Labib v. Citigroup Global Markets Holdings Inc.

Background

Magdy Labib filed the complaint on March 26, 2021. The court directed the Clerk of Court to issue a summons and directed Labib to serve Citigroup Global Markets Holdings Inc. within 90 days after the summons was issued. The summons was issued on May 4, 2021.

The court later learned that Citigroup had not been served with process. On January 20, 2022, the court ordered Labib to file a letter explaining why the case should not be dismissed for failure to prosecute or failure to timely serve Citigroup. The deadline was February 10, 2022. As of April 4, 2022, the docket contained no certificate of service, and Labib had not responded to the order.

Court’s Analysis

The court relied on Federal Rule of Civil Procedure 41, which allows a court to dismiss a case for failure to prosecute or failure to follow a court order. The court considered the factors used in the Second Circuit for dismissal based on failure to prosecute: the length of the delay, notice that dismissal could result, likely prejudice to the defendant, the court’s need to manage its calendar while preserving the plaintiff’s opportunity to be heard, and whether lesser sanctions would be effective.

The court concluded that dismissal for failure to prosecute was appropriate. It found that Labib appeared not to have served Citigroup within the required 90 days and had not prosecuted the case for nearly a year. Labib had received notice that the case could be dismissed for failing to serve Citigroup, and the court gave Labib another opportunity to explain the failure. Labib did not respond. Although the record did not contain specific evidence of prejudice to Citigroup, the court stated that prejudice may be presumed from unreasonable delay. The court also concluded that lesser sanctions would be futile.

The court separately determined that dismissal was appropriate under Federal Rule of Civil Procedure 4(m), which requires service within 90 days after a summons is issued unless an extension is justified. The court had given Labib notice and an opportunity to show good cause for the failure to serve Citigroup, but Labib did not respond.

Disposition

Judge Lewis J. Liman dismissed the case without prejudice for failure to prosecute and failure to timely serve Citigroup. The Clerk of Court was directed to mail a copy of the memorandum and order to Labib and close the case. The opinion did not address the merits of Labib’s underlying claims.