Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-azd-2_13-cv-02021/USCOURTS-azd-2_13-cv-02021-2/pdf.json

Nature of Suit Code: 190
Nature of Suit: Other Contract Actions
Cause of Action: 28:1332 Diversity-Fraud

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WO 

IN THE UNITED STATES DISTRICT COURT 

FOR THE DISTRICT OF ARIZONA 

Liberty West Regional Center LLC,

Plaintiff, 

v. 

Salvatore Carpanzano, Marisa Belcastro 

Carpanzano, Samba Financial Group 

Escrow & Consulting Services U.S.A. LLC, 

Defendants.

No. CV-13-02021-PHX-DGC

ORDER 

 Plaintiff Liberty West Regional Center, LLC has filed a motion pursuant to 

Rule 55(b) of the Federal Rules of Civil Procedure requesting the entry of default 

judgment against Defendants Salvatore Carpanzano, Marisa Belcastro Carpanzano, 

(collectively the “Carpanzanos”), and Samba Financial Group Escrow & Consulting 

Services U.S.A., LLC (“Samba”). Doc. 44. For the reasons that follow, the Court will 

grant in part and deny in part the motion. 

I. This Suit. 

On July 22, 2011, Plaintiff deposited $2,700,000 into an escrow account with 

Defendant JP Morgan Chase Bank, N.A. (“JP Morgan”), pursuant to an escrow 

agreement. Doc. 1, ¶¶ 14-15. The following year, JP Morgan notified Plaintiff that it 

was planning to “get out of the business” of providing escrow services. Id., ¶ 17. 

Plaintiff was subsequently introduced to Samba and its representative, Salvatore 

Carpanzano. Id., ¶ 1. Mr. Carpanzano allegedly represented that Samba would place 

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Plaintiff’s funds “in an account at Citibank at its branch office in Scarsdale, New York,” 

and further represented that Samba was a subsidiary of Samba Financial Group. Id., ¶ 19, 

20. On December 10, 2012, JP Morgan wired the $2,700,000 in Plaintiff’s account to 

Citibank. Id., ¶ 26, Doc. 1-5 at 2. Mr. Carpanzano is alleged to have converted 

Plaintiff’s funds for his own personal benefit. Doc. 1, ¶ 33. Plaintiff commenced this 

action on October 4, 2013. See id. 

II. Plaintiff’s Motion for Default Judgment. 

Default was entered as to the Carpanzanos and Samba on November 5, 2013. 

Doc. 21. Once a party’s default has been entered, the district court has discretion to grant 

default judgment against that party. See Fed. R. Civ. P. 55(b)(2); Aldabe v. Aldabe, 616 

F.2d 1089, 1092 (9th Cir. 1980). Factors the court must consider in deciding whether to 

grant default judgment include (1) the possibility of prejudice to the plaintiff, (2) the 

merits of the claim, (3) the sufficiency of the complaint, (4) the amount of money at 

stake, (5) the possibility of a dispute concerning material facts, (6) whether default was 

due to excusable neglect, and (7) the strong policy favoring a decision on the merits. See 

Eitel v. McCool, 782 F.2d 1470, 1471-72 (9th Cir. 1986). In applying these factors, “the 

factual allegations of the complaint, except those relating to the amount of damages, will 

be taken as true.” Geddes v. United Fin. Group, 559 F.2d 557, 560 (9th Cir. 1977); see 

Fed. R. Civ. P. 8(d) (“Averments in a pleading to which a responsive pleading is 

required, other than those as to the amount of damage, are admitted when not denied in 

the responsive pleading.”). “However, necessary facts not contained in the pleadings, 

and claims which are legally insufficient, are not established by default.” Cripps v. Life 

Ins. Co. of N. Am., 980 F.2d 1261, 1267 (9th Cir. 1992). 

 Unless “the amount claimed is liquidated or capable of ascertainment from 

definite figures,” the Court generally should hold a hearing to determine the proper 

amount of damages. Dundee Cement Co. v. Howard Pipe & Concrete Prods., Inc., 722 

F.2d 1319, 1323 (7th Cir. 1983); see Fed. R. Civ. P. 55(b)(2); 10 James Wm. Moore, 

Moore’s Federal Practice § 55.20[1][b] at 55-23 (3d ed. 1998). Finally, “[a] judgment 

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by default shall not be different in kind from or exceed in amount that prayed for in the 

demand for judgment” in the complaint. Fed. R. Civ. P. 54(c); Fed. R. Civ. P. 55(d) (“In 

all cases a judgment by default is subject to the limitations of Rule 54(c).”); see Fed. R. 

Civ. P. 8(a)(3). 

 A. Possible Prejudice to Plaintiff. 

The first Eitel factor weighs in favor of granting Plaintiff’s request for an award of 

monetary damages because Plaintiff will be prejudiced if default judgment is not entered. 

Plaintiff served process on Defendants more than four months ago. Docs. 11, 12. 

Defendants have not answered or otherwise responded to the complaint. If Plaintiff's 

motion for default judgment is not granted, Plaintiff “will likely be without other recourse 

for recovery.” PepsiCo, Inc. v. Cal. Security Cans, 238 F. Supp. 2d 1172, 1177 (C.D. 

Cal. 2002). 

 B. The Merits of the Claim and the Sufficiency of the Complaint. 

The second and third Eitel factors favor a default judgment where the complaint 

sufficiently states a claim for relief under Rule 8. See Cal. Security Cans, 238 F. Supp. 

2d. at 1177; Danning v. Lavine, 572 F.2d 1386, 1388-89 (9th Cir. 1978). Plaintiff’s 

Complaint states plausible claims for relief as to Counts One through Eight and Count 

Ten. 

 Count Nine asserts a claim for “Scheme or Artifice to Defraud using Interstate 

Commerce in violation of 18 [U.S.C.] § 1343, and 18 U.S.C. §§ 1962 & 1964.” Doc. 1 at 

15. “To state a civil claim for a RICO violation under 18 U.S.C. § 1962(c), a plaintiff 

must show ‘(1) conduct (2) of an enterprise (3) through a pattern (4) of racketeering 

activity.’” Rezner v. Bayerische Hypo-Und Vereinsbank AG, 630 F.3d 866, 873 (9th Cir. 

2010) (quoting Sedima, S.P.R.L. v. Imrex Co., 473 U.S. 479, 496 (1985)). Standing under 

civil RICO requires a plaintiff “to show that the racketeering activity was both a but-for 

cause and a proximate cause of his injury.” Id. (citation omitted). Plaintiff has not 

alleged the existence of an enterprise or a pattern of racketeering activity, and has 

therefore failed to state a claim as to Count Nine. 

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 C. The Amount of Money at Stake. 

Under the fourth Eitel factor, the Court considers the amount of money at stake in 

relation to the seriousness of Defendants’ conduct. See Cal. Security Cans, 238 F. Supp. 

2d. at 1176. Plaintiff seeks $2,700,000 in actual damages, “multiple damages in the 

amount of $8,100,000 pursuant to 18 U.S.C. § 1964, and punitive damages in the amount 

of $10 million, together with prejudgment and post-judgment interest, attorneys’ fees and 

costs.” Doc. 44 at 4. Plaintiff has alleged that Defendants absconded with $2,700,000 

provided to them pursuant to an escrow agreement. This factor weighs in favor of a 

default judgment. 

 D. Possible Dispute Concerning Material Facts. 

Given the sufficiency of the complaint and Defendants’ default (Docs. 1, 21), “no 

genuine dispute of material facts would preclude granting [Plaintiff’s] motion.” Cal. 

Security Cans, 238 F. Supp. 2d. at 1177. 

 E. Whether Default Was Due to Excusable Neglect. 

Defendants were properly served with the summons and complaint pursuant to 

Rule 4 of the Federal Rules of Civil Procedure. Docs. 11-13. It is therefore “unlikely 

that [Defendants’] failure to answer and the resulting default was the result of excusable 

neglect.” Gemmel v. Systemhouse, Inc., No. CV 04-187-TUC-CKJ, 2008 WL 65604, at 

*5 (D. Ariz. Jan. 3, 2008). 

 F. The Policy Favoring a Decision on the Merits. 

“Cases should be decided upon their merits whenever reasonably possible.” Eitel, 

782 F.2d at 1472. But the mere existence of Rule 55(b) “indicates that this preference, 

standing alone, is not dispositive.” Cal. Security Cans, 238 F. Supp. 2d. at 1177 (citation 

omitted). Moreover, Defendants’ failure to answer or otherwise respond to the complaint 

“makes a decision on the merits impractical, if not impossible.” Id. 

 

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 G. Conclusion. 

Having reviewed Plaintiff’s motion and supporting exhibits, and having 

considered the Eitel factors as a whole, the Court concludes that entry of a default 

judgment is appropriate against Defendants in the amount of $2,700,000. The Court will 

also grant Plaintiff’s request for pre-judgment interest to be calculated pursuant to A.R.S. 

§ 44-1201(B), beginning on December 10, 2012. Under Arizona law, “prejudgment 

interest on a liquidated claim is a matter of right.” AMHS Ins. Co. v. Mut. Ins. Co. of 

Ariz., 258 F.3d 1090, 1103 (9th Cir. 2001). “[A] claim is liquidated if the plaintiffs 

provide a basis for precisely calculating the amounts claimed.” Gemstar Ltd. v. Ernst & 

Young, 917 P.2d 222, 237 (Ariz. 1996). Plaintiff has provided evidence showing that 

$2,700,000 was transferred to Defendants’ account at Citibank on December 10, 2012. 

Doc. 1-5 at 2. Plaintiff has alleged that Defendants then wrongfully converted the 

money. Defendants clearly knew the amount they converted, and therefore can be found 

to have known the amount they owed Plaintiff as of the date of the conversion. 

 The Court will also grant Plaintiff’s request for post-judgment interest pursuant to 

28 U.S.C. § 1961(a) (“Such interest shall be calculated from the date of the entry of the 

judgment, at a rate equal to the weekly average 1-year constant maturity Treasury yield, 

as published by the Board of Governors of the Federal Reserve System, for the calendar 

week preceding [ ] the date of the judgment.”). 

 Because the Court finds that Plaintiff has not adequately pleaded a claim under 18 

U.S.C. § 1964, the Court will deny Plaintiff’s request for in treble damages. Plaintiff’s 

request for punitive damages is also denied. Under Arizona law, in order to recover 

punitive damages, “a plaintiff must prove by clear and convincing evidence that the 

defendant engaged in aggravated and outrageous conduct with an ‘evil mind.’” Hyatt 

Regency v. Winston & Strawn, 907 P.2d 506, 518 (Ariz. Ct. App. 1995). “A defendant 

acts with the requisite evil mind when he intends to injure or defraud, or deliberately 

interferes with the rights of others, ‘consciously disregarding the unjustifiable substantial 

risk of significant harm to them.’” Id. (quoting Linthicum v. Nationwide Life Ins. Co., 

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723 P.2d 675, 680 (Ariz. 1986)). Plaintiff has not addressed the “evil mind” requirement, 

let alone proven by clear and convincing evidence that Defendants acted with an evil 

mind. 

III. Request for Attorney’s Fees. 

Plaintiff has requested attorney’s fees in the amount of $96,448.13 (Doc. 44-1 at 

4) and has submitted time records in support of its request (Doc. 44-2). Local Rule 

54.2(d)(3) requires a party seeking attorneys’ fees to submit a task-based itemized 

statement of fees and expenses. The intent of this requirement is to enable a court to 

determine the precise amount or work devoted to specific claims. The time records 

submitted by Plaintiff in this case are not limited to work incurred in pursuing the 

Carpanzano and Samba Defendants, but instead appear to include all time incurred in this 

case, including time spent pursuing other defendants. It is not the Court’s role to sort 

through Plaintiff’s time records to identify which entries apply to the Defendants at issue 

in this motion. Because Plaintiff have failed to provide a task-based itemized statement 

of fees and expenses specific to these Defendants, the Court will deny the request for 

attorneys’ fees. 

 IT IS ORDERED: 

1. Plaintiff’s motion for default judgment (Doc. 44) is granted in part and 

denied in part as set forth above. The motion is granted with respect to 

Plaintiff’s request for actual damages, pre-judgment interest, and post 

judgment interest and denied with respect to Plaintiff’s requests for treble 

damages, punitive damages, and attorneys’ fees. 

2. Pursuant to FRCiv. P. 54(b), the Court finds that there is no just reason for 

delay and directs that default judgment be entered by the Clerk in favor of 

Plaintiff Liberty West Regional Center, LLC and against Defendants 

Salvatore Carpanzano, Marisa Belcastro Carpanzano, and Samba Financial 

Group Escrow & Consulting Services U.S.A., LLC in the amount of 

$2,700,000 plus pre-judgment interest calculated pursuant to A.R.S. § 44-

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1201(B) and beginning on December 10, 2012, and post judgment interest 

calculated pursuant to 28 U.S.C. § 1961. 

3. The Clerk is directed to enter judgment in accordance with this order. 

Dated this 3rd day of March, 2014. 

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