Loop Production v. Capital Connections LLC, 797 F. Supp. 2d 338

Plaintiff The Loop Production sues Capital Connections LLC, Escobar Entertainment, Inc., and individuals as alleged agents under RICO and New York law.
Plaintiff seeks default judgments against Capital Connections, Escobar Entertainment, Durbert O'Neal Brandon, Jr., Alisha E. Harris, and Breeden for failure to respond.
Plaintiff alleges Capital Connections advertised false authority to book artists (including Nelly) and demanded $40,000 to secure a non-existent booking.
Plaintiff wired $40,000 to CCA; Defendants later claimed breach or non-receipt of funds and offered partial refunds or credits, all of which were allegedly fraudulent.
Plaintiff asserts the entire contract and arbitration clause were void due to a fraudulent scheme; plaintiff seeks damages, treble under RICO, and attorneys’ fees.
The court denied the moving defendants’ motion to vacate default and to dismiss, and granted default judgment against the defaulting defendants on most claims.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether the default should be vacated	Defendants willfully ignored notices; default undue should be sustained.	Delay due to settlement talks and counsel mail issues; should be excused.	Default not vacated; willful default found and no meritorious defense.
Whether the complaint should be dismissed for lack of jurisdiction/arbitration	Arbitration clause does not bar RICO claims given fraud; jurisdiction exists.	Arbitration clause and lack of personal jurisdiction warrant dismissal.	Arbitration and jurisdiction defenses rejected; claims proceed in default posture.
Whether plaintiff is entitled to relief on the RICO and conspiracy claims	Defendants engaged in a pattern of wire fraud via a fraudulent scheme.	Merits of RICO/conspiracy defenses contested; no merits shown without response.	Plaintiff entitled to default judgment on RICO and conspiracy claims.
Whether plaintiff is entitled to relief on common law fraud and fraudulent inducement	Defendants knowingly misrepresented authority and representation of artists.	No responsive brief; defenses not shown.	Plaintiff entitled to default judgment on fraud and fraudulent inducement.
Whether plaintiff is entitled to relief on breach of contract and conversion	Contract void due to fraud; conversion occurred when funds were kept.	Contract defenses and lack of contract validity argued; not supported without response.	No default judgment on breach of contract; damages awarded on conversion and other claims.

Odfjell Seachem A/S v. Continental De Petrols Et Invs. SA, 613 F. Supp. 2d 497 (S.D.N.Y. 2009) (willful default requires more than mere negligence)
Commercial Bank of Kuwait v. Rafidain Bank, 15 F.3d 238 (2d Cir. 1994) (three-factor test for setting aside default)
New York v. Green, 420 F.3d 99 (2d Cir. 2005) (meritorious defenses are key in default judgments)
SEC v. McNulty, 137 F.3d 732 (2d Cir. 1998) (meritorious defense requires potential complete defense)
Weinrott v. Carp, 32 N.Y.2d 190 (N.Y. 1973) (fraud invalidates contracts under grand scheme theory)
Doctor's Assocs., Inc. v. Casarotto, 517 U.S. 681 (U.S. 1996) (contract defenses to arbitration agreements)
Parke-Bernet Galleries, Inc. v. Franklyn, 26 N.Y.2d 13 (N.Y. 1970) (personal jurisdiction over non-domiciliaries via contract)