Wells Fargo Bank v. Green
Wells Fargo Bank, National Association, as Trustee for the Benefit of the Registered Holders of UBS Commercial Mortgage Trust 2018-C11, Commercial Mortgage Pass-Through Certificates, Series 2018-C11 v. Green
- Lewis Liman
- 1:22-cv-04351
- U.S. District Court · Southern District of New York
- 3
Wells Fargo v. Shulem Green: Judge Liman dismissed the case for failure to prosecute after the loan purchaser did not appear or seek substitution.
The dismissal ended Wells Fargo’s case against Shulem Green and Steve Deutsch after BTC Capital LLC did not appear or seek to substitute as plaintiff. The opinion does not decide the underlying dispute.
What happened
In Wells Fargo Bank, National Association, as Trustee for the Benefit of the Registered Holders of UBS Commercial Mortgage Trust 2018-C11, Commercial Mortgage Pass-Through Certificates, Series 2018-C11 v. Shulem Green and Steve Deutsch, the parties reported a settlement in principle, but the plaintiff later sold the loan involved in the case to BTC Capital LLC. The plaintiff then told the court it no longer had an interest in the matter.
The court gave BTC Capital notice and an opportunity to appear or ask to replace the plaintiff. BTC Capital did neither by March 7, 2023. The court also considered the delay, notice of possible dismissal, possible prejudice to the defendants, court resources, and whether a lesser penalty would work.
Judge Lewis J. Liman dismissed the case for failure to prosecute and directed the Clerk of Court to close it.
The detailed version
- Wells Fargo Bank v. Green · No. 1:22-cv-04351
- Lewis Liman
- Mar. 7, 2023
Background
The complaint was filed on May 26, 2022. At an August 24, 2022 conference, the parties told the court they had reached a settlement in principle and asked for a stay so they could finalize it. The court granted the stay and later granted an additional 30-day stay.
On January 5, 2023, the plaintiff reported that it had closed the sale of the loan involved in the case to BTC Capital LLC. At a February 3, 2023 status conference, the parties represented that the plaintiff no longer had an interest in the matter. The court directed the parties to show cause why the case should not be dismissed for failure to prosecute if BTC Capital had not appeared and no motion to substitute the plaintiff had been filed by March 3, 2023. As of March 7, BTC Capital had not appeared or sought substitution.
Court’s Analysis
Federal Rule of Civil Procedure 41 allows a court to dismiss an action on its own for failure to prosecute or failure to comply with a court order. The court applied five factors used in the Second Circuit: the length of the delay, whether the plaintiff received notice that further delay could lead to dismissal, likely prejudice to the defendants, the need to manage the court’s calendar while preserving the plaintiff’s opportunity to have the case heard, and whether lesser sanctions would be effective.
The court concluded that dismissal was appropriate. The plaintiff no longer had an interest in the matter, and the purchaser had not prosecuted the case since at least January 2023. The purchaser had been warned that failing to appear would result in dismissal. Although the record did not contain specific evidence of prejudice to the defendants, the court stated that prejudice may be presumed from unreasonable delay. The court also found that it had already given the purchaser an opportunity to continue the action and that a lesser sanction would be ineffective.
Disposition
Judge Lewis J. Liman dismissed the case for failure to prosecute. The Clerk of Court was directed to close the case. The opinion does not state that the dismissal was with or without prejudice.
Read the full 3-page opinion on CourtListener, the free public archive maintained by the Free Law Project.