Our firm secured a nearly $1 million default judgment in New York’s Supreme Court under CPLR § 3215. The defendant’s repeated delays—missed conferences and cycling through multiple attorneys—were firmly rejected by the Court. This outcome reflects our unwavering dedication to achieving results against even the most obstructive tactics.

At an IAS Commercial Part 12 of the Supreme Court of the State of New York, held in and for the County of Kings, at the Courthouse, located at 360 Adams Street, Borough of Brooklyn, City and State of New York on the 22"‘ day of November 2024.

P R E S E N T:

Honorable Reginald A. Boddie Justice, Supreme Court

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Keith Kantrowitz and Associates, Inc.,

Plaintiff,

-against- Michael Strauss,

Defendant.

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The following e-filed papers read herein: MS 4

MS 5

Index No. 525127/2022 Cal. No. 22-23 MS 4-5

Decision and Orde

NYSCEF Doc Nos. 47-58; 66; 68-74

59-65; 67; 75-85

Plaintiffs motion for default judgment against defendant pursuant to CPLR § 3215(a) and defendant's cross-motion to vacate the court's order dated April 2, 2024 and extend defendant's time to answer the complaint are decided as follows:

This action arises from defendant's alleged misappropriation of $750,000 in investment funds provided by plaintiff under a 2021 LLC agreement, which defendant purportedly used for personal and non-company purposes. A detailed account of the facts and background of this case is set forth in the court's Decision and Order dated October 5, 2023.

On August 17, 2023, the court granted defendant's then-counsel's motion to withdraw.

Recognizing there were two motions pending at the time, the court adjourned the motions and 1

further ordered: “The case is stayed for 35 days from the date of this order for defendant to retain new counsel. Movant shall serve a copy of this order on defendant by regular first-class mail within five days of the date of this order.” In compliance with the court's directive, on August 18, 2023, defendant's then-counsel served a notice of entry along with the court's order relieving them as counsel and directing defendant to retain new counsel to defendant's personal residence located at 367 Great Plains Road, Southampton, NY 11968.

On October 5, 2023, the court granted defendant's pre-answer motion to dismiss, dismissing all causes of action except the sixth cause of action for conversion. On October 19, 2023, plaintiff served a notice of entry of the court's October 5 Decision and Order on defendant at his personal residence in Southampton. Defendant failed to file an answer to the complaint. Subsequently, on November 9, 2023, plaintiff filed a request for a preliminary conference and served a copy of the notice of the request for preliminary conference and RJI on defendant at his Southampton personal residence.

The preliminary conference was held on January 22, 2024. Plaintiff appeared, but defendant did not. The court directed plaintiffs counsel to send a courtesy letter to defendant, instructing him to contact the court by phone to be added to the email chain for future conferences. An adjourned preliminary conference was held on February 7, 2024. Once again, defendant failed to appear. Upon reviewing the court's internal meeting minutes and conference notes, it is recorded that plaintiff informed the court during this conference that it had sent a courtesy letter to defendant by regular mail, although no affidavit of service had been filed. The court directed plaintiff to resend defendant a courtesy letter via certified mail, file an affidavit of

service, and include notice of the next conference scheduled for February 28, 2024, at 9:15 a.m.

The preliminary conference scheduled for February 28, 2024, proceeded as planned, but defendant once again failed to appear. To provide the pro se defendant with a fourth opportunity

to participate, the court adjourned the conference to April 2, 2024, and directed plaintiffs counsel to send a final courtesy letter notifying defendant of the new conference date.

On February 28, 2024, plaintiff served a courtesy letter advising defendant of the April 2, 2024, conference. The letter was sent to defendant's last known business address at 90 Merrick Avenue, 5th Floor, East Meadow, NY 11554, which had also been used to serve the summons and complaint in 2022. Additionally, plaintiff served the letter to another address, 1 Short Path, Westhampton Beach, NY 11978. On the day of the April 2 preliminary conference, plaintiff sent a courtesy email to defendant at Michael.Strauss@Sproutmortgage.com, advising him of the scheduled conference. At the preliminary conference held on April 2, 2024, defendant once again failed to appear. Consequently, the court issued a conference order on the same date, stating: “After a conference held today, defendant failed to appear. Accordingly, the defendant is in default.”

Defendant claims in his cross-motion that he did not receive any of these notices for the April 2, 2024, conference, that the East Meadow business address was associated with his company, Sprout, which “in or around June 2022” was “forced to close its doors and began to engage in an orderly liquidation of its assets” and eventually “vacated this [East Meadow] space in late 2022,” and that he no longer had access to the associated email address due to the company's wind-down. As for the Westhampton Beach address, defendant claims he does not recognize it, and plaintiffs motion papers fail to clarify the origin of this address or its connection to defendant.

On August 15, 2024, plaintiff filed a motion for default judgment on its conversion cause of action against defendant and served the motion at defendant's personal residence in Southampton. Defendant's newest counsel appeared in the action on September 26, 2024, and cross-moved on October 18, 2024, to vacate the court's April 2, 2024, default order and to extend the time for defendant to answer the complaint.

Defendant ’s Cross-Motion

It is well settled that a party seeking to vacate a default “must demonstrate both a reasonable excuse for the default and the existence of a meritorious claim” (Parker v City of New York, 272 AD2d 310, 310 [2d Dept 2000] [citations omitted]; see CPLR 5015[a][1]). “The determination of what constitutes a reasonable excuse for a default lies within the sound discretion of the trial court” (id.).

Here, defendant failed to provide any reasonable excuse for his delay in answering the complaint for a year. Defendant argues that he “only defaulted in appearing during a time when he was proceeding pro se and going through an intense period of financial and personal distress.” Defendant acknowledges that his “time to submit an answer to the sole remaining cause of action began to run on October 19, 2023, and expired on November 3, 2023.” However, defendant claims that “during this period, [he] was without counsel in this action” and that “at this time, [his] financial life entered a state of complete ruin.” Despite these claims of not being able to answer before November 3, 2023, defendant fails to explain why he did not request leave to file an answer during the 10 months following the expiration of his deadline and only appeared after plaintiff filed a motion for default judgment against him.

Defendant also acknowledges that his personal residence is “367 Great Plains Road, Southampton, NY 11968,” and claims that “according to the docket, notice of the preliminary conference was not served on [him] at his home address.” However, NYSCEF Doc. No. 41 contains an affirmation of service showing that defendant was, in fact, served at this Southampton address on November 9, 2023, with a copy of the plaintiffs request for judicial intervention, request for preliminary conference, and affirmation of good faith.

Additionally, defendant contends that “the record does not reflect any notice being

provided to [him] for the April 2nd conference, aside from the correspondence dated April 2, 4

2024.” This claim is contradicted by NYSCEF Doc. No. 44, which shows that on February 28, 2024, plaintiff served a courtesy letter to defendant's East Meadow business address, advising him of the April 2, 2024, conference. Even if defendant no longer had access to his business email address or mail delivered to the East Meadow address where he was served the summons and complaint, his argument that he lacked notice of the preliminary conference does not suffice. Plaintiff had no legal obligation to notify defendant of scheduled conferences. The courtesy letters sent by plaintiff were done per the court's directive and served as additional notifications, not mandatory legal obligations.

It is defendant's own responsibility to monitor his case and not abandon ongoing litigation (see, for example, Limani Realty, LLC v Zayfert, 40 Misc 3d 32, 35 [App Term 2012] [holding that “while courts may afford a pro se litigant some latitude, a pro se litigant acquires no greater right than any other litigant and will be held to the same standards of proof as those who are represented by counsel”]; Roundtree v Singh, 143 AD2d 995, 996 [2d Dept 1988] [holding that parties appearing pro se “did so at [their] own peril” and are not entitled to additional opportunities in the interest of justice]). As early as August 17, 2023, the court directed defendant to retain new counsel and granted a 35-day stay solely for that purpose. Defendant failed to retain counsel, failed to contact the court for assistance, and provided no explanation for his inaction. Even while proceeding pro se, defendant had access to the case information, as multiple court decisions containing case details and the index number were served to his personal residence. Moreover, defendant had full access to view scheduled and upcoming conferences for his case through the publicly accessible New York courts website, a resource designed to enable pro se parties like defendant to stay informed. As a business owner and a sophisticated party, defendant should have been fully capable of managing his legal obligations. Instead, the court adjourned the preliminary conference three times due to defendant's repeated failure to appear. This delay caused prejudice

to plaintiff, who incurred extensive time and legal expense as a result of defendant's consistent defaults.

Accordingly, as defendant failed to provide any reasonable excuse for his default, defendant's cross-motion is denied.

Plainti ’s Motion

“On a motion for leave to enter a default judgment pursuant to CPLR 3215, a plaintiff is required to submit proof of service of the summons and complaint, the facts constituting the cause of action, and the defendant's default in answering or appearing” (Curra v Brunswick Hosp. Ctr., Inc., 161 AD3d 1042, 1043 [2d Dept 2018] [citations omitted]; see CPLR 3215[f]).

Here, plaintiff has established proof of service of the summons and complaint through its process server's affidavit, which confirms that defendant was served at his East Meadow business address on September 8, 2022. Defendant has not challenged the validity of this service and, in fact, appeared and filed a motion to dismiss. Plaintiff has also demonstrated the facts supporting the cause of action for conversion against defendant, as analyzed in the court's Decision and Order dated October 5, 2023, and as established by the notarized affidavit of plaintiffs principle, Keith Kantrowitz. Additionally, plaintiff has established defendant's default in answering, as the docket reflects that defendant's time to answer the complaint expired in late 2023.

Defendant argues that plaintiffs motion should be denied because plaintiff “failed to submit an affidavit in support of its claim,” alleging that the initial affidavit of plaintiff s principal, Keith Kantrowitz, was unsigned and not notarized. Defendant contends that plaintiff only refiled a notarized version on November 14, 2024, after contacting the clerk to reject the original filing. Plaintiff responds that the affidavit was, in fact, signed and notarized on August 15, 2024, and that the filing of an unexecuted version was “due to a clerical mistake.” Upon review of the docket,

NYSCEF Doc. No. 53 confirms that the affidavit of Mr. Kantrowitz was indeed signed and notarized on August 15, 2024.

Accordingly, plaintiff s motion for default judgment is granted.

Based on the foregoing, plaintiff s motion for default judgment is granted. Defendant's cross-motion is hereby denied. The issue of plaintiffs damages and interests shall be referred to a special referee to hear and report. A referral order is signed simultaneously herewith. Any arguments not expressly addressed herein was considered and deemed without merit or unnecessary to address given the court's determination.

E N T E R:

Honorable Reginald A. Boddie Justice, Supreme Court

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J.s.c.

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