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VIADA v. OSAKA HEALTH SPA

United States District Court, S.D. New York


December 13, 2005.

JUANA VIADA, ET AL., Plaintiffs,
v.
OSAKA HEALTH SPA, INC., ET AL., Defendants.

The opinion of the court was delivered by: KEVIN FOX, Magistrate Judge

REPORT and RECOMMENDATION

In this action, brought pursuant to the Fair Labor Standards Act and analogous provisions of state law, the plaintiffs have requested that a default judgment be entered against the corporate defendants: Osaka Health Spa, Inc. d/b/a Osaka 56; Osaka Health Spa Center Corp. d/b/a/ Osaka 56; Osaka 46 Traditional Health Spa, Inc. d/b/a Osaka 46; and Osaka Spa Construction, Inc. ("Osaka"), because they failed to comply with two Orders of the Court dated April 11, 2005 and May 13, 2005. Each of the orders directed the Osaka corporate defendants to obtain new counsel, since their prior counsel had been relieved by the Court of the obligation of continuing to represent them in this action. Each of the orders also directed the Osaka corporate defendants to have their new counsel provide a copy of any Notice of Appearance counsel might file with the Clerk of the Court to all other parties to the action and to the undersigned magistrate judge.

The plaintiffs maintain that the Osaka corporate defendants' failure, repeatedly, to comply with the orders of the Court, that they obtain new counsel to represent them in this action, warrants the entry of a default judgment against them. Moreover, the plaintiffs note that a corporate entity cannot appear in an action pro se; it can conduct litigation only through counsel. See Shapiro, Bernstein & Co., Inc. v. Continental Record Co., Inc, 386 F.2d 426, 427 (2d Cir. 1967). In addition, the plaintiffs contend that the entry of a default judgment against the Osaka corporate defendants is also warranted because they did not seek additional time from the Court to comply with the above-noted orders and failed to apprise the Court of attempts, if any, they made to comply with the Court's orders.

  After the plaintiffs filed the instant motion, a Notice of Appearance was filed with the Clerk of Court, by an attorney, on behalf of the Osaka corporate defendants. That attorney prepared a written submission in opposition to the instant motion. The submission made on behalf of the Osaka corporate defendants was untimely. Moreover, it is devoid of citation to any legal authority.

  When a corporate defendant fails, repeatedly, to appear by counsel in an action, a default judgment may be entered against it. See Shapiro, Bernstein & Co., Inc., 386 F.2d at 427. However, the Court is mindful that a default judgment is the most severe sanction that a court, in the exercise of its discretion, may apply. See Cody v. Mello, 59 F.3d 13, 15 (2d Cir. 1995). The Court is also mindful that the Second Circuit Court of Appeals has expressed a strong preference for having litigation resolved on the merits, and not through the entry of a default judgment. See Powerserve Int'l, Inc. v. Lavi, 239 F.3d 508, 514 (2d Cir. 2001). Thus, while it is reprehensible that the Osaka corporate defendants failed to abide by the orders of the Court directing them to obtain new counsel by dates certain, now that the Osaka corporate defendants have retained counsel who is assisting them in defending against this action, the Court finds that it is reasonable and appropriate to allow the action to be resolved against the Osaka corporate defendants on the merits, as is the preference in this circuit. Therefore, the Court recommends that the plaintiffs' motion for the entry of a default judgment against the Osaka corporate defendants be denied.

  FILING OF OBJECTIONS TO THIS REPORT AND RECOMMENDATION

  Pursuant to 28 U.S.C. ยง 636(b)(1) and Rule 72(b) of the Federal Rules of Civil Procedure, the parties have ten (10) days from service of the Report to file written objections. See also Fed.R.Civ.P. 6. Such objections, and any responses to objections, shall be filed with the Clerk of Court, with courtesy copies delivered to the chambers of the Honorable Victor Marrero, United States District Judge, 40 Centre Street, Room 414, New York, New York 10007, and to the chambers of the undersigned, 40 Centre Street, Room 540, New York, New York 10007. Any requests for an extension of time for filing objections must be directed to Judge Marrero. FAILURE TO FILE OBJECTIONS WITHIN TEN (10) DAYS WILL RESULT IN A WAIVER OF OBJECTIONS AND WILL PRECLUDE APPELLATE REVIEW. See Thomas v. Arn, 474 U.S. 140 (1985); IUE AFL-CIO Pension Fund v. Herrmann, 9 F.3d 1049, 1054 (2d Cir. 1993); Frank v. Johnson, 968 F.2d 298, 300 (2d Cir. 1992); Wesolek v. Candair Ltd., 838 F.2d 55, 57-59 (2d Cir. 1998); McCarthy v. Manson, 714 F.2d 234, 237-38 (2d Cir. 1983).

20051213

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