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United States District Court, Southern District of New York

April 10, 2003


The opinion of the court was delivered by: Henry Pitman, United States Magistrate Judge

With the parties' consent, this matter is before me for all purposes pursuant to 18 U.S.C. § 636(c).

A pretrial conference was scheduled in December 2002. No one appeared on behalf of defendants at that time, and I issued an Order to show cause on December 19, 2002, advising Legendary Restaurant 2000, Inc. ("Legendary") that since it was a corporation, it could only appear by counsel and unless it retained counsel by January 20, 2003 or explained why a default judgment should not be issued, it was my intention to enter a default judgment against Legendary.

Legendary has not responded to my December 19, 2002 Order to Show Cause in any way.

It is beyond any serious question that a corporation can appear in federal court only through an attorney and that the unjustified failure of a corporation to retain counsel in a timely manner justifies the entry of a default judgment. Rowland v. California Men's Colony, 506 U.S. 194, 201-02 (1993); Powerserve Int'l. Inc. v. Lavi, 239 F.3d 508, 514 (2d Cir. 2001); Jacobs v. Patent Enforcement Fund, Inc., 230 F.3d 565, 568 (2d Cir. 2000); Eagle Assoc. v. Bank of Montreal, 926 F.2d 1305, 1306-08 (2d Cir. 1991); S.E.C. v. Research Automation Corp., 521 F.2d 585, 589 (2d Cir. 1975); RLS Assoc., LLC v. United Bank of Kuwait PLC, 01 Civ. 1290 (CSH), 2002 WL 122927 at *5 (S.D.N.Y. Jan. 29, 2002); Derekoylu Tekstil, Ltd. v. Oxford Indus., Inc., 99 Civ. 9685 (KMW) (JCF), 2001 WL 484017 at *1 (S.D.N.Y. Apr. 19, 2001) (Report & Recommendation); Comedy III Prods., Inc. v. Class Publ'ns. Inc., 95 Civ. 5552 (SS), 1996 WL 219636 at *1 n. 1 (S.D.N.Y. May 1, 1996). Since almost three months have now passed without an appearance by counsel on behalf of Legendary and without any communication whatsoever from Legendary, the entry of a default judgment against it is appropriate. See Pecarsky v. Ltd., 249 F.3d 167, 173 (2d Cir. 2001).

As a result of Legendary's default, all the well pleaded allegations of the complaint, except plaintiff's allegations concerning damages, against Legendary are deemed admitted. Dow Chemical Pac. Ltd. v. Rascator Mar. S.A., 782 F.2d 329, 336 (2d Cir. 1986) ("In principle, [the defendant] had no standing to participate in the further adjudication of issues as to its liability to plaintiffs."); Flaks v. Koegel, 504 F.2d 702, 707 (2d Cir. 1974) ("While a default judgment constitutes an admission of liability, the quantum of damages remains to be established unless the amount is liquidated or susceptible of mathematical computation"); Trans World Airlines, Inc. v. Hughes, 449 F.2d 51, 63 (2d Cir. 1971), rev'd on other grounds, 409 U.S. 363 (1973). Thus, the only issue remaining for consideration with respect to Legendary is damages.

Accordingly, it is hereby ORDERED that

1. Plaintiff shall submit proposed findings of fact and conclusions of law concerning damages no later than May 12, 2003. All factual assertions made by plaintiff is to be supported by either affidavit or other material of evidentiary weight.
2. Defendant shall submit its response to plaintiff's submissions, if any, no later than June 12, 2003. IF, BY JUNE 12, 2003. DEFENDANT (1) FAILS TO RESPOND TO PLAINTIFF'S SUBMISSIONS. OR (2) FAILS TO CONTACT MY CHAMBERS AND REQUEST AN IN-COURT HEARING. IT IS MY INTENTION TO ISSUE A REPORT AND RECOMMENDATION CONCERNING DAMAGES ON THE BASIS OF PLAINTIFF'S WRITTEN SUBMISSIONS ALONE WITHOUT AN IN-COURT HEARING. See Transatlantic Marine Claims Agency, Inc. v. Ace Shipping Corp., 109 F.3d 105, 111 (2d Cir. 1997); Fustok v. ContiCommodity Services Inc., 873 F.2d 38, 40 (2d Cir. 1989) ("[I]t [is] not necessary for the District Court to hold a hearing, as long as it ensured that there was a basis for the damages specified in a default judgment.")
3. No later than May 12, 2003, plaintiff shall either move for a default judgment against the individual defendant or explain in writing why the action should not be dismissed against the individual defendant for failure to prosecute.


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