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John Hancock Life Insurance Co. v. Perchikov


January 15, 2010


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

By motion dated September 29, 2008, cross-plaintiff Laryssa Vasserman, through her administratrix Elizabeth Katchalova ("Katchalova" or "plaintiff"), seeks default judgment against cross-defendant Euguene Perchikov a/k/a Eyal Shahar ("Perchikov" or "defendant"). Katchalova seeks to recover (1) life insurance proceeds received by Perchikov from Union Central Life Insurance Company as a result of Vasserman's death, plus interest; (2) damages for wrongful death, plus interest; and (3) punitive damages in the sum of $10 million. For the reasons stated below, Katchalova's motion for default judgment is granted, and damages are awarded in the sum of $6,826,466.01.*fn1

I. Factual Background*fn2

Cross-plaintiff Elizabeth Katchalova, a resident of Kings County, New York, is the administratrix of the estate of Laryssa Vasserman. Vasserman, who was a resident of Ukraine until immigrating to New York in 1999, died on November 19, 2002. At the time of her death, Vasserman did not understand, speak, read, or write English. Cross-defendant Eugene Perchikov, a/k/a Eyal Shahar, is believed to be a citizen and resident of Israel. During frequent visits to the United States, he resided with Ms. Vasserman, with whom he had a romantic relationship, at her apartment in Brooklyn. At all times relevant to this action, Ms. Vasserman was married to but separated from Alexander Vasserman ("A. Vasserman" or "Mr. Vasserman"), and had a daughter, Elizabeth (Yelizaveta) Klyuchnikova ("Klyuchnikova"), from a previous marriage. Klyuchnikova was born on February 22, 1984, and resided with her mother at all times until Ms. Vasserman's death. Ms. Vasserman was the sole source of financial support for her daughter, and received no financial support from either her first husband (Klyuchnikova's father) or from Mr. Vasserman.*fn3

Ms. Vasserman applied for three life insurance policies in late 2000-one for $1,000,000 from Union Central Life Insurance Company ("Union Central"), one for $1,000,000 from Metropolitan Life Insurance Company ("MetLife"), and a third for $1,500,000 from Allstate Life Insurance Company ("Allstate"). The Allstate application listed Vasserman's sister Irena Esina as the primary beneficiary and her daughter Elizabeth as the contingent beneficiary. Ms. Vasserman withdrew her application before Allstate could act on it. MetLife issued a policy to Ms. Vasserman. The Union Central application, which resulted in the issuance of a policy, initially listed Ms. Vasserman's husband, Alexander Vasserman, as the primary beneficiary. Later, Ms. Vasserman changed the primary beneficiary of her Union Central policy to Irena Esina, and designated Eugene Perchikov as the contingent beneficiary, identifying both Esina and Perchikov as her cousins. Ms. Vasserman again changed her Union Central beneficiary ten months later, designating her "cousin" Eyal Shahar as the primary beneficiary.

Around the same time, Ms. Vasserman applied for a $1,000,000 life insurance policy from John Hancock. In that application, she listed Eugene Perchikov as her "husband" and primary beneficiary. When this policy lapsed in early 2001, Ms. Vasserman applied for a new $1,000,000 life insurance policy from John Hancock, this time listing Perchikov as Vasserman's "cousin" and primary beneficiary. John Hancock again issued the policy.

Perchikov accompanied Vasserman to each meeting with insurance company representatives and provided information to the companies about Ms. Vasserman's employment, income, marital status, and beneficiaries, because Vasserman could not communicate in English. Perchikov also paid the premiums on each of Vasserman's policies.

On November 19, 2002, Perchikov assaulted, battered, and murdered Ms. Vasserman for the purpose of obtaining the proceeds of the life insurance policies in force at the time of her death. Because the two year contestable period had expired, Union Central immediately paid $1,000,000 plus interest to Shahar/Perchikov as sole primary beneficiary of Vasserman's life insurance policy.*fn4 MetLife and John Hancock disqualified Perchikov from receiving Ms.

Vasserman's insurance benefits because he had intentionally caused her death, and they refused to pay him. Katchalova alleges that she-as administratrix of Vasserman's estate-is the proper beneficiary of the proceeds of Vasserman's Union Central policy. She further alleges that Perchikov is liable for wrongful death and for punitive damages.

II. Analysis

A. Entry of Default Judgment

Rule 55(a) of the Federal Rules of Civil Procedure sets forth the procedures for securing a default judgment in cases where "a party against whom a judgment for affirmative relief is sought has failed to plead or otherwise defend." Fed. R. Civ. P. 55(a). Katchalova has completed the first step of Rule 55's two-part process by requesting that the Clerk of Court enter default judgment. Default was entered on June 3, 2008. Since Perchikov has failed to contest the default, this court may complete the Rule 55 process by entering a default judgment. Fed. R. Civ. P. 55(b).

Here, plaintiff alleges that Perchikov was unjustly enriched by receipt of Ms. Vasserman's Union Central life insurance proceeds; and that he is liable for wrongful death because he killed Ms. Vasserman specifically in order to recover said proceeds. Plaintiff's well-pleaded allegations, together with defendant's failure to appear at all in connection with this case, make clear that default judgment is appropriate in this case.

Under New York law, a life insurance beneficiary who kills the insured is disqualified from collecting the insured's life insurance proceeds. See Riggs v. Palmer, 70 Sickels 506, 22 N.E. 188 (N.Y. 1889); In re Barrett, 224 A.D.2d 415 (2d Dep't 1996). By submission of the certified copy of the affidavit of Union Central claims examiner Jill O'Connor, which was originally submitted in the state court action Katchalova v. Perchikov, No. 45186/03 (Sup. Ct. Kings Cty. 2007), aff'd 43 A.D. 3d 873 (2d Dep't 2007), Katchalova has proved that Union Central paid the $1,000,000 proceeds of Ms. Vasserman's life insurance policy to Perchikov. See Debrot Cert. Ex. F at 7. Because Perchikov was not a proper beneficiary, he has "received the money . of another which is inequitable or against good conscience for him . to retain." AGF York 57 L.P. v. Glikman, 24 Misc. 3d 1225(A), 2009 WL 2208405, at *5 (Sup. Ct. N.Y. Cty. July 16, 2009) (citing Miller v. Schloss, 28 N.Y. 400, 407 (1916)). As such, Katchalova has offered sufficient proof of her claim that Perchikov was unjustly enriched by receipt of Vasserman's life insurance proceeds, which were paid to him to the detriment of Ms. Vasserman's rightful beneficiaries-her estate and her daughter. See Estate of Grieco v. Bankers Am. Life Assurance Co., 251 A.D.2d 446, 447 (2d Dep't 1998).

Katchalova also has established a claim for wrongful death. Under New York law, "the personal representative . of a decedent who is survived by distributees may maintain an action to recover damages for a wrongful act . which caused the decedent's death against a person who would have been liable to the decedent . if death had not ensued.." N.Y. Est. Pow. & Trst. § 5-4.1. Had Ms. Vasserman survived, Perchikov would have been liable to her for battery based upon the facts alleged in Katchalova's cross-complaint. See Debrot Cert. Ex. C; see also, e.g., Wende C. v. United Methodist Church, 4 N.Y.3d 293, 298 (2005).

Given that Katchalova has adequately supported the allegations, and given that defendant has not once appeared in these proceedings, the court determines that the grounds for default are clearly established, finds no reason to delay further resolution of this case, and grants Katchalova's motion for default judgment.

B. Damages

"While a default judgment constitutes an admission of liability, the quantum of damages remains to be established by proof unless the amount is liquidated or susceptible to mathematical computation." Flaks v. Koegel, 504 F.2d 702, 707 (2d Cir. 1974). Where, as here, the plaintiff has submitted detailed affidavits informing the court of the basis for the recovery sought, the court can set damages without holding an evidentiary hearing. See Fed. R. Civ. P. 55(b)(2); see also Transatlantic Marine Claims Agency, Inc. v. Ace Shipping Corp., 109 F.3d 105, 111 (2d Cir. 1997). Having reviewed the Debrot certification and the Freifelder, Katchalova, Klyuchnikova, and Vasserman affidavits, the court finds that Perchikov is liable for the following damages.

i. Life Insurance Proceeds

As discussed above, and as described in the affidavits of Union Central employees Jill O'Connor and Rebecca Vonderhaar, Debrot Cert. Exs. F, G, Perchikov received the proceeds of Ms. Vasserman's Union Central life insurance policy even though, by virtue of his intentional killing of Ms. Vasserman, he should have been disqualified as a beneficiary. In accordance with the terms of the Union Central policy, Ms. Vasserman's estate-through cross-plaintiff Katchalova-was the proper beneficiary of the proceeds once Perchikov was excluded. See Debrot Cert. Ex. F(1) (copy of Union Central policy). As such, Perchikov has been unjustly enriched by receipt of the proceeds, and must pay over to Katchalova the proceeds of the Union Central life insurance policy, plus interest. See N.Y. C.P.L.R. § 5001.

On April 16, 2003, Perchikov received $1,008.164.38 from Union Central, representing the policy proceeds plus interest from the date of Ms. Vasserman's death. Debrot Aff. Ex. F, ¶ 13. Since that date, $566,785.20 in interest has accrued to date. See N.Y. C.P.L.R. §§ 5002, 5004. Thus, the court awards Katchalova $1,574,949.58 in life insurance proceeds.

ii. Wrongful Death Damages

New York law permits the following recovery on a successful wrongful death claim: (1) "compensation for pecuniary injuries resulting from the decedent's death to the persons for whose benefit the action is brought"; (2) reasonable expenses, including funeral expenses of the decedent that were paid by the distributes; and (3) "interest upon the principal sum" at a rate of 9 percent per year. N.Y. Est. Pow. & Trst. § 5-4.3; N.Y. C.P.L.R. § 5004. Punitive damages also are available if they would have been recoverable had the decedent survived. N.Y. Est. Pow. & Trst. § 5-4.3.

Here, Katchalova, on behalf of distributees Klyuchnikova and Mr. Vasserman, seeks wrongful death damages for loss of financial support, the cost of replacing Klyuchnikova's health insurance, which was formerly provided by Ms. Vasserman's employer,*fn5 and loss of inheritance. Such damages are available under New York law, and Katchalova has submitted sufficient proof of damages in the form of the affidavit of Leonard R. Freifelder, Ph.D, an expert in the application of economic models and statistical analysis. In his affidavit, Dr. Freifelder opines that Ms. Vasserman's estate suffered a total economic loss of $245,091, comprised of $124,954 in past loss of financial support and health insurance as of December 31, 2008 (Freifelder's projected date of decision in this case), and $120,137 in loss of future inheritance. Freifelder Aff. Ex. B. 12-13.

The court accepts Freifelder's calculations regarding recoverable wrongful death damages. The court awards $245,090.00 in wrongful death damages, representing the principal calculated in the Freifelder Affidavit, plus interest from Ms. Vasserman's death to Katchalova's estimated date of verdict, December 31, 2008.*fn6 This total is one dollar less than Dr. Freifelder's total, which reflected a mathematical error.*fn7

In addition, the court awards to Katchalova $4,145.00 in funeral expenses plus $2,281.43 in interest from the date of Ms. Vasserman's death to December 31, 2008, for a total of $6,426.43. See Katchalova Aff. ¶ 18, and Ex. D.

The total wrongful death damages, inclusive of funeral expenses and interest, are as follows:*fn8

InjuryRecoveryTotal Interest (9% per annum from 11/19/2002 to 12/31/2008)Total Funeral Expenses$4,145.00$2,281.43$6,426.43 Health Insurance$21,339.00$6,699.00$28,038.00 Loss of Financial Support$80,630.00$16,285.00$96,915.00 Loss of Inheritance$120,137.00N/A$120,137.00    Total = $251,516.43

iii. Punitive Damages

Punitive damages are available to redress a defendant's "outrageous" conduct. Exxon Shipping Co. v. Baker, --- U.S. ----, 128 S.Ct. 2605, 2621-22 (2008). The Supreme Court has instructed that punitive damages "should only be awarded if the defendant's culpability, after having paid compensatory damages, is so reprehensible as to warrant the imposition of further sanctions to achieve punishment or deterrence." State Farm Mutual Auto. Ins. Co. v. Campbell, 538 U.S. 408, 419 (2003).

While the Supreme Court has "rejected the notion that the constitutional line is marked by a simple mathematical formula," BMW of North America v. Gore, 517 U.S. 559, 582 (1996), the Court has determined that "few awards exceeding a single-digit ratio between punitive and compensatory damages . will satisfy" the constraints of due process-particularly, the requirement that "a penalty should be reasonably predictable in its severity." Baker, 128 S.Ct. at 2627; State Farm, 538 U.S. at 425. In some cases, the appropriate ratio will be far lower. See, e.g., Baker, 128 S.Ct. at 2632, 2633 (holding that a ratio of 1:1 is the "fair upper limit" in maritime tort cases "of reckless action, pointless to the tortfeasor, resulting in substantial recovery for substantial injury."). However, heavier punitive damages have been found to be justified in circumstances where the "wrongdoer" acts or fails to act "in order to augment profit," or where one acts willfully or maliciously "with a purpose to injure." Baker, 128 S.Ct. at 2622. In addition, relatively large punitive damages awards are justified where "wrongdoing is hard to detect (increasing chances of getting away with it)" or where "the value of the injury and the corresponding compensatory award are small (providing low incentives to sue)." Id.

In this case, Perchikov engaged in reprehensible, malicious conduct with both a purpose to injure and the desire to profit. He targeted a woman who was especially vulnerable because of her inability to speak English and status as a recent immigrant. He not only helped her apply for life insurance, but also completed the forms for her, and, in doing so, supplied information he knew to be false to the life insurance companies. He killed Ms. Vasserman specifically to recover her life insurance benefits. And, because Ms. Vasserman earned a small salary, the compensatory damages available to her estate and to her daughter are small in comparison to the egregiousness of Perchikov's act and the resulting harm. Gore, 517 U.S. at 582. For these reasons, the court awards $5 million in punitive damages.*fn9

III. Conclusion

For the foregoing reasons, Katchalova's motion for default judgment is granted, and damages are awarded in the sum of $6,826,466.01, representing $1,574,949.58 in insurance proceeds, $251,516.43in wrongful death damages, and $5 million in punitive damages. The Clerk of Court is directed to enter judgment accordingly and close this case.


NINA GERSHON United States District Judge

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