DeVito v. Neiman

• Decision Date: 09 July 2021
• Docket Number: 19-CV-5099 (ARR) (RML)
• Parties: Robert DEVITO, Plaintiff, v. Jeffrey NEIMAN, Herman Jacobowitz a/k/a Herman Jacobs, Expedite Collections Inc., RFC Distributors Inc., Barry Klein, John Does 1-10, and Stephen W. Biegel, Defendants.
• Court: U.S. District Court — Eastern District of New York

548 F.Supp.3d 314

Robert DEVITO, Plaintiff,

v.Jeffrey NEIMAN, Herman Jacobowitz a/k/a Herman Jacobs, Expedite Collections Inc., RFC Distributors Inc., Barry Klein, John Does 1-10, and Stephen W. Biegel, Defendants.

19-CV-5099 (ARR) (RML)

United States District Court, E.D. New York.

Signed July 9, 2021

Joshua Tarrant-Windt, Brian L. Bromberg, Bromberg Law Office, P.C., Brooklyn, NY, for Plaintiff.

Jeffrey Neiman, Giuttari and Mertz Law Office, New York, NY, for Defendant Jeffrey Neiman.

David M. Barshay, Barshay, Rizzo & Lopez, PLLC, Melville, NY, for Defendants Herman Jacobowitz, Expedite Collections Inc.

Peter Cipparulo, III, Pro Hac Vice, Law Offices of Peter Cipparulo, III, LLC, Hillsborough, NJ, for Defendants RFC Distributors Inc., Barry Klein.

Andrew P. Schriever, Troy David Lipp, Cuddy & Feder LLP, White Plains, NY, for Defendant Stephen W. Biegel.

OPINION & ORDER

ROSS, United States District Judge:

Plaintiff, Robert DeVito, first filed this action on September 6, 2019, and he has since twice amended his complaint. Compl., ECF No. 1; Am. Compl., ECF No. 16; Second Am. Compl., ECF No. 68. The operative, second amended complaint asserts multiple claims against various defendants under the Fair Debt Collection Practices Act and New York state law. Second Am. Compl. ¶¶ 133–70. Defendant Stephen W. Biegel now moves to dismiss the sole claim against him—a common-law conversion claim (Count IV)—for failure to state a claim pursuant to Federal Rule of Civil Procedure 12(b)(6). Plaintiff opposes the instant motion. For the reasons set forth below, Biegel's motion is denied.

BACKGROUND¹

In the late 1990s, plaintiff suffered "some financial setbacks," and "he may have run up a debt on a Chase Manhattan Bank USA, NA [("Chase")] credit card." Second Am. Compl. ¶ 68. In 2000, Chase filed a collection action, and in 2001, Chase obtained a default judgment against plaintiff in New York City civil court in the amount of $5,421.15. Id. ¶¶ 2, 70–71. Plaintiff alleges that he "never received a copy of the summons and complaint" in that proceeding, and that the Chase judgment was procured through "sewer service." Id. ¶¶ 2, 74.

Plaintiff was made aware of the Chase judgment in 2018, when defendants Jeffrey Neiman, Herman Jacobowitz, and Expedite Collections Inc. ("Expedite"), "claiming to have the right to collect on the Chase judgment, sent Defendant Biegel to take approximately $14,700 from Plaintiff's [TD Bank, N.A.] account by serving an Execution with Notice to Garnishee (the "Execution") prepared by Defendants and signed by Defendant Nieman." Id. ¶ 75. Plaintiff asserts that "the only possible judgment creditors with a right to collect was Chase—and possibly defendant RFC Distributors Inc.," a "now-defunct company" to which Chase may have assigned its judgment in 2003. Id. ¶¶ 4, 88–92, 108–09, 112, 123, 159, Ex. J. The Execution itself listed Chase as the judgment creditor, and it "misrepresented ... that Nieman was the attorney for the judgment creditor." Id. ¶ 76, Ex. I at 3.

Biegel, a New York City marshal, garnished the funds from plaintiff's bank account and "transferred the money to Expedite," "even though Expedite does not appear anywhere on the judgment that was purportedly being enforced." Id. ¶¶ 67, 77. "Biegel did not request or receive any proof that Neiman was acting on behalf of the current creditor; that Expedite was an assignee of the judgment against Plaintiff; or that Expedite was acting as an agent for the assignee of the judgment against Plaintiff." Id. ¶ 78.²

Based on these allegations, plaintiff brings a claim for conversion against Biegel. Id. ¶¶ 154–68. In short, plaintiff asserts that "Biegel had no legal right to take Plaintiff's money and transfer that money to an entity that had no relationship to the judgment that was being enforced." Id. ¶¶ 79, 162, ¶ 163 ("Biegel lacked the authority to garnish Plaintiff's money in the first place since he did not receive a valid Execution and he had no authority to send Plaintiff's money to Expedite, which had not provided any proof that it was an assignee of the judgment or acting as an agent for the assignee of the judgment.").

On May 17, 2021, Biegel filed a motion to dismiss. Def.’s Mot. Dismiss., ECF No. 90-5. He argues that, "where a marshal acts pursuant to a facially valid court-ordered execution, such as the Execution at issue herein, the marshal is not liable for damages arising from his/her compliance therewith." Id. at 3. Relatedly, he argues that, even if plaintiff's conversion claim were to otherwise have merit, Beigel would nevertheless be "entitled to immunity when performing official duties." Id. at 3, 6–8.

On June 1, 2021, plaintiff filed an opposition, rebutting that Biegel should be held liable because his actions "exceed[ed] the scope of authority granted by legal process." Pl.’s Opp'n 1, ECF No. 92. On June 8, 2021, Biegel filed a reply, reiterating that there was "nothing facially improper about the Execution from Expedite" and thus that "the Marshal was legally permitted to carry out its mandate by enforcing the Judgment against Plaintiff's assets." Def.’s Reply 8, ECF No. 93.

STANDARD OF REVIEW

To survive a motion to dismiss under Rule 12(b)(6), a complaint must "contain sufficient factual matter ... to state a claim to relief that is plausible on its face." Cnty. of Erie v. Colgan Air, Inc. , 711 F.3d 147, 149 (2d Cir. 2013) (quoting Ashcroft v. Iqbal , 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) ). "A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Iqbal , 556 U.S. at 678, 129 S.Ct. 1937. I must "accept[ ] all factual allegations in the complaint as true, and draw[ ] all reasonable inferences in the plaintiff's favor." Lundy , 711 F.3d at 113 (quoting Holmes v. Grubman , 568 F.3d 329, 335 (2d Cir. 2009) ). "Threadbare recitals of the elements of cause of action, supported by mere conclusory statements," however, "do not suffice." Iqbal , 556 U.S. at 678, 129 S.Ct. 1937 (quoting Bell Atl. Corp. v. Twombly , 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) ). I am "not bound to accept as true a legal conclusion couched as a factual allegation." Id. (quoting Twombly , 550 U.S. at 555, 127 S.Ct. 1955 ).

DISCUSSION

I. Plaintiff Has Stated a Claim for Conversion Against Biegel.

"Under New York law, ‘[c]onversion is the unauthorized assumption and exercise of the right of ownership over goods belonging to another to the exclusion of the owner's rights.’ " Alzheimer's Disease Res. Ctr., Inc. v. Alzheimer's Disease & Related Disorders Ass'n, Inc. , 981 F. Supp. 2d 153, 163 (E.D.N.Y. 2013) (quoting Thyroff v. Nationwide Mut. Ins. Co. , 460 F.3d 400, 403–04 (2d Cir. 2006) ). To succeed on a claim for conversion, "a plaintiff must allege: (1) the property subject to conversion is a specific identifiable thing; (2) plaintiff had ownership, possession or control over the property before its conversion; and (3) defendant exercised an unauthorized dominion over the thing in question, to the alteration of its condition or to the exclusion of the plaintiff's rights." Id. (citation and quotation marks omitted); see also, e.g. , Giardini v. Settanni , 70 N.Y.S.3d 57, 58, 159 A.D.3d 874 (2d Dep't 2018). "The tort of conversion does not require defendant's knowledge that he is acting wrongfully, but merely an intent to exercise dominion or control over property in a manner inconsistent with the rights of another." LoPresti v. Terwilliger , 126 F.3d 34, 42 (2d Cir. 1997) ; see also, e.g. , Coughlan v. Jachney , 473 F. Supp. 3d 166, 201 (E.D.N.Y. 2020) (same).

In essence, the parties dispute whether Biegel's actions in garnishing approximately $14,700 from plaintiff's bank account and transferring the funds to Expedite constituted an "exercise[ ]" of "unauthorized dominion" over those funds sufficient to support a claim for conversion under New York law. Alzheimer's Disease Res. Ctr., Inc. , 981 F. Supp. 2d at 163 ; see also, e.g. , Giardini , 70 N.Y.S.3d at 58. Biegel argues that his "possession of the TD Bank funds ... was expressly authorized and mandated by the Execution." Def.’s Mot. Dismiss 6. Plaintiff argues that "neither the underlying default judgment nor the notice of execution ... authorized Biegel to convert Plaintiff's money on Expedite's behalf." Pl.’s Opp'n 1, 6 ("Nothing in the judgment or the [Execution] permitted Biegel to ... transfer Plaintiff's money to a debt collector with no connection to the identified judgment creditor."). I agree with plaintiff that the allegations in the complaint, taken as true, describe an exercise of unauthorized dominion over the funds held in plaintiff's bank account and therefore state a claim for conversion against Biegel.

A New York City marshal, as an officer of the court, is required to execute any "mandate" that he is given "according to its command." N.Y. C.P.L.R. 2223 ; see, e.g. , Bello v. Rockland Cnty. , No. 19-CV-3514 (VB), 2020 WL 2319115, at *6 (S.D.N.Y. May 11, 2020), aff'd , 846 F. App'x 77 (2d Cir. 2021).³ The mandate at issue here—the Execution—identified Chase as the judgment creditor and plaintiff as the judgment debtor, and it commanded "THE SHERIFF OR MARSHAL OF THE CITY OF NEW YORK ... to satisfy judgment out of the real and personal property of the ... judgment debtor." Second Am. Compl. Ex. I at 3. Neither the Execution nor the Chase judgment "mention[ed] Expedite, let alone identifie[d] Expedite as the judgment creditor or an agent of the judgment creditor." Pl.’s Opp'n 5–6; see Second Am. Compl. ¶ 77, Ex. I at 3.

Thus, Biegel's alleged conduct—garnishing funds on behalf and at the behest of Expedite, and then transferring those funds to Expedite, ostensibly a third-party with no connection to the Chase judgment—cannot be considered to have been "authorized" or "commanded" by the Execution itself. In fact, any suggestion that...