Field v. Exponential Wealth Inc.
- John Koeltl
- 1:21-cv-01990
- U.S. District Court · Southern District of New York
- 3
In Field v. Exponential Wealth Inc., Magistrate Judge Cave directed default filings and denied Field’s sanctions request without prejudice.
Dr. David S. Field and the defendants, particularly Exponential Wealth Inc., which was subject to the direction to seek a certificate of default and to file a motion for default judgment proceedings.
What happened
In Dr. David S. Field v. Exponential Wealth Inc., the court had ordered the defendants to produce bank statements and comply with discovery-related deadlines. Their lawyers withdrew, no new lawyer appeared for any defendant, and the defendants did not respond to the court’s orders.
Field asked for sanctions because the defendants had not produced the bank statements or otherwise participated in discovery. The court directed Field to request a certificate of default against Exponential Wealth Inc. and to file a motion for default judgment. It also set deadlines for a renewed sanctions motion and responses.
The court denied Field’s request for sanctions without prejudice, meaning he could renew it through a properly supported motion. The court warned that failing to oppose that motion could lead to sanctions, a certificate of default, and a default judgment. Magistrate Judge Sarah L. Cave issued the order, which did not decide the underlying claims.
The detailed version
- Field v. Exponential Wealth Inc. · No. 1:21-cv-01990
- John Koeltl
- Apr. 1, 2022
Background
On January 4, 2022, the court ordered the defendants to produce certain bank statements by January 21. Defense counsel later moved to withdraw, and the defendants told the court they intended to retain new counsel. The court extended the production deadline and later granted counsel’s withdrawal request.
On March 14, 2022, the court ordered Exponential Wealth Inc. to have new counsel enter an appearance by March 28 and ordered the individual defendants to produce the bank statements by March 21. The court warned Exponential Wealth Inc. that corporations cannot represent themselves without counsel and that failing to retain counsel could lead to a certificate of default and default judgment. As of this order, no defendant had retained new counsel or responded to the relevant orders.
Plaintiff’s request
On March 31, 2022, Field informed the court that the defendants had not produced the bank statements and had otherwise failed to participate in discovery. He requested sanctions under Federal Rule of Civil Procedure 37, which allows courts to impose consequences for violating discovery obligations and orders.
Court’s actions
The court ordered Field to request a certificate of default against Exponential Wealth Inc. from the Clerk of Court by April 8, 2022. A certificate of default is a formal docket entry recognizing that a party has failed to plead or otherwise defend. The court also ordered Field to file a motion for default judgment by April 22, 2022, following the applicable federal rules and the assigned district judge’s practices.
The court denied Field’s Rule 37 sanctions request without prejudice to a renewed request supported by a motion served on notice. It set May 2, 2022, for Field to file the sanctions motion, June 1, 2022, for the defendants to oppose it, and June 15, 2022, for Field to reply. The court warned that failure to oppose the sanctions motion could result in the requested sanctions, a certificate of default, and a default judgment.
Disposition and scope
The order did not grant sanctions or enter a default judgment. It denied the sanctions request without prejudice, directed Field to begin default-related proceedings against Exponential Wealth Inc., and left the other terms of the March 14 order in effect. The order addressed discovery compliance and case-management steps rather than the merits of Field’s underlying claims. Magistrate Judge Sarah L. Cave issued the order.
Read the full 3-page opinion on CourtListener, the free public archive maintained by the Free Law Project.