BMaddox Enterprises LLC v. Milad Oskouie, Osko M Ltd., and Platinum Avenue Holdings Pty, Ltd.

Filing 78

ORDER. For the reasons in this Order, the Court adopts Judge Pitman's thorough and well-reasoned Report in its entirety. The Order currently in place, Dkt. 15, is dissolved without prejudice to a renewed application by Plaintiff. So ordered. Re: 58 Report and Recommendation. (Signed by Judge Ronnie Abrams on 10/23/2017) (rjm)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
BMADDOX ENTERPRISES LLC,
Plaintiff,

US DC-SD NY
DOCUMENT
ELECTRO NI CALLY
FILED
DOC#:
DATE FILED: I 0I~2>/1'1

v.
MILAD OSKOUIE, OSKO M LTD, and
PLATINUM AVENUE HOLDINGS PTY, LTD,
Defendants.
No. 17-CV-1889 (RA)
MILAD OSKOUIE and PLATINUM AVENUE
HOLDINGS PTY, LTD,

ORDER

Counterclaimants,
v.
BMADDOX ENTERPRISES LLC and
BRANDON MADDOX,
Counterdefendants.

RONNIE ABRAMS, United States District Judge:
Before the Court is the September 8, 2017 Report and Recommendation ("Report") of
United States Magistrate Judge Pitman, Dkt. 58, recommending that the Asset Restraining Order
("Order") currently in place be dissolved without prejudice to a renewed application by Plaintiff.
On September 12, 2017, Plaintiff BMaddox Enterprises, LLC filed a Memorandum of Law in
Opposition to the Motion to Vacate, which this Court construes as its objections to the Report. See
Dkt. 59. Defendants submitted a letter in response to Plaintiff's submission on September 13, 2017.
Dkt. 62. On September 22, 2017, Plaintiff filed additional objections to the Report, Dkt. 65, to

which Defendants responded, Dkt. 69. The Court adopts the Report and dissolves the Order
without prejudice to a renewed application by Plaintiff.
A district court "may accept, reject, or modify, in whole or in part, the findings or
recommendations made by the magistrate judge." 28 U.S.C. § 636(b)(l). Under Federal Rule of
Civil Procedure 72(b )(2), a party may make "specific written objections to the proposed findings
and recommendations" within fourteen days of being served with a copy of a magistrate judge's
recommended disposition. A district court must review de novo "those portions of the report or
specified proposed findings or recommendations to which objection is made." 28 U.S.C. §
636(b)(1 ). "When a party makes only conclusory or general objections, or simply reiterates the
original arguments, the Court will review the Report strictly for clear error." George v. Prof'/

Disposables Int'/, Inc., 221 F. Supp. 3d 428, 433 (S.D.N.Y. 2016) (quotation omitted); see also
Vega v. Artuz, No. 97-CV-3775, 2002 WL 31174466, at

*1

(S.D.N.Y. Sept. 30, 2002)

("[O]bjections that are merely perfunctory responses argued in an attempt to engage the district
court in a rehashing of the same arguments set forth in the original [papers] will not suffice to
invoke de novo review.").
The Court need not decide whether to review the Report de novo or for clear error, as it
finds no error, clear or otherwise, in Judge Pitman's conclusion that Plaintiff has not met its burden
of demonstrating that it will likely suffer irreparable harm if Defendants' assets are not restrained.
Plaintiff argues that the Report did not consider, or give adequate weight, to the fact that
Defendants' conduct was likely willful, or "the scope of the infringing activity alleged, the nature
of the business engaged in by the infringing activity, and whether the business has a fixed location
or is a fly-by-night operation." Dkt. 59 at 6 (internal quotations omitted). The case Plaintiff relies
on, Moose Toys Pty Ltd. v. Thriftway Hylan Blvd. Drug Corp., No. 15-CV-4483 (DLI) (MDG),

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2015 WL 4772173 (E.D.N.Y. Aug. 6, 2016), discusses these considerations in deciding to grant a
seizure order. Notably, however, Moose Toys held that there was an insufficient basis to issue an
asset restraining order, even though it found that a seizure order was appropriate. Id. at *5.
Moreover, although Plaintiffs statement that "federal courts have found preliminary injunctions
appropriate where it has been shown that the defendant intended to frustrate any judgment on the
merits by transfer[ring assets] out of the jurisdiction," Dkt. 59 at 8 (alteration in original) (quoting
In re Feit & Drexler, Inc., 760 F .2d 406, 416 (2d Cir. 1985)), is an accurate recitation of the law,

the Report rightly concluded that Plaintiff simply has not met its burden of demonstrating that
Defendants intend to frustrate a judgment.
Plaintiff also argues that Defendants' alleged misrepresentations before the Court justify
continuing the Order. Plaintiff points to In re Feit, where the court found that freezing the assets
of a defendant was appropriate after, among other actions, the defendant had demonstrated "blatant
disregard for court orders and the obligation to testify truthfully under oath." 760 F.2d at 411
(internal quotation marks omitted). But the comparison is inapt. First, Defendants' behavior in this
case does not rise to the level of the defendant in Drexler. Second, Drexler rested more squarely
on the defendant's documented and repeated efforts to hide her assets, of which her false
representations were a part. Id. at 416. Here, as the Report rightly noted, evidence of similar assethiding in order to frustrate a judgment is absent, and Plaintiff cannot currently meet its burden to
maintain the Order.
Plaintiff next takes issue with the Report's conclusion that Plaintiff "has offered no
evidence in support of its claim of irreparable injury." Dkt. 58 at 13. The Report noted that Plaintiff
has offered only counsel's unswom statements to show irreparable injury-statements which do
not constitute evidence. Id. Plaintiff does not dispute that it has offered only unswom statements,

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but nonetheless argues that the Report's finding of "no evidence," id., is "clearly erroneous," Dkt.
65 at 3, in light of the information contained in Defendant Oskouie's declarations. Those
declarations, Plaintiff argues, paint a conflicting picture: continuing revenue from e-commerce
websites, and yet negligible finances in the various accounts of Defendant Oskouie. Id. at 4. From
this, Plaintiff urges the Court to conclude that Defendant Oskouie must be insolvent or imminently
insolvent. Id. at 5.
While Plaintiff is correct that a showing that Defendant is or imminently will be insolvent
could establish irreparable harm, see, e.g., Shaoxing Bon Textiles, Co., Ltd. v. 4-U Performance

Grp. LLC, No. 16-CV-6805 (JSR), 2017 WL 737315, at *3 (S.D.N.Y. Feb. 6, 2017), its one-page
recitation of the balances of the accounts that Defendant Oskouie has submitted is insufficient
evidence of insolvency. As Plaintiff itself acknowledges, "only Defendants know whether they are
solvent." Dkt. 65 at 7. And ifDefendant Oskouie is not insolvent, Plaintiff concludes, then he must
be hiding money. Id. at 5. These arguments rest on the assumption that Defendants must
demonstrate why the Order should be dissolved. But the burden is on Plaintiff, and the Court
cannot speculate about solvency and asset-hiding at this early stage absent more evidence. The
Report's conclusions about Plaintiffs lack of irreparable-injury evidence are not erroneous.
Plaintiffs other objections amount to disagreements with how the Report viewed and
characterized the record. The Court see no error with the Report's characterizations of various
pieces of evidence as insufficient to meet Plaintiffs burden.

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For the foregoing reasons, the Court adopts Judge Pitman's thorough and well-reasoned
Report in its entirety. The Order currently in place, Dkt. 15, is dissolved without prejudice to a
renewed application by Plaintiff.

SO ORDERED.
Dated:

October 23, 2017
New York, New York
Ro ie brams
United States District Judge

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