Press v. Forest Laboratories, Inc.

45 F.R.D. 354, 180 U.S.P.Q. (BNA) 783, 1968 U.S. Dist. LEXIS 12765
CourtDistrict Court, S.D. New York
DecidedNovember 8, 1968
DocketNo. 65 Civ. 2975
StatusPublished
Cited by28 cases

This text of 45 F.R.D. 354 (Press v. Forest Laboratories, Inc.) is published on Counsel Stack Legal Research, covering District Court, S.D. New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Press v. Forest Laboratories, Inc., 45 F.R.D. 354, 180 U.S.P.Q. (BNA) 783, 1968 U.S. Dist. LEXIS 12765 (S.D.N.Y. 1968).

Opinion

MEMORANDUM OPINION UPON REARGUMENT

MOTLEY, District Judge.

This is a motion by defendants pursuant to Rule 9(m) of the General Rules of this Court for reargument of their motion for an order setting aside a default judgment entered on November 28, 1967 and granting defendants leave to answer or otherwise move with respect to the complaint. Rules 55(b), (c) and 60(b) Fed.R.Civ.P.

On April 12, 1968, defendants moved for an order setting aside the default judgment. The motion was denied after oral argument on June 6, 1968. On June 17, 1968, defendant moved for reargument. In support of that motion, on June 26, 1968, with the permission of the court, defendants filed an affidavit of the defendant Hans Lowey, who is also president of the defendants Bonded Laboratories, Inc. (hereinafter referred to as “Bonded”) and Forest Laboratories, Inc. (hereinafter referred to as “Forest”), detailing the circumstances under which a default judgment was entered in this action without notice to any of the defendants. On August 19, 1968, the court granted reargument limited to a question overlooked by it on the first argument, i. e., whether, as a matter of law, the default must be vacated because plaintiff failed to notify defendants of the application to enter a default judgment. Failure to give notice had been raised by defendants in their original moving papers.

The parties were directed to ánd did submit briefs on the question and the [355]*355court permitted the question to be reargued. The court now sets aside its former decision and grants defendants’ motion to set aside the default judgment.

The present action is the third of three actions commenced by plaintiff against defendants over a ten-year period, all involving a running dispute between the parties in regard to a claim of breach of contract, patent infringement, and patent appropriation. In all three actions, plaintiff and defendants were represented by attorneys. The earliest action, commenced in 1956 in the Supreme Court of New York, Kings County, was settled by a stipulation executed by plaintiff and defendants and their respective attorneys on May 6, 1957.

Thereafter, in 1963, plaintiff commenced the first of two actions in this court' (hereinafter referred to as the “first action”) alleging a patent infringement. The first action was brought solely against Forest. In the course of the litigation of the first action, plaintiffs attorney (Harry Price) and defendants’ attorney (Bernard H. Goldstein) fought bitterly and as a result, plaintiff’s attorney sought to amend the complaint in the first action to add as defendants, among others, Mr. Goldstein and another member of the firm of defendants’ attorneys. This court, by order of Judge Tenney, denied plaintiff permission to name additional defendants. Plaintiff, blocked in his attempt to add defendants in the first action, commenced this action (hereinafter sometimes referred to as the “second action”) while the first action was still pending.

In the second action, this action, plaintiff added as defendants Bonded and Hans Lowey (president of both Forest and Bonded), and, in addition, added as a defendant one of the defendants’ attorneys, Mr. Goldstein. The complaint in the second action, paragraph for paragraph, contained the identical claim of patent infringement recited in the first action. In addition, it alleged causes of action against Mr. Goldstein for libel and unethical conduct. Further, the complaint in the second action contained allegations referring to the earliest action in 1956 in the Supreme Court of New York and sought to set aside the stipulation of settlement disposing of that action on the grounds of alleged misrepresentations.

The complaint in the second action was served on all defendants except Mr. Gold-stein and, prior to the service of the complaint, a copy of the complaint was forwarded by plaintiff’s attorney to Mr. Goldstein at his office informing him that a complaint had been filed. As a result of the allegations made by plaintiff’s attorney, Mr. Goldstein went to the Grievance Committee of the Bar Association and commenced a proceeding against plaintiff’s attorney, Harry Price. In the latter part of 1965, the two actions were pending in this court, as well as a proceeding in the Bar Association.

Throughout all these proceedings plaintiff’s attorney recognized that defendants were represented by the same attorneys and, in fact, forwarded correspondence and papers, including notice of taking depositions and interrogatories, to defendants’ attorneys.

Defendants interposed an answer and counterclaim in the first action, but did not interpose an answer or enter a written appearance in the second action; instead both plaintiff’s attorney and defendants’ attorney proceeded before the Grievance Committee. During the pend-ency of the proceedings before the Grievance Committee, the first action was called for a pre-trial conference before Judge Cooper of this court. After a hearing on January 25, 1966, at which both plaintiff’s attorney and defendants’ attorney were present, an order was entered by Judge Cooper on March 9, 1966, discontinuing the first action. The order recited that all claims between the parties had been settled. No further proceedings were had by either party in this action during the remainder of the [356]*356year 1966. The Bar Association proceedings continued. On December 26, 1965, during the pendency of both actions and during the pendency of the Bar Association proceedings, plaintiff’s attorney wrote to defendants’ attorney, Mr. Goldstein, seeking to meet with him “in an effort to discuss some way of disposing of this entire situation.”

In April 1967, plaintiff’s attorney filed a Notice of Discontinuance in this action but only against defendants’ attorney, Mr. Goldstein. Mr. Goldstein never informed defendants that the action was dismissed only against himself but contended that he told trial counsel, Mr. March, of March, Gillette, and Wyatt. Mr. March informed defendants (who have proceeded at all times in good faith believing that they were being actively defended against plaintiff’s claim) that he understood that two discontinuances had been filed and that both cases had been discontinued. It must be noted also that plaintiff’s attorney, who had. served notices of deposition and interrogatories in this action, took no further steps with respect to these pretrial proceedings.

On May 29, 1967, a review calendar hearing was held before Judge Sugar-man. It is not clear what notice, if any, defendants received of this hearing. It appears that they received none since they had not entered any formal appearance and had not filed any responsive pleading. In any event, all defendants failed to answer the review calendar call. Judge Sugarman advised plaintiff, who at that time appeared pro se in this action, that he was entitled to a default judgment and explained to him the steps he had to take to obtain entry of such judgment. Plaintiff’s attorney withdrew as counsel on November 20, 1967, and plaintiff, a layman, thereafter proceeded in this action as attorney pro se. Plaintiff, with the advice of the Clerk of the Court, prepared the papers for the default judgment. According to plaintiff’s statement, the Clerk advised him that he: was not legally bound to serve copies of the proposed default judgment on defendants since they had made no formal appearance in the action. The default judgment was entered on November 28, 1967, by Judge Mansfield, in accordance with the Rules of this Court, without prior notice to defendants or to defendants’ attorneys.

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Cite This Page — Counsel Stack

Bluebook (online)
45 F.R.D. 354, 180 U.S.P.Q. (BNA) 783, 1968 U.S. Dist. LEXIS 12765, Counsel Stack Legal Research, https://law.counselstack.com/opinion/press-v-forest-laboratories-inc-nysd-1968.