Alghafly v Ewiess

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Alghafly v Ewiess 2019 NY Slip Op 33502(U) November 20, 2019 Supreme Court, New York County Docket Number: 650335/2019 Judge: Andrea Masley Cases posted with a "30000" identifier, i.e., 2013 NY Slip Op 30001(U), are republished from various New York State and local government sources, including the New York State Unified Court System's eCourts Service. This opinion is uncorrected and not selected for official publication. [*FILED: 1] NEW YORK COUNTY CLERK 11/27/2019 10:58 AM NYSCEF DOC. NO. 122 INDEX NO. 650335/2019 RECEIVED NYSCEF: 11/27/2019 SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK: COMMERCIAL DIVISION PART IAS MOTION 48EFM -------------------------------~------------------------------------------------~--X KHALID ALGHAFLY, AHMAD ALKHAMEES, MOHAMMED ALHULEIMI; FAHAD ALSHAIKH, and HAMZA ALALI, INDEX NO. 650335/2019 MOTION DATE Plaintiffs, MOTION SEQ. NO. 002 -v- DECISION+ ORDER ON MOTION FADI EWIESS, a/a/a "Fadi Awise," Defendant. ---------------------------------------------------------------~-------------------X HON. ANDREA MASLEY: The following e-filed documents, listed by NYSCEF document number (Motion 002) 66, 67, 68, 69, 70, 71, 72, 73, 74, 75, 76, 77, 78, 79, 80, 81, 82, 83, 84, 85, 86, 87, 88, 89, 90, 91, 92, 93, 94, 95,96, 97, 98, 99, 100, 101, 102, 103, 104, 105, 106, 107, 108, 109, 110, 111, 112, 113, 114,, 115, 116, 117, 118, 119, 120, 121 JUDGMENT - DEFAULT were read on this motion to/for Upon the foregoing documents, it is ordered that the motion is granted in part. Plaintiffs move, pursuant to CPLR 3215, for a default judgment against defendant for failure to timely respond to plaintiffs' summons and unverified complaint (NYSCEF 76). In motion 02, plaintiffs seek a default judgment as to their conversion, fraud; breach of contract, unjust enrichment, and breach of fiduciary duty claims (id). To date, defendant, who was personally served on January 23, 2019, (NYSCEF 4) has not answered, responded, or otherwise appeared. "On a motion for a default judgment under CPLR 3215 based upon a failure to answer the complaint, a plaintiff demonstrates entitlement to a default judgment against a defendant by submitting: (1) proof of service of the summons and complaint; (2) proof of the facts constituting its claim; and (3) proof of the defendant's default in answering or appearing" (Medina v Sheng Hui Realty LLC, 2018 WL 2136441, *6-7 [Sup Ct, NY County 2018] [citations omitted]). "CPLR 3215 (f} Page 1 of4 650335/2019 ALGHAFLY, KHALID vs. EWIESS, FADI Motion No. 002 1 of 4 [*FILED: 2] NEW YORK COUNTY CLERK 11/27/2019 10:58 AM NYSCEF DOC. NO. 122 INDEX NO. 650335/2019 RECEIVED NYSCEF: 11/27/2019 requires that an applicant for a default judgment file proof by affidavit made by the [moving] party of the facts constituting the claim" (see Woodson v Mendon Leasing Corp., 100 NY2d 62, 70 [2003]). The movant may, however, file a "verified complaint instead of the affidavit when the complaint has been properly served" and, because "the [movant] does not have the benefit of discovery, the affidavit or verified complaint need only allege enough facts to enable a court to determine that a viable cause of action exists" (id. at 70-71 ). Plaintiffs have met their burden as to the fraud claims. In support of this motion, plaintiffs provide proof of service of the summons and complaint upon defendant (NYSCEF 77-78), as well as affidavits of each of the plaintiffs setting forth th.e facts of their involvement with defendant's allegedly fraudulent investment scheme (see NYSCEF 79! 87, 91, 104, 117). Plaintiffs' counsel further states that no answer or other response to the complaint was timely interposed (NYSCEF 70). "The elements of fraud are a material misrepresentation of fact, knowledge of its falsity, an . intent to induce reliance, justifiable reliance by the plaintiff, and damages" (Art Capital Group, LLC·v Neuhaus, 70 AD3d 605, 607 [1st Dept 201 OJ), and the fattual allegations supporting a fraud claim must be stated with particularity under CPLR 3016 (b). Together, plaintiffs state in their affidavits that defendant intentionally misrepresented that they would receive large amounts of interest (22%) for their invested funds transferred to defendant's business, nonparty Golden Bridge Ltd. (Golden Bridge), and that those investments were "guaranteed" by a nonparty, international financial institution in order to coerce plaintiffs into wiring funds to Golden Bridge, knowing that the promised return rates, guarantees, and promise that the investments could be withdrawn at any time were false. (NYSCEF 79, 87, 91,. 104, and 117). Plaintiffs further assert that they reasonably relied on defendant's misrepresentations and were damaged by transferring funds to Golden Page 2 of 4 650335/2019 ALGHAFLY, KHALID vs. EWIESS, FADI M~~N~O~ . 2 of 4 [*FILED: 3] NEW YORK COUNTY CLERK 11/27/2019 10:58 AM NYSCEF DOC. NO. 122 INDEX NO. 650335/2019 RECEIVED NYSCEF: 11/27/2019 Bridge, which were not returned and which did not generate the promised profits. Accordingly, the motion is granted as to the fraud claims. The motion is denied as to the remaining claims as plaintiffs' do not adequately allege or demonstrate with their submissions that they contracted with or transferred funds to defendant; rather, they entered contracts with and wired funds to Golden Bridge. Further, plaintiffs do not adequately establish a fiduciary relationship between plaintiffs and defendant, individually, or that plaintiff, individually, converted or benefited from the allegedly fraudulent investments. Accordingly, the motion is denied as to the conversion, breach of contract, breach of fiduciary duty, and unjust enrichment claims, which are severed and shall continue separately from the fraud claims resolved in this decision an.d order. With respect to the fraud claims, the plaintiffs assert that they transferred the following sums to Golden Bridge: Allghafly, $255,319; Alkhamees, $50,000; Alhuleimi, $146,000; Alshaikh, $117, 779; and Alali, $13,000. Plaintiffs' request for pre-judgment interest dating from April 11, 2017 (the date on which defendant pleaded guilty in federal court) is granted. Plaintiffs' request, in the complaint, for punitive damages is denied as wholly unsupported in their submissions in connection with this motion. Accordingly, it is ORDERED that plaintiffs' motion for a default judgment, motion sequence 002, is granted in part and the Clerk of the Court is directed to enter judgment in favor of plaintiff and against defendant in the sum of $570,398, together with interest at the statutory rate from April 11, 2017, I I as calculated by the Clerk, together with costs and disbursements to be taxed by the Clerk upon submission of an appropriate bill of costs, for a total sum of$ _ __;__ _ , and plaintiff shall have execution thereof; and it is further 650335/2019 ALGHAFLY, KHALID vs. EWIESS, FADI Motion No 002 3 of 4 Page 3 of 4 [*FILED: 4] NEW YORK COUNTY CLERK 11/27/2019 10:58 AM NYSCEF DOC. NO. 122 INDEX NO. 650335/2019 RECEIVED NYSCEF: 11/27/2019 ORDERED that the second cause of action for fraud is severed and the remainder of the action continues; and it is further ORDERED that the parties shall appear for a status conference on __1+-/_Q_&-+-/JJ_D_ _ __ at~am/8 11/ a?./2019 #B~~~MJ'RE'i· . ASLEY ATE CHECK ONE: APPLICATION: CHECK IF APPROPRIATE: ~ CASE DISPOSED GRANTED 007 DENIED GRANTED IN PART SETTLE ORDER SUBMIT ORDER INCLUDES TRANSFER/REASSIGN FIDUCIARY APPOINTMENT 650335/2019 ALGHAFLY, KHALID vs. EWIESS, FADI Mntinn Nn D NON-FINAL DISPOSITION 4 of 4 D O~HER D REFERENCE Page 4 of 4

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