasons that follow, the Defendant’s motion is denied in its entirety.
Relevant Procedural History
The procedural history of this case has been set forth in detail in prior Orders. Nevertheless,
given the nature of the relief sought, the Court finds that it will be useful to recount the course of
events that have led to this point.
The Events Prior to Defense Counsel’s Appearance
On July 9, 2014, the Plaintiffs Thomas Gesualdi, Louis Bisignano, Anthony D’Aquila, Michael
O’Toole, Benny Umbra, Joseph A. Ferrara, Sr., Frank H. Finkel, Marc Herbst, Denise Richardson, and
Thomas F. Corbett, in their capacity as the trustees and fiduciaries of the Local 282 Welfare Trust
Fund, the Local 282 Pension Trust Fund, the Local 282 Annuity Trust Fund, the Local 282 Job
Training Trust Fund, and the Local 282 Vacation and Sick Leave Trust Fund (collectively, the
“Plaintiffs”) filed a complaint alleging that the Defendant violated Section 502(g)(2) of the Employee
Retirement Income Security Act of 1974, as amended, and Section 301 of the Labor Management
Relations Act of 1947 by failing to make fringe benefit contributions in accordance with the terms of
a collective bargaining agreement. The Plaintiffs sought damages under the statutes and the
agreement, including the unpaid contributions, prejudgment interest, liquidated damages, attorneys’
fees and litigation costs.
The Defendant was personally served with process on July 22, 2014, but did not file an
answer or otherwise respond to the complaint.
On August 11, 2014, the Plaintiffs filed an amended complaint as of right, which added a
cause of action for injunctive relief, namely, an order compelling the Defendant to submit its books
and records for an audit and to pay any amounts that an audit may reveal to be due, together with
On August 13, 2014, the Plaintiffs served the amended complaint by mailing it to the
Defendant’s corporate address. The Defendant does not deny receiving the amended complaint.
On September 2, 2014, after the Defendant failed to answer or otherwise respond to the
amended complaint, the Plaintiffs requested that the Clerk of the Court note the Defendant’s
default. The Plaintiffs served a copy of this request by mailing it to the Defendant’s corporate
address. Again the Defendant does not deny receiving this notice.
The following day, on September 3, 2014, the Clerk of the Court noted the Defendant’s
On October 14, 2014, the Plaintiffs filed a motion for a default judgment. That same day,
copies of the motion and supporting papers were served on the Defendant by first-class mail and
UPS next-day delivery. On October 16, 2014, the Court referred the motion for a default judgment to
United States Magistrate Judge Gary R. Brown.
Between October 16, 2014 and August 12, 2015, the Defendant did not respond to the motion
for a default judgment.
On August 12, 2015, Judge Brown issued a Report and Recommendation (the “First R&R”),
recommending that the Court deny without prejudice the motion for a default judgment. In
particular, Judge Brown noted that, under FED. R. CIV. P. 5(a)(2), a pleading that asserts a new claim
for relief against a party who is in default must be personally served on that party in accordance with
Rule 4. Therefore, Judge Brown concluded that, to the extent that the amended complaint added a
claim for injunctive relief; and because the amended complaint had served by mail rather than
personally served, the Plaintiffs had not satisfied the procedural prerequisites for entitlement to a
On September 16, 2015, the Court adopted the First R&R to the extent that it recommended
denial without prejudice of the Plaintiffs’ motion for a default judgment. However, the Court found
that good cause had been shown to extend, nunc pro tunc, the time for service of the amended
complaint until August 17, 2015, and declined to vacate the Clerk’s entry of default.
In reaching this conclusion, the Court reasoned that:
[T]he Defendant received notice of this action, and the facts upon which it is premised, as
early as July 9, 2014, when the original complaint was properly served upon it. The amended
complaint added forms of relief, but did not materially alter the facts giving rise to the
Nevertheless, in response to the complaint, the Defendant failed to appear or take
any steps to defend the claims against it. Thereafter, on August 11, 2014, the Plaintiffs mailed
a copy of the amended complaint to the Defendant’s corporate address. Although this
mailing does not suffice as proper service under the Federal Rules, there is a strong
probability that it resulted in the Defendant receiving notice that a second complaint had
been filed against it. The Defendant took no action in response to this mailing, or to the
Clerk’s Notice of Default on September 3, 2014 and the mailing of the Plaintiffs’ motion for a
default judgment on October 14, 2014. Accordingly, it does not appear that the Defendant
will suffer any prejudice by this nunc pro tunc extension.
In addition, the Plaintiffs acted promptly upon learning of the error, and properly
served the amended complaint upon the Defendant within one week of the issuance of Judge
Brown’s R&R. See PH Int’l Trading Corp. v. Nordstrom, Inc., 07-cv-10680, 2009 U.S. Dist. LEXIS
27110, at *18-*19 (S.D.N.Y. Mar. 31, 2009) (granting application to extend the time for service
under analogous provision of New York law where, as here, the plaintiff served the relevant
documents upon the defendant “within weeks of discovering that it had not been served”).
Accordingly, the Court finds that an extension of the time to serve the amended complaint is
Furthermore, because the Court deems the Plaintiffs’ August 17, 2015 service timely,
the Defendant had until September 7, 2015 to answer or otherwise respond to the pleading.
See FED. R. CIV. P. 12(a). Having failed to do so, the Court finds that the Defendant is in
default. See Kondaur Capital Corp. v. Cajuste, 849 F. Supp. 2d 363 (E.D.N.Y. 2012) (“Even if the
defendant is served pursuant to a state law method of service [e.g., service upon the New
York Secretary of State] . . . , the Second Circuit has established that ‘under the plain terms of
Federal Rule of Civil Procure 12(a), a defendant has twenty [now twenty-one] days from
receipt of the summons to file an answer unless a federal statute provides otherwise’ ”
(quoting Beller & Keller v. Tyler, 120 F.3d 21, 25-26 (2d Cir. 1997)). Therefore, the Clerk’s entry
of default, although originally issued upon a flawed premise, need not be vacated at this time.
Docket Entry , at 7-8.
The Court granted the Plaintiffs leave to renew their motion for a default judgment within
thirty days of the date of that Order. On September 24, 2015, the Plaintiffs mailed a copy of the
Court’s September 16, 2015 Order to the Defendant, and the Defendant does not deny receiving it.
Thereafter, consistent with the Court’s directives, on September 23, 2015, the Plaintiffs filed
a renewed motion for a default judgment, which was again referred to Magistrate Judge Brown. On
September 25, 2015, copies of the renewed motion and supporting papers were served on the
Defendant by UPS next-day delivery.
The Events Following Defense Counsel’s Appearance
On October 15, 2015, while the renewed motion for a default judgment was on submission,
the law firm of Tobia & Sorger, LLC, by attorney Ronald L. Tobia, Esq., filed a notice of appearance
on behalf of the Defendant.
However, between October 15, 2015 and June 29, 2016, Mr. Tobia did not seek to vacate the
Certificate of Default entered against the Defendant; failed to interpose an answer or other response
to the complaint; and failed even to oppose the motion for entry of a default judgment. In fact,
during this eight-month period, Mr. Tobia took no discernible action with respect to this case.
Thus, on June 29, 2016, Judge Brown issued a second Report and Recommendation (the
“Second R&R”), recommending that: (i) the Plaintiffs’ motion for entry of a default judgment be
granted; (ii) damages in the total amount of $1,030,265.28, representing unpaid contributions,
accrued interest, liquidated damages, attorneys’ fees, and costs, be awarded to the Plaintiffs;
(iii) continuing per diem interest at the rate of $291.74, from October 1, 2014 until judgment is entered,
also be awarded; and (iv) the portion of the motion seeking injunctive relief be denied.
In relevant part, the Second R&R stated that:
Any written objections to this Report and Recommendation must be filed with the Clerk of
the Court within fourteen (14) days of service of this report. 28 U.S.C. § 636(b)(1) (2006 &
Supp. V 2011); Fed. R. Civ. P. 6(a), 72(b). Any requests for an extension of time for filing
objections must be directed to the district judge assigned to this action prior to the
expiration of the fourteen (14) day period for filing objections. Failure to file objections
within fourteen (14) days will preclude further review of this report and
recommendation either by the District Court or Court of Appeals. Thomas v. Arn, 474 U.S.
140, 145 (1985) (“[A] party shall file objections with the district court or else waive right to
appeal.”); Caindor v. Onondaga Cnty., 517 F.3d 601, 604 (2d Cir. 2008) (“[F]ailure to object
timely to a magistrate’s report operates as a waiver of any further judicial review of the
Docket Entry , at 18 (emphasis in original).
On June 30, 2016, the Plaintiffs served copies of the Second R&R, via UPS next-day delivery,
on the Defendant at its corporate address and to Mr. Tobia at his law firm.
On July 13, 2016, one day before the expiration of the deadline for filing objections, Mr. Tobia
filed a letter motion requesting a four-week extension of time to object to the Second R&R. In his
letter motion, Mr. Tobia identified two reasons why additional time was necessary: (1) despite
entering an appearance in this case nine months earlier, his law office was still in the process of
“review[ing] the issues in this matter”; and (2) although the two-week objections period had nearly
lapsed, an associate at the firm, namely, Michael A. DeMarco, Esq., who was apparently assisting
Mr. Tobia on this case, was scheduled to be married the following weekend (July 16, 2016-July 17, 2016)
and would be away on his honeymoon until August 2016.
On July 14, 2016, the Court granted in part and denied in part Mr. Tobia’s request, stating
The Defendant has already had two weeks to file objections to Judge Brown’s R&R,
and the Court finds that an additional four-week extension is not warranted under
the circumstances. A modest and final two-week extension, until 7/28/16, is granted.
Defense counsel received service of this Order via ECF that same day. Nevertheless, the
extended deadline to file objections, namely, July 28, 2016, passed without any party filing a timely
objection to the Second R&R.
On July 29, 2016, despite the Court’s indication that the two-week extension previously
granted to the Defendant had been “final,” Mr. Tobia filed a second letter motion seeking a further
extension of time to file objections to the Second R&R. This time, Mr. Tobia stated that additional
time was needed, as he had been ill, and Mr. DeMarco was still on his honeymoon.
By Order dated July 29, 2016, the Court denied Mr. Tobia’s untimely request for a second
extension of time to file objections; adopted Magistrate Judge Brown’s Second R&R in its entirety;
and directed the Clerk of the Court to enter judgment in favor of the Plaintiffs and close the case.
As noted above, approximately two weeks after the case was closed, the Defendant filed a
motion seeking to vacate the default judgment.
The Standard of Review
Under FED. R. CIV. P. 60(b)(1), the Court may relieve a party from a final judgment based on
a showing of excusable neglect. In deciding whether to grant relief under this section, “the court’s
determination must be guided by three principal factors: ‘(1) whether the default was willful,
(2) whether the defendant demonstrates the existence of a meritorious defense, and (3) whether,
and to what extent, vacating the default will cause the nondefaulting party prejudice.’ ” State St. Bank
& Tr. Co. v. Inversiones Errazuriz Limitada, 374 F.3d 158, 166-67 (2d Cir. 2004) (quoting S.E.C. v. McNulty,
137 F.3d 732, 738 (2d Cir. 1998)).
However, “[o]f these three criteria, ‘willfulness is preeminent, and a willful default will not
normally be set aside.’ ” Arista Records, Inc. v. Musemeci, No. 03-cv-4465, 2007 U.S. Dist. LEXIS 81630, at
*12 (E.D.N.Y. Sept. 19, 2007) (quoting MacEwen Petroleum, Inc. v. Tarbell, 173 F.R.D. 36, 39 (N.D.N.Y.
1997)); see Hernandez v. La Cazuela de Mari Rest., Inc., 538 F. Supp. 2d 528, 534 (E.D.N.Y. 2007)
(notwithstanding the other factors, “a default judgment should not be vacated if the default was
willful”); Finkel v. Hall-Mark Elec. Supplies Corp., No. 07-cv-2376, 2011 U.S. Dist. LEXIS 76716, at *8
(E.D.N.Y. July 12, 2011) (“If a default is determined to be willful, that fact alone can justify denying a
motion to vacate a default judgment”).
Ultimately, the decision to vacate a final judgment is within the sound discretion of the
Court and will not be disturbed except to correct an abuse of discretion. See State St. Bank & Tr. Co.,
374 F.3d at 166.
The Defendant’s Default Was Willful, Precluding a Finding of Excusable Neglect
The Applicable Legal Principles
“In the context of a motion to vacate a default judgment, ‘ ‘excusable neglect’ is to be
construed generously,’ ” and the willfulness standard “should not be interpreted to include careless
or negligent errors,” which “can appropriately be considered excusable.” Am. Arbitration Ass’n v.
Defonseca, No. 93-cv-2424, 1997 U.S. Dist. LEXIS 2433, at *3 (S.D.N.Y. Mar. 6, 1997) (quoting Am.
Alliance Ins. Co. v. Eagle Ins. Co., 92 F.3d 57, 58, 61 (2d Cir. 1996)).
Rather, the Second Circuit has interpreted “willfulness” “to refer to conduct that is more
than merely negligent or careless,” McNulty, 137 F.3d at 738, and “ ‘will look for bad faith, or at least
something more than mere negligence, before rejecting a claim of excusable neglect based on an
attorney’s or a litigant’s error,’ ” Yan v. Bocar, No. 04-cv-4194, 2005 U.S. Dist. LEXIS 28390, at *39
(S.D.N.Y. Sept. 8, 2005) (Report and Recommendation), adopted, 2005 U.S. Dist. LEXIS 28387
(S.D.N.Y. Sept. 30, 2005); see Hernandez, 538 F. Supp. 2d at 532 (noting that “[t]he willfulness
standard encompasses conduct that is deliberate or egregious or is carried out in bad faith”); King v.
Galluzzo Equip. & Excavating, Inc., 223 F.R.D. 94, 97 (E.D.N.Y. 2004) (“The boundary of willfulness lies
somewhere between a case involving a negligent filing error, which is normally considered an
excusable failure to respond, and a deliberate decision to default, which is generally not excusable”).
For example, “[a] default is deemed willful where a defendant simply ignores the complaint
without action.” Circuito Cerrado, Inc. v. LV Foods, Inc., 296 F.R.D. 122, 126 (E.D.N.Y. 2013) (quoting
Arista Records, Inc., 2007 U.S. Dist. LEXIS 81630, at *12). “Thus, ‘where a party is notified that he is in
default and he apparently makes no effort to appear pro se or to explain his situation to the court,
such neglect is inexcusable.’ ” Arista Records, Inc., 2007 U.S. Dist. LEXIS 81630, at *13 (quoting Yan,
2005 U.S. Dist. LEXIS 28390, at *39-*40); cf. Kauhsen v. Aventura Motors, Inc., No. 09-cv-4114, 2010 U.S.
Dist. LEXIS 55554, at *13 (E.D.N.Y. June 7, 2010) (noting that “[w]illfulness includes conduct that is
‘not satisfactorily explained’ ” (quoting McNulty, 137 F.3d at 738)); Domond v. Great Am. Rec., Inc., 116
F. Supp. 2d 368, 374 (E.D.N.Y. 2000) (Spatt, J.) (noting that “willfulness may be inferred where a
party’s conduct was egregious and not adequately explained”); Frost Belt Int’l Recording Enters., Inc. v.
Cold Chillin’ Records, 758 F. Supp. 131, 136 (S.D.N.Y. 1990) (“[U]tter failure to explain the default
effectively precludes a finding of excusable neglect”).
In general, no exception is made for neglectful conduct that is attributable to an attorney.
On the contrary, the Second Circuit has “consistently declined to relieve a client under
subsection (1) of the ‘burdens of a final judgment entered against him due to the mistake or omission
of his attorney by reason of the latter’s ignorance of the law or other rules of the court, or his
inability to efficiently manage his caseload.’ ” Nemaizer, 793 F.2d at 62 (collecting cases).
In this regard, “[a]lthough the court may consider [a] counsel’s illness, regardless of its
seriousness, illness alone is not a sufficient basis for setting aside a judgment under Rule 60(b)(1).”
Carcello v. TJX Cos., 192 F.R.D. 61, 64 (D. Conn. 2000) (citing Andree v. Ctr. for Alternative Sentencing and
Employment Servs., Inc., No. 92-cv-616, 1993 U.S. Dist. LEXIS 12697, at *4-*6 (S.D.N.Y. Sept. 14, 1993));
see Lehr Constr. Corp. v. Flaxer, No. 16-cv-4048, 2017 U.S. Dist. LEXIS 15047, at *12-*13 (S.D.N.Y. Feb. 2,
2017) (noting, as a general matter, that “[i]lness or disability alone does not constitute excusable
neglect,” and explaining that, “[w]hile courts will occasionally rely on the illness or disability of a
party or attorney when finding excusable neglect, these cases involve extraordinary circumstances,
such as a sudden, unexpected, or catastrophic illness, or the party has pointed to specific facts and
circumstances demonstrating why the illness or disability caused them to miss the original
deadline”); Epps v. City of Schenectady, No. 10-cv-1101, 2013 U.S. Dist. LEXIS 116083, at *8-*9 (N.D.N.Y.
Aug. 16, 2013) (noting that an attorney’s illness only provides grounds for excusable neglect where
the illness is shown to be “so physically and mentally disabling that counsel is unable to file
[required documents] and is not reasonably capable of communicating to co-counsel his inability to
file” (internal quotation marks and citation omitted)); see also Carcello, 192 F.R.D. at 65 (noting that
the Rules of Professional Conduct “make it clear that if an illness interferes or potentially interferes
with counsel’s competence, diligence, and effective representation of a client, the prudent and
professionally responsible attorney must make alternative arrangements for his clients and
withdraw from their representation until such time as he is able to provide competent, diligent, and
This is particularly true when the attorney claiming to have been ill for Rule 60(b) purposes
failed during the course of the litigation to sufficiently communicate with opposing counsel or the
Court regarding the serious nature of his medical condition, or to avail himself of procedural
safeguards designed to afford litigants and their counsel reasonable extensions of time and other
leniencies. See Carcello, 192 F.R.D. at 64; Long v. Carberry, 151 F.R.D. 240, 243 (S.D.N.Y. 1993) (with
regard to counsel’s argument regarding illness, reasoning that, “[r]ather than showing excusable
neglect, [ ] plaintiff ha[d] demonstrated that his lawyer either made a tactical decision not to file
responsive papers or was ignorant of the procedural rules governing extensions of time in the federal
courts”; either way, “plaintiff [was] not entitled to relief under Rule 60(b)(1)”); see also Martin v.
Giordano, 185 F. Supp. 3d 339, 364 (E.D.N.Y. 2016) (observing that, if the attorney in fact “suffered
from a physical or mental condition that impaired his ability to represent his client and comply with
court orders, it was incumbent upon him to provide prompt and appropriate notification and, if
necessary, to withdraw his representation”).
Even more so, an attorney’s claims of illness will not justify relief from a default judgment if
the lawyer was actually engaged in other facets of the case during the same time period. See Lehr
Constr. Corp., 2017 U.S. Dist. LEXIS 15047, at *13 (claims of illness were insufficient to justify
excusable neglect where, during the same time that an attorney claimed to be disabled, he filed a
different motion in the case); Epps, 2013 U.S. Dist. LEXIS 116083, at *9-*10 (in the same context, the
allegedly disabled lawyer filed a letter and traveled to the courthouse to inquire about a court ruling
without ever mentioning his illness).
Relevant here, this necessarily includes engaging in settlement discussions rather than
taking affirmative actions to avoid a default judgment. See United States v. Cejas, No. 03-cv-1720, 2005
U.S. Dist. LEXIS 1462, at *3-*4 (D. Conn. Feb. 3, 2005) (rejecting a theory of excusable neglect
where, rather than claim that their failure to appear was due to inadvertence or mistake, the
defendants “acknowledged that they were aware of the claim against them and had entered into
unsuccessful settlement negotiations with the plaintiff”; reasoning that “[a]lthough there is no bad
faith apparent in the decision not to defend this suit in court, defendants acknowledge a conscious
decision not to file an appearance or answer . . . In these circumstances, defendants’ conduct must be
deemed willful” (internal citation omitted)); see also ARA Servs., Inc. v. Olympia Vending & Amusement
Corp., No. 88-cv-794, 1990 U.S. Dist. LEXIS 3578, at *5-*6 (S.D.N.Y. Apr. 4, 1990) (noting that
“settlement negotiations alone do not excuse a defendant’s failure to answer within the prescribed
time”); Richardson Greenshields Secs., Inc. v. Int’l Petroleum Corp., No. 84-cv-2680, 1985 U.S. Dist. LEXIS
20974, at *10 (S.D.N.Y. Apr. 8, 1985) (holding that “[a] party cannot make a strategic decision to
ignore an action in order to engage in settlement negotiations” – “neither impecuniosity nor an
avowed preference for settling a dispute, relieves a party from answering or otherwise defending an
This also remains true when, due to inconsistent explanations, the credibility of the
attorney’s alleged medical condition is called into question. See Carcello, 192 F.R.D. at 64 (reasoning
that, although the plaintiff offered his counsel’s illness as a basis for Rule 60(b) relief, he previously
cited different reasons for his attorney’s failings; the court found these “inconsistent explanations”
“troubling and [sufficient to] cast doubt upon counsel’s credibility”); cf. United States v. Chesir, 862
F. Supp. 2d 286, 291 (E.D.N.Y. 2012) (“post hoc rationalization” based on defendant’s illness was
incapable of establishing excusable neglect).
“The reason behind this seemingly harsh rule is that generally, ‘the conduct of an attorney is
imputed to his client, for allowing a party to evade the consequences of the acts or omissions of his
freely selected agent would be wholly inconsistent with our system of representative litigation, in
which each party is deemed bound by the acts of his lawyer-agent.’ ” Alvarado, 2003 U.S. Dist. LEXIS
19339, at *8 (quoting Aalmuhammed v. Kesten, No. 98-cv-171, 2003 U.S. Dist. LEXIS 415, at *14 (S.D.N.Y.
Jan. 14, 2003)).
Even so, counseled litigants themselves have a burden to act with diligence.
Aalmuhammed, 2003 U.S. Dist. LEXIS 415, at *15 (“Even where an attorney has inexcusably and
completely abandoned his responsibilities to his client, [ ] a party must still demonstrate his own
diligent efforts to induce the attorney ‘to fulfill his duty’ ” (quoting Dominguez v. United States, 583 F.2d
615, 618 (2d Cir. 1978)). In this regard, the Second Circuit has explained that:
where a party fails to act with diligence, he will be unable to demonstrate that his conduct
constituted “excusable neglect.” See Martella v. Marine Cooks & Stewards Union, 448 F.2d 729, 730
(9th Cir. 1971) (per curiam); see also 11 Charles Alan Wright & Arthur R. Miller, Federal
Practice and Procedure § 2858, at 288-89 (2d ed. 1995) (“Insufficient showings for relief [under
Rule 60(b)(1)] . . . include when the party or attorney did not act diligently”); 12 James Wm.
Moore et al., Moore’s Federal Practice § 60.41[c][ii], at 60-90 (3d ed. 1997) (“Courts repeatedly
deny relief [pursuant to 60(b)(1)] when they find that the facts and circumstance[s]
demonstrate a lack of diligence in pursuing or defending litigation.”). Cf. Ramseur v. Beyer, 921
F.2d 504, 506 (3d Cir. 1990) (recognizing that a court must be satisfied that attorneys acted
with substantial diligence before finding “excusable neglect”). Hence, when a party
demonstrates a lack of diligence in defending a lawsuit, a court need not set aside a default
judgment. See Florida Physician’s Ins. Co. v. Ehlers, 8 F.3d 780,784 (11th Cir. 1993) (per curiam).
State St. Bank & Tr. Co., 374 F.3d at 177.
With this legal framework in mind, the Court now turns to the parties’ substantive
Application to the Facts of this Case
In this case, the Defendant argues that its default was due to excusable neglect, and was
therefore not willful, for two reasons.
First, the Defendant contends that, at an unspecified time at or about the “time that
Plaintiffs served . . . their Complaint and their Amended Complaint,” the Executive Vice President of
the corporate Defendant, who “had intimate knowledge of the facts surrounding the instant matter”
retired, resulting in the Defendant “neglect[ing] to notify its counsel of this matter until after a
default was entered.” See Def. Memo of Law at 1, 4-5. In the Court’s view, this argument is patently
insufficient to warrant the relief sought.
Initially, the alleged facts giving rise to this explanation are asserted only by counsel in a
legal memorandum, and are not supported by an affidavit of anyone associated with the corporate
Defendant or any other pertinent evidence.
Nevertheless, even if the Court were inclined to accept this explanation based on counsel’s
word alone, the Defendant’s argument omits material facts that preclude recovery. For example, the
record is lacking any indication of when the Defendant’s Executive Vice President retired and
specific reasons why his or her retirement caused the corporate Defendant to fail for more than a
year to take any action in this case. Although the Defendant states that this officer’s retirement
occurred “[d]uring time that Plaintiffs served . . . their Complaint and their Amended Complaint,”
this explanation fails to appropriately account for the fact that, between July 22, 2014 and
September 25, 2015 – a period of fourteen months – the Defendant was served with no less than
seven sets of papers, including the Plaintiffs’ request for a Certificate of Default; the Plaintiffs’ initial
motion for a default judgment; Judge Brown’s First R&R; this Court’s Order partially adopting the
First R&R; and the Plaintiffs’ renewed motion for a default judgment. As noted, the Defendant does
not deny that it actually received all of these filings but failed to take any responsive action.
Thus, under these circumstances, and based solely on counsel’s unsupported argument, the
Court is unable to conclude that the retirement of an unidentified corporate officer, at or about the
time the original complaint was filed, is a satisfactory reason to excuse the Defendant’s failure for
more than a year to do anything with regard to this case, even after being notified of its default.
This is particularly true since the Defendant has failed to identify even a single legal
authority in support of its position. Rather, as discussed above, the caselaw of which the Court is
aware seems to strongly reject the premise that internal mismanagement constitutes the type of
excusable error that justifies relief under Rule 60(b)(1). On the contrary, as set forth in detail above,
where, as here, “ ‘a party is notified that he is in default and he apparently makes no effort to appear
pro se or to explain his situation to the court, such neglect is inexcusable.’ ” Arista Records, Inc., 2007
U.S. Dist. LEXIS 81630, at *13; see King, 223 F.R.D. at 97 (noting that “[t]he boundary of willfulness
lies somewhere between a case involving a negligent filing error, which is normally considered an
excusable failure to respond, and a deliberate decision to default, which is generally not excusable”).
Further, in this case, there is no evidence tending to show that the Defendant acted with the
requisite diligence to warrant relief from the default judgment, and the conclusory explanation that
the retirement of a single officer resulted in the Defendant’s prolonged period of indolence is
insufficient to warrant a different result. See State St. Bank & Tr. Co., 374 F.3d at 177 (“[W]here a party
fails to act with diligence, he will be unable to demonstrate that his conduct constituted 'excusable
The Defendant’s alternative explanation – which shifts the focus from the corporate
Defendant to its lawyer – fares no better. In particular, the Defendant contends that, after retaining
Mr. Tobia in October 2015, a serious illness prevented him from timely objecting to the Second
R&R, and thus averting the entry of a default judgment.
In a supporting declaration, which neither attached relevant medical evidence nor included a
diagnosis, Mr. Tobia stated only that, at or about the same time that Judge Brown issued the Second
R&R, namely, June 29, 2016, he “was dealing with a chronic health condition flare-up,” the
treatment for which “required [his] absence and complete bed rest.” See Aug. 18, 2016 Declaration of
Ronald L. Tobia (“Tobia Decl.”), DE [42-2], at ¶ 14. In this regard, although his affidavit offers to
supply a physician’s note “to establish [his] incapacity,” id., the record otherwise fails to set forth any
details that would allow the Court to conclude that Mr. Tobia’s alleged illness constitutes excusable
neglect for purposes of Rule 60(b)(1).
First, as discussed above, even assuming the truth of Mr. Tobia’s assertions regarding his
illness, it is well-settled that illness alone is not a sufficient basis for setting aside a judgment under
Rule 60(b)(1). See, e.g., Carcello, 192 F.R.D. at 64. That is to say nothing of the fact that, due to Mr.
Tobia’s failure to set forth any specific details concerning his condition; the timing of his alleged
flare-up; or particularized reasons other than a general need for “bed rest” why he or other attorneys
at his law firm were prevented from taking any steps whatsoever to avert a default judgment, the
Court cannot determine that Mr. Tobia’s illness was “so physically and mentally disabling” that he
was unable to adequately represent the Defendant’s interests. See Epps, 2013 U.S. Dist. LEXIS 116083,
In any event, assuming that an attorney’s illness may constitute a proper basis for Rule
60(b)(1) relief; and further assuming that Mr. Tobia adequately detailed and supported his alleged
incapacity; the fact that his illness worsened at approximately the same time that objections were
due to the Second R&R nevertheless fails to account for the eight-month period between October
15, 2015 and June 29, 2016, during which he neglected to take any action to vacate the Clerk’s
Certificate of Default; to interpose an answer or other response to the complaint; or, most
importantly, to seek leave to oppose the motion for entry of a default judgment. Contrary to his
current assertions, the Court finds that Mr. Tobia inexcusably took no discernible action to avoid
the entry of a default judgment during this time.
Further, again, drawing every inference in the Defendant’s favor, Mr. Tobia’s health-based
explanation simply is not an adequate excuse. In this regard, as the Court already noted, the
existence of excusable neglect is more unlikely where, due to inconsistent explanations, the
credibility of the attorney’s alleged medical condition is called into question. See Carcello, 192 F.R.D.
at 64. Here, as noted, for eight months between October 2015 and June 2016, Mr. Tobia did not
bring his alleged medical condition to the Court’s attention as a reason for failing to take any
identifiable action in this case.
Nor did Mr. Tobia raise his medical condition as a basis for seeking a four-week extension of
time to object to the Second R&R after the original two-week objections period had nearly lapsed.
Rather, importantly, Mr. Tobia identified two different reasons why additional time was
necessary – namely, that his law office was still “review[ing] the issues in this matter,” and that an
associate at the firm who was working on this case was scheduled to be married the following
weekend. In the Court’s view, Mr. Tobia’s failure to assert his medical condition at the time he now
claims he was seriously ill raises questions about the reliability of his current position. Indeed, it
was not until Mr. Tobia filed a second, untimely request for an extension of time to object to the
Second R&R that he stated for the first time that he had “been out of the office ill.” Even then, he
again cited the extended honeymoon of his associate Michael DeMarco as a basis for his inability to
In this regard, the Court is also troubled by Mr. Tobia’s assertion in his sworn affidavit that
he is “the only attorney handling this matter from [his] law firm,” see Tobia Decl. ¶ 3, which
obviously contradicts his prior assertions, made in letter motions filed on July 13, 2016 and July 29,
2016, regarding the impact of attorney DeMarco’s absence on the firm’s ability to timely object to the
Finally, the Court finds that Mr. Tobia’s alleged illness does not constitute excusable neglect
because, during the prolonged period of time during which Mr. Tobia failed to take any action to
forestall the entry of a default judgment, he concedes that he was engaged in negotiations to settle
this matter out of Court. See Tobia Decl. ¶ 11 (“During this lengthy interim between filing my notice
of appearance and the issuance of the [Second R&R] . . . Counsel for Plaintiffs and I had numerous
conferences concerning settlement and resolving this matter on terms that were both acceptable and
feasible for Defendant”); id. ¶ 12 (conceding that settlement negotiations were ongoing during the
period to file objections to the Second R&R); id. ¶ 18 (noting that the Defendant “directed [Mr.
Tobia] to conserve legal expenses during settlement negotiations rather than directly defending this
action through the Court”); see also Def. Memo of Law at 1 (“Once counsel for Defendant Reid was
informed of this matter, it participated in settlement conferences in attempts to amicably resolve the
matter without resorting to protracted litigation”).
As discussed above, where, as here, the Defendant “acknowledge[s] a conscious decision not
to file an appearance or answer,” electing instead to “enter[ ] into unsuccessful settlement
negotiations with the plaintiff” in an effort to conserve resources, the Defendant’s conduct “must be
deemed willful.” Cejas, 2005 U.S. Dist. LEXIS 1462, at *3-*4; see also ARA Servs., Inc., 1990 U.S. Dist.
LEXIS 3578, at *5-*6; Richardson Greenshields Secs., Inc., 1985 U.S. Dist. LEXIS 20974, at *10.
Accordingly, the Court finds that the Defendant’s failure to defend this action was deliberate
and willful, and not the result of an excusable error. Therefore, in its discretion, the Court finds that
the Defendant has not sufficiently demonstrated its entitlement to relief from the default judgment
under Rule 60(b)(1), and its current motion to vacate the default judgment is denied in its entirety.
Based on the foregoing, the Court denies the Defendant’s motion for relief from the default
judgment under Rule 60(b)(1). This case shall remain closed.
It is SO ORDERED.
Dated: Central Islip, New York
February 27, 2017
/s/ Arthur D. Spatt__________________________
ARTHUR D. SPATT
United States District Judge
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