Nissan Motor Acceptance Corporation v. Five Towns Nissan, LLC et al

Filing 89

MEMORANDUM & ORDER denying 84 Motion for Reconsideration; For the stated reasons, Plaintiff's motion for reconsideration (ECF No. 84) is DENIED. The Court renews its referral to Judge Lindsay to schedule a settlement and/or discovery confere nce for Plaintiff to discover any additional information from Defendant regarding its claims of forgery and the execution of the Promissory Note (see Order at 21 n.9). The stay entered June 30, 2020 is LIFTED and within thirty (30) days of the date of this Order, the parties are to submit a joint letter as set forth herein. So Ordered by Judge Joanna Seybert on 12/17/2020. C/ECF (Valle, Christine)

Case 2:16-cv-07028-JS-ARL Document 89 Filed 12/17/20 Page 1 of 11 PageID #: 1640

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF NEW YORK
-----------------------------------X
NISSAN MOTOR ACCEPTANCE CORPORATION,
Plaintiff,
MEMORANDUM & ORDER
16-CV-7028(JS)(ARL)

-againstFIVE TOWNS NISSAN, LLC,
SHMUEL WOLF, NEIL BARBAGALLO,
and ALEX KORCHMAR,

Defendants.
-----------------------------------X
APPEARANCES
For Plaintiff:
Richard A. Braden, Esq.
Goldberg Segalla LLP
711 Third Avenue, Suite 1900
New York, New York 10017
Louis Arnold Russo, Esq.
Russo Law LLC
276 Fifth Avenue, Suite 704
New York, New York 10001
For Defendant
Shmuel Wolf:

Annie P. Kubic, Esq.
Philip Joseph Campisi, Jr., Esq.
Westerman Bail Ederer Miller Zucker &
Sharfstein, LLP
1201 RXR Plaza
Uniondale, New York 10601

SEYBERT, District Judge:
Currently before the Court is Plaintiff Nissan Motor
Acceptance Corporation’s (“Plaintiff”) motion for reconsideration
of the Memorandum & Order, dated May 29, 2020, denying Plaintiff’s
motion for summary judgment.

(“Order,” ECF No. 83; Mot., ECF No.

84; Pl. Br., ECF No. 84-1; Def. Opp., ECF No. 87; Pl. Reply, ECF
No. 88.)

For the reasons that follow, the motion is DENIED.

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BACKGROUND
The

Court

presumes

familiarity

with

the

facts

and

procedural history of his case and recites only those necessary to
adjudicate the pending motion.

(See Order at 2-16); see also

Nissan Motor Acceptance Corp. v. Five Towns Nissan, LLC, No. 16CV-7028, 2018 WL 895533, at *1-*2 (E.D.N.Y. Feb. 14, 2018).
I.

Facts
In

brief,

Plaintiff

initiated

this

action

against

defendant Shmuel Wolf (“Defendant”)1 asserting claims for (1)
breach of continuing guaranties (Count I) and (2) attorneys’ fees,
costs, and expenses (Count II), among others.

Specifically,

Plaintiff entered into two separate Automotive Wholesale Financing
and Security Agreements with Five Towns Nissan, LLC (the “Nissan
Dealership”)

and

Five

Dealership,”

and

together

“Dealerships”).
purportedly

Towns

Automotive,

with

the

LLC

Nissan

(the

“Chrysler

Dealership,

the

In connection with these agreements, Defendant

executed

certain

guaranty

agreements

in

favor

of

Plaintiff for all “obligations and liabilities” incurred by the
Dealerships (the “Guaranty Agreements”).
entered into additional agreements.

The parties subsequently

Defendant admits that he

entered into the Nissan Guaranty Agreement but denies entering
into any other agreement.

As discussed in prior orders, Shmuel Wolf is the sole remaining
defendant.
1

2

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The Dealerships defaulted on their payment obligations
and Plaintiff initiated a “Replevin Action” against Defendant,
among others.

See Replevin Action, No. 14-CV-5144 (E.D.N.Y. 2014)

(Wexler, J.).

During the pendency of the Replevin Action, co-

defendant Alex Korchmar (“Korchmar”), in his individual capacity,
and the Dealerships, by Defendant, executed a Promissory Note under
which they promised to pay Plaintiff $2,830,797.00 in monthly
installments.

(Promissory Note, ECF No. 76-13.)

The Promissory

Note was secured by an Affidavit of Confession of Judgment, signed
by Korchmar, in his individual capacity, and the Dealerships, by
Defendant.

(Confession of J., ECF No. 76-14, ¶ 5.)

Defendant

admits that he signed the Promissory Note and the Affidavit of
Confession of Judgment on behalf of the Dealerships as their
“Operations Manager/Member,” but maintains that he did not “agree
to confess to any judgment and/or Note or other payment obligations
to [Plaintiff], individually.”

(Def. 56.1 Stmt., ECF No. 81, ¶

24; Wolf Decl., ECF No. 79, ¶ 39.)
The Affidavit of Confession of Judgment provides that
the Dealerships and Korchmar “jointly and severally confess[ed]
judgment

and

authoriz[ed]

the

entry

thereof

against

[the

Dealerships and Korchmar] in the same of $2,830,797.00 or for such
lesser amount as may be due pursuant to the terms of certain
Promissory Note they executed in favor of plaintiff in January
2015.” (Id. ¶ 5.) Korchmar and the Dealerships defaulted on their
3

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obligations

under

the

Promissory

Note

and

on

July 21, 2015,

Plaintiff entered the Affidavit of Confession of Judgment to
recover $1,848,128.54 (the “Judgment”).

(Judgment, ECF No. 76-

15.)
Defendant

submitted

a

December 12, 2014

email

chain

outlining “Final [ ] Conditions for Closing,” wherein Plaintiff
listed

certain

conditions

required

“to

release

its

security

interest to the extent of any collateral sold” by the Dealerships
(the “December 12 Email”).
1.)

(Dec. 12, 2014 Email, ECF No. 79-9, at

In the email, Plaintiff required, among other things, the

execution of the Promissory Note and Confession of Judgment, with
“all payments to be credited in the following order: (1) first, to
the [Nissan Dealership] floor plan deficiency, (2) second, to the
Overpayment amount, (3) third, to the [Chrysler Dealership] floor
plan deficiency, and (4) finally, to the unpaid Capital Loan (Loan
#

3476-20001)

statement.”
parties

amount

as

listed

in

[Plaintiff’s]

(Dec. 12, 2014 Email at 1, ¶ 4.)

purportedly

agreed

that

the

closing

Per the email, the

Promissory

Note

and

the

Confession of Judgment would “not reference [Defendant] in his
individual capacity.”

(Id. at 1, ¶ 4.)

The email also states

that Plaintiff required “written acknowledgment by Guarantors
that, by releasing its security interest, [Plaintiff] is not
waiving or discharging any rights I may have to enforce the
Guaranty Agreements with respect to any post-closing deficiencies
4

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or breaches.” (Id. at 1, ¶ 5.) Neither party submitted additional
details surrounding the “Conditions for Closing” and whether the
terms were accepted, denied, or modified.
II.

The Court’s Summary Judgment Order
On September 30, 2019, Plaintiff moved this Court for

summary judgment arguing that Defendant is personally liable for
the Judgment under the various Guaranty Agreements.
Br., ECF No. 76-1, at 8, 13-14.)

(Pl. Summ. J.

On May 29, 2020, the Court denied

the motion finding “an issue of material fact exists as to whether
the parties intended for Defendant to maintain responsibility for
the Nissan Dealership’s obligations through the negotiation of the
Promissory
Judgment.”

Note

secured

by

(Order at 19.)

the

Affidavit

and

Confession

of

The Court recognized that the “the

Nissan Guaranty contains an ‘advance consent to modifications’
clause, which is valid and enforceable under New York Law,”
however, various case-specific considerations counseled against
summary judgment because “an issue exists as to whether the parties
entered into ‘a new enforceable obligation that superseded the
Plaintiff’s

rights

under

the

past’

agreements

Defendant’s obligations under any guaranty.”

and

discharged

(Id. at 23-24.)

“Important in this analysis” was the December 12 Email that
Plaintiff argued was “unauthenticated” and inadmissible under
Federal Rule of Civil Procedure 37(c)(1)

(Id. at 20-21 & n.9; Pl.

Summ. J. Reply, ECF No. 82, at 2-4.)

Nonetheless, the Court

5

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considered the December 12 Email because “Defendant may be able to
authenticate it at trial and because Defendant disclosed it on
February 28, 2019 as an exhibit in its Rule 56.1 Statement.”

(Id.

at 21 n.9 (citations omitted).)
ANALYSIS
I.

Legal Standards
“A motion for reconsideration should be granted only

when the [movant] identifies an ‘intervening change of controlling
law, the availability of new evidence, or the need to correct a
clear error or prevent manifest injustice.’”

Kolel Beth Yechiel

Mechil of Tartikov, Inc. v. YLL Irrevocable Trust, 729 F.3d 99,
104 (2d Cir. 2013) (quoting Virgin Atl. Airways, Ltd. v. Nat’l
Mediation Bd., 956 F.2d 1245, 1255 (2d Cir. 1992)).

A motion for

reconsideration is “not a vehicle for relitigating old issues,
presenting the case under new theories, securing a rehearing on
the merits, or otherwise taking a second bite at the apple.”
Analytical Surveys, Inc. v. Tonga Partners, L.P., 684 F.3d 36, 52
(2d Cir. 2012) (quoting Sequa Corp. v. GBJ Corp., 156 F.3d 136,
144 (2d Cir. 1998)) (internal quotation marks omitted).

Indeed,

“[i]t is black letter law that a motion for reconsideration may
not

be

used

to

advance

new

facts,

previously presented to the Court[.]”

issues

or

arguments

not

Nat’l Union Fire Ins. Co.

of Pittsburg, PA v. Las Vegas Prof’l Football Ltd. P’ship, 409 F.
App’x 401, 403 (2d Cir. 2010) (summary order) (internal quotation

6

Case 2:16-cv-07028-JS-ARL Document 89 Filed 12/17/20 Page 7 of 11 PageID #: 1646

marks and citations omitted).

The standard for granting a motion

for reconsideration is “strict, and reconsideration will generally
be

denied

unless

the

moving

party

can

point

decisions or data that the court overlooked.”

to

controlling

Analytical Surveys,

684 F.3d at 52 (quoting Shrader v. CSX Transp., Inc., 70 F.3d 255,
257 (2d Cir. 1995)).
II.

Discussion
Plaintiff’s motion for reconsideration fails because it

advances “arguments of the kind strictly outside the realm of
reconsideration; namely, rehashing arguments previously made and
‘relitigat[ing] . . . issue[s] already decided.’”

Heredia v.

Americare, Inc., No. 17-CV-6219, 2020 WL 4748295, at *1 (S.D.N.Y.
Aug. 17, 2020) (quoting Shrader, 70 F.3d at 257) (alterations in
original).
First,

Plaintiff

argues

that

the

Court

overlooked

“controlling decisions which reflect that, under New York law, a
guarantor to a loan agreement may consent to modifications to the
initial underlying loan terms (and commit to the guaranty of future
obligations of the principal, among other things) in advance, and
that such written consent is valid and enforceable.”

(Pl. Br. at

5; id. at 3-5; Pl. Reply at 4.)

The Court did not overlook any

controlling

recognized

law

and

explicitly

that

“[t]o

obtain

summary judgment to enforce a written guaranty, all that the
creditor need prove is an absolute and unconditional guaranty, the
7

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underlying debt, and the guarantor’s failure to perform under the
guaranty.”

(Order at 18 (internal quotation marks and citation

omitted)); see also Davimos v. Halle, 826 N.Y.S.2d 61, 62 (N.Y.
App. Div. 1st Dep’t 2006) (citation omitted).

The Court also

acknowledged that the Nissan Guaranty was undoubtedly “continuous”
and contained “an ‘advance consent to modifications’ clause which
is valid and enforceable under New York Law.”

(Order at 18, 23.)

But the Court’s summary judgment determination did not
solely turn on whether the Guaranty Agreements were continuous and
absolute because a threshold issue of fact existed as to whether
the parties “entered into ‘a new enforceable obligation that
superseded the Plaintiff’s rights under the past’ agreements and
discharged Defendant’s obligations under any guaranty.”
24 (citations omitted).)

(Order at

As stated in the Order, Plaintiff seeks

to hold Defendant liable for the outstanding amount due under the
Promissory Note through the Guaranty Agreements.

Thus, the Court

looked to the Promissory Note, as urged by Plaintiff, and observed
that Defendant is not listed as a guarantor in his individual
capacity.

(Order at 23.)

The Court then reviewed the record

evidence and could not decide as a matter of law whether the
parties executed a new agreement (the Promissory Note and Judgment)
that

discharged

their

obligations

under

prior

agreements

or

whether the parties modified the existing agreements without any
intent

to

discharge

the

obligations
8

under

prior

agreements,

Case 2:16-cv-07028-JS-ARL Document 89 Filed 12/17/20 Page 9 of 11 PageID #: 1648

including the Guaranty Agreements.

Nothing in Plaintiff’s motion

for reconsideration changes this determination.
N.Y.S.2d

at

62–63

(stating

that

“the

Davimos, 826

various

guaranties,

promissory notes and loan agreements in the record undermine,
rather than support, plaintiff’s claim that, read together, they
create a binding obligation on defendant.

Rather than elucidate

plaintiff’s claim, the documents obscure it, creating factual
issues”).

On this basis, Plaintiff’s reconsideration motion must

be denied.2
Second,

Plaintiff

contends

that

the

Court

erred

in

considering the December 12 Email because (1) the Promissory Note
is “unambiguous” and extrinsic evidence is therefore inadmissible
(Pl. Br. at 6-8); and (2) the Promissory Note’s release language
“nullified” any “alleged prior agreement(s) purportedly giving
rise to obligation(s) that [Plaintiff] may have owed to the Nissan

Plaintiff argues that “[t]he fact the Wolf did not execute the
Promissory Note in his individual capacity does nothing under New
York law to negate or otherwise impact the enforceability of the
Nissan Guaranty Agreement absent evidence of a written revocation
of that guaranty by Wolf prior to execution of the Promissory Note,
which the record reflects never occurred.”
(Pl. Reply at 4.)
However, the December 12 Email, the evidence Plaintiff asks this
Court to ignore (Pl. Br. at 6-8), indicates that Plaintiff required
“written acknowledgment by Guarantors that, by releasing its
security interest, [Plaintiff] is not waiving or discharging any
rights that it may have to enforce the Guaranty Agreements with
respect to any post-closing deficiencies or breaches.” (Dec. 12,
2014 Email, ECF No. 79-9, at 1, ¶ 5.) Neither party submitted any
additional details to confirm that Defendant provided written
acknowledgment of his obligations under the various Guaranty
Agreements.
2

9

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Dealership” (Pl. Br. at 6).

Plaintiff did not advance these

arguments in its summary judgment motion and the Court declines to
consider them here.

See Yang v. Mic Network, Inc., No. 18-CV-

7628, 2020 WL 6562403, at *2 (S.D.N.Y. Nov. 9, 2020).
Even if these arguments were properly before the Court,
they still fail.

There is no real dispute that “the Promissory

Note unambiguously and unconditionally provides that that Nissan
Dealership,”
Defendant)

the

are

Chrysler

“jointly

Dealership,

and

and

severally

liable

principal and interest upon any default.”
Plaintiff

argues

the

Nissan

Korchmar
for

(and

all

unpaid

(Pl. Br. at 8.)

Dealership’s

guaranty

not

Yet,

of

the

Promissory Note triggers Defendant’s obligations to the Nissan
Dealership under the relevant Guaranty Agreements.

The plain and

unambiguous terms of the Promissory Note do not reference Defendant
as a person liable for the Dealerships’ default thereunder nor do
the terms reference the Guaranty Agreements.
reviewed

the

evidence,

including

the

The Court thus

December

12

Email,

to

determine whether Defendant’s obligations to the Nissan Dealership
under

the

Guaranty

Agreements

extended

liabilities under the Promissory Note.

to

the

Dealerships’

Through this review, the

Court determined material issues of fact exist as to whether the
parties intended for Defendant to remain liable for the Nissan
Dealerships’ liabilities under the Promissory Note, as stated in

10

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the Order, supra, and in Note 2.3

Accordingly, the Court did not

err in considering documents extrinsic to the Promissory Note.
CONCLUSION
For

the

stated

reasons,

Plaintiff’s

reconsideration (ECF No. 84) is DENIED.

motion

for

The Court renews its

referral to Judge Lindsay to schedule a settlement and/or discovery
conference for Plaintiff to discover any additional information
from Defendant regarding its claims of forgery and the execution
of the Promissory Note (see Order at 21 n.9).
The stay entered June 30, 2020 is LIFTED and within
thirty (30) days of the date of this Order, the parties are to
submit a joint letter (1) providing the Court with an update as to
the status of settlement and/or discovery, if any; (2) clarifying
all

remaining

claims,

crossclaims,

and

counterclaims;

and

(3) identifying any outstanding substantive or scheduling issues.

SO ORDERED.
/s/_JOANNA SEYBERT
___
Joanna Seybert, U.S.D.J.
Dated: December
17 , 2020
Central Islip, New York

The issue may be more appropriately framed as whether the Court
erred in considering evidence extrinsic to the Nissan Guaranty.
However, Plaintiff does not raise this argument and the Court will
not consider it at this juncture.
3

11