### Zomongo.TV USA Inc. v Capital Advance Servs.,LLC 2024 NY Slip Op 31701(U) May 14, 2024 Supreme Court, Kings County Docket Number: Index No. 512735/2021 Judge: LeonRuchelsman Cases posted with a "30000" identifier, i.e., 2013 NY Slip

Op30001(U), are republished from various New York State and local governmentsources, including the New

York State Unified Court System's eCourtsService. This opinion is uncorrected and not selected for official publication.

### FILED: KINGS COUNTY CLERK 05/14/2024 02:49 PM INDEX NO. 512735/2021 NYSCEF DOC. NO. 286 RECEIVED NYSCEF: 05/14/2024

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### SUPREME 

### COURT OF THE STATE OF NEW 

### YORK COUNTY OF KINGS : CIVIL TERM: COMMERCIAL 8

-----.-- .. - ·--·..----. -------------------·-· ·-X ZOMONGO.TVUSA INC. D/B/A ZOMONGO.TV 

### USA, JOCELYNE LISAHUGHES-OSTROWSKI and JEREMY GENE OSTROWSKI, 

### .Plaintiffs,

- against

- CAPITAL ADVANCE SERVICES, LLC;Defendant,

- .-----.----·----------- ..-- .--------.--------.x PRESENT: HON. LEON RUCHELSMAN 

### Decision and order Index No. 512735/2021

. .. . .. 

### May 

### 14, 2024 Motion Seq. #9 

### The plaintiff has movedpursuant to CPLR §3025 

### seeking to amend the complaint to add causes ofaction for trespass, conversion, a claimfor RICO pursuant to 18 

### USC §1962

### Cc) and cairn for RICO 

### pursuant to 18 USC §1962

### (d)
. The defendant has opposed the rn.otion. As recorded inprior orders, theplaintiff, Zomongo, a 

### corporation involved in the advertising industry, entered into two merchant cash agreements with the defendant. The first agreement was dated February 12, 2018 

### whereby the defendant purt:ha5ed $449,700 of plaintiff's future .t:eceivabl.e:s for $300,000. 

### The second agreement was dated April 11, 2018 

### whereby the defendant purchased $861,925 

### of

### plaintiff's future receivables for $575,000. The 

### complaint alle:ges the defendant 

### failedto deliver 

### the

### .:purchased

### .amounts pursuant.to the agreements 

### and 

### improperly withdre.w daily 

### amounts in 

### excess ofthe amounts to which 

### the partie.s 

### agreed. The plaintiff 

### now seek$ to 

### amend 

### the complaint 

### as noted
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### FILED: KINGS COUNTY CLERK 05/14/2024 02:49 PM INDEX NO. 512735/2021 NYSCEF DOC. NO. 286 RECEIVED NYSCEF: 05/14/2024

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### Conclusionsof Law On May 4, 2022 in another actionbetween the sameparties the court held that levies servedupon a bank in Illinois and Arizona was void 

### (gg, Decision and Order fNYSCEF Doc. 219]). Further, in another action with the same plaintiff anda different defendant, with a 

### similarly improper levy, the plaintiff withdrew tort claims for trespass and conversion. The court in thatcase explainedthat "the plaintiffs contendthat in PlymouthVenture Partners, the courtof Appeals conclusively decided that the proper avenue for litigating claims like the plaintiffs' claims concerning the issuance of an unlawful levyis by filing a CPLR §524Oni.otion under the Index Number f

### ram which the levy stemmed. Accordingly, theplaintiffs cross-.,.move to withdraw thqse of their c1aims which they feel ate improper under Plymouth Venture Partners" (.§.§.§., 

### ZomongoTV.USA Inc., v. GTR 

### Source LLC, 78 Misc3d 461, 185NYS3d 559 [Supreme CourtNassau County 2023]); That withdrawal was basedupon Plymouth Venture Partners, II, LP v. GTR Source, LLC, 37 NY3d 59:1, i63 NYS3d 467 [2021] 

### which held that the exclusive: remedy available following
an improper levy is to file a motionpursuant to CPLR §5420 

### and that "CPLR 5240 

### provides courts with the ability tocraft £1.exible and equitable responses to claims that arise with respect to enforcement of validmoneyjudgntents" (id). The court categorically rejected the argument th.at tort causes of action
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### FILED: KINGS COUNTY CLERK 05/14/2024 02:49 PM INDEX NO. 512735/2021 NYSCEF DOC. NO. 286 RECEIVED NYSCEF: 05/14/2024

3 of 7 could be filed a:s well. The plaintiff argues that they have satisfied the requirements of GPLR §5240, have obtained a determination the levy was improper, andnow, after that determination, may pursue tort claims. However, thatwould essentially permitany party aggrievedby an improper levyto eventually pursue tort claims. Plymouth Venture Partners, 

### IL LP v. GTR Source, LLC (supra)
never endorsed a delayed pursuit ocf tort claims at all. Indeed, the decision states that ''CPLR article 52•..is the exclusive
avenue .for a judgment debtor seeking relief from the use of an enforcementmechanism that does not comply witha.rticle 52's requirements" (id). The decision does not support the plaintiff's argument that it isjustthe exclusive first step for
a judr;_i-e:tnent debtor, in what amounts to a two..,step process, but rather it is the exclusive avenue in all ways. Further, the decision noted that CPLR Article 52 is sufficient by "providing a flexible array of procedures for relief from violations of the statute" (..id.), To the extent the remedies available pursuant to CPLR Article 52 are not as broad or as advantageous as tort claims, the legislature's decision to curtail them is a determination which cannot addressed in this forum. Lastly, the plain:tiff~s reliar:ice upon the dissent iri Plymouth Venture Partners. II. LP v. GTR source, 

### LLC cannot possibly c~rry any weight considerJ,.ng the majority's conclusions.
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### FILED: KINGS COUNTY CLERK 05/14/2024 02:49 PM INDEX NO. 512735/2021 NYSCEF DOC. NO. 286 RECEIVED NYSCEF: 05/14/2024

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### Therefore, the plaintiff is ba.rred from asserting ahy 

### tort claims and the motion seeking to amendthe complaintto add claims 

### for trespass andconversion is denied. Turning to the RICO claims, to succeed on a RICO claim, the moving partymust demonstrate three elements: (1) 

### a violation of the RICO statute, 18 USG §1962; 

### (2) an injury to business or property; 

### and (3) the injury was caused by the violation

### of section 1962 

### (Spool v. World ChildInt'l Adoption Agency, 520 

### F.3d 178 [2d. Cir. 2008]). Under 18 USC §1962(c) it is unlawful for anyperson employedby or associatedwith any enterprise engaged in, or the activiti.es of

### whic:h affect, interstate or foreigncommerce, to conduct orparticipate, directly or indirectly, in the conduct of 

### such enterprise's affairs through a pattern of racketeering activity. Racketeering activity is defined a.s anyactivity includedwithin 18

## use §1961(1). 

### That statute includes within racketeering activity the collection of


### an unlawful debt {id). Forpur~oses of this lawsuit unlawful debt. is .defined as .any debt "which was incurred
....:Ln connection 

### with thebusiness of.•..lendingmoney

## or a thing ofvalue at a rate usuriou.'.3 under State or Federal law, where the usurious rate is at least twice the enforceable rate" (18 

### use §1961((6) (B)) . 

### Tb maintainan action for 

### unlawf.ui clebt 

### it 

### must bie estaplishedthat Cl) the debt 

### was unenforceable irt whole 

### or ih 

### part because of state 

### or. fecteral 

### law.s relating 

### to illegal usury,
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### FILED: KINGS COUNTY CLERK 05/14/2024 02:49 PM INDEX NO. 512735/2021 NYSCEF DOC. NO. 286 RECEIVED NYSCEF: 05/14/2024

5 of 7 {2) the debt was incurred in t:onne~tion with "the business of lending money.;.at a [usurious] rate," 

### (3) the usurious rate was at least twice the enforceable rate, and (4) as a resultof all the above factors the plaintiff was injured in his or her business or property (Durante Bros
.. & Sons Inc., v. Flushing National Bank, 755 F2d 239 [2d Cir. 1985]). The court has already det:errnined that the plaintiff ffi<:lY not assert claims based upbri. usury. Thus, notwithstanding, there are independent reasons the RICO statute may not bepleadecf. In addition to establishingra¢keteering, the plaintiffmust demonstrate the defendan:ts engaged in an enterprise.. A RICO enterprise is "any individual, partnership, corporation, association, or oth:er legal entity, arid arty union or group bf individuals associated in fact although not a legal entity" (see, 18 USC §1961(4)). Thus, the 'enterprise' must be an entity ''separate and apart from the pattern of activity in which it engagesii (United States v. Turkette, 

### 452

## us 576, 101 S.Ct 

### 2524 [1981]). Tn Goldfine v. Sichenzia, 118 F.Supp2d 392 [:S•.D•.N.Y. 

### 2002] the court held that ''in a fr<:iud:-based RICO claim, if the

. . sole purpose of the alleged enterprise is to perpetuate the alleged fraud, ther·e cart be no enterprise forRICO purposes'' (id)
. This does notconflictwith Second Circuit precedent coricerriirigthe definition of an enterprise which does not really address the narrow issue raised here, namely that the sole


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### FILED: KINGS COUNTY CLERK 05/14/2024 02:49 PM INDEX NO. 512735/2021 NYSCEF DOC. NO. 286 RECEIVED NYSCEF: 05/14/2024

6 of 7 purpose of the enterprise is to perpetrate the fraud (see, Pavlov
v. Bank of New YorkCo., Inc., 25 Fed. Appx. 7 O [2dCir. 2:002], cf., Sands Harbor Marina Corp., v. Wells Fargo Insurance Services of Oregon Inc.,. 2013 WL 12368689 [E.D.N.Y. 2013]), In this case the entire purpose of the enterprisewas to defraud the plaintiffs and engage in unlawful debt collection methods. There hasbeen no evidence presentedthe enterprise served a purpose other than to engc1ge in the alleged fraud (Goldfine, supra). Indeed, the Fropo·sed Amended Complaint asserts that "The RICO Persons have organized tri:emselves and the E:nterprise into a .cohesive groupwith specific and assigned responsibilities and a command structure to operate as a unit in orderto accomplish the
commongoals andpurposes of collecting upon unlawful debts" {see, J?roposed Amended Complaint {Redline version}, '!l320 [NYSCEF Doc, No
.. 192]) . The Amended Complaint further asserts '~since at least 

### 2012 antj continuing through the present, themembers of the Enterprise have had ongoing relations with each other through

common control/owrtership, shared personnel and/or one or more contracts or agreements relating to and for the purpose of collecting upon fraudulent fees through electronicwires (see, Proposed Amended Complaint {Redline Version}, !J[318 [NYSCEF Doc. No. 192]). Thus, according to the ProposedAmended Complaint the entire enterprise was createdmerely to defraud the plaintiffs. Upon those representations the plaintiff has failed to
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### FILED: KINGS COUNTY CLERK 05/14/2024 02:49 PM INDEX NO. 512735/2021 NYSCEF DOC. NO. 286 RECEIVED NYSCEF: 05/14/2024

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### demonstrate the existence of 

### an _enterprise. Consequently, the motion seeking to amend the complaintto assert 

### RICO causes of action is 

### denied. Likewise, the motion to ame_nd the complaintto 

### assert conspiracy pursuant to 

### lS USC 

### §1962(d) is 

### denied. Thus, the 

### motion seeking 

### to 

### amendthe 

### compl_aint to assert 

### any of the proposed claims 

### isdenied. So ordered. ENTER:

DATED: 

### May 14, 

### 2024 Brooklyn N.Y. 

### Hon. Leon Ruchelsman JSC

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