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Rubin v. Salvatore

United States District Court, D. New Jersey

November 4, 2019

MARK RUBIN, et al., Plaintiffs,
v.
CANNOVO SALVATORE, et al., Defendants.

          REPORT & RECOMMENDATION

          JAMES B. CLARK, III United States Magistrate Judge

         This matter has been opened by the Court sua sponte based on Defendants' Cannavo Salvatore, SaratogaBlue Capital Advisors, LLC, Blue Waters Equity and Development, LLC (collectively “Defendants”) failure to comply with Court orders and defend this case. For the reasons set forth below, it is respectfully recommended that Defendants' Answer be stricken and default entered against them.

         BACKGROUND

         On November 5, 2018, Defendants removed this action from the Supreme Court of the State of New York, County of Queens pursuant to 28 U.S.C. § 1441. Dkt. No. 1. Defendants filed their Answer on the same date. Dkt. No. 3. On December 20, 2018, the Court granted Defendants' motion to change venue from the United States District Court for the Eastern District of New York to the United State District Court for the District of New Jersey. Dkt. No. 16.

         On July 15, 2019, Defendants' attorneys, Rima Ayzen (“Ms. Ayzen”) and Sarah Yean Khurana (“Ms. Khurana”) of Kruzhkov Russo PLLC, filed a motion to withdraw as counsel for Defendants based on Defendants' failure to communicate effectively and failure to compensate them as counsel. Dkt. Nos. 21, 22. The Court thereafter scheduled an in-person conference for September 10, 2019 with all counsel and parties to address the motion to withdraw. Dkt. No. 25. On September 11, 2019, the Court issued an Order to Show Cause (“OTSC”) after Defendants failed to appear at the September 10, 2019 conference. Dkt. No. 30. The OTSC required Ms. Khurana and Plaintiffs' counsel to serve a copy of the OTSC on Defendants by certified mail, return receipt requested, and file proof of said service with the Court. Id. The OTSC also mandated that Defendants appear in-person before the Court on October 23, 2019 and submit a position paper outlining why their Answer should not be stricken no later than October 10, 2019. Id. Finally, the Court granted Kruzhkov Russo PLLC's motion to withdraw as counsel for Defendants and required Plaintiffs' counsel and Ms. Khurana to serve a copy of the order on Defendants by certified mail, return receipt requested. Dkt. No. 29. Ms. Khurana was also directed to serve a copy of the order on Defendants by email. Id.

         On September 17, 2019, Ms. Khurana filed a declaration with the Court attesting that she had served a copy of the OTSC and order by email and by certified mail, with return receipt requested at Defendants' last known address. Dkt. No. 31. On September 20, 2019, Plaintiffs' counsel filed a declaration with the Court attesting that he had also served the OTSC and order on Defendants by regular mail and certified mail, with return receipt requested. Dkt. No. 32.

         October 10, 2019 came and went without any paper submission, or any other communication, from Defendants. Defendants then failed to appear at the OTSC hearing on October 23, 2019.

         ANALYSIS

         The Federal Rules of Civil Procedure authorize courts to impose sanctions for failure to respond to court orders and for failure to prosecute or defend a case. See Fed. R. Civ. P. 37(b)(2). Rule 37(b)(2) explicitly recognizes the court's ability to strike a pleading, in whole or in part, for failure “to obey an order to provide or permit discovery.” Id.

         However, where a sanction may “deprive a party of the right to proceed with or defend against a claim, ” courts must weigh the six factors enunciated by the Third Circuit in Poulis v. State Farm Casualty Co., 747 F.2d 863 (3d Cir. 1984) in deciding whether to impose the sanction. See Comdyne I, Inc. v. Corbin, 908 F.2d 1142, 1148 (3d Cir. 1990). The Poulis factors are:

(1) The extent of the party's personal responsibility; (2) the prejudice to the adversary caused by the plaintiff's conduct; (3) the history of dilatoriness; (4) whether the conduct of the party or the attorney was willful or in bad faith; (5) the effectiveness of sanctions other than dismissal, which entails an analysis of alternative sanctions; and (6) the meritoriousness of the claim.

Poulis, 747 F.2d at 868 (emphasis omitted). No. single Poulis factor is determinative and dismissal may be appropriate even if some of the factors are not met. See Mindek v. Rigatti, 964 F.2d 1369, 1373 (3d Cir. 1992); Hicks v. Feeney, 850 F.2d 152, 156 (3d Cir. 1988).

         1. Defendants' Personal Responsibility.

         In this case, it appears that Defendants are solely responsible for their failure to comply with court orders and defend this matter. At the outset, Defendants failed to cooperate with their prior attorneys. Defendants' counsel withdrew on September 11, 2019, and Defendants have made no apparent efforts to retain new counsel. Moreover, both Plaintiffs' counsel and Ms. Khurana served Defendants the OTSC by regular mail, certified mail, and email, and yet Defendants did not respond nor appear when required to do so by the Court. By failing to ...


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