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Peter T. Dolson v. Lacy Katzen

February 6, 2013

PETER T. DOLSON, PLAINTIFF,
v.
LACY KATZEN, LLP, WORLD FINANCIAL NETWORK BANK, DEFENDANTS.



The opinion of the court was delivered by: Thomas J. McAVOY Senior United States District Judge

DECISION and ORDER

Plaintiff Peter Dolson commenced the instant action against Defendants Lacy Katzen, LLP and World Financial Network Bank, alleging violations of N.Y. Gen. Bus. Law § 349 and 15 U.S.C. § 1692. Presently before the Court is Plaintiff's motion for a default judgment in the amount of $104,561.09, inclusive of attorneys' fees. Defendants have not appeared in this action.

I. FACTS

The following facts are taken from the Complaint. Because Defendants have failed to appear, the factual allegations are deemed to be true.

Plaintiff made a purchase of furniture from American Signature Furniture. The purchase was financed by Defendant World Financial Network Bank ("WFNB"). The parties entered into a note and security agreement to memorialize the financing of the furniture.

Thereafter, Plaintiff defaulted on the note and security agreement. WFNB retained Defendant law firm Lacy Katzen LLP to collect the unpaid debt.

On October 11, 2011, Lacy Katzen commenced an action against Plaintiff by filing a complaint with the Syracuse City Court. The complaint alleges that Plaintiff owed a debt to WFNB and is in default on the debt. Lacy Katzen then attempted to effectuate service of process on Plaintiff by leaving a copy of the complaint at 8192 Mantova Drive, Clay, New York 13041, and also mailing a copy of the complaint to that same address.

The instant Complaint alleges that "upon information and belief both Defendants had actual knowledge or in the alternative could have obtained actual knowledge after a reasonable inquire that the Plaintiff's address had changes from 8192 Mantova Drive, Clay, New York 13041 to 5451 Lucknow Drive, Clay, New York 13041 in November 2008." Plaintiff claims that he was never a resident of the City of Syracuse or an adjacent town.

The instant Complaint alleges that Defendants knowingly served the complaint on an incorrect address "with the purpose and forethought that improper service would likely result in a default being taken against Plaintiff" and that "Defendants knowingly caused service of a copy of the complaint referenced in paragraph 10 above to a person that was not the Plaintiff and therefore improperly disclosed that the Plaintiff had defaulted on an obligation in an attempt to harass, embarrass, and intimidate the Plaintiff into paying the alleged debt." It is alleged that these actions violated N.Y. Gen. Bus. Law § 349(a) and 15 U.S.C. § 1692.

II. STANDARD OF REVIEW

Defendant's failure to appear constitutes an admission of all well-pleaded allegations in the Complaint. H. Blair & Co., Inc. v. Gottdiener, 462 F.3d 95, 107 (2d Cir. 2006). "However, it is also true that a district court 'need not agree that the alleged facts constitute a valid cause of action.'" City of New York v. Michalis Pawn Shop, LLC, 645 F.3d 114, 137 (2d Cir. 2011) (quoting Au Bon Pain Corp. v. Artect, Inc., 653 F.2d 61, 65 (2d Cir. 1981)). "[A] district court has discretion . . . to require proof of necessary facts. . . ." Au Bon Pain, 653 F.2d at 65. The Second Circuit has instructed that "prior to entering default judgment, a district court is 'required to determine whether the [plaintiff's] allegations establish [the defendants'] liability as a matter of law.'" Machalis Pawn Shop, 645 F.3d at 137 (quoting Finkel v. Romanowicz, 577 F.3d 79, 84 (2d Cir. 2009)). "While a party's default is deemed to constitute a concession of all well pleaded allegations of liability, it is not considered an admission of damages. . . . Damages, which are neither susceptible of mathematical computation nor liquidated as of the default, usually must be established by the plaintiff in an evidentiary proceeding in which the defendant has the opportunity to contest the amount." Greyhound Exhibitgroup, Inc. v. E.L.U.L. Realty Corp., 973 F.2d 155, 158 (2d Cir. 1992).

III. DISCUSSION

a. Fair Debt Collection ...


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