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September 15, 2004.

NISSAN NORTH AMERICA, INC., CORP., et al., Defendants.

The opinion of the court was delivered by: THEODORE KATZ, Magistrate Judge


Plaintiff, Regina Lewis, proceeding pro se, brings this action against Defendants Nissan North America, Inc., Corp., Newburgh Nissan Car Dealership (collectively "Nissan"), and various employees of Nissan, claiming that she was misled in a variety of ways with regard to the purchase and financing of a Nissan automobile. The action was referred to this Court for general pretrial supervision and reports and recommendations on dispositive motions, pursuant to 28 U.S.C. § 636(b) (1) (A), (B), and (C).

In a decision, dated June 8, 2004, the Court granted in part and denied in part a motion brought by some of the Defendants to strike portions of the Complaint and for a more definite statement, and recommended the dismissal of some of Plaintiff's claims. The District Court (Kaplan, J.), accepted this Court's recommendation and dismissed Plaintiff's claims under 42 U.S.C. §§ 1983, 1985, and 1986. (See Order, dated July 6, 2004 & modified on July 7, 2004.) On June 30, 2004, Defendants Newburgh Nissan, Inc., George Harte, Joseph DiRaffaele, Sebastian D'Amica, William Birmingham, and Nelson Demeleo filed their Answer. On August 26, 2004, Defendants Nissan North America, Inc., Nissan Motor Acceptance Corp., David Inurriago, and John Brinegar ("the moving Defendants"), submitted a proposed Answer, seeking leave to file it nunc pro tunc. On August 31, 2004, Plaintiff Regina Lewis filed an application for the entry of a default and default judgment against undefined Defendants.*fn1 For the reasons that follow, Defendants' application to file their Answer nunc pro tunc is granted, and Plaintiff's application for a default judgment is denied.


  Under the Federal Rules of Civil Procedure, an answer must be filed within twenty days after a party is served with a complaint, or if a motion asserting defenses under Federal Rule of Civil Procedure 12 is filed in lieu of an answer, the answer must be filed within ten days of notice of the court's action on the motion. See Fed.R. Civ. P. 12(a) (1) (A), (4) (A). When a motion for a more definite statement is made, pursuant to Rule 12(e), and the court grants the motion, the answer must be filed within ten days after service of the more definite statement. See Fed.R. Civ. P. 12(a) (4) (B). In this action, however, while Defendants' motion was pending, the moving Defendants stipulated with Plaintiff that their answer could be filed by June 30, 2004, or five business days after the denial of the motion. Accordingly, there is no claim, nor can there be, that Defendants Newburgh Nissan, Harte, DiRaffaele, D'Amica, Birmingham, and Demeleo are in default, since they filed their Answer on June 30.*fn2

  However, the moving Defendants' Answer is untimely. At the latest, it was due by July 21, ten business days after Judge Kaplan dismissed portions of the Complaint. Defendants therefore now seek leave to file their Answer, arguing that (1) they have meritorious defenses; (2) their delay in filing their Answer was not willful; (3) there is a reasonable excuse for their default; and (4) their delay has not resulted in any prejudice to Plaintiff. (See Letter from William H. Grae, Esq., dated Aug. 26, 2004 ("Grae Letter").*fn3

  The Second Circuit has held that "[s]trong public policy favors resolving disputes on [their] merits and that, [a]lthough courts have an interest in expediting litigation, abuses of process may be prevented by enforcing those defaults that arise from egregious or deliberate conduct." Pecarsky v. Ltd., 249 F.3d 167, 172 (2d Cir. 2001) (quoting Am. Alliance Ins. Co. v. Eagle Ins. Co., 92 F.3d 57, 61 (2d Cir. 1996)); see also id. at 174 ("It is well established that default judgments are disfavored. A clear preference exists for cases to be adjudicated on the merits."); Enron Oil Corp. v. Diakuhara, 10 F.3d 90, 95-96 (2d Cir. 1993) ("[B]ecause defaults are generally disfavored and are reserved for rare occasions, when doubt exists as to whether a default should be granted or vacated, the doubt should be resolved in favor of the defaulting party.").

  As provided in Federal Rule of Civil Procedure 55(c), "[f]or good cause shown the court may set aside an entry of default. . . ." In this action, a default has not even been entered. See Fed.R. Civ. P. 55(a) ("When a party against whom a judgment for affirmative relief is sought has failed to plead or otherwise defend as provided by these rules and that fact is made to appear by affidavit or otherwise, the clerk shall enter the party's default."); see also Enron, 10 F.3d at 95. The Court will nevertheless treat Defendants' motion as one to set aside their default. See Meehan v. Snow, 652 F.2d 274, 276 (2d Cir. 1981) ("The omission of the entry of a default was largely technical because the hearing on the appellees' motion for the entry of a default judgment afforded the appellants the same opportunity to present mitigating circumstances that they would have had if a default had been entered and they had then moved under Rule 55 to set it aside."). The factors to be considered in determining whether "good cause" has been shown to relieve a party of its default are: "whether the default was willful; (2) whether setting aside the default would prejudice the adversary; and (3) whether a meritorious defense is presented." Enron, 10 F.3d at 96; see also Action S.A. v. Marc Rich & Co., Inc., 951 F.2d 504, 507 (2d Cir. 1991); Meehan, 652 F.2d at 277. "Other relevant equitable factors may also be considered, for instance, whether the failure to follow a rule of procedure was a mistake made in good faith and whether the entry of default would bring about a harsh and unfair result." Enron, 10 F.3d at 96.


  Willfulness requires a showing of bad faith or deliberate default on the part of the defaulting party, and does not "include careless or negligent errors." Am. Alliance, 92 F.3d at 62. There is no evidence of willfulness in this case. Defendants' counsel has explained that he confused the requirements of Federal Rule of Civil Procedure 12(e), with those of Rule 12(f), and believed that after this Court granted Defendants' motion to strike portions of the Complaint, Plaintiff was required to filed an amended complaint, which would then trigger the ten-day period for filing a responsive pleading. See Fed.R. Civ. P. 12(a)(4)(B). Accordingly, this factor weighs in Defendants' favor.

  Meritorious Defenses In order to establish a meritorious defense, "the test . . . is measured not by whether there is a likelihood that [the defendant] will carry the day, but whether the evidence submitted, if proven at trial, would constitute a complete defense." Pecarsky, 249 F.3d at 173 (quoting Enron, 10 F.3d at 98); see also Am. Alliance, 92 F.3d at 61 ("[T]he defense need not be ultimately persuasive at this stage. A defense is meritorious if it is good at law so as to give the factfinder some determination to make.") (internal quotation marks omitted).

  Defendants assert several defenses to Plaintiff's claims which, if proven, will preclude a finding of liability. For example, as mere assignees of Plaintiff's automobile financing contract, Defendants contend that they cannot be liable under the Truth in Lending Act ("TILA") because they did not engage in any failure to comply with the disclosure requirements of the Act.

  Defendants also contend that Plaintiff's claims under TILA will be time-barred. There is a one-year statute of limitations under TILA, see 15 U.S.C. § 1640(e), which commences running on the date of the alleged violation. In most cases involving "closed-end credit" transactions, the violation occurs on the date the plaintiff enters into the loan agreement. See Boursiquot v. Citibank F.S.B., 323 F. Supp. 2d 350, 353 (D. Conn. 2004); Cardiello v. The Money Store, Inc., No. 00 Civ. 7332 (NRB), 2001 WL 604007, at *3 (S.D.N.Y. June 1, 2001). Moreover, absent fraudulent concealment, most courts which have addressed the issue have concluded that the limitations period will not be equitably tolled for mere nondisclosure of information. See Boursiquot, 323 F. Supp. 2d at 354; Cardiello, 2001 WL 604007, at *5. In this case, Plaintiff took possession of her automobile and signed the financing agreement in March 2002, and, after demanding various financing documents, refused to make any further payments for the car as of January 6, 2003, on the grounds that she had been mislead about the financing and warranty terms. The Complaint was filed on January 23, 2004, although, this Court considers the filing date to be December 10, 2003, the date it was received in the Court's Pro Se Office. See Toliver v. County of Sullivan, 841 F.2d 41, 42 (2d Cir. 1988). The Complaint was therefore filed more than one year after Plaintiff's purchase of the automobile. Although the question cannot be resolved absent factual discovery, there thus appears to be a substantial possibility that Plaintiff's TILA claims will be time-barred.

  In addition, Defendants contend that Plaintiff's claims under the Magnuson-Moss Warranty Act, 15 U.S.C. § 2310, et seq., are facially defective, since the Act grants relief to a consumer "who is damaged by the failure of a . . . warrantor . . . to comply with any obligation . . . under a written warranty." Wilbur v. Toyota Motor Sales, U.S.A., 86 F.3d 23, 26 (2d Cir. 1996); see also 15 U.S.C. § 2310(d)(1) (1994). The Complaint recites a litany of grievances regarding misrepresentations that Nissan Newburgh made about Plaintiff's ...

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