Ancona v. Paragon International Wealth Management, Inc., 1:18-cv-01338

Plaintiff sued Paragon International Wealth Management, Inc., and individuals Rosenberg, Gagliardini, and Shumak, alleging fraud, RICO, MCPA, trover/conversion, and securities law violations arising from investments in purportedly high‑value jewelry transactions.
Clerk entered defaults for Paragon, Rosenberg, and Gagliardini after they failed to respond; Plaintiff moved for default judgments claiming a sum certain under Fed. R. Civ. P. 55(b)(1).
Plaintiff sought specified monetary awards (e.g., $1,000,000 compensatory on fraud; treble damages on RICO; $1,700,000 on securities claim) and submitted a single affidavit listing payments to Paragon.
The complaint’s well‑pleaded facts support fraud liability as to Rosenberg and Paragon but are only tangential as to Gagliardini (alleging conspiracy without detailed factual predicates).
The Court found the damages claimed are unliquidated (not a sum certain), Plaintiff’s affidavit/documentary proof insufficient to calculate damages, and briefing inadequate to establish elements for several causes of action.
Court ordered an evidentiary hearing, required prehearing briefing on each claim’s elements and supporting evidence, and directed Plaintiff to serve motions/briefs on defendants before the hearing.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether Rule 55(b)(1) sum‑certain default judgment is proper	Amounts in complaint are a sum certain permitting Clerk entry of judgment	Damages are not liquidated; Rule 55(b)(1) inapplicable	Not a sum certain; default judgment under Rule 55(b)(1) inappropriate; hearing required
Whether defaults establish liability for all defendants	Default admits well‑pleaded facts supporting all causes and liabilities	Default does not admit damages or legal conclusions; pleading must support relief	Defaults admit well‑pleaded factual allegations but not damages or legal conclusions; liability established for Rosenberg and Paragon on fraud but not sufficiently for Gagliardini
Sufficiency of evidence for damages (affidavit of payments)	Plaintiff’s affidavit and complaint suffice to calculate damages	Documentary proof and detailed accounting required to fix unliquidated damages	Single affidavit insufficient; Court cannot compute damages without further evidence or hearing
Whether other causes (RICO, MCPA, trover, securities) warrant default judgment now	Complaint and defaults support all listed statutory and common‑law claims and requested relief	Plaintiff must brief elements and produce evidence for each statutory cause before judgment	Court requires prehearing briefs and evidentiary hearing to address these claims before awarding damages; cautious approach to high‑penalty claims (e.g., RICO)

Thomson v. Wooster, 114 U.S. 104 (explaining relief on default is limited to what is proper on admitted facts)
Ryan v. Homecomings Fin. Network, 253 F.3d 778 (4th Cir.) (defaults admit well‑pleaded facts but not legal conclusions)
Nishimatsu Constr. Co. v. Houston Nat'l Bank, 515 F.2d 1200 (5th Cir.) (court must find sufficient basis in pleadings for default judgment)
Monge v. Portofino Ristorante, 751 F. Supp. 2d 789 (D. Md.) (plaintiff’s allegation of sum does not make damages certain absent liquidated claim or documentary support)
DirecTV, Inc. v. Pernites, [citation="200 F. App'x 257"] (4th Cir.) (per curiam) (default alone does not automatically warrant default judgment)
Paniagua Grp., Inc. v. Hosp. Specialists, LLC, 183 F. Supp. 3d 591 (D.N.J.) (insufficient evidence for damages where only bank withdrawals shown without invoices)
Alan Neuman Prods., Inc. v. Albright, 862 F.2d 1388 (9th Cir.) (courts should enforce pleading requirements strictly when RICO treble damages and stigma are at stake)