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PSG Poker, LLC v. DeRosa-Grund

August 13, 2009

PSG POKER, LLC, AND PHIL GORDON, PLAINTIFFS,
v.
TONY DEROSA-GRUND, PROJO POKER TOURNAMENT SERIES, LLC., PROJO POKER TOURNAMENT SERVICES, LLC., AND PROJO POKER TOURNAMENT SERVIES, LLC., DEFENDANTS.



The opinion of the court was delivered by: Denise Cote, District Judge

MEMORANDUM OPINION & ORDER

Defendant Tony DeRosa-Grund has filed a Motion for Relief from Judgment pursuant to Rule 60(b) of the Federal Rules of Civil Procedure. For the following reasons, the motion is denied.

BACKGROUND

Plaintiffs PSG Poker, LLC and its principal member Phil Gordon brought suit in 2004 for breach of contract and fraudulent inducement in connection with a contract for the production of a poker television program. On December 4, 2006, following the withdrawal of counsel for the individual defendant DeRosa-Grund and the failure of counsel to appear on behalf of the corporate defendants, a default was entered against defendants Projo Poker Tournament Series, LLC, Projo Poker Tournament Services, LLC, and Projo Poker Tournament Services, LLC.

At the conclusion of the discovery period, plaintiffs moved for summary judgment on December 15, 2006, against DeRosa-Grund, the sole remaining defendant. In opposition, DeRosa-Grund argued, inter alia, that the contract at issue was "not enforceable" because Gordon had held himself out as a consultant to "Full Tilt Poker" when in fact he was a beneficial owner. DeRosa-Grund argued that defendants would not have entered into a contract with Gordon had they known about his ownership interest. In addition to his opposition to the summary judgment motion, DeRosa-Grund moved for further discovery, including discovery regarding the issue of Gordon's ownership of Full Tilt Poker.

On June 27, 2007, plaintiffs' motion for summary judgment was denied without prejudice to its renewal and plaintiffs were given an opportunity to conduct additional discovery. PSG Poker, LLC v. DeRosa-Grund, No. 06 Civ. 1104(DLC), 2007 WL 1837135, at *1 (S.D.N.Y. June 27, 2007) ("June 2007 Opinion"). The June 2007 Opinion warned DeRosa-Grund that an adverse inference might be drawn against him if he persisted in his refusal to cooperate in that discovery. Id. at *4, 6. The June 2007 Opinion also denied DeRosa-Grund's application for further discovery due to his lack of diligence during the discovery period. Id. at *7. In denying DeRosa-Grund's application for, inter alia, "documents he seeks which he claims would show that the contract was not enforceable," id. at *6, the June 2007 Opinion noted that DeRosa-Grund admitted the following: he had not made any efforts to obtain these facts in discovery because "I knew these facts to be true and it was my expectation that I would have the opportunity to bring out these facts during cross examination of Mr. Gordon at trial."

Id. The June 2007 Opinion reviewed the procedural history of the case and found that "DeRosa-Grund ha[d] not shown that he ha[d] been at all diligent in pursuing discovery; instead, he ignored this action until the plaintiffs filed their motion for summary judgment." Id. at *7.

The June 2007 Opinion also noted that defendants had initially "produced few documents" and that DeRosa-Grund had failed to appear for his deposition. Id. at *2. DeRosa-Grund was warned that if he "continue[d] to refuse to comply with his discovery obligations, adverse inferences will be applied against him." Id. at *4. The June 2007 Opinion gave DeRosaGrund "one final opportunity to comply with his discovery obligations," and issued a scheduling order to that effect. Id. at *6.

Plaintiffs then filed a renewed motion for summary judgment against DeRosa-Grund, and that motion was granted in a January 22, 2008 Opinion. PSG Poker, LLC v. DeRosa-Grund, No. 06 Civ. 1104(DLC), 2008 WL 190055 (S.D.N.Y. Jan. 22, 2008) ("January 2008 Opinion"). As described in greater detail in the January 2008 Opinion, DeRosa-Grund produced some documents, but did not provide records relevant to certain key issues, id. at *1, and an adverse inference was drawn against him. See id. at *12.

Following the grant of plaintiffs' motion for summary judgment in the January 2008 Opinion, the matter was referred to the Magistrate Judge for an inquest on the issue of damages, and an August 15, 2008 Opinion adopted the Magistrate Judge's Report and Recommendation as to damages. PSG Poker, LLC v. DeRosaGrund, No. 06 Civ. 1104(DLC), 2008 WL 3852051 (S.D.N.Y. Aug. 15, 2008). On September 24, 2008, judgment was entered against DeRosa-Grund for $340,000 in compensatory damages, $200,000 in punitive damages, and $36,266.70 in attorneys fees, for a total of $576,266.70, together with interest calculated at the rate of 9% per year, compounded annually, on a principle amount of $170,000 running from January 1, 2006 to the date of judgment of $45,274.28, and also on a principle amount of $170,000 running from January 1, 2007 to the date of judgment of $27,499.34, for a total of $649,040.32. DeRosa-Grund did not appeal from this judgment.

On April 20, 2009, DeRosa-Grund filed the instant Motion for Relief from Judgment pursuant to Fed. R. Civ. P. 60(b). Plaintiffs' opposition was filed on May 12. Plaintiffs' opposition included an application for sanctions against DeRosaGrund, including plaintiffs' costs and attorney's fees incurred in responding to this motion.

According to an Order dated April 23, 2009, DeRosa-Grund's reply papers, if any, were due on June 5, 2009. In a letter dated May 19, 2009, plaintiffs' counsel informed the Court of a bankruptcy proceeding in Texas involving DeRosa-Grund. After having been informed by plaintiffs' counsel in a letter dated July 24, 2009 that plaintiffs' motion for relief from the automatic bankruptcy stay had been granted, the Court issued an Order dated July 28, 2009 stating that DeRosa-Grund's reply papers, if any, were due by August 5, 2009.*fn1 The Court has not received any reply papers from DeRosa-Grund, nor has it received any other communication from DeRosa-Grund since April 20, 2009 regarding the status of this action.

DISCUSSION

A. DeRosa-Grund's Rule ...


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