Amity Digital LLC v. Helix Digital Inc., 1:23-cv-11044

Amity Digital LLC (Plaintiff), a New York-based AdTech company, entered several business contracts with Helix Digital Inc. (Defendant), a Delaware corporation, allegedly misrepresented as "Helix Digital Partners, LLC."
Defendant defaulted on a payment plan to repay a debt over $1.5 million owed to Amity, failing to make agreed-upon installment payments and subsequently ceased communication.
Plaintiff later discovered that "Helix Digital Partners, LLC" was not associated with Defendants, but actually a separate hydroelectric company, leading Amity and others to pursue claims for debts owed by Helix.
Amity initiated this federal action, bringing RICO, breach of contract, fraud, negligent misrepresentation, and unjust enrichment claims against Helix and James Waltz (Helix’s CEO).
Defendants failed to timely appear in the case, resulting in a default entry against Helix, but later moved to vacate the default. Plaintiff also moved for sanctions against Defendants and counsel.
The key procedural posture centers on the motions to vacate Helix’s default, dismiss Plaintiff’s claims (RICO, state law, jurisdiction), and impose sanctions.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Vacatur of Helix’s Default (Rule 55(c))	Default was willful; Plaintiff would be prejudiced by vacatur.	Default was not willful; there are meritorious defenses; no prejudice.	Denied for breach of contract claim; granted for other claims.
RICO Claim (Rule 12(b)(6))	Sufficiently pleaded pattern of racketeering activity and predicate acts.	No specific predicate acts pled with required particularity.	Motion to dismiss denied; RICO claim survives.
Subject Matter Jurisdiction	Court has federal question and diversity jurisdiction.	Diversity was not adequately pled; court lacks jurisdiction.	Motion to dismiss denied; jurisdiction exists.
Rule 11 Sanctions	Defense’s filings were false and warranted sanctions.	No merit or safe harbor violation; behavior not sanctionable.	Motion for sanctions denied.

Pecarsky v. Galaxiworld.com Ltd., 249 F.3d 167 (2d Cir. 2001) (default judgments are disfavored; preference for resolution on the merits)
Enron Oil Corp. v. Diakuhara, 10 F.3d 90 (2d Cir. 1993) (standard for vacating defaults should be construed generously; doubts resolved in favor of defaulting party)
Davis v. Musler, 713 F.2d 907 (2d Cir. 1983) (prejudice from delay must involve more than mere delay or cost for vacatur)
Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007) (pleading standard for plausibility under Rule 12(b)(6))
Ashcroft v. Iqbal, 556 U.S. 662 (2009) (plausibility standard and reasonable inference under Rule 12(b)(6))
Makarova v. United States, 201 F.3d 110 (2d Cir. 2000) (standard for federal court jurisdiction under Rule 12(b)(1))
Harris v. Mills, 572 F.3d 66 (2d Cir. 2009) (all reasonable inferences go to plaintiff on Rule 12(b)(6) motion)