Corsair Special Situations Fund, L.P. v. Pesiri, No. 16-158 (2d Cir. 2018)

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Justia Opinion Summary

Corsair obtained a $5,443,171.33 judgment against the defendants. Corsair learned that one of the defendants had a contract with National Resources, entitling the defendant to a payment of more than $3,000,000 and obtained a writ of execution.  Corsair engaged Connecticut State Marshall Pesiri, who successfully served the writ. National Resources ignored it, relinquishing $2,308,504 to Corsair only after Corsair instituted and won a subsequent turnover action. Perisi sued, seeking a statutory commission. The Second Circuit concluded that Connecticut state law was insufficiently developed for the court to answer the question raised on appeal. The court certified questions to the Connecticut Supreme Court. The court responded that Marshal Pesiri was entitled to a 15 percent fee under CONN. GEN. STAT. 52‐8 261(a)(F). It does not matter that the writ was ignored and that the monies that were the subject of the writ were procured only after the judgment creditor, not the marshal, pursued further enforcement proceedings in the courts. The Second Circuit then affirmed the district court’s fee award in the amount of $346,275.60.

This opinion or order relates to an opinion or order originally issued on July 13, 2017.

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16 158 Corsair Special Situations Fund, L.P. v. Pesiri 1 2 UNITED STATES COURT OF APPEALS FOR THE SECOND CIRCUIT 3 August Term, 2016 (Argued: October 24, 2016 4 Decided: April 13, 2018) Docket No. 16 158 5 6 7 8 CORSAIR SPECIAL SITUATIONS FUND, L.P., Plaintiff–Appellant, 9 v. 10 11 12 13 14 15 STATE MARSHAL MARK PESIRI, Intervenor–Appellee, ENGINEERED FRAMING SYSTEMS, INC., JOHN J. HILDRETH, MARIE N. HILDRETH, EFS STRUCTURES, INC., Defendants. 16 17 18 Before: LEVAL, SACK, AND RAGGI, Circuit Judges. Corsair, a judgment creditor, appeals from an award by the United States 19 District Court for the District of Connecticut (Janet C. Hall, Judge) to Connecticut 20 State Marshal Pesiri of a fifteen percent commission on a collected debt, which 21 Corsair obtained independently from a third party after the writ of execution 22 Pesiri served on the third party was ignored. We previously concluded that this 23 case involved unsettled Connecticut law and certified two questions to the 24 Connecticut Supreme Court. First: [w]as Marshal Pesiri entitled to a fifteen 16 158 Corsair Special Situations Fund v. Pesiri 1 percent fee under the terms of Conn. Gen. Stat. § 52 261(a)(F)? Corsair Special 2 Situations Fund, L.P. v. Pesiri, 863 F.3d 176, 183 (2d Cir. 2017). And second: [i]n 3 answering the first question, does it matter that the writ was ignored and that the 4 monies that were the subject of the writ were procured only after the judgment 5 creditor, not the marshal, pursued further enforcement proceedings in the 6 courts? Id. The Connecticut Supreme Court accepted the certification, 7 answering the first question in the affirmative and the second in the negative. 8 Corsair Special Situations Fund, L.P. v. Engineered Framing Sys., Inc., 327 Conn. 467, 9 481, 174 A.3d 791, 799 (2018). Accordingly, the district court s fee award is: AFFIRMED. 10 11 12 13 14 15 GREGORY J. SPAUN (Matthew S. Sturtz, Derek P. Roussillon, Miles & Stockbridge P.C., Baltimore, Maryland, on the brief), Welby, Brady & Greenblatt, LLP, Danbury, Connecticut, for Plaintiff Appellant. 16 17 18 NEAL L. MOSKOW (Deborah M. Garskof, on the brief), Ury & Moskow L.L.C., Fairfield, Connecticut, for Intervenor–Appellee. 19 20 21 2 16 158 Corsair Special Situations Fund v. Pesiri 1 PER CURIAM: 2 3 appeals from a fee award by the United States District Court for the District of 4 Connecticut (Janet C. Hall, Judge) in favor of Intervenor Appellee State Marshal 5 Mark A. Pesiri ( Pesiri ). We assume the parties familiarity with our earlier 6 opinion in this matter, which discusses at length the underlying facts, procedural 7 history, and arguments presented on appeal. Corsair Special Situations Fund, L.P. 8 v. Pesiri, 863 F.3d 176 (2d Cir. 2017). We repeat them here only insofar as we 9 think it necessary to understand the discussion that follows. Plaintiff Appellant Corsair Special Situations Fund, L.P. ( Corsair ) In June 2010, Corsair obtained a judgment from the United States District 10 11 Court for the District of Maryland jointly and severally against the defendants in 12 the amount of $5,443,171.33. Id. at 177 78. While attempting to enforce [that] 13 judgment, Corsair learned that one of the defendants, having become a 14 judgment debtor of Corsair, signed a contract with a Connecticut based third 15 party, National Resources, entitling [it] to a payment from National Resources of 16 more than $3,000,000. Id. at 178 (footnote omitted). On learning that, Corsair 17 enrolled its judgment in the United States District Court for the District of 18 Connecticut, which thereupon issued a writ of execution. Id. Corsair engaged 3 16 158 Corsair Special Situations Fund v. Pesiri 1 Pesiri to serve a writ of execution on National Resources for a portion of the debt. 2 Id. Although Pesiri successfully served the writ, National Resources ignored 3 4 it, relinquishing the $2,308,504 to Corsair only after Corsair instituted and won a 5 subsequent turnover action for the monies. Id. Despite the intervening legal 6 action taken by Corsair in pursuit of the fruits of its judgment, the district court 7 held that under Connecticut General Statute § 52 261(a),* Pesiri was entitled to a 8 full fifteen percent commission on the $2,308,504. Corsair Special Situations Fund, 9 L.P. v. Engineered Framing Sys. Inc., No. 3:11 CV 01980 (JCH), 2016 WL 128089, at 10 *6, 2016 U.S. Dist. LEXIS 3322, at *20 (D. Conn. Jan. 11, 2016). It therefore 11 awarded him fees representing that fifteen percent: $346,275.60. Id. Connecticut General Statute § 52 261(a), which governs [f]ees and expenses of officers and persons serving process or performing other duties, provides in relevant part: The following fees shall be allowed and paid: . . . (F) for the levy of an execution, when the money is actually collected and paid over, or the debt or a portion of the debt is secured by the officer, fifteen per cent [sic] on the amount of the execution, provided the minimum fee for such execution shall be thirty dollars . . . . Conn. Gen. Stat. § 52 261(a)(F) (2011). * 4 16 158 Corsair Special Situations Fund v. Pesiri On appeal, Corsair argued that Pesiri was not entitled to the fee because it 1 2 collected the debt itself through the enforcement proceedings. Corsair Special 3 Situations Fund, L.P., 863 F.3d at 177. We concluded that the statute governing a 4 fee award in this context was ambiguous and certified two questions to the 5 Connecticut Supreme Court: 6 7 (1) Was Marshal Pesiri entitled to a fifteen percent fee under the terms of Conn. Gen. Stat. § 52 261(a)(F)? 8 9 10 11 12 (2) In answering the first question, does it matter that the writ was ignored and that the monies that were the subject of the writ were procured only after the judgment creditor, not the marshal, pursued further enforcement proceedings in the courts? 13 Id. at 183. The Court accepted the certification, and on January 2, 2018, 14 responded. Corsair Special Situations Fund, L.P. v. Engineered Framing Sys., Inc., 15 327 Conn. 467, 174 A.3d 791 (2018). It answered the first question, Yes, i.e., 16 Pesiri was entitled to the fifteen percent fee under § 52 261(a)(F), and the second 17 question, No, i.e., it did not matter that the writ was ignored by the judgment 18 creditor and the monies were obtained through enforcement proceedings. Id. at 19 481, 174 A.3d at 799. The Connecticut Supreme Court, in reaching that conclusion, relied on its 20 21 observation that Pesiri s proper service and demand were essential predicates to 5 16 158 Corsair Special Situations Fund v. Pesiri 1 recovery of [the] debt [via turnover], a fact made evident by Corsair s own 2 statements in its application for, and memorandum in support of, the turnover 3 order. Id. at 480. The Court based its decision on its interpretation of the 4 statute, concluding that Pesiri met the conditions required for the fee. Id. at 472 5 80. We then authorized and received additional briefing from the parties, which 6 we have considered. We receive the response to our certification bearing in mind that the 7 8 highest court of a state has the final word on the meaning of state law, and are 9 bound to apply [Connecticut] law as determined by the [Connecticut Supreme 10 Court]. Engel v. CBS, Inc., 182 F.3d 124, 125 (2d Cir. 1999) (per curiam) (internal 11 quotation marks and citations omitted). The Supreme Court of Connecticut has 12 now decided that under Connecticut law, Pesiri is entitled to the full fifteen 13 percent fee. We therefore AFFIRM the district court s decision to award Pesiri 14 fees in the amount of $346,275.60. 6

Primary Holding

Connecticut State Marshal was entitled to a 15 percent statutory commission although the monies that were the subject of the writ served by the marshal were procured only after the judgment creditor, not the marshal, pursued further enforcement proceedings in the courts.

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