Copper Leaf, LLC v. Borland
- John Keenan
- 1:18-cv-06377
- U.S. District Court · Southern District of New York
- 5
In Copper Leaf v. Borland, Judge Keenan ordered an evidentiary hearing on Caruso’s request to cancel a default judgment allegedly based on forged signatures.
Marco Caruso, who sought to cancel the default judgment; Copper Leaf, LLC, which opposed the hearing; and the other parties required to attend the ordered evidentiary hearing.
What happened
In Copper Leaf, LLC v. Borland, Marco Caruso asked the court to cancel a default judgment entered against him after he failed to respond to Copper Leaf’s lawsuit. Caruso said his signatures on a guarantee agreement were forged and that he never agreed to let the court exercise power over him in New York.
Copper Leaf opposed a hearing, arguing that the motion could not succeed because the guarantee agreement provided a basis for jurisdiction if Caruso had signed or authorized the signatures. The court found that whether Caruso signed or authorized the signatures was a disputed fact that could determine whether the judgment was valid.
Judge John F. Keenan ordered the parties to attend an in-person evidentiary hearing on April 20, 2022. The order did not decide whether the default judgment would be canceled.
The detailed version
- Copper Leaf, LLC v. Borland · No. 1:18-cv-06377
- John Keenan
- Feb. 10, 2022
Background
Copper Leaf sued Marco Caruso, Brent Borland, and Belize Infrastructure Fund I, LLC, alleging that they failed to make loan repayments required by a Guarantee Agreement. The agreement included a forum-selection clause, meaning a provision that subjected its signatories to personal jurisdiction in New York. After Caruso did not answer or otherwise respond, the court entered a default judgment against him on December 20, 2018.
On May 24, 2021, Caruso moved under Federal Rule of Civil Procedure 60(b)(4) to vacate, or cancel, the default judgment. He argued that the judgment was void because the court lacked personal jurisdiction over him when it was entered. According to Caruso, Borland had placed computerized images of Caruso’s signature on the Guarantee Agreement without Caruso’s knowledge or consent. Copper Leaf argued that Caruso had authorized Borland to place his electronic signature on the agreement.
Court’s Analysis
The court explained that the Guarantee Agreement was the only stated basis for exercising personal jurisdiction over Caruso. Therefore, if Caruso could establish that he neither signed nor authorized the signing of the agreement, the default judgment would be void for lack of personal jurisdiction. The court rejected Copper Leaf’s argument that an evidentiary hearing was legally unavailable because Caruso could not prevail.
The court stated that evidentiary hearings are appropriate when material facts are disputed in a motion under Rule 60(b). It concluded that the dispute over whether Caruso signed or authorized the signatures required further factual development and should not be resolved solely through written affidavits or depositions.
Disposition
The court ordered the parties to appear in person for an evidentiary hearing under Federal Rule of Civil Procedure 43(e) on April 20, 2022, at 11:15 a.m. in Courtroom 20C. The order ruled on the request for a hearing; it did not rule on the merits of Caruso’s motion to vacate the default judgment.
Read the full 5-page opinion on CourtListener, the free public archive maintained by the Free Law Project.