Yi Feng Leather International LTD v. Tribeca Design Showroom, LLC

Filing 80

OPINION AND ORDER re: 43 SECOND MOTION for Default Judgment as to All Defendants. filed by Yi Feng Leather International LTD. For the reasons stated above, the Court GRANTS Plaintiff's motion for default judgment against Tribe ca. Plaintiff is awarded $404,207.99 or the Hong Kong equivalent in damages plus interest at a rate of 8% per annum. The Court DENIES as moot Plaintiff's motion for default judgment against the Grysons. The Clerk of Court is directed to enter judgment in this matter and close the case. SO ORDERED. (Signed by Judge Alison J. Nathan on 9/30/2019) (kv) Transmission to Finance Unit (Cashiers) for processing. Transmission to Orders and Judgments Clerk for processing.

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UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK

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Yi Feng Leather International LTD,
Plaintiff,
17 Civ. 05195 (AJN)

-vOPINION & ORDER
Tribeca Design Showroom, LLC,
Defendant.

ALISON J. NATHAN, District Judge:
On November 21, 2018 Plaintiff Yi Feng Leather International Limited filed a motion for
default judgment as to all Defendants in this matter. Dkt. No. 45. For the following reasons, the
motion is GRANTED as to Defendant Tribeca Design Showroom, LLC ("Tribeca") and
DENIED as moot as to Defendants Peter and Joy Gryson.

I.

BACKGROUND
This action arises out of a commercial dispute. Plaintiff alleges that Tribeca never paid

Plaintiff for over $400,000 worth of goods that Tribeca purchased and received in 2014 and
2015. Amended Complaint ("Compl.''), Dkt. No. 11

,r,r 9-15.

Plaintiff then sued Tribeca in

Hong Kong. Tribeca appeared but failed to mount a defense in that action, despite asking for
multiple extensions to respond to the Hong Kong complaint. Id.

,r,r 17-23.

As a result, judgment

was entered in favor of Plaintiff for $404,207.99 or the Hong Kong equivalent plus interest at a
rate of 8% per annum. Id.

,r,r 24-27; Exh.

11-7.

Plaintiff, a Hong Kong Corporation, filed this lawsuit against Tribeca, Complaint, Dkt.
No. 1, and then amended its complaint to add two individual defendants, Peter Gryson and Joy

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Gryson. Dkt. No. 11. Plaintiff seeks to enforce the Hong Kong judgment against Tribeca and
sued the individual defendants for corporate fraud. Id.

,r,r 28-41.

All defendants failed to appear

and the Clerk entered Certificates of Default. Dkt. Nos. 29-31. On November 21, 2018, Plaintiff
filed this motion for default judgment against all three defendants. Subsequently, the individual
defendants did appear and succeeded in vacating the defaults against them. Dkt. No. 64. Plaintiff
and the individual defendants stipulated to a voluntary dismissal with prejudice, leaving Tribeca
as the only remaining defendant. Dkt. No. 79.

II.

LEGAL STANDARD
Federal Rule of Civil Procedure 55 sets out a two-step procedure to be followed for the

entry of judgment against a party who fails to defend: the entry of a default, and the entry of a
default judgment. New Yorkv. Green, 420 F.3d 99, 104 (2d Cir. 2005). The first step, entry of a
default, simply "formalizes a judicial recognition that a defendant has, through its failure to
defend the action, admitted liability to the plaintiff." City of New York v. Mickalis Pawn Shop,

LLC, 645 F.3d 114, 128 (2d Cir. 2011); Fed. R. Civ. P. 55(a). The second step, entry of a default
judgment, "converts the defendant's admission of liability into a final judgment that terminates
the litigation and awards the plaintiff any relief to which the court decides it is entitled, to the
extent permitted" by the pleadings. Mickalis Pawn Shop, 645 F.3d at 128; see also Fed. R. Civ.
P. 54(c).
Whether entry of default judgment at the second step is appropriate depends upon
whether the allegations against the defaulting party are well-pleaded. See Mickalis Pawn Shop,
645 F.3d at 137. Once a party is in default, "a district court must accept as true all of the factual
allegations of the non-defaulting party and draw all reasonable inferences in its favor." Belizaire

v. RAV Investigative and Sec. Servs., Ltd., 61 F. Supp. 3d 336,344 (S.D.N.Y. 2014). But

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because a party in default does not admit conclusions of law, a district court must determine
whether the plaintiffs allegations are sufficient to establish the defendant's liability as a matter
oflaw. Finkel v. Romanowicz, 577 F.3d 79, 84 (2d Cir. 2009). The legal sufficiency of these
claims is analyzed under the familiar plausibility standard enunciated in Bell Atlantic Corp. v.
Twombly, 550 U.S. 544, 570 (2007), and Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009).

III.

DISCUSSION
A. Default Judgment Against Tribeca
Default judgment is warranted against Tribeca. Under New York law, a foreign

judgment that is "final, conclusive and enforceable where rendered" is "conclusive between the
parties to the extent that it grants or denies recovery of a sum of money." N.Y. C.P.L.R.
§§ 5302, 5303; see S.A.R.L. Louis Feraud Int'! v. Viewfinder, Inc., 489 F.3d 474,477 (2d Cir.
2007). A plaintiff seeking to enforce such a judgment must further make a prima facie showing
that the judgment was not "rendered under a system which does not provide impartial tribunals
or procedures compatible with the requirements of due process of law" and that "the foreign
court ... [had] personal jurisdiction over the defendant." N.Y. C.P.L.R. § 5304(a); see Wimmer
Can. v. Abele Tractor & Equip. Co., 750 N.Y.S.2d 331,332 (N.Y. App. Div. 2002).

Plaintiff has sufficiently pled its foreign judgment claim. The complaint clearly alleges a
final and conclusive judgment for a sum of money that is enforceable in Hong Kong. See
Comp1. ,r 24. Additionally, Plaintiff attached a copy of the judgment to its complaint. Id. Exh.
11-7. As to the adequacy of the Hong Kong courts, Plaintiffs complaint is somewhat
conclusory. See id.

,r 27.

But a treatise on the rule oflaw abroad cannot be expected at this stage

of the litigation. Moreover, New York courts have previously enforced Hong Kong judgments,
treating the sufficiency of the Hong Kong legal system as a settled matter. See Bond v

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Lichtenstein, 11 N.Y.S.3d 63 (N.Y. App. Div. 2015); Downs v. Yuen, 748 N.Y.S.2d 131 (N.Y.
App. Div. 2002); Watary Servs. v. Law Kin Wah, 668 N.Y.S.2d 458 (N.Y. App. Div. 1998).
Finally, by alleging that defendant appeared in the Hong Kong action and failed to dispute
jurisdiction, Plaintiff has properly pled that there was personal jurisdiction. See Compl.

,r,r 19-

22, 25; see also N.Y. C.P.L.R. § 5305(a)(2) ("The foreign country judgment shall not be refused
recognition for lack of personal jurisdiction if ... the defendant voluntarily appeared in the
proceedings, other than for the purpose of protecting property seized ... or of contesting the
jurisdiction of the court over him").
The Court therefore grants Plaintiffs motion for default judgment against Tribeca.

B. Default Judgment Against the Grysons
Because the claims against the Grysons were voluntarily dismissed, Dkt. No. 79, the
Court denies as moot the motion for default judgment against them.

IV.

CONCLUSION
For the reasons stated above, the Court GRANTS Plaintiffs motion for default judgment

against Tribeca. Plaintiff is awarded $404,207.99 or the Hong Kong equivalent in damages plus
interest at a rate of 8% per annum. The Court DENIES as moot Plaintiffs motion for default
judgment against the Grysons. The Clerk of Court is directed to enter judgment in this matter
and close the case.
SO ORDERED.
Dated: September ____
New York, Ne

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