Callen et al v. ILKB LLC et al

Filing 78

MEMORANDUM & ORDER - For the stated reasons, IT IS HEREBY ORDERED that Plaintiffs' Motion to Strike the Answer of Defendants Michael Parrella and ILKB, LLC, and for Entry of Default Judgment against them (ECF No. 66) is GRANTED to the extent t hat the Defendants' Answer (ECF No. 54) IS HEREBY STRICKEN, and the Clerk of the Court is directed to issue certificates of default against Defendants. Plaintiffs shall have 30 days from the issuance of the certificates of default to move for de fault judgment pursuant to the procedure outlined in EDNY Local Civil Rule 55.2. IT IS FUTHER ORDERED that Plaintiffs are to serve Defendants with a copy of this Memorandum & Order at their respective last known addresses of record and file proof of such service to ECF forthwith. So Ordered by Judge Joanna Seybert on 5/19/2023. (CV)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF NEW YORK
--------------------------------X
THOMAS CALLEN, COURTNEY CALLEN
and GOLDEN POLAR BEAR, LLC.,
Plaintiffs,

MEMORANDUM & ORDER
20-CV-3345 (JS)(JMW)

-againstILKB LLC, MICHAEL PARRELLA, RYAN
HEALY, and SCOTT FERRARI, each
individually; and ILKB TOO, LLC,
DANIEL CASTELLINI, and SHAUN
YORK, each as successor by merger
to ILKB LLC,
Defendants.
--------------------------------X
APPEARANCES
For Plaintiffs:
John D. Giampolo, Esq.
Justin Scott Weitzman, Esq.
Rosenberg & Estis, P.C.
733 Third Avenue, 12th Floor
New York, New York 10017
For Defendants:
ILKB LLC & Michael
Parrella

No appearances

SEYBERT, District Judge:
Thomas Callen, Courtney Callen, and Golden Polar Bear,
LLC (hereafter the “Plaintiffs”) move, pursuant to Rule 37(b) of
the Federal Rules of Civil Procedure (hereafter “Rule”), to strike
the answer of Defendants Michael Parrella (“Parrella”) and ILKB,
LLC (“ILKB” and, together with Parrella, the “Defendants”) and
enter default judgment against them (hereafter, the “Motion”).
(See Motion, ECF No. 66; see also Pls.’ Letter, ECF No. 65, at 2.)

Since the Defendants have failed to submit any opposition to the
Motion the Court deems it to be unopposed.

(See Dec. 6, 2022,

Elec. Order to Show Cause (hereafter the “OTSC”).) For the reasons
that follow, Plaintiffs’ Motion is GRANTED to the extent that the
Defendants’ answer (ECF No. 54) is stricken and the Clerk of Court
is directed to enter certificates of default against them.
BACKGROUND 1
The Court presumes the parties’ familiarity with the
factual background of this case which is detailed in Judge Hurley’s
earlier

decision

granting

in

Defendants’ motion to dismiss. 2

part

and

denying

in

part

the

See Callen v. ILKB, LLC, No. 20-

CV-3345, 2022 WL 2079651 (E.D.N.Y. June 9, 2022). 3

As such, the

Court provides only those facts necessary to adjudicate the present
motion.
PROCEDURAL HISTORY
On

July

24,

2020,

Plaintiffs

against, inter alia, the Defendants.

commenced

this

action

(See Compl., ECF No. 1.)

Plaintiffs filed an Amended Complaint on August 31, 2020, (Am.
The facts are primarily drawn from the Declaration of John
Giampolo and attached exhibits (see Giampolo Decl., ECF No. 68),
and from the Court’s own review of the Case Docket.
1

The Defendants were also joined in their Motion to Dismiss by
defendants ILKB, Too, LLC; Daniel Castellini; and Shaun York.
2

Judge Hurley’s Memorandum & Order is also available on the case
Docket at ECF No. 51.
Herein, when citing to the Memorandum &
Order, the Court uses the Westlaw citation.

3

2

Compl., ECF No. 15), and a Second Amended Complaint (hereafter the
“SAC”) on October 23, 2020 (SAC, ECF No. 18.)

“In response to the

Complaint . . . Defendants, ILKB and Parrella, [both] appeared in
this action through counsel” Gordon Rees Scully Mansukhani, LLP
(hereafter, “Gordon Rees.”)

(Giampolo Decl. at ¶ 6; see also

Notice of Appearance, ECF No. 13.)

Subsequently, Defendants:

(1) “filed a motion to dismiss the Complaint for failure to state
a claim on or before August 21, 2020” (see ECF Nos. 11, 12);
(2) “filed pre-motion letters on September 14, 2020, and October
28, 2020” (see ECF Nos. 16, 20); (3) filed a second “motion to
dismiss . . . on March 12, 2021” (see ECF No. 28); (4) “filed
additional

notices

of

appearance

on

behalf

of . . . ILKB

and

Parrella on December 6, 2021” (see ECF No. 43); and (5) “served
written responses and objections to Plaintiffs’ demand for answers
to interrogatories and to Plaintiffs’ demand for production of
documents” on February 18, 2022.

(Giampolo Decl. at ¶ 6.)

After

adjudication of the Defendants’ motion to dismiss, on June 23,
2022, the Defendants filed an Answer to the SAC.

(Id. at ¶ 9; see

also Answer.)
On July 6, 2022, “Defendants’ counsel moved to withdraw
from [the] case.”

(Giampolo Decl. at ¶ 10; see also Am. Motion to

Withdraw as Attorney, ECF No. 59 (hereafter, the “Withdrawal
Motion).)

In the Withdrawal Motion, Gordon Rees explained that

“[a] conflict of interest ha[d] arisen between the parties, which
3

necessitate[d] that [] Parrella and ILKB have separate counsel”
from the other defendants in the case.
2.)

(Withdrawal Motion at 1-

The Withdrawal Motion further noted that, while the other

defendants had secured substitute counsel, “Parrella and ILKB
ha[d] not.”

(Id. at 1.)

On July 12, 2022, the Court directed

ILKB to retain counsel on or before August 12, 2022, because
“corporate entities are not permitted to appear pro se.”

(See

July 12, 2022 Min. Order, ECF No. 58.) As ILKB’s owner and founder,
Parrella

would

have

been

substitute counsel for ILKB.

the

party

responsible

for

securing

See Callen, 2022 WL 2079651, at *1,

*11 (identifying Michael Parrella as ILKB’s founder and owner).
Additionally, the July 12 Order adopted a discovery schedule
containing deadlines for document discovery and the conclusion of
fact depositions.

(July 12, 2022 Min. Order.)

On July 18, 2022,

the Court granted the Withdrawal Motion and again reiterated that
ILKB must obtain substitute counsel by August 12, 2022, since ILKB
would not be permitted to proceed pro se.
Order.)

(See July 18, 2022 Elec.

Copies of the July 18, 2022, Electronic Order were served

upon Defendants Parrella and ILKB by outgoing counsel via overnight
mail.

(See Certificate of Service, ECF No. 61.)
On September 7, 2022, after the deadline for ILKB to

retain substitute counsel had expired, the Court entered another
Electronic Order noting that “[t]o date, ILKB [] has failed to
notify the Court that it has retained counsel or put in a notice
4

of appearance.”

(Sept. 7, 2022 Elec. Order).

To that end, the

Court, again, directed the Defendants to “advise the Court no later
than

[September

16,

appointed/retained.”

2022,]
(Id.)

as

to

whether

counsel

has

been

The Court directed the Clerk of Court

to “mail a copy of [the] Order upon Defendants Parrella and ILKB.”
(Id.)

On September 15, 2022, the Court’s Order was returned as

undeliverable

for

both

Defendants,

Vacant; Unable to Forward.”

“marked

Return

(See ECF Nos. 63, 64.)

to

Sender,

Subsequently,

the Court directed Plaintiffs to advise the Court as to how they
wished to proceed.

(See Sept. 20, 2022 Elec. Order).

In response,

Plaintiffs indicated that they intended “to proceed against [the
Defendants] by filing motions to strike their Answer and enter
default judgment against them for refusal to comply with Court
Orders [regarding] discovery” and in failing to appear in this and
other related cases.

(See Pls.’ Letter at 2.)

On October 31, 2022, Plaintiffs filed their Motion and
supporting declarations.

(See Case Docket.)

Plaintiff served its

Motion on the Defendants via “regular mail, certified mail and
email.” (Affidavit/Declaration, ECF No. 70.) The Defendants filed
no objection to Plaintiffs’ Motion; consequently, on December 6,
2022, the Court issued an OTSC as to why Plaintiffs’ Motion should
not be granted.

(See Dec. 6, 2022 Elec. OTSC.)

The OTSC warned

that “Defendants ILKB [], and [] Parrella are ON NOTICE: Failure
to respond to this [OTSC] BY January 3, 2023, will result in the
5

Court deeming Plaintiffs’ Motion to be unopposed.”

(Id.)

Despite

service of the OTSC, (see Certificate of Service, ECF No. 72),
neither Parrella nor ILKB responded.

(See Case Docket, in toto.)

To date ILKB has failed to secure substitute counsel and
Parrella has failed to respond to the Court’s orders or provide an
updated mailing address.
have

“produced

any

[or] . . . documents

Furthermore, neither of the Defendants
further

in

written

response

production of documents.”

to

discovery

Plaintiffs’

responses
demand

(Giampolo Decl. at ¶ 11.)

for

Similarly,

neither Defendant has attended or participated in court-mandated
conferences held in this case to resolve outstanding discovery
disputes.

(See Dec. 2, 2022 Min. Order for Proceedings, ECF No.

71 (noting “No Appearance” for Parrella or ILKB); see also Jan. 5,
2023 Min. Order for Proceedings, ECF No. 75 (same).)
DISCUSSION
While unopposed, the Court notes that Plaintiffs’ Motion
is presented in a procedurally improper manner.
Civil

Rule

7.1(a)(2)

“all

motions

shall

Pursuant to Local

include

.

.

.

[a]

memorandum of law, setting forth the cases and other authorities
relied upon in support of the motion.”
7.1(a)(2).

EDNY Local Civil Rule

Plaintiffs’ Motion contains no memorandum of law.

In

fact, Plaintiff’s Motion and corresponding motion papers contain
no legal argument or analysis whatsoever.

Instead, Plaintiffs’

Motion relies entirely upon the information and record citations
6

contained in the Giampolo Declaration.

Nevertheless, in its

discretion the Court “has decided to proceed without the Memorandum
of Law.”

Team Kasa, LLC v. Humphrey, No. 17-CV-1074, 2018 WL

1867117, at *5 (E.D.N.Y. Jan. 24, 2018) (citing Holbert v. CohenGallet, No. 05-CV-1281, 2006 WL 47452, at *1 (E.D.N.Y. Jan 9,
2006)).
I.

Legal Standard
Rule 37 states that “[i]f a party . . . fails to obey an

order to provide or permit discovery . . . the court where the
action is pending may issue further just orders.”
37(b)(2)(A).

FED. R. CIV. P.

Among the available sanctions are: (1) the “striking

[of] pleadings in whole or in part;” and (2) “rendering a default
judgment

against

the

disobedient

P. 27(b)(2)(A)(iii), (vi).

party.”

FED

R.

CIV.

“Pursuant to Rule 37 . . . a court

‘has broad discretion to impose sanctions’ when a party engages in
discovery misconduct.”

Silverman & Silverman, LLP v. Pacifica

Found., No. 11-CV-1894, 2014 WL 3724801, at *3 (E.D.N.Y. July 25,
2014) (quoting Fleming v. City of N.Y., No. 01-CV-8885, 2006 WL
2322981, at *5 (S.D.N.Y. Aug. 9, 2006)); see also Stirrat v. Ace
Audio/Visual,

Inc.,

No.

02-CV-2842,

2004

WL

2212096,

at

*1

(E.D.N.Y. Sept. 24, 2004) (“The imposition of sanctions under Rule
37 lies within the discretion of the district court.” (citing Bobal
v.

Rensselaer

1990))).

Polytechnic

Inst.,

916

F.2d

759,

764

(2d

Cir.

However, “Rule 37 sanctions are [] ‘a harsh remedy to be
7

used only in extreme situations.’”

Kantor v. Air Atl. Med., P.C.,

No. 19-CV-3597, 2020 WL 7130732, at *2 (E.D.N.Y. Sept. 23, 2020)
(quoting Agiwal v. Mid. Island Mort. Corp., 555 F.3d 298, 302 (2d
Cir. 2009)).

The purpose of Rule 37 sanctions is to “‘protect

other parties to the litigation from prejudice resulting from a
party’s noncompliance;’ additionally, Rule 37 sanctions ‘serve
other functions unrelated to the prejudice suffered by individual
litigants[,]’ including specific and general deterrence.”

Id.

(quoting S. New Eng. Tel. Co. v. Glob. NAPs Inc., 624 F.3d 123,
149 (2d Cir. 2010)).

In determining whether Rule 37 sanctions are

appropriate:
The Second Circuit has articulated [s]everal
factors [that] may be useful in evaluating a
district court's exercise of discretion to
impose
sanctions
pursuant
to
Rule
37,
including: (1) the willfulness of the noncompliant
party
or
the
reason
for
noncompliance; (2) the efficacy of lesser
sanctions; (3) the duration of the period of
noncompliance, and (4) whether the noncompliant party had been warned of the
consequences of . . . noncompliance
Id. (citing Agiwal, 555 F.3d at 302-03).
No factor is exclusive or dispositive “[b]ecause the
text of the rule requires only that the district court’s orders be
‘just,’” and “because the district court has ‘wide discretion in
imposing sanctions under Rule 37[.]’” S. New Eng. Tel. Co., 624
F.3d at 144 (quoting Shcherbakovskiy v. Da Capo Al Fine, Ltd., 490
F.3d 130, 135 (2d Cir. 2007)). Additionally, “[t]he district court
8

is free to consider ‘the full record in the case in order to select
the appropriate sanction.’”

Id., 624 F.3d at 144 (quoting Nieves

v. City of N.Y., 208 F.R.D. 531, 535 (S.D.N.Y. 2002)).
II.

ANALYSIS
Applying

the

above

articulated

standards,

the

Court

finds that striking the Defendants’ Answer and directing entry of
certificates of default against Defendants is appropriate in this
case.
A. Willfulness and Duration of Non-Compliance
Willfulness

may

be

demonstrated

through

a

party’s

“repeated and unexplained failure to respond to [] discovery
requests in any meaningful way, comply with court orders, [or]
appear in a scheduled hearing to defend” itself.
Peru-Courier

Corp.,

No.

15-CV-6859,

2018

WL

Vargas v. Jet

1545699,

at

*3

(E.D.N.Y. March 14, 2018) (citing Microsoft Corp. v. Comput. Care
Ctr., Inc., No. 06-CV-1429, 2008 WL 4179653, at *5 (E.D.N.Y. Sept.
10,

2008),

report

&

recommendation

adopted,

2018

WL

1545679

(E.D.N.Y. Mar. 28, 2018)). “Noncompliance with a court’s discovery
order is willful when the order is clear, the party understood the
order, and the failure to comply is not due to factors beyond the
party’s control.”

Ramgoolie v. Ramgoolie, 333 F.R.D. 30, 35

(E.D.N.Y. Sept. 10, 2019) (citing Joint Stock Co. Channel One Russ.
Worldwide v. Infomir LLC, No. 16-CV-1318, 2017 WL 3671036, at *21
(S.D.N.Y. July 18, 2017)).
9

Here,

the

Defendants

are

aware

of

this

litigation,

having initially participated in it by, inter alia, filing a motion
to dismiss and, subsequently, by filing an Answer to the Amended
Complaint.
willfully

After
ignored

Gordon

Rees’

withdrawal

several

Court

orders

substitute counsel.
attend

court

however,

directing

ILKB

has

to

hire

it

Similarly, both Defendants have failed to

scheduled

discovery

conferences

and

failed

to

communicate whatsoever with Plaintiffs regarding their outstanding
discovery obligations.

Regarding Parrella, mail sent to him by

this Court has been returned undeliverable such that Parrella has
effectively become unreachable.

When warned that the Court would

entertain case-ending sanctions due to the Defendants’ failures,
neither Parrella nor ILKB responded.

Similarly, after Plaintiffs’

Motion was ultimately filed, neither of the Defendants filed any
opposition.

As

such,

the

Court

issued

an

OTSC

warning

the

Defendants again of the consequences of not responding.
Defendants

continued

to

willfully

ignore

willfulness merits case-ending sanctions.
Metro.

Enter.,

Inc.,

No.

15-CV-1378,

the

Court.

The
This

See e.g., Gesualdi v.

2016

WL

6988830,

at

*2

(E.D.N.Y. Nov. 29, 2016) (striking defendants’ answer and entering
default judgment against defendant for failing to comply with the
court’s discovery orders); Campos v. Quentin Mkt. Corp., No. 16CV-5303, 2017 WL 9253412, at *3 (E.D.N.Y. Nov. 21, 2017) (striking
corporate defendant’s answer where it “willfully ignored a court
10

order

to

retain

new

counsel

and

failed

to

appear

at

two

conferences, despite repeated warnings from the Court that their
failure . . . would result in an entry of default); Castillo v.
Zishan, Inc., No. 16-CV-6166, 2017 WL 3242322, at *2 (S.D.N.Y.
July

28,

2017)

(finding

individual

Defendant’s

and

corporate

defendant’s failure to comply with court orders was willful where
defendants were aware of the lawsuit, failed to seek new counsel
for the corporate defendant, and “refused to respond to the order
to respond to the motion seeking a default judgment against them”).
B. Efficacy of Lessor Sanctions
“[D]istrict courts are not required to exhaust possible
lesser sanctions before imposing dismissal or default if such
sanction is appropriate on the overall record.”

S. New Eng. Tel.

Co., 624 F.3d at 148 (citing John B. Hull, Inc. v. Waterbury
Petroleum Prods., Inc., 845 F.2d 1172, 1176–77 (2d Cir. 1988)).
Moreover, “[w]here defendants willfully abandon their defense of
the case, case-ending sanctions are appropriate.”

Xin Hao Liu v.

Millenium Motors Sports, LLC, No. 17-CV-6438, 2020 WL 7028924, at
*4 (E.D.N.Y. Nov. 5, 2020) (citing Montblanc-Simplo GmhH v. Colibri
Corp.,

692

F.

Supp.

2d

245,

253

(E.D.N.Y.

2010)),

report

&

recommendation adopted, 2020 WL 7024378 (E.D.N.Y. Nov. 30, 2020).
Here, the Court finds that the Defendants have willfully
abandoned

the

defense

of

their

case.

Neither

Defendant

has

appeared at any court-mandated discovery conferences since Gordon
11

Rees’ withdrawal; similarly, neither Defendant has attempted to
communicate with the Court or Plaintiff whatsoever since July 2022.
Even after the filing of Plaintiffs’ Motion, neither Parrella nor
ILKB filed any opposition to the Motion despite the Court’s OTSC
warning them of the consequences of non-response.

As such, the

Court finds this factor weighs in favor of granting Plaintiffs’
Motion.

See Kantor, 2020 WL 7130732, at *3 (finding defendants

had “essentially abandoned the case and become unreachable,” and
therefore anything less than striking their answer “would be ‘an
exercise in futility.’” (quoting Koch v. Rodenstock, No. 06-CV6586, 2010 WL 2010892, at *7 (S.D.N.Y. Apr. 23, 2010) report &
recommendation adopted, 2010 WL 2010900 (S.D.N.Y. May 18, 2010))).
C. Duration of Non-Compliance
“Periods of noncompliance as brief as a few months may
merit

dispositive

sanctions.”

Ramgoolie,

333

F.R.D.

at

37

(collecting cases). Moreover, “periods of greater than five months
favor such sanctions even more heavily.”

Id. (collecting cases).

Since the Withdrawal Motion was granted in July 2022,
neither of the Defendants have appeared, participated or responded
to

the

Court’s

effective

numerous

abandonment

of

orders
this

approximately eight months later.

in

this

case

case;

persists

indeed,

their

even

today,

In that time, the Defendants

have: ignored Court orders warning that ILKB may not appear pro se
due to its corporate status; failed to appear for court-ordered
12

conferences; failed to communicate with the Court or opposing
counsel regarding Plaintiffs’ outstanding discovery requests; and
failed to oppose Plaintiffs’ Motion despite the Court’s OTSC
warning them failure to do so would result in the Court deeming
the Motion unopposed.
D. History of Warnings
“[S]evere sanctions like dismissal or default should be
imposed only if the party has been warned that such a sanction
will follow from continued noncompliance and has nevertheless
refused to comply.”

Urbont v. Sony Music Ent., No. 11-CV-4516,

2014 WL 6433347, at *3 (S.D.N.Y. Nov. 6, 2014).
As

a

corporate

entity,

ILKB

has

received

numerous

warnings that it cannot proceed pro se and must retain counsel.
Yet despite these warnings, ILKB has consistently failed to heed
them.

Both Defendants have been on notice since September 27,

2022, that Plaintiffs would seek to strike their Answer and have
entries of default entered against them for ILKB’s failure to
retain counsel, and for Parrella’s failure to maintain a current
mailing address. On September 30, 2022, in response to Plaintiffs’
letter, the Court ordered that “the anticipated motions to strike
the Answers and enter default judgment against [] Parrella and
ILKB” were to be filed on or before October 31, 2022.

Despite the

Court’s warnings and Plaintiffs’ subsequent filing of the Motion,
neither of the Defendants responded.
13

In December 2022, the Court

warned

both

Parrella

and

ILKB

“to

show

cause

[as

to]

why

Plaintiffs’ Motion . . . should not be granted;” again, neither
Defendant responded to the Court’s OTSC.

As such, the Court finds

this factor weighs in favor of granting Plaintiffs’ Motion. Accord
Sanchez v. Jyp Foods Inc., No. 16-CV-4472, 2018 WL 4502008, at *4
(S.D.N.Y.

Sept.

20,

2018)

(striking

defendants’

answer

where

defendants had been warned that failure to appear would result in
the court permitting plaintiffs to move to strike their answer and
seek a default judgment against them).
In

sum,

after

considering

each

factor,

the

Court

concludes that striking the Answer of the Defendants and directing
the Clerk of the Court to enter certificates of default against
Defendants are appropriate sanctions in this case.
CONCLUSION
For

the

stated

reasons,

IT

IS

HEREBY

ORDERED

that

Plaintiffs’ Motion to Strike the Answer of Defendants Michael
Parrella and ILKB, LLC, and for Entry of Default Judgment against
them (ECF No. 66) is GRANTED to the extent that the Defendants’
Answer (ECF No. 54) IS HEREBY STRICKEN, and the Clerk of the Court
is directed to issue certificates of default against Defendants.
Plaintiffs shall have 30 days from the issuance of the certificates
of default to move for default judgment pursuant to the procedure
outlined in EDNY Local Civil Rule 55.2.

14

IT
Defendants

IS

with

FUTHER
a

copy

ORDERED
of

this

that

Plaintiffs

Memorandum

&

are

to

serve

Order

at

their

respective last known addresses of record and file proof of such
service to ECF forthwith.

SO ORDERED.
/s/ JOANNA SEYBERT______
Joanna Seybert, U.S.D.J.
Dated: May 19, 2023
Central Islip, New York

15