U.S. Bank National Association v. Kozikowski

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF NEW YORK

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U.S. BANK NATIONAL ASSOCIATION, :

NOT IN ITS INDIVIDUAL CAPACITY BUT :

SOLELY AS TRUSTEE FOR THE RMAC :

TRUST, SERIES 2016-CTT, :

: MEMORANDUM AND ORDER

Plaintiff, : ADOPTING IN PART

: REPORT & RECOMMENDATION

-against- :

: 19-CV-00783 (DLI) (CLP)

RYSZARD KOZIKOWSKI, et al., :

:

Defendants. :

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DORA L. IRIZARRY, United States District Judge:

On February 8, 2019, U.S. Bank National Association, not in its individual capacity but

solely as Trustee for the RMAC Trust, Series 2016-CTT (“Plaintiff”), commenced this action

pursuant to New York Real Property Actions and Proceedings Law (“RPAPL”) against Ryszard

Kozikowski, Anna Chelstowska, Czeslaw Chelstowski (together, “Individual Defendants”), the

Clerk of the Suffolk County District Court, and the Clerk of the Suffolk County Traffic and Parking

Violations Agency (together, “Suffolk County Defendants” and, collectively with the Individual

Defendants, “Defendants”), seeking to foreclose on a mortgage encumbering 99 Wilson Avenue,

Amityville, New York 11701 (the “Property”). See, Complaint (“Compl.”), Dkt. Entry No. 1.

Defendants did not appear or answer the Complaint. Plaintiff requested a certificate of default,

and the Clerk entered a notation of default against Defendants. See, Dkt. Entry Nos. 14-15.

On October 16, 2019, Plaintiff moved for a default judgment pursuant to Federal Rule of

Civil Procedure (“Fed. R. Civ. P.”) 55. See, Plf.’s First Mot., Dkt. Entry Nos. 20-21. The motion

was referred to the Honorable Cheryl L. Pollak, now Chief United States Magistrate Judge who,

on October 29, 2020, issued a Report and Recommendation (“R&R”) identifying deficiencies both

in Plaintiff’s proof of compliance with RPAPL § 1304’s pre-foreclosure notice requirement and in

Plaintiff’s proof of damages. See, R&R, Dkt. Entry No. 25. The magistrate judge recommended

that the Court deny Plaintiff’s default judgment motion without prejudice to renew pending

resolution of two certified questions submitted to the New York State Court of Appeals by the

Second Circuit in CIT Bank N.A. v. Schiffman, 948 F.3d 529 (2d Cir. 2020), certified questions

accepted, 34 N.Y.3d 1137 (2020) that concerned compliance with, inter alia, RPAPL § 1304. See,

R&R at 10-11.

In its objections to the R&R, Plaintiff contended that, pursuant to New York state

intermediate appellate court authority, compliance with RPAPL § 1304 is a non-jurisdictional

defense that must be raised by the defendant to a foreclosure action and, thus, the magistrate judge

erred by considering sua sponte Plaintiff’s compliance with RPAPL § 1304 in the default judgment

context. See, Plf.’s First Objs., Dkt. Entry No. 27. In ruling on Plaintiff’s objection, this Court

recognized that the New York state decisions Plaintiff cited were at odds with the disposition of

this issue by the federal courts in this district that have held that, even in the context of a

defendant’s default, a court should consider a plaintiff’s compliance with RPAPL § 1304 sua

sponte. Order dated March 31, 2021, Dkt. Entry No. 35, at 4-5. Given the split on this issue and

the potential clarification forthcoming in Schiffman, this Court held that “it would not be prudent

to decide this question prior to the resolution of Schiffman.” Id. at 5. Accordingly, over Plaintiff’s

objections, the Court adopted the R&R in substantial part, denying the motion without prejudice,

and modifying the R&R only to the extent that the Clerk of Court was directed to close the case

administratively, with leave to reopen upon Schiffman’s resolution. See, Id. at 9.

However, unlike Defendants here, the defendants in Schiffman had not defaulted; instead,

they had opposed the plaintiff’s summary judgment motion by raising, inter alia, plaintiff’s failure

to comply with RPAPL § 1304 as a defense. See, Schiffman, 36 N.Y.3d at 554. Thus, given

Schiffman’s procedural posture, neither the Second Circuit nor the New York State Court of

Appeals reached the question now before this Court of whether a court should assess independently

a plaintiff’s compliance with RPAPL § 1304 if the defendants did not appear or interpose an

answer, and, thus, defaulted.

Nonetheless, upon Schiffman’s resolution, Plaintiff filed a motion to reopen the case, which

the Court granted on September 7, 2021 giving Plaintiff leave to renew its default judgment

motion. See, CIT Bank N.A. v. Schiffman, 36 N.Y.3d 550 (2021); Plf.’s Mot. to Reopen, Dkt. Entry

No. 38; Electronic Order dated September 7, 2021. The Court also directed Plaintiff to submit

supplemental documentation to support its damages claims given the deficient support Plaintiff

had submitted in connection with its first motion. See, Electronic Order dated September 7, 2021.

On October 5, 2021, Plaintiff filed its renewed motion for default judgment. See, Plf.’s

Renewed Mot., Dkt. Entry No. 40; Plf.’s Memorandum of Law in Support of its Renewed Motion

(“Plf.’s Mem.”), Dkt. Entry No. 41. Notably, and notwithstanding Plaintiff’s awareness that

Schiffman’s resolution failed to provide clarity as to whether a court should assess sua sponte a

plaintiff’s compliance with RPAPL § 1304 on a default judgment motion, Plaintiff did not raise

any argument contending that it is not required to demonstrate compliance with RPAPL § 1304 in

this case. See, Id. at 17-18. Instead, Plaintiff argued only that, “[a]lthough the defaulting

Defendants did not allege any statutory defenses, the Plaintiff through the Affidavit established

compliance with, inter alia, the pre-foreclosure notice requirements of RPAPL §1304[.]” Id.

Plaintiff’s renewed motion seeks default judgment against the Individual Defendants as

mortgagors, and against the Suffolk County Defendants as alleged subordinate lienholders and

necessary defendants. See, Id. It also requests a judgment of foreclosure and sale; damages under

the note, mortgage, and loan modification agreement (collectively, the “Loan Documents”); and

attorney’s costs related to the prosecution of this action. 1 See, Id. at 19-20. Defendants did not

oppose the motion. The motion was referred to the magistrate judge and, on May 10, 2022, the

Honorable Cheryl L. Pollak, Chief United States Magistrate Judge, issued the instant R&R,

recommending the Court deny the motion in its entirety without prejudice. 2 See, R&R, Dkt. Entry

No. 48. Plaintiff objected timely to the R&R.3 See, Plf.’s Objs., Dkt. Entry No. 50.

For the reasons set forth below, the R&R is adopted in part and rejected in part, and

Plaintiff’s motion for default judgment, including all damages and other relief requested therein,

is denied without prejudice to renew consistent with this Memorandum and Order.

LEGAL STANDARD

When a party objects to an R&R, a district judge must make a de novo determination with

respect to those portions of the R&R to which the party objects. See, Federal Rules of Civil

Procedure (“Fed. R. Civ. P.”) 72(b)(3); 28 U.S.C. § 636(b)(1); See also, United States v. Male

Juvenile, 121 F.3d 34, 38 (2d Cir. 1997) (citation omitted). Pursuant to the standard often

articulated by the district courts of this Circuit, “[i]f a party . . . simply relitigates his original

arguments, the Court reviews the Report and Recommendation only for clear error.” Antrobus v.

N.Y. City Dep’t of Sanitation, 2016 WL 5390120, at * 1 (E.D.N.Y. Sept. 26, 2016) (internal

citations and quotation marks omitted); See also, Rolle v. Educ. Bus Transp., Inc., 2014 WL

1 Plaintiff’s motion also requests that this action be dismissed voluntarily pursuant to Fed. R. Civ. P. § 41(a)(2) against

DCFS Trust, which Plaintiff contends is a defendant that it never served because it determined it was not a necessary

defendant. See, Plf.’s Renewed Mot., at 1; Plf.’s Mem. at 2. However, DCFS Trust does not appear to have been

named as a defendant in the Complaint nor does DCFS Trust appear as a party on the docket. As such, this motion is

denied.

2 The Court assumes the parties’ familiarity with the facts and procedural posture of this case as set forth by the

magistrate judge in both the October 29, 2020 R&R and the instant May 10, 2022 R&R.

3 Unless otherwise noted, all references to “the R&R” made throughout the remainder of this Order refer to the second

R&R issued on May 10, 2022.

4662267, at *1 (E.D.N.Y. Sept. 17, 2014) (“[A] rehashing of the same arguments set forth in the

original papers . . . would reduce the magistrate’s work to something akin to a meaningless dress

rehearsal.”) (internal citations and quotation marks omitted).

On the other hand, the Court of Appeals for the Second Circuit has suggested that a clear

error review may not be appropriate “where arguably ‘the only way for [a party] to raise . . .

arguments [is] to reiterate them.’” Moss v. Colvin, 845 F.3d 516, 519 n.2 (2d Cir. 2017) (quoting

Watson v. Geithner, 2013 WL 5441748, at *2 (S.D.N.Y. Sept. 27, 2013)). Nonetheless, a court

will not “ordinarily . . . consider arguments, case law and/or evidentiary material which could have

been, but [were] not, presented to the magistrate judge in the first instance.” Santiago v. City of

New York, 2016 WL 5395837, at *1 (E.D.N.Y. Sept. 27, 2016) (internal citation and quotation

marks omitted). Separately, when there is no objection “to a magistrate judge’s recommendation,

the recommendation is reviewed, at most, for ‘clear error.’” Barrera v. F & A Rest. Corp., 2021

WL 2138875, at *1 (E.D.N.Y. May 25, 2021) (citing Fed. R. Civ. P. 72(b), Advisory Committee’s

Notes (1983)). After its review, the district court then may “accept, reject, or modify the

recommended disposition; receive further evidence; or return the matter to the magistrate judge

with instructions.” Fed. R. Civ. P. 72(b)(3); See also, 28 U.S.C. § 636(b)(1).

DISCUSSION

RPAPL § 1304 instructs that, at least ninety days before commencing a foreclosure action,

a plaintiff must send notice “by registered or certified mail and also by first-class mail to the last

known address of the borrower, and to the residence that is the subject of the mortgage.” RPAPL

§§ 1304(1), (2). “‘Proper service of RPAPL 1304 notice on the borrower or borrowers is a

condition precedent to the commencement of a foreclosure action, and the plaintiff has the burden

of establishing satisfaction of this condition.’” Schiffman, 948 F.3d at 533 (quoting Deutsche Bank

Nat. Tr. Co. v. Spanos, 102 A.D.3d 909, 961 (2d Dep't 2013)). However, it remains unsettled

whether compliance with RPAPL § 1304 is a defense that must be raised by the defendant to a

foreclosure action, as intermediate New York state courts have held, or whether, in the context of

a default by the defendant, a court should review compliance with RPAPL § 1304 independently,

as a number of federal courts in the Second Circuit, and particularly in this district, have held. See,

Order dated March 31, 2021, at 5 (citing Windward Bora, LLC v. Thompson, 2020 WL 1242828,

at *4 n.6 (E.D.N.Y. Mar. 16, 2020)).

Here, the magistrate judge explained that, absent any argument in Plaintiff’s renewed

motion as to whether or why this Court should not follow the federal precedent requiring a sua

sponte assessment of a plaintiff’s compliance with RPAPL § 1304 on a default judgment motion,

such an assessment would ensue. See, R&R at 11-12. In undertaking such an assessment, the

magistrate judge found Plaintiff’s proof of compliance with RPAPL § 1304 insufficient and, thus,

recommended that the Court deny Plaintiff’s renewed default judgment motion in its entirety on

that ground. Id. at 13. The magistrate judge also found that Plaintiff’s proof of damages remained

deficient and, thus, further recommended that, even if the Court were to find in Plaintiff’s favor

on the RPAPL § 1304 notice requirement, the motion still should be denied in its entirety without

prejudice to renew upon the submission of additional evidence to support the damages requested

under the Loan Documents. Id. at 13-15.

Plaintiff objects to the R&R on two grounds. First, Plaintiff contends that the magistrate

judge erred by considering Plaintiff’s compliance with RPAPL § 1304 sua sponte. Plf.’s Objs. at

2-7. Second, Plaintiff contends that it has submitted sufficient evidence to substantiate the

requested damages and, therefore, its default judgment motion should be granted. Id. at 7-8.

Plaintiff did not object to portion of the R&R that considered and found Plaintiff’s proof

concerning compliance with RPAPL § 1304’s notice requirement insufficient to support granting

the default judgment motion. See, R&R at 12-13.

For the reasons set forth below, and upon due consideration of the R&R and Plaintiff’s

objections thereto, the Court finds that: (1) Plaintiff’s compliance with RPAPL § 1304 should not

be considered sua sponte and, thus, Plaintiff’s failure to establish compliance with RPAPL § 1304

does not preclude it from prevailing on its default judgment motion; and (2) although Plaintiff has

established liability against the Individual Defendants, Plaintiff has failed to submit sufficient

evidence to substantiate any of its requested damages. Accordingly, the R&R is rejected as to the

magistrate judge’s recommendation that the motion be denied for Plaintiff’s failure to establish

compliance with RPAPL § 1304, and is adopted as to the magistrate judge’s recommendation that

Plaintiff’s default judgment motion be denied without prejudice to renew upon the submission of

additional evidence to substantiate the requested damages.

I. Plaintiff’s First Objection: Consideration of RPAPL § 1304

In support of its first objection as to the magistrate judge’s sua sponte consideration of its

compliance with RPAPL § 1304, Plaintiff cites to New York intermediate appellate court decisions

finding that the failure to comply with RPAPL § 1304 is a non-jurisdictional defense and, thus, a

plaintiff is not required to show, nor should a court consider sua sponte, compliance with RPAPL

§ 1304 where the borrower does not raise it as a defense. See, Plf.’s Objs. at 4-5 (collecting cases).

Plaintiff asserts that a federal court construing New York law is bound by the law as interpreted

by the New York State Court of Appeals, but where, as here, the New York State Court of Appeals

has not addressed an issue, federal courts may consider state intermediate appellate court precedent

as a helpful indicator of how the New York State Court of Appeals may rule. Id. at 4. Plaintiff

also cites to RPAPL § 1302(2), which refers to a violation of RPAPL § 1304 as a “defense” to a

mortgage foreclosure action. Id. Plaintiff contends that the magistrate judge’s reliance on the

federal decisions from this district was misplaced because those decisions are inconsistent with

both the statutory text and “unequivocal” New York intermediate appellate court precedent. Id. at

6-7. Plaintiff also asserts that the New York intermediate appellate court precedent is consistent

with Second Circuit precedent finding generally that courts should not raise sua sponte non-

jurisdictional defenses not raised by the parties and that the Court here is bound by the doctrine of

stare decisis to adhere to such precedent. Id. at 6-7 (citing Acosta v. Artuz, 221 F.3d 117, 122 (2d

Cir. 2000) (discussing non-jurisdictional defenses in the context of the Antiterrorism and Effective

Death Penalty Act (AEDPA) and 28 U.S.C. § 2254 habeas petitions)).

Although Plaintiff’s arguments may have some merit, they are raised improperly for the

first time on objection, and, thus, the Court is under no obligation to consider them. See, Faison

v. Comm’r of Soc. Sec., 2020 WL 1528152, at *2 (S.D.N.Y. Mar. 31, 2020). As mentioned above,

a party may not oppose an R&R by asserting new arguments and case law that could have been

presented to the magistrate judge in the first instance but were not. See, Ferreira v. Carranza,

2022 WL 34610, at *2 (E.D.N.Y. Jan. 4, 2022) (citation omitted); E. Sav. Bank, FSB v. Johnson,

2020 WL 1452461, at *1 (E.D.N.Y. Mar. 25, 2020); Iacob v. http://re.brooklyn-

flatbush.com/midtown-renter-hit-with-300k-lawsuit-for-using-airbnb/, 2020 WL 2570358, at *2

(S.D.N.Y. May 21, 2020) (citation omitted).

Here, Plaintiff’s objection regarding RPAPL § 1304 differs significantly from the argument

it presented to the magistrate judge in its opening default judgment motion. Compare Plf.’s Mem.

at 17-18 with Plf.’s Objs at 4-7. As discussed above, Plaintiff did not raise in its opening motion

any argument contending that it is not required to demonstrate compliance with RPAPL § 1304.

See, Plf.’s Mem. at 17-18. Nor did Plaintiff cite any of the cases on which it now relies and that

were available to it at that time. See, Id. Plaintiff’s failure to raise these arguments in its opening

motion is inexcusable for two reasons. First, Plaintiff already was aware of, and intimately familiar

with, many of the arguments it now raises on objection because it raised them before this Court in

connection with its objections to the first R&R issued on October 29, 2020. Compare Plf.’s First

Objs at 1-3 with Plf.’s Objs at 4-7. Second, Plaintiff was on notice that these arguments would

have continued relevance upon renewal of its motion because, as Plaintiff itself notes in its

objections to the instant R&R, Schiffman “did not address the question of whether a court should

consider sua sponte if there was compliance with RPAPL §1304 in the context of a default by the

defendant.” See, Plf.’s Objs. at 4. For these reasons, the Court finds that the arguments and case

law raised in this objection could, and should, have been brought before the magistrate judge.

Not only should these arguments and case law have been brought before the magistrate

judge, but the magistrate judge’s analysis and findings also were based in part on the absence of

the very arguments that Plaintiff now raises on objection. As explained above, the magistrate

judge had prefaced the decision to assess Plaintiff’s proof compliance with RPAPL § 1304 by

pointing out the absence of any argument in Plaintiff’s moving papers as to whether or why the

Court should not undertake such an assessment.4

Notwithstanding the fact that, for the foregoing reasons, the Court need not consider

Plaintiff’s arguments in support of this objection, the Court finds that Plaintiff’s objection and

some of the arguments raised therein have merit in light of intervening case law. In particular, the

Court finds persuasive a recent decision issued by the Honorable Kiyo A. Matsumoto, United

4 Plaintiff contends that the R&R “is silent with respect to the litany of New York State intermediate appellate

precedent or why such axiomatic decisional law should be disregarded and ignored,” but this ignores the fact that the

magistrate judge explicitly had proceeded to analyze RPAPL § 1304’s requirements because of Plaintiff’s own failure

to raise such arguments in its moving papers. See, R&R at 10-12; Plf.’s Objs at 7. Notably, Plaintiff otherwise fails

to provide any explanation for not making these arguments in its renewed motion before the magistrate judge initially.

States District Judge of this Court, wherein Judge Matsumoto held that the plaintiff was “not

required to demonstrate its compliance with RPAPL 1304 in order to obtain a default judgment,

since the failure to comply with RPAPL 1304 is not a jurisdictional defect, and that defense was

not raised by [the defendants], who failed to answer the complaint.” Secretary of U.S. Dep’t of

Housing and Urban Dev. v. Rhodie as Co-Trustee of Lornice Rhodie Revocable Living Trust, 2022

WL 3213048, at *4 (E.D.N.Y. Aug. 9, 2022) (citing to New York State Second Department

Appellate Division cases) (internal quotation marks and citations omitted). Judge Matsumoto

explained that, “[t]his court ‘is bound to apply [state] law as interpreted by a state’s intermediate

appellate courts unless there is persuasive evidence that the state’s highest court would reach a

different conclusion’” and found New York State Second Department Appellate Division cases

persuasive given the absence of any guidance from the New York State Court of Appeals on this

issue. Id. (quoting Chufen Chen v. Dunkin’ Brands, Inc., 954 F.3d 492, 499 (2d Cir. 2020) (citation

omitted). In recognizing, but declining to follow, other courts in this district that have reviewed

compliance with RPAPL § 1304 in the default judgment context, Judge Matsumoto pointed out

that “none of th[o]se courts ha[s] engaged…with the countervailing Appellate Division cases” that

Judge Matsumoto found persuasive. Id. (citation omitted).

Thus, despite Plaintiff’s failure to raise its arguments regarding RPAPL § 1304 in its

opening motion, and despite finding no clear error as to the magistrate judge’s unopposed finding

that Plaintiff provided insufficient proof of RPAPL § 1304 notice, the Court adopts the analysis

set forth by Judge Matsumoto and holds that, because the failure to comply with RPAPL § 1304

is a non-jurisdictional defect, “Plaintiff’s failure to establish compliance with [RPAPL §] 1304

does not preclude the entry of default judgment.” See, Rhodie, 2022 WL 3213048, at *4. Given

the frequency with which this issue arises, this Court respectfully submits that the issue is one that

should be certified as a question to the New York State Court of Appeals.

However, a defendant’s default “does not necessarily conclusively establish…[a]

defendant[s’] liability.” Rhodie, 2022 WL 3213048, at *2 (internal quotations marks and citations

omitted). Instead, “the court must determine whether the plaintiff's allegations establish the

defendant’s liability” or, in other words, “whether the plaintiff has stated a cause of action.” Id.;

Freedom Mortg. Corp. v. Jett, 2019 WL 3714795, *2-4 (E.D.N.Y. May 23, 2019) (internal

quotation marks and citations omitted), report & recommendation adopted, 2019 WL 3805103

(E.D.N.Y. Aug. 13, 2019). Thus, prior to addressing damages, the Court must determine if

Plaintiff has made a prima facie showing of Defendants’ liability as to warrant default judgment.

Although the magistrate judge made no determination as to Defendants’ liability, the Court

has reviewed the Complaint and documentation submitted by Plaintiff and finds that, for the

following reasons, Plaintiff adequately has pled a prima facie case against the Individual

Defendants, but not against the Suffolk County Defendants. As such, Plaintiff’s default judgment

motion as to the Suffolk County Defendants is denied without prejudice to renew upon the

submission of further information consistent with this Memorandum and Order.

Furthermore, for the reasons set forth in Section II, below, the Court concurs with the

magistrate judge’s finding that Plaintiff failed to submit sufficient evidence to substantiate any of

its requested damages. Thus, although Plaintiff established a prima facie case as to liability against

the Individual Defendants, Plaintiff’s motion for default judgment as to the Individual Defendants

also is denied without prejudice to renew upon the submission of further evidence to substantiate

the damages and other costs requested consistent with this Memorandum and Order. See, Onewest

Bank, N.A. v. Hawkins, 2015 WL 5706945, at *4 (E.D.N.Y. Sept. 2, 2015) (“The court has

significant discretion and may consider a number of factors in deciding whether to grant a default

judgment,” including, inter alia, “whether the facts alleged in the complaint state a valid cause of

action [and] whether there are unresolved questions regarding material issues of fact as to liability

or damages[.]”) report & recommendation adopted, 2015 WL 5706953, at *1-2 (E.D.N.Y. Sept.

28, 2015).

A. Liability

As to the Individual Defendants, Plaintiff seeks default judgment on its foreclosure claim.

“Under New York law, a plaintiff seeking to foreclose upon a mortgage must demonstrate the

existence of the mortgage and mortgage note, ownership of the mortgage, and the defendant's

default in payment on the loan secured by the mortgage.” Rhodie, 2022 WL 3213048, at *3

(internal quotation marks and citations omitted). First, Plaintiff has demonstrated the existence of

the Mortgage and Note. 5 Mortgage, Dkt. Entry No. 8, at 12-31; Note, Dkt. Entry No. 8, at 4-11.

Second, Plaintiff has established ownership over the Mortgage and Note by documenting the

assignments from Mortgage Electronic Registration Systems Inc. (“MERS”), as nominee for

Approved Funding Corp., to BAC Home Loans Servicing; to Nationstar Mortgage LLC; and,

ultimately, to Plaintiff. See, Compl. ¶¶ 2-3, 15-18; Assignments, Dkt. Entry No. 8, at 32-37, 55.

Lastly, Plaintiff has established default under the provision of the Loan Modification Agreement

requiring the Individual Defendants to make payments in accordance with the Note and Mortgage

beginning on February 1, 2016, as the Complaint alleges that Defendants have failed to make such

requisite payments. See, Compl. ¶¶ 19-20; Loan Modification Agreement, Dkt. Entry No. 8, at

40; See, e.g., ARCPE Holding, LLC. v. 9Q4U5E LLC, et al., 2021 WL 8316275, at *3 (E.D.N.Y.

5 The Certificate of Merit attached to the Complaint, which was filed on February 8, 2019, purports to annex the Note,

Mortgage, Assignment, and Loan Modification Agreement, but those documents do not appear to have been so

annexed. See, Certificate of Merit, Dkt. Entry No. 1-3. Instead, those documents appear annexed to a version of the

Certificate of Merit that was filed on March 22, 2019. See, Dkt. Entry No. 8.

Aug. 11, 2021) (finding allegations of failure to make payments due by a date certain under the

terms of the note and mortgage sufficient to establish prima facie entitlement to foreclosure) report

& recommendation adopted, 1:19-cv-06417-DLI-RER, Electronic Order dated September 7, 2021.

Accordingly, Plaintiff has established a prima facie case against the Individual Defendants.

As to the Suffolk County Defendants, Plaintiff seeks default judgment on its claim to

extinguish their Property interests because they allegedly hold liens against the Property that are

subordinate to Plaintiff’s Mortgage. Compl. ¶ 9. In this regard, a complaint must allege “‘nominal

liability,’—i.e., that any judgments or liens a defendant may have against the property are

subordinate to the plaintiff's lien.” See, Jett, 2019 WL 3714795, at *3-4. Furthermore, pursuant

to RPAPL § 202-a, “‘[w]here a city or any department, bureau, board, commission, officer, agency

or instrumentality thereof is a defendant in an action affecting real property, the complaint shall

set forth:…[d]etailed facts showing the particular nature of the interest in or lien on the real

property and the reason for making such’ an entity a party to the action.” 6 Empire Cmty. Dev.,

LLC. v. Giambalvo-West, 2020 WL 9813022, at *6 (E.D.N.Y. Mar. 6, 2020) (quoting RPAPL §

202-a and analyzing allegations of nominal liability as to the Clerk of the Suffolk County District

Court and the Suffolk County Traffic and Parking Violations Agency under RPAPL § 202-a’s

heightened pleading requirement) report & recommendation adopted, 2:19-cv-05341-DLI-RLM,

Electronic Order dated March 27, 2020.

Here, the Complaint alleges only that each Suffolk County Defendant is “the holder of a

lien encumbering the Property, which is subject and subordinate to Plaintiff’s Mortgage.” Compl.

6 Although it is unclear whether the Suffolk County Defendants are considered state agencies or city agencies for

RPAPL purposes, the RPAPL provisions governing pleadings as to a state’s interest and a city’s interest both require

“[d]etailed facts showing the particular nature of the interest in or lien on the real property and the reason for making”

the state or city a party defendant. See, RPAPL §§ 202, 202-a.

¶¶ 8-9. “These bare allegations fail to satisfy the pleading requirement of N.Y. RPAPL § 202–a”

and it is otherwise unclear where, if anywhere, Plaintiff has provided supporting documentation

of the alleged liens. See, Onewest Bank, N.A. v. Cole, 2015 WL 4429014, at *4 (E.D.N.Y. July

17, 2015); Empire Cmty. Dev., LLC., 2020 WL 9813022, at *6-7 (finding allegations as to Suffolk

County agency defendants insufficient where complaint stated “neither the total sums of the liens

owed by these defendants nor the nature of the interest in or lien on the real property,” but still

granting default judgment because plaintiff submitted documents showing liens totaling a sum

certain for the agencies). Accordingly, Plaintiff has failed to establish a prima facie case against

the Suffolk County Defendants and, thus, Plaintiff’s default judgment motion as to the Suffolk

County Defendants is denied without prejudice to renew upon the submission of documentation

evidencing the alleged liens.

II. Plaintiff’s Second Objection: Sufficiency of Damages Evidence

Even if a plaintiff adequately alleges a defendant’s liability warranting default judgment, a

plaintiff still must prove damages. See, Eastern Sav. Bank, FSB v. Beach, 2014 WL 923151, at *9

(E.D.N.Y. Mar. 10, 2014) (explaining that courts may decide whether a plaintiff has submitted

sufficiently detailed affidavits and documentary evidence to support damages requested) (citations

omitted). Plaintiff’s second objection is that it has submitted sufficient evidence to support the

requested damages amounts. Plf.’s Objs. at 7-10. In support of the damages it requests under the

Loan Documents, Plaintiff has submitted the Affidavit of Anthony Younger and its exhibits (the

“Younger Affidavit”), which include, inter alia, a copy of the loan modification agreement setting

forth the principal balance and interest rate as modified by the agreement, copies of the other Loan

Documents, and computer printouts that appear to show customer account activity and transaction

history (together, the “transaction records”) related to the at-issue mortgage loan transaction. See,

Younger Aff., Dkt. Entry No. 42-6. 7

Plaintiff contends that the Younger Affidavit and transaction records are sufficient to

support all damages amounts requested for unpaid principal, deferred principal under the loan

modification agreement, interest, late charges, hazard insurance disbursements, tax disbursements,

and property inspection and preservation disbursements. Plf.’s Objs. at 8-10. However, the

magistrate judge found Plaintiff’s papers are insufficient to substantiate each such amount

requested. See, R&R at 13-15. Upon de novo review, this Court agrees.

As to the requests for unpaid principal and interest, Plaintiff fails to explain why the

requested amounts are warranted, how they were calculated, or how they are supported by

Plaintiff’s papers. See, Beach, 2014 WL 923151, at *9-10 (awarding principal amount requested

where it was corroborated by the transaction history submitted and awarding interest where

plaintiff provided a breakdown of how the interest was analyzed and calculated). Upon an

independent review of Plaintiff’s papers, the Court finds that the amounts set forth in the loan

modification agreement for unpaid principal and deferred principal appear to match the amounts

requested in the Younger Affidavit for the same, but Plaintiff has failed to show how its transaction

records support these amounts. The Younger Affidavit asserts that the amounts requested are due

through September 25, 2021, but Plaintiff submitted transaction records dated through August 26,

2021 only. Compare Younger Aff. at 3 with Id. at 65-132. Additionally, as noted in the R&R,

there is an unexplained reference on the transaction records to a “new loan” issued on October 19,

2012 in the amount of $286,106.04, which does not match any other of the loan information

provided. See, R&R at 14; See also, Lightning 1179 LLC v. Rodriguez, 2020 WL 7000902, at *7

7 Citations to “Younger Aff.” refer to the Younger Affidavit as well as its attached exhibits.

(E.D.N.Y. Sept. 18, 2020) (declining to award damages amounts requested in light of, inter alia,

“inconsistencies in the record”), report & recommendation adopted, 2020 WL 6042000, *1-2

(E.D.N.Y. Oct. 13, 2020). Furthermore, without an analysis of the interest that has accumulated

on the principal amounts sought or an explanation for how the requested interest figure was

computed, the Court cannot verify the amount of interest requested. See, R&R at 14; CIT Bank

N.A. v. Schiffman, 2022 WL 1085419, at *3 (E.D.N.Y. Feb. 16, 2022) (recommending award of

interest where Plaintiff’s affidavit provided its analysis and computations of the interest that had

accrued in order to show how the amount requested was reached), report & recommendation

adopted, 2022 WL 912520, at *1-2 (E.D.N.Y. Mar. 29, 2022). Plaintiff cannot expect the Court

to sift through its supporting documentation while engaging in guesswork to figure out how

Plaintiff reached the amounts stated in the Younger Affidavit.

The Court similarly finds that it is unable to verify the amounts requested for late charges,

hazard insurance disbursements, tax disbursements, property inspection disbursements, and

preservation disbursements. Plaintiff contends that the transaction records and Younger Affidavit

are sufficient to demonstrate that these amounts are due to Plaintiff because they itemize each

mortgage loan transaction and identify the type, date, and amount of each transaction. Plf.’s Objs.

at 9. However, while the transaction records appear to include notations for these categories of

charges, the Younger Affidavit fails to explain how the transaction records substantiate the total

amounts that Plaintiff requests as to each category or how these requested totals otherwise were

reached. See, Younger Aff. at 65-132. See, Hawkins, 2015 WL 5706945, at *8 (declining to award

requested damages where plaintiff “failed to sufficiently explain the figures on the screen-print”

submitted and otherwise failed to clearly set forth support for the amount requested),

Moreover, the Younger Affidavit fails to provide an itemization of the amounts requested

for any of these categories other than for hazard insurance and tax disbursements, and, even with

the itemization provided for those categories, Plaintiff fails to demonstrate how the transaction

records substantiate the sum Plaintiff seeks for them. See, Younger Aff. at 3-6. First, the charges

itemized for hazard insurance disbursements on the Younger Affidavit are dated through

September 21, 2021, yet the transaction records reflect transaction and account activity occurring

through August 26, 2021 only. Compare Id. at 3 with Id. at 80. Second, a significant number of

the itemized charges labeled on the Younger Affidavit as hazard insurance disbursements

inexplicably seem to correspond to flood insurance disbursement charges listed on the transaction

records, not to hazard insurance disbursement charges. Compare Id. at 3-6 (listing, for example,

a “hazard insurance” charge of $240.91 on August 20, 2021) with Id. at 80-132 (showing on the

attached transaction records that, on August 20, 2021, there was only a “flood insurance

disbursement” charge of $240.91). Third, the transaction records contain notations for “town tax”

disbursements as well as for “town/boro” charges, but Plaintiff fails to explain which charges

substantiate those itemized in the Younger Affidavit or why. Id. at 67-76, 83-129. Without any

indication as to how the amounts sought were calculated or how the transaction records Plaintiff

has now provided substantiate the amounts listed in the Younger Affidavit for each of these

categories, the Court cannot verify the damages sought. See, R&R at 13-15.

For these same reasons, Plaintiff cannot legitimately support its objection that the proof of

damages it has proffered is “substantially similar” to the proof this Court found sufficient in

Schiffman or that it is akin to the “itemizations and schedules of payments and transactions” found

sufficient in United States v. Scott. See, Plf.’s Objs. at 8-9 (citing Schiffman, 2022 WL 1085419,

at *3-4); Id. at 10 (citing United States v. Scott, 2021 WL 4942076, at *3 (N.D.N.Y. Oct. 22,

2021)). The plaintiff’s affidavit in Scott, unlike Plaintiff’s affidavit here, appended a “schedule”

that itemized the individual transactions, including identifying the date and amount of each

transaction, that it sought to recover for each category of damages requested, thus allowing the

Court to verify how the attendant transaction records substantiated the amounts requested on the

affidavit. Scott, 2021 WL 4942076, at *3. Similarly, the plaintiff in Schiffman, unlike Plaintiff

here, provided an additional affirmation that explained how each of the total amounts requested in

its affidavit were calculated or how the attendant transaction records otherwise substantiated those

amounts. See, Schiffman, 2022 WL 1085419, at *2-3 (finding “that the records support and are

consistent with the calculations in plaintiff's affidavits.”)

Notably, and for similar reasons, the Court finds meritless Plaintiff’s contention that

Freedom Mortgage Corp. v. Jett, cited in the R&R, “is distinguishable.” See, Plf.’s Objs. at 10;

R&R at 13-14 (citing Jett, 2019 WL 3714795, at *5-6). Plaintiff asserts that Jett is distinguishable

“because the foreclosing party did not submit business records in support of its request for

damages, while the Plaintiff did so here.” See, Plf.’s Objs. at 10. However, for the reasons

discussed above, the Court finds that Plaintiff’s submitted transaction records are insufficient to

verify the damages requested; more information or explanation from Plaintiff is required. Plaintiff

also contends, without any elaboration, that, “in Jett, the [c]ourt granted the [p]laintiff a substantial

sum of damages for unpaid principal and interest as well as late fees and disbursements.” 8 Id. To

the extent Plaintiff suggests that the Court should do the same here, the Court declines to do so.

First, the court in Jett granted the plaintiff’s requests for the unpaid principal and interest and “for

fees and disbursements in connection with the filing fee” in the action only; it did not grant the

8 The citation to Jett that Plaintiff provides in its objections in support of this contention appears inaccurate as the

LEXIS reporter included in the citation corresponds to a civil rights action filed in the Southern District of Indiana

titled Gupta v. Melloh, 2019 U.S. Dist. LEXIS 136863 (E.D.N.Y. Aug. 9, 2019). Plf.’s Objs. at 10 (citing to Freedom

Mortg. Corp. v. Jett, 2019 U.S. Dist. LEXIS 136863).

plaintiff’s request for late charges or any of the other fees or disbursements. See, Jett, 2019 WL

3714795, at *4-8. Second, for the reasons discussed above, the Court concurs with the magistrate

judge’s finding that more information is needed from Plaintiff to assess the accuracy of the

amounts requested, including for principal, interest, and late fees. See, R&R at 13-15.

Accordingly, Plaintiff’s objection as to its damages request is overruled and its default

judgment motion is denied without prejudice to renew upon submission of additional evidence

consistent with this Memorandum and Order. Additionally, while the magistrate judge did not

address Plaintiff’s separate request for attorney’s costs related to the prosecution of this action,

Plaintiff did not object to their omission from the R&R. See, Plf.’s Mem. at 20-21. Thus, upon

the resubmission of Plaintiff’s motion consistent with this Memorandum and Order, Plaintiff is

directed to clarify whether it maintains its request for such costs.

CONCLUSION

For the reasons set forth above, Plaintiff’s objections are sustained in part and overruled in

part, and the R&R is: (1) rejected as to the recommendation that Plaintiff’s motion be denied

without prejudice for failing to establish compliance with RPAPL § 1304; and (2) adopted as to

the recommendation that Plaintiff’s motion be denied without prejudice for failing to submit

sufficient evidence of its requested damages. Accordingly, as set forth in this Memorandum and

Order, Plaintiff’s default judgment motion: (1) is denied as to the Individual Defendants, including

as to Plaintiff’s requests for damages, attorney’s costs, a judgment of foreclosure and sale, and

appointment of a referee, without prejudice to renew upon the submission of further information

to substantiate the requested damages and costs; (2) is denied as to the Suffolk County Defendants

without prejudice upon the submission of further information regarding the alleged liens held; and

(3) is denied as to Plaintiff’s request that the action be dismissed voluntarily against DCFS Trust,

which never was joined as a party in this action. In renewing its motion for default judgment for

the third time, Plaintiff is well advised to cure the deficiencies as noted in this Memorandum and

Order. Plaintiff may not be granted any additional opportunities to cure its deficient filings in the

future.

SO ORDERED.

Dated: Brooklyn, New York

September 30, 2022

/s/

DORA L. IRIZARRY

United States District Judge