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Wells Fargo Bank, N.A. v. Long Ball Utica, LLC

United States District Court, N.D. New York

June 11, 2015

WELLS FARGO BANK, N.A., as trustee for The registered holders of the J.P. Morgan Chase Commercial Mortgage Securities Trust 2006-CIBC 16, Commercial Mortgage Pass-Through Certificates Series 2006-CIBC 16, Plaintiff,
v.
LONG BALL UTICA, LLC, CITY OF UTICA INDUSTRIAL DEVELOPMENT AGENCY and BUTLER REAL ESTATE, INC., Defendant.

ARONAUER, RE & YUDELL, LLP JOSEPH ARONAUER, ESQ. New York, New York, Attorneys for Plaintiff.

DELORENZO LAW FIRM RICHARD H. WEISKOPF, ESQ. Schenectady, New York, Attorneys for Defendant. Long Ball Utica, LLC

BOND, SCHOENECK & KING LINDA E. ROMANO, ESQ. Utica, NY, Attorneys for Defendant City of Utica Industrial Development Agency BUTLER REAL ESTATE, INC.

MEMORANDUM-DECISION AND ORDER

MAE A. D'AGOSTINO, District Judge.

I. INTRODUCTION

On September 30, 2014, Plaintiff Wells Fargo, N.A., as Trustee for the Registered Holders of the J.P. Morgan Chase Commercial Mortgage Securities Trust 2006-CIBC 16, Commercial Mortgage Pass-Through Certificates, Series 2006-CIBC 16 (hereinafter "Plaintiff") brought this action to foreclose a mortgage of commercial real property situated at 2160 Erie Street, Oneida County, New York ("Mortgaged Property"). See Dkt. No. 1 at ¶¶ 82, 99(b). Defendants in this action are Long Ball Utica, LLC (hereinafter "Long Ball"), City of Utica Industrial Development Agency (hereinafter "Utica IDA"), and Butler Real Estate, Inc. (hereinafter "Butler"). See Dkt. No. 2; Dkt. No 2-1; Dkt. No 2-2.

Currently before the Court is Plaintiff's December 29, 2014 motion for entry of consent judgment of foreclosure and sale on Mortgaged Property and Rule 55 motion to enter a default judgement against Defendant Butler (which will be entered by virtue of entry of the consent foreclosure judgment). See Dkt. No 15 at ¶¶ 1, 2; Dkt. No. 15-1 at ¶ 1.

II. BACKGROUND

Defendant Long Ball is the current owner of Mortgaged Property and original borrower of the mortgage Plaintiff seeks to foreclose upon. See Dkt. No. 15-2 at ¶ 2. Long Ball was properly served pursuant to Rule 4(h)(1) of the Federal Rules of Civil Procedure on October 3, 2014. Fed. R. Civ P. 4(h)(1); See Dkt. No. 6. On January 30, 2015, Long Ball submitted notice to the Court that, pursuant to Local Rule 7.1(b)(3), it has no intention of opposing Plaintiff's motions. See Dkt. No. 23. Likewise, Defendant Utica IDA was properly served notice on October 6, 2014. See Dkt. No. 7. On November 7, 2014, Defendant Utica IDA signed and submitted to this Court notice of appearance and waiver of foreclosure. See Dkt. No. 9.

Plaintiff properly served the remaining party, Defendant Butler, on October 17, 2014. See Dkt. No. 8. Defendant Butler has no present interest in the property, but was named a defendant due to a prior recorded interest. See Dkt. No. 15-1 at ¶ 3. Defendant Butler failed to respond to the complaint within sixty days of service as required. See Dkt. Nos. 2-2. In response, Plaintiff moved for an entry of default judgment against Defendant Butler, which was entered by the Clerk of this Court on November 15, 2014. See Dkt. Nos. 10, 11. On December 29, 2014, Plaintiff filed its motion for entry of consent judgment of foreclosure and default judgment and served Defendant Butler with notice of such in accordance with the requirements of Local Rule 55.2(a)(4) and Federal Rule of Civil Procedure 4(h)(1). Fed. R. Civ P. 4(h)(1); LOCAL RULES N.D.N.Y. 55.2(a); Dkt. No. 15; Dkt. No. 16 at 1-2.

III. DISCUSSION

"Generally, Federal Rule of Civil Procedure 55 provides a two-step process that the Court must follow before it may enter a default judgment against a defendant.'" United States v. Simmons, No. 5:10-CV-1272, 2008 WL 685498, *2 (N.D.N.Y. Mar. 2, 2012) (quoting Robertson v. Doe, No. 05-CV-7046, 2008 WL 2519894, *3 (S.D.N.Y. June 19, 2008)). "First, under Rule 55(a), when a party fails to "plead or otherwise defend... the clerk must enter the party's default."'" Id. (quotation omitted); see also Fed.R.Civ.P. 55(a). "Second, pursuant to Rule 55(b)(2), the party seeking default is required to present its application for entry of judgment to the court.'" Id. (quotation omitted). "Notice of the application must be sent to the defaulting party so that it has an opportunity to show cause why the court should not enter a default judgment.'" Id. (quotation omitted); see also Fed.R.Civ.P. 55(b)(2).

In the present case, Plaintiff has amply demonstrated that Defendant Butler, a corporation, is not in the military service, an infant or an incompetent, as required under Local Rule 55.2(a). See Dkt. No. 15-1 at ¶ 5. Further, service was effected upon Defendant Butler in accordance with Rule 4(h)(1) of the Federal Rules of Civil Procedure and New York State procedural rules governing commercial mortgage foreclosure actions against a corporation. Fed.R.Civ.P. 4; N.Y. C.P.L.R. § 3215(g)(iii). As such, this Court finds that Plaintiff has met its burden and is entitled to an entry of default judgment against Defendant Butler under Rule 55 of the Federal Rules of Civil Procedure. Fed.R.Civ.P. 55.

In addition, by virtue of granting Plaintiff's December 29, 2014 motion for entry of the consent judgment of foreclosure and sale on Mortgaged Property, this Court also grants the Rule 55 motion for default judgment against Defendant Butler. See Dkt. No. 15 at ¶¶ 1, 2; Dkt. No. 15-1 at ¶ 1. Foreclosure is the proper remedy here as Defendants Long Ball-the current owner-and ...


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