Edman & Co., LLC v Z & M Media, LLC

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Edman & Co., LLC v Z & M Media, LLC 2012 NY Slip Op 32918(U) December 7, 2012 Sup Ct, New York County Docket Number: 102178/11 Judge: Joan A. Madden Republished from New York State Unified Court System's E-Courts Service. Search E-Courts (http://www.nycourts.gov/ecourts) for any additional information on this case. This opinion is uncorrected and not selected for official publication. SCANNEDON I211012012 [* 1] Y . ,?&," .s SUPREME COURT OF THE STATE OF NEW YORK - NEW YORK COUNTY MOTION DATE -v- ($3 MOTION SEO. NO. MOTION CAL. NO. were read on this motion tdfot Tha following papersr numbered 1 to Notice of Motion/ Order to Show Cause Answering Affidavits - AffMavits - Exhibits ... - Exhibits I Y PAPER$ &@&E REQ I Replying Affidavits Cross-Motion: *Yes &4h 0 NQ the foregoing pape u J.S, C . Check one: ~ I N A WSPQSITION L Check if appropriate: 0 DO NOT POST \ 0 SUBMIT ORDER1 JUDG. N O N - l k L DISPOSITION 0 REFERENCE a SETTLE ORDER/ JUDG. . . A . .. [* 2] Plaintiff, . 63 -againstZ & M MEDIA, LLC, Defendant moves for an ordm ~~t - 1 * , . INDqX NO. 10217W11 ! I NED to CPLR 317 and CPLR 5015(a)(4) vacating the default judgment entered against it on May 22,2012 i the amount of $165,434.85, and to n dismiss the complaint on various grounds, Plaintiff oppoaes the motion and crossbmoves for leave of court to cure any alleged proeedud irregul athenvise that under the law are curable. Plaintiff commenced this action 201 1 seeking to recover damages for breach of a September 2009 contract entia Magazine. The contract describes d ertising Sales in Hip Hop %kddy .Iz.& M Media, LCC as Publisher and owner of Hip Hop Weekly Magazine, and plaintiff Edwn & Company LLC, as an independent tantractor and defendant s Representative far the purpose of direct[ing] and devdop[ing] d e s as East Coast and West Coast Ad Sales Director for Hip Hop Weekly Magazine. The contract provides that the interpretationand enforcement O_fthis &xgrnent Wi --- g the laws of the State ofNew York. The contract ~ S provides that [bloth Publisher and Q Representative shall defend and indemnify each other for all claims, liabilities, actions or (including reasonable of acts and omissions of the ~ t h t ~ . I [* 3] $, The complaint asserts a first cause of action for breach of contract alleging that defendant breached the agreement by failing to pay plaiptiff the commissions due under the agreement. The complaint asserts a second cause o for double damages and attorneys fees based OD Lahr Law § 191-c. The complaint alleges that plaintiff is a Connecticut limited liability company, and defendant is a Florida limited liability company, which [t]~imactdbusiness and/or supplied goods in New York State . . ,[r].egularly did or solicitid bushess in New [elngaged in any other persistent course of cdnduct in New York State . . . a d o r I . . [elxpected cxshould reasonably have expected its acts to have consequences in the state and derived substantial revenue f o interstate or international commerce. rm Defendant does not dispute that it neither appeared in this action nor answered the complht. After this court granted plaintiffs m t o for a default judgment and directed an oin inquest and assessment of damages, defendant failed to appear at the inquest. A judgment w s a entered on May 22,2012 in the total amount of $165,434.85, which includes reasomble attorney s fees, costs and disbursements in the amount of $13,693, and interest in the amount of $16,861.85, In an effort to enforce the judgment, plaintiff served a Restraining N d c e With Information Subpoena dated June 4,20 12 on JP Morgan Chase Bank in Indianapolis, Indiana. On or about June 28,2012, defendant filed an order to show cause seeking to judgment, dismiss the complaint and vacate the restraining notice. In support of the motion, defendant d e s the following arguments: 1) plaintiff, a foreign limited liability company, w s not licensed to do business in New York,and as such was a prohibited from bringing this action pursuant to New York Limited Liability Company Law 8808; 2) the default judgment w s improper as plaintiff submitted an out-of-state affidavit a 2 [* 4] j without a certificate of conformity which rendered the default void under CPLR 2309(c); 3) the court lacked personal jurisdiction over defendant pursuant to Limited Liability Company Law $304, warranting vacatur pursuant to CPLR 3 17; 4) the COW lacked subject matterjurisdiction over this case as the contract was exec de the State of New York by n Connecticut n bwiness location i the State of Florida, and plaintiff and a New Jersey defendant, that the only connection with New York wm that the plaintiff drafted the contract w i n g New York law as governing the business reIationsl.lip ; 5) jurisdiction, the judgment should be vac4td p d the complaint dismissed pwswt to CPLR 327 on forum non conveniens grounds; 6) d&m3ant has meritdous defenses; and 7 t restrzlining )b notice served on Chase Bank in Indi ant s bank account in Florida axed on the separate entity rule of 34 Misc3d 1290(A) (Sup Ct, NY Co 2012). None of defend,mt s arguments provides a sufficient factual or le@ basis for v m h g the default judgment or dismissing the complaint. While plaintiff acknowledges that it was not licensed as a foreign limited liability authorized to do business in Ned York, which was mcessary under Limited Liability Company Law $808 to bring this action, that defect is not fatal to this action, but is curable nunc pro tunc. &g Mobihvisian Medical Imaai u wices. LLC v. Sinai Diagnosh & Interventional c P C , AD3d 685 (Zd Dept 2009) Showcase . . 66 Limousine. Inc v. Carev, 269 AD2d 133 (I@Dept 2000). To that effect, plaintiff cross-moves for leave to obtain authorization to do bushes in New Ydrk as a foreign limited liability company. That crossmotion is granted, and the enfoTcement afthe judgment shall be stayed to afford dntiff a opportunity to comply with Limited Liability Campany Law 5808. 3 u. [* 5] Likewise, the absence of a certification of a foreign affidavit required by CPLR 2309(c) is a mere irregularity, and not a fatal defeat, Comimio Ltda, 68 AD3d 672,673 (18 aepE 2009). As long as the oath is duly given, authentication of the oathgiver s authority can be secure necessary. u. In response to the motioa a Certificate of Conformity, Defendant fails to raise any issue as tp the lack of personal jurisdiction based on defective sentice pursuant to Limited Liability Company Law $304. On June 20,201 1, plaintiff filed an Affidavit of Compliance which satisfies the service, notiice and filing requirements of seGtion 304. In its original motion papers, defendant reli SOlQlY on the separate and initial Affidavit of Service dated April 11,2011 and filed not include and therefore did not address the later Ai%davit of Compliance: filed in June. Now, in reply, defendant argues &at such &davit does not satis6 the following portion of section 304(e): If acceptance [of the registered rnaiEind was refused, a copy of the notice aJldprocess together with notice of the mailing by registered mail and refusal to accept shall be promptly sent to such foreign limited liability company at the same address by ordinary mail and the &davit o f compliance shall so state. Contrary to defendant s argument, plaintiff has complied with the foregoing provision. The Affidavit of Compliance explicitly states th& the s m o m and complaint w e e senred on defendant by delivery to the Secr- of State on April 8,20 11, pursuant to section 304 Qfthe Limited Liability Company Law, that copies were mailed to defendant on April 1,2011 by registered mail, return receipt, and that [rJegistered . . .. .. . -. . . . .. [* 6] 4 1 deponent Cprocess servei, on June 2 ., returned by the U.S. Post Office, marked returnto sender-unclaimed. The Affidavit of Compliance further states that [oJn June 20,201 1 a true copy of said Swnmons and Complaint and Notice were mailed to defendant at said address by first class mail, with certificate of mailing. Also, on a q m t e page attached to the Afidavit of Compliance, are copies of the certificate of mailing, and the post ofice stamp indicating that the registered mail addressed to defendant was funclairned. Thus, since the AEdavit of Compliance establishes that plaintiff satisfied the requiraents of Limited Liabdity Company Law $304, defendant has failed to raise any issue as to pasanal jurisdiction. Defendant s objection as to subject mer jdadiction does not properly address of subject matter jurisdiction. Defendant s wsertian that the parties are both foreign companies With no connection to New York, goes to the issue of personal, as opposed to subject matter jurisdiction. The court notes that even ifm issue of long-arm jurisdiction were raised, defendant does not dispute the allegations in the complaint, quoted above, regarding its business activities in New York. Defendant seeks dismissal of the complaint on grounds of fonun non conveniens, Since defendant has not provided a sufficient basis for vacating its default, it is not in a p move for dismissal on forum non convenim grounds pursuant to CPLR 327. As defendant has failed to establish a legal basis for vacating the default judgment based on the grounds asserted in the motion, the court need not determine whether defendant othmvise a meritorious defense. The court notes that defendant s motion papers provide no excuse or explanation for its to timely appear and answer, and that defendant is not moving to vacate its dehult under 5015(a)(l) which requires a showing of both a reasonable excuse and a meritorious 5 [* 7] - Finally, defendant argues that the res@aining notice served on Chase Bank in In not act to restrain its bank account in Florida, citing the separate entity rule. Plaintiffs opposition papers do not address this argument. The court agrees with defendant that under the separate entity rule the restrainkg notice served on the bank branch in lndiann does not ~ s t r & 35 bank accounts in Florida. &g MiscSd 1203(A) (Sup Ct, NY Co 2012); Globd Techolow. & @ I . v. Rovd &,&of c n d aa% Neverthelessj the court doclines to gant any relief wt respect to the Indiana restraining ih notice, as defendant has not made any showing that plaintiff is attempting to use it t restrain o accounts in Florida. Accordingly, it is ORDERED that defendant s motion to May 22,2012 in the amount of $165,434.85 and to dismiss the complaint, is denied i its entirety n and the judgment shall stand; ad it is furthe ORDERED that plaintiff s cro& Qn is p.nMto the extent that the enforcement of the judgment shall be stayed until M e r order of this court, to give plaintiff an opportunity to comply wt Limited Liability Company Law $808; and it is further ih ORDERED that upon c may move by Order to Show C I defense. Euaene DiJ,orenzo. Inc, v. A.C. Dutto-h C0. Inc)67N m t r e Row Phase ZJ Assocs v.H&lC& 27 AD3d 216 (lstDept 2006).

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