Plaintiff(s), & TRUST CO., et al. Defendant(s).

Transcription

1 SHORT FORM ORDER SUPREME COURT - STATE OF NEW YORK Present: HON. RALPH P. FRANCO, Justice TRIAL/IA& PART 13 ALAN GUTHARTZ Plaintiff(s), NASSAU COUNTY -against- INDEX No.: MOTION SEQ. #l&2 THE NORTH FORK BANK & TRUST CO., et al. Defendant(s). The following papers read on this motion: Notice of Motion/ Order to Show Cause..... Answering Affidavits... Replying Affidavits... Defendants North Fork Bank and Trust Company ( North Fork ) move, (Seq. No. l), and Defendant Peter Seidman ( Seidman ), (Seq. No. 2), cross moves to dismiss the herein action, pursuant to CPLR (a) (5), (7) in that the complaint fails to state a cause of action and 1

2 the action is barred by the Statute of Limitations. North Fork recorded a judgment in excess of $450,000 plus interest against plaintiff in March, The judgment was affirmed by the Appellate Division in February, In an effort to collect the judgment, North Fork retained Defendant, Seideman. In April, 1997, Seideman prepared a subpoena to depose plaintiff as a Judgment- Debtor. Seidman used Defendant R/D Travelers Worldwide Process Service Corp. ( Worldwide ) to serve plaintiff. Defendants JYL Reybold and John Lewis were employees of Worldwide. Plaintiff failed to appear for the examination and a proceeding to punish plaintiff for contempt. Seideman was initiated by Order to Show Cause, with service by publication. Defendant Bank was ultimately unsuccessful in seeking to impose contempt sanctions on plaintiff. At the traverse hearing, the subpoena was quashed for failure to make service. Plaintiff contends the process service was not done with due diligence despite defendants contentions otherwise. Plaintiff alleges 2

3 his service prior to publication was server service, and defendants wanted to allow service by publication. Based on the above, plaintiff commenced this action on December 16, Plaintiff has set forth five causes of action. The first cause of action is for a violation of 42 USC , the second cause of action is for abuse of process, the third cause of action sounds in tort, the fourth cause of action is for violation of the Federal Fair Debt Collection Practices Act, and the fifth cause of action is for violation of the Racketeer Influenced Corrupt Organizations ( RICO ) Act. A plaintiff claiming a violation of rights under 42 USCA 1983 is required to demonstrate that a person deprived him of a federal law and that such person acted under the color of state law. A private litigant and his attorney did not act under color of state law. by allegedly providing false statements and misinformation to the Internal Revenue Service for the purpose of inducing to investigate plaintiffs tax returns and to harass and interfere with plaintiffs pursuing claims 3

4 against defendants(johnson v Cullen, 925 F Supp 244). On the record herein, the Court must conclude defendants acted solely as private parties and do not meet the under color of state law requirements (see Mac Farlene v Smith, 947 F Supp 572). Here, plaintiff does not properly allege state action by contending that the private party acted together with, significant aid from, state officials or that their conduct or obtained is otherwise attributable to the state (Lugar v Edmondson Oil Company, Inc., 457 U.S. 922). A duly licensed New York process server executing a false affidavit of the service of a summons on a defendant in a civil proceeding may well be directly responsible for the absence of notice where such affidavits result in default iudgments (Carrasco v Klein, 381 F Supp 782) (emphasis added). Here there has been an adjudication that plaintiff owes in excess of $500,000, plus interest to North Fork. The matter was appealed and 4

5 North Fork s position was upheld. North Fork is not proceeding on a default judgment. It sought to depose plaintiff to locate and secure plaintiffs assets. No alleged actions (i.e., sewer service) by defendants resulted in a default judgment (Phillipe v American Express Travel Related Services Company, Inc., 174 AD2d 470) or eviction (Carrasco v Klein, 381 F Supp 782). Here, plaintiff has not met the standard for the tort of abuse of process nor has plaintiff alleged actual or special damages (see Board of Educ. v Farmingdale, 38 NY2d 397). Plaintiff was an adjudged debtor and was subpoenaed to appear for a deposition to.assist the creditor in locating plaintiffs assets. The fact that plaintiff ultimately received notice of the deposition in a newspaper notice instead of actual personal notice is of little moment. Plaintiff has not demonstrated the deliberate premeditated infliction of economic injury without economic or social excuse orjustification nor were specific, quantifiable damages demonstrated to be attributable to this tort (see Wale&as v Johnes, 257 5

6 AD2d 352). The record herein reflects the process server made efforts to properly serve plaintiff. The fact that plaintiff had to be served for his post judgment deposition by publication in a newspaper is of no consequence. The court notes with limited exception, court files are a public record (see Rogers v Giant Eagle, Inc., 113 F Supp2d 777). Thus, plaintiffs debt is already public record. The fact that he was informed of an informational deposition on his adjudicated debt by a means not of his liking should be properly ignored absent evidence of prejudice. Plaintiff has shown none. He is a defendant in an action that North Fork, his creditor, won. North Fork is rightfully seeking the debt owed. A claim asserted in the hope of avoiding another statute of limitations is not permitted where complete relief is available within a traditional cause of action (Jones v City of New York, 16 1 AD2d 5 18; Milone v Jacobson, 78 AD2d 548; see also Entertainment Partners 6

7 Group, Inc. v Davis, 198 AD2d 63). The court must concur with Seideman that plaintiff has alleged the elements of a cause of action for defamation. Plaintiffs attempt to extend the Statute of Limitations by alleging his cause of action is one for prima facie tort is unavailing. As noted by North Fork, the plaintiff has not pleaded the requisite elements of a prima facie tort (see Burns Jackson v Lindner, 59 NY2d 3 14; see also Curiano v Suozzi, 63 NY2d 113). The Statute of Limitations for defamation is one year (CPLR 2 15 [3]). Plaintiffs cause of action commenced 15 months after the alleged defamation and is untimely. The purpose of FDCPA is to protect consumers from those unscrupulous debt collectors who use abusive, deceptive and unfair collection practices including threats of violence, use of obscene language, contacts with acquaintances of the consumer, late-night phone calls, and simulated legal process (see Barstow Rd. Owners v 7

8 Billing, 179 Misc2d 958). The FDCPA is meant to regulate those who regularly collect debts of others and not creditors collecting on their own and thus FDCPA does not apply to a bank attempting to collect a debt owed itself, the conduct of a bank utilizing legitimate judicial process to collect outstanding debt is not prohibited by FDCPA (15 USC ; Mendez v Apple Bank for Sav., 143 Misc2d 915). Thus, plaintiff has not set forth allegations of conduct which are covered by FDCPA legislation. Collection of a purely business related debt was not governed by the FDCP Act (Bank of Boston Intern v Argue110 Tefel, 644 F Supp 1423). Clearly, plaintiff should allege whether the debt as defined in 15 USC 1692 a (5) is an obligation of a consumer to pay money arising out of a transaction in which the money, property, insurance or services are primarily for personal, family or household purposes or a business debt. Here, plaintiff seeks to have everyone guess. purely Thus, 8

9 plaintiff fails to allege a FDCP Act violation with the requisite specificity. Any alleged FCDPA claims against North Fork and Seideman must be dismissed as time barred since there is a one year limitation thereto (15 USC [d]). To state a civil claim for violation of the RICO Act, plaintiff must allege the conduct of an enterprise through a pattern of racketeering activity that amounts to or poses a threat of continued criminal activity (Griffin v McNiff, 744 F Supp 1237, affd 966 F2d 303). The court sees no such conduct of an enterprise here. In order to state a claim of mail fraud under RICO, plaintiff must allege the existence of a scheme to defraud, defendant s knowing or intentional participation in that scheme, and the use of interstate mail in furtherance of the scheme (Beck v Manufacturers Hanover Trust Co., 820 F2d 460. The term scheme to defraud connotes some degree of planning 9

10 by the perpetrators making it essential that the evidence show the defendants entertained an intent to defraud (Soper v Simmons International Ltd., 632 F Supp. 244) and the fraudulent schemes must not be economically irrational (Matsushite Elec. Indus. Co. v Zenith Radio Corp., 475 U.S. 574) and it must be assumed that the defendant is acting in his or her informed economic self-interest (Shields v Citytrust Bankcorp, Inc., 25 F2d 1124). Here, plaintiff has not alleged a viable fraudulent scheme on the part of defendants that is economically rational. The effort by defendants herein was to collect a post judgment debt. Defendant sought to compel plaintiff to provide information as to his assets to pay outstanding obligations. The continuity element of a RICO pattern may be established by showing that predicate acts or offenses are part of an ongoing entity s regular way of doing business (H.J. Inc. v Northwestern Bill Telephone Co., 492 U.S. 229).

11 The Court sees no viable allegations of continuity to constitute a pattern of racketeering activity herein. In general, mail and wire fraud statutes as predicate acts under the RICO Act require the showing of intentional fraud and a plaintiff must provide some factual basis for conclusory allegations of intent; the factual allegations must give rise to a strong inference that a defendant possessed the requisite fraudulent intent (Beck v Manufacturers Hanover Trust Co., 820 F Supp. 46). Thus a plaintiff may allege facts showing a motive for fraud and a clear opportunity for doing so (Goldman v Belden, 754 F2d 1059) or by identifying circumstances indicating conscious behavior by the defendant (United States v Simon, ). F2d 796, cert den. 397 US Here plaintiff has not alleged facts as to defendants motive, and his complaint does not provide an adequate basis for the requisite inference of scienter herein. 11

12 A claim al leging a pattern of racketeering under the Racketeer Influenced and Corrupt Organizations Act (RICO) requires four elements: (1) the existence of an enterprise affecting interstate commerce; (2) the defendant was employed by or associated with the enterprise; (3) the defendant participated directly or indirectly in the conduct or affairs of the enterprise; and (4) the defendant participated through a pattern of racketeering activity that must include allegations of at least two racketeering acts (Baglio v Baska, 940 F Supp. 8 19). It is well settled that the plaintiff cannot prevail under a 18 USC claim (RICO) unless he has been injured in his business or property by the conduct constituting the violation, and there must be a direct relationship between the injury asserted and the injurious conduct alleged (Baglio v Baska, 940 F Supp. 832). Here, there are no such viable allegations by plaintiff. 12

13 Plaintiff has not set forth a viable RICO cause of action. Accordingly, North Fork s motion and Seideman s cross-motion to dismiss the complaint are granted. This terminates all proceedings und ndex No. &rt 30943/99. Dated: April Hon. Ralph P. X%K Franc0 ENTERE D MAY NASSAU COUNTY COUNTY CLERK'S OFRCE 13