UNITED STATES COURT OF APPEALS 

FOR THE SECOND CIRCUIT 

SUMMARY ORDER 

RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A 

SUMMARY ORDER FILED ON OR AFTER JANUARY 1, 2007, IS PERMITTED AND IS GOVERNED 

BY FEDERAL RULE OF APPELLATE PROCEDURE 32.1 AND THIS COURT’S LOCAL RULE 32.1.1. 

WHEN CITING A SUMMARY ORDER IN A DOCUMENT FILED WITH THIS COURT, A PARTY 

MUST CITE EITHER THE FEDERAL APPENDIX OR AN ELECTRONIC DATABASE (WITH THE 

NOTATION “SUMMARY ORDER”). A PARTY CITING A SUMMARY ORDER MUST SERVE A COPY 

OF IT ON ANY PARTY NOT REPRESENTED BY COUNSEL. 

 At a stated Term of the United States Court of Appeals for the Second Circuit, held at the 

Thurgood Marshall United States Courthouse, 40 Foley Square, in the City of New York on the 

16th day of November, two thousand fifteen. 

Present: JOSÉ A. CABRANES, 

 ROSEMARY S. POOLER, 

 DENNY CHIN, 

 Circuit Judges. 

_____________________________________________________ 

ALEXANDER A. BENZEMANN, 

 Plaintiff-Appellant, 

 v. 14-2668-cv 

CITIBANK N.A., HOUSLANGER & ASSOCIATES, PLLC, 

TODD E. HOUSLANGER, AND NEW CENTURY FINANCIAL SERVICES,

 Defendants-Appellees.

*

_____________________________________________________ 

 

Appearing for Appellant: Andrew L. Tiajoloff, Tiajoloff & Kelly LLP (Edward P. Kelly, on 

the brief), New York, NY. 

Appearing for Appellees: Robert J. Bergson, Abrams Garfinkel Margolis Bergson, LLP (Eric 

B. Post, on the brief), New York, NY, for Defendants-Appellees 

Houslanger & Associates, PLLC and Todd E. Houslanger. 

 *

 The Clerk of Court is directed to amend the official caption to conform with the caption 

above. 
2 

 Anthony I. Giacobbe, Zeichner Ellman & Krause LLP (Barry J. 

Glickman, on the brief), New York, NY, for Defendant-Appellee 

Citibank, N.A. 

Appeal from the United States District Court for the Southern District of New York (Buchwald, 

J.). 

ON CONSIDERATION WHEREOF, IT IS HEREBY ORDERED, ADJUDGED, 

AND DECREED that the judgment of said District Court be and it hereby is AFFIRMED IN 

PART, VACATED IN PART, AND REMANDED. 

 Appellant Alexander A. Benzemann appeals from the June 27, 2014, judgment of the 

United States District Court for the Southern District of New York (Buchwald, J.), dismissing 

his claims under the Fair Debt Collections Practices Act (“FDCPA”), 42 U.S.C. § 1983, the Due 

Process Clause of the Fourteenth Amendment, and state law. We assume the parties’ familiarity 

with the underlying facts, procedural history, and specification of issues for review. 

 In this summary order, we address the district court’s dismissal of the Section 1983 and 

Due Process claims against Defendants Houslanger & Associates, PLLC and Todd E. 

Houslanger (“Houslanger Defendants”) and all of Benzemann’s claims against Defendant 

Citibank, N.A (“Citibank”). An accompanying opinion addresses the remainder of Benzemann’s 

claims. 

I. Section 1983 and Due Process Claims Against Houslanger Defendants 

Benzemann sued the Houslanger Defendants under Section 1983 and the Due Process 

Clause, arguing that these defendants interfered with his Fifth and Fourteenth Amendment Due 

Process rights as well as his Fourth Amendment rights against unreasonable searches and 

seizures when they sent restraining notices to Citibank. 

 “Because the United States Constitution regulates only the Government, not private 

parties, a litigant . . . who alleges that her constitutional rights have been violated must first 

establish that the challenged conduct constitutes ‘state action.’” Grogan v. Blooming Grove 

Volunteer Ambulance Corps, 768 F.3d 259, 263 (2d Cir. 2014) (alterations, emphasis, and 

internal quotation marks omitted), cert. denied 135 S. Ct. 1895 (2015). “To demonstrate state 

action, a plaintiff must establish both that [1] her alleged constitutional deprivation was caused 

by the exercise of some right or privilege created by the State or by a rule of conduct imposed by 

the State or by a person for whom the State is responsible, and [2] that the party charged with the 

deprivation is a person who may fairly be said to be a state actor.” Id. at 263–64 (emphasis 

omitted). 

 Benzemann’s Section 1983 and due process claims fail both prongs of this state-action 

test. First, Benzemann has not established that his alleged constitutional deprivation was caused 

by a privilege or right granted by the state. Benzemann argues that the Houslanger Defendants 

misused New York State rules allowing attorneys to issue restraining notices, but the Supreme 

Court has held that “private misuse of a state statute does not describe conduct that can be 

attributed to the State.” Lugar v. Edmondson Oil Co., Inc., 457 U.S. 922, 940–41 (1982); see 
3 

also Dahlberg v. Becker, 748 F.2d 85, 90 (2d Cir. 1984) (“A private party’s misuse of New 

York’s Judiciary Law . . . is not fairly attributable to New York State.”). 

 Nor can the Houslanger Defendants fairly be said to be state actors. For the purposes of 

Section 1983, the actions of a nominally private entity are attributable to the state: 

(1) [when] the entity acts pursuant to the “coercive power” of the state or is 

“controlled” by the state (“the compulsion test”); (2) when the state provides 

“significant encouragement” to the entity, the entity is a “willful participant in 

joint activity with the state,” or the entity’s functions are “entwined” with state 

policies (“the joint action test” or “close nexus test”); or (3) when the entity has 

been delegated a public function by the state, (“the public function test”). 

Sybalski v. Indep. Grp. Home Living Program, Inc., 546 F.3d 255, 257 (2d Cir. 2008) (quoting 

Brentwood Acad. v. Tennessee Secondary Sch. Athletic Ass’n, 531 U.S. 288, 296 (2001)). 

Benzemann argues that the Houslanger Defendants qualify as state actors under the “public 

function test.” But to qualify as a state actor under that test, the public function that is delegated 

must be one that was “traditionally under the exclusive authority of the state.” Id. at 259. 

Benzemann cites no authority supporting his view that sending a restraining notice is 

“traditionally under the exclusive authority of the state.” To the contrary, we have previously 

recognized that restraining notices are typically issued to banks both by private individuals and 

by the state. See Sykes v. Bank of Am., 723 F.3d 399, 406 (2d Cir. 2013) (“Bank of America . . . 

did no more than comply with the restraining notice issued by [the state agency] in the same way 

it would with a notice from a private attorney on behalf of a private creditor.”). Because the 

sending of restraining notices is not traditionally under the exclusive authority of the state, 

Benzemann’s argument that the Houslanger Defendants qualify as state actors fails. Accordingly, 

the district court properly dismissed both the Section 1983 and the due process claims against the 

Houslanger Defendants.

II. Claims Against Citibank 

 Citibank moved to compel arbitration of Benzemann’s claims against it, arguing that the 

claims were subject to arbitration under the parties’ arbitration agreement. The district court 

granted the motion, finding that the question whether the claims were arbitrable was itself 

delegated to the arbitrator by the agreement. See PaineWebber Inc. v. Bybyk, 81 F.3d 1193, 1198 

(2d Cir. 1996) (noting that under federal law, parties to an arbitration agreement “may provide 

that the arbitrator, not the court, shall determine whether an issue is arbitrable”). On appeal, 

Benzemann does not challenge the district court’s decision to compel arbitration. Rather, he 

argues only that, upon compelling arbitration, the district court improperly dismissed the claims 

against Citibank rather than staying the claims pending arbitration. 

 Recently, we “join[ed] those Circuits that consider a stay of proceedings necessary after 

all claims have been referred to arbitration and a stay requested.” Katz v. Cellco P’ship, 794 F.3d 

341, 345 (2d Cir. 2015); see also 9 U.S.C. § 3 (providing that district court, after granting motion 

to compel arbitration, shall stay proceedings “on application of one of the parties”). Benzemann, 

however, did not request a stay before the district court entered judgment. Thus, Section 3 did 
4 

not require the district court to stay the proceedings when it entered judgment against 

Benzemann. See Katz, 794 F.3d at 346 (noting that, absent a statutory mandate to stay 

proceedings, district courts “enjoy an inherent authority to manage their dockets”). Although 

Benzemann sent a letter to the district court on July 23, 2014, requesting that the court modify 

the judgment to stay his claims against Citibank, Benzemann then filed a notice of appeal on July 

25, 2014. The district court correctly concluded that, after Benzemann filed the notice of appeal, 

the court lacked jurisdiction to decide Benzemann’s request to modify the judgment. United 

States v. Rodgers, 101 F.3d 247, 251 (2d Cir. 1996) (“As a general matter, ‘the filing of a notice 

of appeal . . . confers jurisdiction on the court of appeals and divests the district court of its 

control over those aspects of the case involved in the appeal.’” (quoting Griggs v. Provident 

Consumer Disc. Co., 459 U.S. 56, 58 (1982)). Thus, the district court did not err in denying 

Benzemann’s request to modify the judgment. 

CONCLUSION 

 We have considered the remainder of Benzemann’s arguments and find them to be 

without merit. In an opinion issued simultaneously with this summary order, we vacate the 

district court’s dismissal of the FDCPA and state law claims. Accordingly, we AFFIRM the 

judgment of the district court insofar as it (1) dismissed Benzemann’s claims against the 

Houslanger Defendants under Section 1983, the Due Process Clause of the Fourteenth 

Amendment, and state law and (2) compelled arbitration of and dismissed Benzemann’s claims 

against Citibank. We VACATE the judgment insofar as it dismissed Benzemann’s claims against 

the Houslanger Defendants under the FDCPA and state law and REMAND for further 

proceedings consistent with the opinion issued simultaneously with this summary order. Each 

side to bear its own costs. 

 FOR THE COURT: 

 Catherine O’Hagan Wolfe, Clerk