Bruzzano, Jr. et al v. Cole

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UNITED STATES BANKRUPTCY COURT
EASTERN DISTRICT OF NEW YORK
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In re:
Clifton Cole, 	Chapter 7
Case No. 8-19-77656-las
Debtor.
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R.J. BRUZZANO, JR., ALDO IANUZZI,
CARMELA IANUZZI, DANIEL O’CONNELL
VINCENT COSTANZO, WILLIAM MCNULTY
RICHARD MCGUIRE, DAVID DIAS, LEONARD
CATALANO, STEPHEN LAROSA, PATRICIA 	Adv. Pro. No. 8-20-08256-las
LAROSA and IRENE NELLIE COSTA,
Plaintiffs,
v.
CLIFTON COLE,
Defendant.
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MEMORANDUM DECISION AND ORDER
ON PLAINTIFFS’ MOTION FOR SUMMARY JUDGMENT
Plaintiffs R.J. Bruzzano, Jr., Aldo Ianuzzi, Carmela Ianuzzi, Daniel O’Connell,
Vincent Costanzo, William McNulty, Richard McGuire, David Dias, Leonard Catalano,
Stephen LaRosa, 	Patricia 	LaRosa 	and 	Irene Nellie 	Costa 	(collectively, 	“Plaintiffs”)
commenced this adversary proceeding seeking a judgment denying defendant Clifton Cole
(“Defendant” or “Debtor), the debtor in the above-captioned chapter 7 case, a discharge of his
debts under 11 U.S.C. § 727(a)(2)(A), (a)(2)(B), (a)(3), (a)(4)(A), (a)(5) and (a)(6)(A).1
Specifically, Plaintiffs allege that Defendant transferred or concealed property of the estate
1 Hereinafter, title 11 of the United States Code will be defined as the “Bankruptcy Code”; the Federal
Rules of Bankruptcy Procedure defined as the “Bankruptcy Rules”; and the Local Bankruptcy Rules
for the United States Bankruptcy Court for the Eastern District of New York defined as the “Local
Bankruptcy Rules.” All statutory references to sections of the Bankruptcy Code will be referred to as
“§ (section number).” Citations to the Local Bankruptcy Rules will be cited as “E.D.N.Y. LBR____.”
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with actual intent to hinder, delay or defraud creditors (§ 727(a)(2)), concealed or failed to
keep or preserve records from which his financial condition or business transactions might
be ascertained (§ 727(a)(3)), knowingly and fraudulently made a false oath in or in connection
with his bankruptcy case (§ 727(a)(4)(A)), failed to satisfactorily explain a loss or deficiency
of assets (§ 727(a)(5)), and refused to obey a lawful order of the Court (§ 727(a)(6)(A)).
In the alternative, Plaintiffs seek a determination that the debts owed by Defendant
to Plaintiffs are excepted from discharge under § 523(a)(2)(A), (a)(4), and (a)(6). Plaintiffs’
central allegation is that Defendant obtained money by means of fraud. See 11 U.S.C. §
523(a)(2)(A) (the bankruptcy discharge “does not discharge an individual debtor from any
debt . . . for money, property, services, or an extension, renewal, or refinancing of credit, to
the extent obtained by . . . false pretenses, a false representation, or actual fraud”); see also
11 U.S.C. § 523(a)(4) (excepting from discharge debts “for fraud or defalcation while acting in
a fiduciary capacity, embezzlement, or larceny”). In addition to the fraud exception, Plaintiffs
argue that the debts owed to them are excepted from discharge under § 523(a)(6), which
makes nondischargeable a debt “for willful and malicious injury by the debtor to another
entity or to the property of another entity.” 11 U.S.C. § 523(a)(6).
Presently pending before the Court is Plaintiffs’ unopposed motion for summary
judgment under Rule 56 of the Federal Rules of Civil Procedure (“Fed. R. Civ. P.”), made
applicable to this adversary proceeding by Bankruptcy Rule 7056 (the “Motion”) [AP Dkt. No.
73].2 	For the reasons discussed 	below, the Court grants the Motion pursuant to §
727(a)(4)(A). Accordingly, the Court enters judgment for Plaintiffs on the fourth cause of
action in their complaint (the “Complaint”) [AP Dkt. No. 1], and Defendant’s discharge is
denied.
2 All citations to “[AP Dkt. No.____]” refer to the corresponding docket entry number for this adversary
proceeding, Adv. Pro. No. 8-20-08256-las.
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I. 	Jurisdiction
The Court has jurisdiction over this matter pursuant to 28 U.S.C. § 1334(b) and the
Standing Order of Reference of the United States District Court for the Eastern District of
New York, dated August 28, 1986 (Weinstein, C.J.), as amended by Order dated December 5,
2012 (Amon, C.J.) entered in accordance with 28 U.S.C. § 157(a). This is a core proceeding
under 28 U.S.C. § 157(b)(2)(I) and (J), in which final orders or judgments may be entered by
this Court pursuant to 28 U.S.C. § 157(b)(1).
II. 	Applicable Legal Standards
A. Summary Judgment Motion
Under Fed. R. Civ. P. 56, made applicable to this adversary proceeding by Bankruptcy
Rule 7056, summary judgment may not be granted unless the movant shows, based on
admissible evidence in the record placed before the court, “that there is no genuine dispute
as to any material fact and the movant is entitled to judgment as a matter of law.” Fed. R.
Civ. P. 56(a); see also Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986) (“[S]ummary judgment
is proper ‘if the pleadings, depositions, answers to interrogatories, and admissions on file,
together with the affidavits, if any, show that there is no genuine issue as to any material
fact and that the moving party is entitled to judgment as a matter of law.”) (quoting former
Fed. R. Civ. P. 56(c)). A fact is considered material if it “might affect the outcome of the suit
under the governing law,” and a genuine dispute exists where “the evidence is such that a
reasonable jury could return a verdict for the nonmoving party.” Anderson v. Liberty Lobby,
Inc., 477 U.S. 242, 248 (1986).
The movant bears the burden of demonstrating the absence of a genuine dispute as to
any material fact. See Celotex, 477 U.S. at 323. The evidence on each material element of its
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claim or defense must be sufficient to entitle the moving party to relief in its favor as a matter
of law. See Vt. Teddy Bear Co. v. 1-800 Beargram Co., 373 F.3d 241, 244 (2d Cir. 2004).
If the movant meets its initial burden, the nonmoving party “must come forward with
‘specific facts showing that there is a genuine issue for trial.’” Matsushita Elec. Indus. Co. v.
Zenith Radio Corp., 475 U.S. 574, 587 (1986) (quoting former Fed. R. Civ. P. 56(e)). A “party
may not rely on mere speculation or conjecture as to the true nature of the facts to overcome
a motion for summary judgment,” as “[m]ere conclusory allegations or denials . . . cannot by
themselves create a genuine issue of material fact where none would otherwise exist.” Hicks
v. Baines, 593 F.3d 159, 166 (2d Cir. 2010) (quoting Fletcher v. Atex, Inc., 68 F. 3d 1451, 1456
(2d Cir 1995)). Thus, to meet its burden, the nonmoving party must offer more than a
“scintilla of evidence” that a genuine dispute of material fact exists, Anderson, 477 U.S. at
252, or that there is some “metaphysical doubt as to the material facts.” Matsushita, 475 U.S.
at 586 (citations omitted). 	It must present “significant probative evidence” that a genuine
issue of fact exists. Anderson, 477 U.S. at 249 (quoting First Nat’l Bank of Ariz. v. Cities Serv.
Co., 391 U.S. 253, 290 (1968)).
On a motion for summary judgment, the court must “construe all evidence in the light
most favorable to the nonmoving party, drawing all inferences and resolving all ambiguities
in its favor.” Dickerson v. Napolitano, 604 F. 3d 732, 740 (2d Cir. 2010) (citation omitted).
The Court is not “to weigh the evidence and determine the truth of the matter but to
determine whether there is a genuine issue for trial.” Cioffi v. Averill Park Cent. Sch. Dist.
Bd. of Ed., 444 F.3d 158, 162 (2d. Cir. 2006) (citation omitted). “Assessments of credibility
and choices between conflicting versions of the events are matters for the jury, not for the
court on summary judgment.” Jeffreys v. City of N.Y., 426 F.3d 549, 553-54 (2d Cir. 2005)
(citations omitted). A court should grant the motion if “the record taken as a whole could not
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lead a rational trier of fact to find for the non-moving party, there [being] no ‘genuine issue
for trial.’” Matsushita, 475 U.S. at 587 (citation omitted).
“It is well established that a court is ordinarily obligated to afford a special solicitude
to pro se litigants,” Tracy v. Freshwater, 623 F.3d 90, 101 (2d Cir. 2010) (citations omitted),
“particularly where motions for summary judgment are concerned,” Jackson v. Fed. Express,
766 F.3d 189, 195 (2d Cir.2014); accord Harris v. Miller, 818 F.3d 49, 57 (2d Cir. 2016).
However, “the liberal treatment afforded to pro se litigants does not exempt a pro se party
from compliance with relevant rules of procedural and substantive law.” Bell v. Jendell, 980
F. Supp. 2d 555, 559 (S.D.N.Y. 2013) (internal quotation marks and citation omitted).
B. Local Bankruptcy Rule 7056-1
Pursuant to Local Bankruptcy Rule 7056-1, each summary judgment motion must
include “a separate statement of the material facts as to which the moving party contends
there is no genuine issue to be tried.” E.D.N.Y. LBR 7056-1(c). The nonmoving party shall
include in opposition “a separate statement of the material facts as to which it is contended
that there exists a genuine issue to be tried.” Id. All material facts set forth in the moving
party’s statement “will be deemed to be admitted by the opposing party unless controverted
by the statement required to be served by the opposing party.” Id. “Each statement of
material fact by a movant or opponent must be followed by citation to evidence which would
be admissible, set forth as required by Federal Rule of Civil Procedure 56(c).” Id.
“A mere denial by [the non-moving party] without citation to admissible evidence in
the record is insufficient.” Ethelberth v. Omogun (In re Omogun), No. 8-16-75566-las, Adv.
Pro. No. 8-17-08023-las, 2022 WL 2517160, at *1 (Bankr. E.D.N.Y. July 6, 2022) (citing
Covelli v. Nat’l Fuel Gas Distrib. Corp., No. 99-CV-0500E(M), 2001 WL 1823584, at *1
(W.D.N.Y. Dec. 6, 2001), aff’d, 49 F. App’x 356 (2d. Cir. 2002) (summary order)). “Courts in
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this district are free to disregard each statement of material fact by a movant or opponent
where there is no citation, or the cited materials do not support the statement.” Id. at *7
(citing Hotlz v. Rockefeller & Co., 258 F.3d 62, 73 (2d Cir. 2001)).
The Court has “broad discretion to determine whether to overlook a party’s failure to
comply with local court rules.” Id. at *8 (quoting Hotlz, 258 F.3d at 73). Where material facts
in a party’s statement go uncontested, either in part or in full, they are not automatically
accepted—they will, nonetheless, be disregarded if not supported by appropriate citations to
the record and the evidence in the record does not support such party’s statement. See
Giannullo v. City of N.Y., 322 F.3d 139, 140 (2d Cir. 2003); Omogun, 2022 WL 2517160, at *8
(undertaking an “independent review of the record” to ensure that “each statement of a
proposed undisputed fact is supported by a citation to the record”). Even “where the non-
moving party ‘chooses the perilous path of failing to submit a response to a summary
judgment motion,’” the court must still determine whether the movant has met its burden to
show that no genuine issue of material fact exits for trial. Vt. Teddy Bear, 373 F.3d at 244
(quoting Amaker v. Foley, 274 F.3d 677, 681 (2d Cir. 2001)).
As explained below, Defendant did not file a response to Plaintiffs’ summary judgment
motion.3 The Court has undertaken an independent review of the record to determine
whether the material facts in the Plaintiff’s Statement of Material Facts submitted pursuant
to Local Bankruptcy Rule 7056-1 (“SOMF”) [AP Dkt. No. 73] are supported by citations to the
record and whether the record supports the Plaintiffs’ assertions. By failing to properly
3 Defendant was served with copies of the Court’s Scheduling Order for the Motion dated April 27,
2022 with Notice to Pro Se Litigants, Plaintiff’s SOMF, Bankruptcy Rule 7056, Local Bankruptcy Rule
7056-1, Fed. R. Civ. P. 56 by email at pristinecole1@aol.com. Defendant was served with copies of the
Motion, affidavits and memorandum of law in support of the Motion, Notice to Pro Se Litigants,
Plaintiff’s SOMF, Bankruptcy Rule 7056, Local Bankruptcy Rule 7056-1, Fed. R. Civ. P. 56 by Priority
Mail 1-Day. See Affs. of Service [AP Dkt. Nos. 79-80].
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controvert Plaintiffs’ SOMF, the properly cited and supported material facts set forth in
Plaintiffs’ SOMF are “deemed to be admitted” for purposes of the summary judgment motion
to the extent they are supported by the record. See E.D.N.Y. LBR 7056-1(c); see also Good v.
Goulding (In re Goulding), No. 8-17-72174-las, Adv. Pro. No. 8-17-08188-las, 2021 WL
4483116, at *1 (Bankr. E.D.N.Y. Sept. 30, 2021) (citing Jackson, 766 F.3d at 194) (finding the
plaintiff’s statement of undisputed facts as supported by evidence in the record to be deemed
admitted because the defendant did not oppose the summary judgment motion and did not
file a counterstatement as required by Local Bankruptcy Rule 7056-1).
III. 	Factual Background
On November 8, 2019, Defendant filed a voluntary petition for relief under chapter 11
of the Bankruptcy Code with the Clerk of this Court, which was converted to a chapter 7 case
on January 31, 2020. See Ch. 11 Pet. [Bankr. Dkt. Nos. 1, 31]4; Pls.’ SOMF ¶ 4.5 Defendant,
represented by counsel, signed the chapter 11 petition (the “Petition”) and the accompanying
statements and schedules (“Schedules”) and Statement of Financial Affairs (“SOFA”)
(collectively, the “Bankruptcy Filings”). See [Bankr. Dkt. No. 1]; Ex. 5, § 341 Hr’g Tr. at 4:6-
8.6 In his Bankruptcy Filings, Defendant made sworn statements regarding his businesses,
business interests, bank accounts, real property, and other assets, all under penalty of
perjury. See [Bankr. Dkt. No. 1].
Additionally, Defendant testified under oath at a meeting of creditors held pursuant
to Section 341 of the Bankruptcy Code on March 2, 2020 (“§ 341 Meeting” or “§ 341 Hearing”)
4 All citations to “[Bankr. Dkt. No.____]” refer to the corresponding docket entry number for the
Debtor’s main bankruptcy case, Case No. 8-19-77656-las.
5 All references to “Pls.’ SOMF ¶ (number)” refer to the corresponding paragraph of the Plaintiffs’
Statement of Material Facts. [AP Dkt. No. 73].
6 Unless otherwise stated, all citations to “Ex. ___” refer to exhibits filed in support of the Plaintiffs’
SOMF. [AP Dkt. Nos. 75-78].
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and at an examination held pursuant to Bankruptcy Rule 2004 on November 24, 2020 (“Rule
2004 Examination” or “Rule 2004 Deposition”).7 See Ex. 5, § 341 Hr’g Tr.; Pls.’ SOMF ¶ 129;
Ex. 4, Rule 2004 Dep. At the § 341 Meeting, Defendant affirmed that it was his signature on
the Petition, that he did not want to make any changes or corrections to it, and that
Defendant had listed all his assets and liabilities. See Ex.5, § 341 Hr’g Tr. at 4:7-11; 6:15-17.
In and around 2008, Defendant entered into a real estate investment partnership—
named New York Equity Partners, Inc. (“NYEP”)—with Patrick Vertucci, with the goal of
purchasing and renovating homes in Long Island, New York and then reselling them. See
Pls.’ SOMF ¶ 13; Ex. 6, NYEP Flyer; Ex. 8, NYS Dept. of State entity pages. Along with
NYEP, another corporate entity named Green Beetle Funding Corp., later changed to Green
Beetle Management Corp. (“Green Beetle”), was formed in 2008 to receive and disburse funds
7 Defendant refused to sign the Rule 2004 Deposition transcript. See Pasquantonio Decl. ¶ 18. The
transcript was sent to the Defendant’s attorney, Btzalel Hirschhorn, Esq., for Defendant’s review, but
Defendant’s attorney advised opposing counsel that Defendant would not be signing the transcript.
See id. The original transcript was returned (though the copy and exhibits were retained). See id.
Defendant did not file any motion, objection, or other challenge to the transcript content. See id. The
transcript was signed by an officer, certifying that the witness was duly sworn and that the transcript
was a true record of the testimony given by the witness. See Ex. 4, Rule 2004 Dep. at 294. Pursuant to
relevant precedent in this Circuit, and “[u]nder Federal Rule of Civil Procedure 30(e), if the deposition
is not signed by the witness within 30 days of its submission to the witness, the officer before whom
the deposition was taken may sign, and the deposition may then be used as fully as though signed
unless on a motion to suppress under Rule 32(d)(4) the court holds that the reasons given for the
refusal to sign require rejection of the deposition in whole or in part.” Vasquez v. Maloney, 15-cv-8848
(NSR), 2020 WL 1309989, at *7 (S.D.N.Y. Mar. 19, 2020) (quotation marks omitted) (quoting Baker v.
Ace Advertisers’ Serv., Inc., 134 F.R.D. 65, 73 (S.D.N.Y. 1991), report and recommendation adopted,
153 F.R.D. 38 (S.D.N.Y. 1992)). Furthermore, “Rule 30(e) of the Federal Rules of Civil Procedure does
not mandate signature by the deponent, but rather requires, only upon ‘request by the deponent . . .
before the deposition is completed,’ that the deponent be afforded a 30-day period in which to review
the transcript, and, if the deponent wishes to make any changes, that the deponent ‘sign a statement
listing the changes and the reasons for making them.’” Vlad-Berindan v. NYC Metro. Transp. Auth.,
14-cv-10304, 2017 WL 9538168, at *26 (S.D.N.Y. Aug. 25, 2017) (quoting Fed. R. Civ. P. 30(e)). “Thus,
under the Federal Rules, ‘[t]he fact that [a] [p]laintiff did not sign the deposition transcript[s] does not
. . . make [the testimony] inadmissible, as a deponent is required to sign the deposition transcript only
if review of the transcript is requested before the deposition is completed and changes are made by the
deponent.’” Id. (quoting Merring v. Town of Tuxedo, N.Y., No. 07-cv-10381, 2009 WL 849752, at *13
n.7 (S.D.N.Y. Mar. 31, 2009); see also Thomas v. S.E.A.L. Sec., Inc., 301 F. App’x 32, 33 (2d Cir. 2008)
(summary order) (citing Fed. R. Civ. P. 30(e)) (finding the magistrate judge did not err in relying on
an unsigned deposition because “a deposition need only be signed where a party so requests”).
Accordingly, the Court will treat the Rule 2004 Deposition transcript as though Defendant signed it.
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and to obtain mortgages. See Pls.’ SOMF ¶¶ 23-25; Ex. 8, NYS Dept. of State entity pages.
Defendant testified during the Rule 2004 Examination that Green Beetle would receive
transfers from multiple corporate accounts in order to make the entity “look strong” in order
to obtain low-interest mortgages. Pls.’ SOMF ¶ 23; Ex. 4, Rule 2004 Dep. at 89. Real estate
holding companies were also formed to purchase and/or mortgage real properties, and on
September 28, 2015, Defendant and Mr. Vertucci dissolved their partnership and real estate
holding companies, leaving Defendant as the sole member of the following companies: NYEP;
Green Beetle; 3 Constant Ct. Inc.; 3 Jeff Court Inc.; 32 Washington Ave., Inc.; 127 East
Carlton Dr., Inc.; Sara Holding Corp.; and PJ Harbor Holding Corp. See Pls.’ SOMF ¶¶ 28-
29; Ex. 9, Agreements. These companies were disclosed in the Defendant’s Bankruptcy
Filings. See Schedule A/B q. 19; SOFA q. 27 [Bankr. Dkt. No. 1]. Defendant listed additional
real estate companies in his Bankruptcy Filings, in which he was the 100% interest member
or a partner: CRC Equities, LLC; 2140 Rt. 112, Inc.; and Mt. Sinai Cabinet Company, LLC.8
See Pls.’ SOMF ¶ 30; Schedule A/B q. 19; SOFA q. 27 [Bankr. Dkt. No. 1]. Defendant has also
worked as a real estate broker, and his real estate brokerage company is named Pristine
Properties Cole, Inc., in which Defendant has a 100% ownership interest. See Ex. 5, § 341
Hr’g Tr. at 7:22-24, 8:3-5, Schedule A/B q. 19 [Bankr. Dkt. No. 1].
To fund his real estate investment ventures, Defendant would generally invite
investors to participate in two different ways: one involving a cash investment with a
promissory note and monthly interest payments and a second involving a joint venture
agreement with a 50/50 split in profits. See Ex. 6, NYEP Flyer; Pls.’ SOMF ¶ 17; see also Ex.
38-A, 41-43, 101, 120, 148, 158-59, 182, JV Agreements and/or Promissory Notes. The
Plaintiffs are owed debts from Defendant arising from such real estate investments. See Pls.’
8 In the SOFA, Defendant described Mt. Sinai Cabinet Company LLC as a “construction company that
did small [construction] jobs and new kitchen [residential] installations.” [Bankr. Dkt. No. 1].
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SOMF ¶ 20; Ex. 6, NYEP Flyer; Ex. 4, Rule 2004 Dep. at 255-56. Defendant testified that he
is obligated as an individual to repay these debts. See Pls.’ SOMF ¶¶ 9-12; Ex. 4, Rule 2004
Dep. at 255-56. Additionally, Defendant has not disputed the debts owed to Plaintiffs. See
Pls.’ SOMF ¶ 11; Ex. 3, Schedules E/F.
1. 	Content of Bankruptcy Filings and Testimony at § 341 Meeting
In his Bankruptcy Filings, Defendant listed several businesses that he owns or has
an interest in, and signed the documents, declaring under penalty of perjury that the
information provided was true and correct. See [Bankr. Dkt. No. 1]. However, as discussed
below, Defendant did not disclose his interest in or connection with two business entities,
Nest Capital, LLC (“Nest Capital”) and RC Rush Equities Corp. (“RC Rush”).
a. 	Nest Capital, LLC
In his Bankruptcy Filings, Defendant did not disclose his interest in Nest Capital, nor
has he filed an amendment to include Nest Capital. See Pls.’ SOMF ¶ 39; Ex. 10, Schedules.
However, Defendant was a member of Nest Capital, having signed the Operating Agreement
for Nest Capital on October 22, 2015. See Pls.’ SOMF ¶¶ 37-38; Ex. 92, Nest Cap. Op.
Agreement. The Operating Agreement for Nest Capital, under Article I, Section 1.2, names
Johnathan Kornreich and Clifton Cole as the only two members, and Schedule A, specifies
that each has a 50% interest. See Ex. 92, Nest Cap. Op. Agreement. Defendant’s signature
appears on the signature page of the document. See id. On September 13, 2018, Defendant
and Mr. Kornreich each signed, as a “Shareholder, officer, Director” of Nest Capital, an
authorization of sale of real property located at 72 West Shore Rd. Mount Sinai, NY 11766
(“72 West Shore Rd.”) by Nest Capital to a certain buyer for $769,000. See Pls.’ SOMF ¶ 37;
Ex. 91, Authorization Resolution.
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b. 	RC Rush Equities Corp.
Additionally, Defendant did not disclose his connection as an officer of RC Rush in his
Bankruptcy Filings, particularly in response to question 27 of the SOFA, which asks if the
debtor has certain connections to any business within the 4 years prior to filing for
bankruptcy, including as an “officer, director, or managing executive of a corporation.”9 See
Pls.’ SOMF ¶ 113; SOFA q. 27 [Bankr. Dkt. No. 1]. Defendant has not filed any amendment
to correct this omission. On July 2017, which was within 4 years prior to his bankruptcy
filing, Defendant signed a joint venture agreement between RC Rush and K&G Capital
Group, LLC (“K&G Capital”), for the purchase, rehabilitation and sale of real property
located at 60 Rush Street, Port Jefferson Station, NY 11776 (“60 Rush Street”). See Pls.’
SOMF ¶ 67; Ex. 15, JV Agreement. The joint venture agreement provided that “Clifton Cole
as officer of RC Rush Equities Corp . . . has agreed to take on the following roles and
responsibilities and agrees to perform the following services.” Ex. 15, JV Agreement.
Defendant also signed a personal guarantee to K&G Capital for the $325,000 loan made by
K&G Capital to RC Rush in connection with the joint venture agreement. See Pls.’ SOMF ¶¶
63-64; Ex. 16, Pers. Guarantee. In addition, on July 2017, there was a joint venture
agreement made between RC Rush and K&G Capital for the purchase, rehabilitation and
sale of real property located at 20 Whitman Avenue, Port Jefferson Station, NY 11776 (“20
Whitman Avenue”), which stated that Defendant was an officer of RC Rush.10 See Pls.’ SOMF
¶ 71; Ex. 20, JV Agreement. Both Defendant and his father, Richard Cole, signed a personal
9 Defendant did disclose in question 18 of the SOFA that within 2 years of filing for bankruptcy, he
made a transfer to RC Rush of real property located at 98 W. Shore Road, Mt. Sinai, NY 11766.
10 The joint venture agreement between RC Rush and K&G Capital concerning 20 Whitman Avenue,
which stated that Defendant was an officer of RC Rush, was signed by Defendant’s father, Richard
Cole, whereas the personal guarantee of the loan made in connection with this joint venture agreement
was signed by both Defendant and his father. See Pls.’ SOMF ¶ 72; Ex. 20, JV Agreement; Ex. 21, Pers.
Guarantee.
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guarantee of the $267,000 loan made in connection with this joint venture agreement. See
Ex. 21, Pers. Guarantee. Richard Cole and Maria Zaffarese, an associate of Defendant, both
testified at their depositions that RC Rush was effectively Defendant’s business.11 See Pls.’
SOMF ¶¶ 46-59; Ex. 12-13, Dep. of Richard Cole at 20, 95, 189-192, 230; Ex. 11, Dep. of Maria
Zaffarese at 30:24-25, 31:2-7, 34:10-14. Richard Cole testified that RC Rush was intended to
be used by Defendant to avoid his wife’s involvement with Defendant’s business activities
and that Defendant controlled the finances and ran the business. See Pls.’ SOMF ¶¶ 49-50;
Ex. 12-13, Dep. of Richard Cole at 20, 22-23, 95, 189-192, 230. Ms. Zaffarese testified that
Defendant did most of the work in RC Rush, Richard Cole’s involvement with RC Rush was
limited (other than opening the business), and that RC Rush was Defendant’s company. See
Pls.’ SOMF ¶¶ 47-48; Ex. 11, Dep. of Maria Zaffarese at 30:24-25, 31:2-7, 34:10-14.
2. 	Transfer of Properties by Nest Capital and RC Rush
Two parcels of real property were sold by Nest Capital or RC Rush within the one year
prior to Defendant’s bankruptcy filing, and two other parcels of real property were sold post-
petition.
On December 11, 2018, Nest Capital sold real property located at 72 West Shore Rd.
for $769,000. See Pls.’ SOMF ¶ 252; Ex. 90, Indenture; Ex. 91, Authorization Resolution. The
corporate resolution, authorizing this sale, was signed by Defendant and Mr. Kornreich as
shareholders, officers, and directors 	of Nest Capital. See 	Pls.’ 	SOMF ¶ 37; Ex. 91,
Authorization Resolution. This transfer was in violation of an Order to Show Cause (“OSC”)
11 Both Richard Cole and Maria Zaffarese have refused to sign the deposition transcripts. See
Pasquantonio Decl. ¶ 18. The transcripts were sent to the witnesses, but the witnesses failed to sign
them. See id. The witnesses did not file any motion, objection, or other challenge to the transcripts’
content. See id. The transcripts were signed by an officer, certifying that the witnesses were duly sworn
and that the transcripts were a true record of the testimony given by the witnesses. See Ex. 11, Dep.
of Maria Zaffarese at 73; Ex. 12-13, Dep. of Richard Cole at 145, 282. So, for the reasons stated in
footnote 7, supra, the Court will treat the deposition transcripts as if the witnesses signed them.
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entered by the New York Supreme Court, County of Suffolk (“State Court”), in a case
involving one of the Plaintiffs, R.J. Bruzzano, Jr., and the Defendant, whereby the State
Court stayed and enjoined the Defendant from transferring any real property or interest in
real property “individually or in any other capacity.” Pls.’ SOMF ¶ 40; Ex. 85, OSC. The State
Court’s stay of any transfer of real property or interest in real property by the Defendant was
effective from November 18, 2018, the date of the OSC, to March 6, 2019, when Defendant’s
application to vacate judgment was decided by the State Court. See Pls.’ SOMF ¶¶ 40, 382-
84, 391; Ex. 85, OSC; Ex. 86, Order Denying OSC. Subsequently, on or about September 23,
2019, less than two months before Defendant’s bankruptcy filing, RC Rush sold the real
property located at 60 Rush Street for $395,000. See Pls.’ SOMF ¶ 68; Ex. 18, Suffolk County
Land Records and Deed, Indenture.
On May 2020, more than six months after Defendant’s bankruptcy filing, RC Rush
sold the real property located at 326 East Garden City Street, Islip Terrace, New York (“326
East Garden City Street”) for $449,000. See Pls.’ SOMF ¶ 75; Ex. 23, Suffolk County Land
Records and Deed, Indenture. Approximately six months later, on November 13, 2020, a deed
was recorded, showing that RC Rush had sold the real property located at 20 Whitman
Avenue for $363,000. See Pls.’ SOMF ¶ 73; Ex. 22, Suffolk County Land Records and Deed.
3. 	False Statements Made During Rule 2004 Examination and § 341
Meeting
Defendant made false statements during the Rule 2004 Examination, when asked
concerning his affiliation with RC Rush.
Q: Do you have any affiliation with RC Rush Equities?
A: No.
Q: Do you have any use or have you ever used RC Rush Equities to buy real
property?
A: I’m not an officer of RC Rush, no . . . .
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Ex. 4, Rule 2004 Dep. at 23:2-9. However, before this examination, as described above,
Defendant had signed a joint venture agreement with K&G Capital—which stated that
Defendant was an officer of RC Rush—concerning the purchase, rehabilitation, and sale of
real estate property located at 60 Rush Street. See Ex. 15, JV Agreement. Defendant also
personally guaranteed the loans made in connection with the two joint venture agreements
between RC Rush and K&G Capital concerning the 60 Rush Street and 20 Whitmore Avenue
properties. See Ex. 16, 21 Pers. Guarantees.
In addition, Defendant made false statements during the § 341 Meeting on March 2,
2020, conducted by the chapter 7 trustee, Kenneth P. Silverman, Esq. See Pls.’ SOMF ¶¶ 132-
46. 	Defendant testified falsely under oath concerning his involvement with ENL Holding
Corp. (“ENL”). During the meeting, counsel for plaintiffs Mr. and Mrs. LaRosa and Ms. Costa
asked the Defendant if he was familiar with ENL. See id. at ¶ 132; Ex. 5, § 314 Hr’g Tr. at
50:14-16. Defendant responded, inter alia, by denying any affiliation with this entity: “I had
no E&L[sic] . . . . I was never any type of officer at any company by the name of that . . . . I
don’t have any affiliation with this entity at all. I think this is a mistake or something. Unless
Patrick Vitucci[sic] did. He opened all the corporations, but I wasn’t part of that.” Ex. 5, § 314
Hr’g Tr. at 50:20, 50:23-25, 51:7-10. However, on August 2009, the Defendant was one of the
signatories of a mortgage agreement between ENL and the LaRosas. See Ex. 129, Mortgage
Agreement. On June 17, 2009, the Defendant, Mr. Vertucci, and Mr. and Mrs. LaRosa signed
the document for Chase Bank to open up a corporate bank account for ENL, and the
Defendant signed as the “President” of ENL. See Pls.’ SOMF ¶ 133; Ex. 128, Chase Acct.
Signature Page.
Defendant also testified falsely concerning his consent and knowledge of the rental
and occupancy of certain real property located at 20 Frost Valley Road, Mount Sinai, NY (“20
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Frost Valley Road”)—which was a single-family home listed in Defendant’s Schedule A/B and
property of the bankruptcy estate—to a certain Ty Edwards Rodriguez and his family for
$5,000 per month. See Pls.’ SOMF ¶¶ 139-46; Schedule A/B [Bankr. Dkt. No. 1]. Defendant
testified at the § 341 Meeting that he did not give consent to Mr. Rodriguez to move into this
property and that the first time he had knowledge of his occupancy was on the Wednesday
or Thursday night of February 26 or 27, 2020. See Pls.’ SOMF ¶¶ 139-46; Ex. 5, § 314 Hr’g
Tr. at 24:12-16, 25:3-9, 25:15-19. The following are excerpts from the § 341 Hearing
Transcript:
MR. SILVERMAN: Here’s my question: Was he [Mr. Rodriguez] in the property
prior to March 1st with your consent?
MR. COLE: No. He changed the locks on one of the earlier - - that’s why the
police department was able to remove him with your help . . . .
MR SILVERMAN: 	Thank you. 	When did you become aware that Mr.
Rodriguez entered the premises?
MR. COLE: On Thursday night [February 27, 2020].
MR SILVERMAN: That was the first knowledge that you had, is that right?
MR. COLE: Yes. I had no communication with Mr. Rodriguez . . . .
MR. SILVERMAN: 	So it’s your testimony your first knowledge of his
occupancy of Frost Valley occurred on Thursday night or - -
MR. COLE: Thursday night or maybe Wednesday night . . . .
Ex. 5, § 314 Hr’g Tr. at 24:12-16, 25:3-9, 25:15-19. However, Defendant, Rachel Cole, and Ty
Rodriguez all signed the lease (with option to purchase) agreement dated February 11, 2020,
pertaining to the 20 Frost Valley Road property. See Pls.’ SOMF ¶ 144; Rodriguez Aff. ¶ 16,
Ex. 8, Lease Agreement.12 Moreover, there are text messages on February 26, 2020 between
Defendant and Mr. Rodriguez that show that Mr. Cole was aware of Mr. Rodriguez’s rental
and occupancy of the property before March 1, 2020:
12 Exhibits cited in conjunction with the affidavit of Mr. Rodriguez refer to the exhibits annexed to
such affidavit. [AP Dkt. No. 74].
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MR. COLE: 	“Ty can we have access to frost valley for about 20 minutes on
Friday at 10am. 	The bankruptcy ct has B.P.O’s being done on all 7 of my
properties on Friday.”
MR. RODRIGUEZ: “Of course. The bank is doing the BPO or it is your guy?”
MR. COLE: “it’s the bankruptcy courts guy – they are coming out Friday to do
all 7 properties . . .”
MR. RODRIGUEZ: “Gotcha. What’s the time frame on sale side you think?”
MR. COLE: “I was looking to drag it out.. 6-8 months or so I figure the later
the better unless u think otherwise”
MR. RODRIGUEZ: “Whatever works for you man. You able to pocket the 5k
a month for as long as you can . . . .”
MR. COLE: “I need to get through the summer after that I should be good to
go”
Rodriguez Aff. ¶ 19; Ex. 11, Text Messages.13
13 “The principles governing admissibility of evidence apply equally on a motion for summary judgment
as in a trial.” Bazak Int’l Corp. v. Tarrant Apparel Grp., 378 F.Supp.2d 377, 391 (S.D.N.Y. 2005) (citing
Raskin v. Wyatt Co., 125 F.3d 55, 66 (2d Cir.1997)). “In both, proper admission requires a
determination on relevance and authenticity.” Id. (citation omitted). Under Federal Rule of Evidence
(Fed. R. Evid.) 401, evidence is relevant if “it has any tendency to make a fact more or less probable
than it would be without the evidence” and “the fact is of consequence in determining the action.” Fed.
R. Evid. 401. Here, these text messages are relevant because, if admitted, they would make the fact of
Defendant’s consent and knowledge of the rental and occupancy of the 20 Frost Valley Road property
more probable than without the evidence, and this fact is of consequence in the Court’s determination
of whether Defendant’s discharge should be denied under § 727(a)(4)(A). In addition, the Court finds
the probative value of this evidence is not substantially outweighed by a danger of unfair prejudice or
any of the other factors listed in Fed. R. Evid. 403 because the evidence is directly related to the
question of Defendant’s consent and knowledge and does not have an adverse effect on Defendant
beyond the purpose for which it is admitted. See Lawson v. Rubin, 17-cv-6404, 2019 WL 13144081, at
*2 (E.D.N.Y. Sept. 5, 2019) (quoting Costantino v. David M. Herzog, M.D., P.C., 203 F.3d 164, 174-75
(2d Cir. 2000)) (finding highly probative evidence not unfairly prejudicial because the prejudice was
due to the evidence’s probative value—in other words, the “unfairness contemplated” did not involve
“some adverse effect beyond tending to prove a fact or issue” in question). Regarding authentication,
the “threshold determination is relatively low”: the “court must merely be able to conclude that the
jury could reasonably find that the evidence is authentic, not that the jury necessarily would so find.”
Bazak, 378 F.Supp.2d at 391 (citation omitted); United States v. Davis, 918 F.3d 397, 402 (4th Cir.
2019) (citation omitted). Fed. R. Evid. 901 “provides that the party offering a piece of evidence can
establish that the evidence ‘is what the proponent claims it is’ simply by presenting the testimony of
a witness with knowledge that the ‘item is what it is claimed to be.’” United States v. Arnold, 696 F.
App'x 903, 907 (10th Cir. 2017) (unpublished) (citing Fed. R. Evid. 901(a), (b)(1)). Further, “it is well
established that, if properly authenticated (for example, by a witness with knowledge, such as a
participant), screenshots of text messages and copies of electronic communications are admissible.”
United States v. Avenatti, 559 F.Supp.3d 274, 281 (S.D.N.Y. 2021) (citations omitted). Courts have
found that text messages can be authenticated by testimony, including by affidavits, of participants
with personal knowledge of the text messages. See Sanders v. Mohtheshum, No. 10–cv–02897, 2011
WL 6329866, at *6 n.2 (D. Colo. Dec. 19, 2011) (“The authenticity of the text message is corroborated
by [p]laintiff's [a]ffidavit.”); Miro v. City of Bridgeport, No. 3:20-cv-346, 2023 WL 4992877, at *14 (D.
Conn. Aug. 3, 2023) (“Testimony by a witness with knowledge of an electronic communication may be
sufficient to authenticate those communications even when they are presented in an altered format.”);
In re E.D.T. ex rel. Adamah v. Tayson, No. 09-CV-5477, 2010 WL 2265308, at *7 n.4 (E.D.N.Y. May
28, 2010) (finding that participant’s testimony was sufficient to establish the authenticity of text
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IV. 	Discussion
A. Denial of Discharge under 11 U.S.C. § 727(a).
Section 727(a) sets forth twelve bases to withhold a discharge in a chapter 7 case.
“Denial of discharge is warranted whenever any of § 727(a)'s subsections is proved.” Ng v.
Adler (In re Adler), 494 B.R. 43, 61 (Bankr. E.D.N.Y. 2013), aff’d, 518 B.R. 228 (E.D.N.Y.
2014) (citations omitted). “If a debtor's discharge is denied in its entirety, all reasons to except
a particular obligation from discharge under § 523(a), are rendered moot.” Id. at 56 (citations
omitted).
Denial of a debtor’s discharge under § 727(a) is an “extreme penalty” that “must be
construed strictly against those who object to the debtor’s discharge and liberally in favor of
the bankrupt.” State Bank of India v. Chalasani (In re Chalasani), 92 F.3d 1300, 1310 (2d
Cir. 1996) (internal quotation marks and citation omitted). “Courts must exercise even
greater caution when considering denial of discharge sought by motion for summary
judgment.” Capital One Equip. Fin. Corp. v. Singh (In re Singh), 585 B.R. 330, 335 (Bankr.
E.D.N.Y. 2018) (citation omitted). “Still, a discharge under section 727 is a privilege, not a
right, and may only be granted to the honest debtor.” Piazza v. Keswani (In re Keswani), No.
20-10315-JLG, Adv. Pro. No. 20-01345-JLG, 2022 WL 90605, at *6 (Bankr. S.D.N.Y. Jan. 7,
messages). Here, Mr. Rodriguez filed an affidavit, declaring under oath that the text messages (which
were printed copies of screenshots) attached to his affidavit as Exhibit 11 were text messages made
between he and the Defendant on February 26, 2020. Rodriguez Aff. ¶ 18-19; Ex. 11, Text Messages.
Because Mr. Rodriguez was a participant in this communication with personal knowledge of the text
messages, the Court finds his affidavit sufficient to authenticate the text messages in Exhibit 11 of his
affidavit. Finally, the Court finds that the statements made by Defendant in the excerpted text
messages are not hearsay because, under Fed. R. Evid. 801(d)(2)(A), a statement that is “offered
against an opposing party” and “was made by the party in an individual or representative capacity” is
not hearsay. Fed. R. Evid. 801(d)(2)(A); Lawson, 2019 WL 13144081, at *2 (finding that statements
made by defendant in text messages were not hearsay); United States v. Lewisbey, 843 F.3d 653, 658
(7th Cir. 2016) (finding the text messages sent by defendant were his own statements and thus
excluded from the definition of hearsay by Rule 801(d)(2)(A)).
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2022) (citations omitted). “This privilege comes with ‘the requirement that debtors act in good
faith and provide full and honest disclosure.’” Web Holdings, LLC v. Cedillo (In re Cedillo),
573 	B.R. 	451, 	465 	(Bankr. 	E.D.N.Y. 	2017) (quoting 	Beer 	Sheva 	Realty 	Corp. 	v.
Pongvitayapanu (In re Pongvitayapanu), 487 B.R. 130, 138 (Bankr. E.D.N.Y. 2013)). That is,
“[f]ull and honest disclosure is required as it is crucial to the effective functioning of the
bankruptcy system. Because the bankruptcy court, trustees, and creditors rely on the
information 	disclosed 	by 	a 	debtor, 	the 	importance 	of 	full 	disclosure 	cannot 	be
overemphasized.” Id. (quotation marks and citation omitted).
The plaintiff bears the burden to prove by preponderance of the evidence that a
defendant’s discharge should be denied. See Grogan v. Garner, 498 U.S. 279, 288 (1991);
Keswani, 2022 WL 90605, at *6 (citations omitted); see also Valley National Bank v. Botticelli
(In re Botticelli), No. 8-13-70167-las, Adv. Pro. No. 8-13-08148-las, 2022 WL 17683407, at *6
(Bankr. E.D.N.Y. Dec. 14, 2022) (“To prevail on its claims [objecting to discharge], plaintiff
bears the burden of presenting evidence in support of the allegations in the complaint that
defendants’ discharge should be denied and proving those allegations by a preponderance of
the evidence.”).
B. Elements of a Claim under § 727(a)(4)(A).
Section 727(a)(4)(A) states:
(a) The court shall grant the debtor a discharge, unless—
(4) the debtor knowingly and fraudulently, in or in connection with the
case—
(A) made a false oath or account.
11 U.S.C. § 727(a)(4)(A). The purpose of § 727(a)(4)(A) is “to [e]nsure that adequate
information is available to those interested in the administration of the bankruptcy estate
without the need of examination or investigation to determine whether the information
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provided is true.” Dubrowsky v. Estate of Perlbinder (In re Dubrowsky), 244 B.R. 560, 572
(E.D.N.Y. 2000) (citation omitted).
To prevail under § 727(a)(4)(A), a plaintiff must establish five elements by a
preponderance of the evidence: “(1) the debtor made a statement under oath; (2) the
statement was false; (3) the debtor knew the statement was false; (4) the debtor made the
statement with fraudulent intent; and (5) the statement related materially to the bankruptcy
case.” Geron v. Grover (In re Grover), 675 B.R. 270, 287 (Bankr. S.D.N.Y. 2025) (citing
Republic Credit Corp. I v. Boyer (In re Boyer), 328 F. App’x 711, 715 (2d Cir. 2009) (summary
order)).
Regarding the 	first 	element, 	“[a] 	bankruptcy petition, 	schedules and related
statements are declarations made under penalty of perjury and constitute a statement under
oath for purposes of § 727(a)(4)(A).” Omogun, 2022 WL 2517160, at *9 (internal quotation
marks omitted) (quoting U.S. Trustee v. Manno-DeGraw (In re Manno-DeGraw), No. 8-15-
73332-reg, Adv. Pro. No. 8-16-08006-reg, 2016 WL 3708062, at *2 (Bankr. E.D.N.Y. July 6,
2016)). “False oaths can encompass affirmative statements and omissions made not just in
the debtor’s petition, schedules, and statement of financial affairs but also in statements
made during examinations.” Id. (citation omitted); see also Kaschner v. Venticinque (In re
Venticinque), 643 B.R. 708, 736 (Bankr. E.D.N.Y. 2022) (citation omitted) (“Courts agree that
a debtor's statements at the Section 341 meeting, which are made under oath, are sufficient
to meet [the first] element of a Section 727(a)(4)(A) claim.”). “A debtor's statements made at
[Bankruptcy Rule] 2004 exams and at formal depositions are given under oath as well.”
McDermott v. McDonald (In re McDonald), 614 B.R. 801, 811 (Bankr. N.D. Ohio 2020) (citing
U.S. Trustee v. Zhang (In re Zhang), 463 B.R. 66, 86 (Bankr. S.D. Ohio 2012)) (finding “any
false statement made by the debtor in the debtor's schedules, at a creditors' meeting held
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pursuant to § 341 or during a deposition relating to the debtor's assets and financial
circumstances could potentially lead to denial of a debtor's discharge under § 727(a)(4)(A) if
all the required elements [are] establish[ed]”).
“Regarding the second element, a statement is false if ‘(1) it omits even one asset or
source of income; (2) necessary[ ] material information is repeatedly left undisclosed during
a case's pendency; or (3) an affirmative misstatement[ ] is made and is not corrected during
an examination or at any point during his case's proceeding.’” Dialectic Distrib. LLC v. Cameo
(In re Cameo), 677 B.R. 163, 171 (Bankr. E.D.N.Y. 2025) (quoting Singh, 585 B.R. at 336); see
also Adler, 494 B.R. at 75 (finding debtor made false statements when he failed to disclose
his spouse’s checking account, his income from prior years, his ownership stake in various
corporations, and status as a defendant in state court litigation). “A debtor’s failure to identify
a business owned and/or controlled by the debtor in the schedules or statement of financial
affairs gives rise to a false oath.” Omogun, 2022 WL 2517160, at *9 (citing Keswani, 2022 WL
90605, at *11) (finding defendant made a false oath when considering the numerous
omissions and misstatements made in his schedules, statement of financial affairs, and § 341
testimony concerning undisclosed business interests and real estate properties). “The plain
language of this statute provides that one single false oath or account is sufficient to deny a
debtor's discharge.” TD Bank, N.A. v. Nazzaro (In re Nazzaro), No. 810-74869-reg, Adv. Pro.
No. 810-8500-reg, 2013 WL 145627, at *7 (Bankr. E.D.N.Y. Jan. 14, 2013) (citations omitted).
Regarding the third element, “[i]n determining a debtor’s knowledge of the falsehood
of a statement ‘[c]ourts may consider the debtor’s education, business experience, and
reliance on counsel . . . but the debtor is not exonerated by pleading that he or she relied on
patently improper advice of counsel.’” Manno-DeGraw, 2016 WL 3708062, at *2 (quoting Bub
v. Rockstone Cap., LLC, 516 B.R. 685, 695 (E.D.N.Y. 2014)). “Indeed, courts ‘do not read §
727(a)(4)’s knowledge requirement . . . as necessitating an awareness of a legal obligation to
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disclose particular information. [Debtor's] actual knowledge of the omitted information itself
suffices to fulfill this element.’” Botticelli, 2022 WL 17683407, at *9 (quoting In re Chlad, 922
F.3d 856, 862 (7th Cir. 2019)); see also Terrasi-Ruggieri v. Ruggieri (In re Ruggieri), No. 23-
11332, Adv. Pro. No. 24-90009, 2025 WL 2775308, at *3 (Bankr. N.D.N.Y. Sept. 29, 2025)
(finding that defendant had knowledge of a false statement when failing to disclose a
residential lease in her schedules because she knew of the omitted residential lease, having
entered into the lease agreement); Carnett v. Davidson (In re Davidson), No. 23-11130, Adv.
Pro. No. 24-90011, 2025 WL 2730796, at *4 (Bankr. N.D.N.Y. Sept. 24, 2025) (finding that
debtor knowingly made a false statement when swearing that the income from his business
was zero, while at the same time, “prolifically writing checks and executing transactions from
the business account”). “The knowledge requirement is satisfied by showing that ‘the
bankrupt knows what is true and, so knowing, wilfully and intentionally swears to what is
false.’” Moreo v. Rossi (In re Moreo), 437 B.R. 40, 62 (E.D.N.Y. 2010) (quoting In re Kaufhold,
256 F.2d 181, 185 (3d Cir. 1958)); see also Singh, 585 B.R. at 338 (finding that debtor, who
was represented by counsel, had knowledge of false statements where debtor was aware that
mistakes and omissions were made in the filing of the petition and schedules).
Regarding the fourth element, “[f]raudulent intent can be established by a showing of
actual fraud through evidence of the traditional badges of fraud, or by the debtor's reckless
disregard for the truth of his statements.” Cameo, 677 B.R. at 171-72 (citing Singh, 585 B.R.
at 338-39). “When determining whether a debtor exhibited a reckless indifference to the
truth, a court may consider:”
(a) the serious nature of the information sought and the necessary
attention to detail and accuracy in answering;
(b) a debtor’s lack of financial sophistication as evidenced by his or her
professional background; and
(c) whether 	a 	debtor 	repeatedly 	blamed 	recurrent 	errors 	on
carelessness or failed to take advantage of an opportunity to clarify
or correct inconsistencies.
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Omogun, 2022 WL 2517160, at *10 (quoting Adler, 494 B.R. at 77) (quotation marks omitted).
“[T]he aggregate of misstatements and omissions of fact can demonstrate a pattern of
reckless disregard for the truth and intent of concealing information from the Court and its
creditors.” Moreo, 437 B.R. at 64 (citing Micro Connections, Inc. v. Shah (In re Shah), 388
B.R. 23, 38-39 (Bankr. E.D.N.Y. 2008)).
In addition, “[f]raudulent intent ‘may be established by circumstantial evidence or by
inferences drawn from a course of conduct.’” Omogun, 2022 WL 2517160, at *10 (citation
omitted). “The Second Circuit has recognized that ‘fraudulent intent may be inferred from a
series of incorrect statements contained in the schedules.’” Id. (citations omitted); see also
Keswani, 2022 WL 90605, at *11 (finding debtor’s false statements and repeated failure to
disclose asset information in her schedules and at the § 341 meeting were sufficient to
establish fraudulent intent). Moreover, “[a] failure to amend schedules can give rise to an
inference of fraud.” Cameo, 677 B.R. at 172 (citing In re Singh, 585 B.R. at 339-40).
Regarding the fifth element, “materiality is a low threshold.” Davidson, 2025 WL
2730796, at *6 (citing Darwin (Huck) Spaulding Living Tr. v. Carl (In re Carl), 517 B.R. 53,
70 (Bankr. N.D.N.Y. 2014)). “Materiality, in the context of § 727(a)(4), ‘merely requires a
showing that the relevant information was something that creditors and the trustee
reasonably would have regarded as significant in identifying assets of the estate that could
be liquidated and used to satisfy claims.’” Omogun, 2022 WL 2517160, at *10 (quoting Mazer-
Marino v. Levi (In re Levi), 581 B.R. 733, 754 (Bankr. S.D.N.Y. 2017)). “A false oath is
material ‘if it bears a relationship to the bankrupt’s business transactions or estate, or
concerns the discovery of assets, business dealings, or the existence and disposition of his
property.” Id. (quoting Agai v. Antoniou (In re Antoniou), 515 B.R. 9, 22 (Bankr. E.D.N.Y.
2014)). “[E]ven worthless assets and unprofitable business transactions must be disclosed.”
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Id. (quoting Nof v. Gannon (In re Gannon), 173 B.R. 313, 320 (Bankr. S.D.N.Y. 1994)); see
also Abraham v. Stuart, No. 15-CV-04864 (JFB), 2016 WL 4045432, at *8 (E.D.N.Y. July 28,
2016) (noting that debtors have “an absolute duty to report whatever interests they hold in
property, even if they believe their assets” are worthless, unavailable, or exempt from
creditors). “It is not for the debtor to decide what information is immaterial or unimportant
or which asset is of no benefit to creditors.” Omogun, 2022 WL 2517160, at *10 (citations
omitted). “Allowing debtors the ‘discretion’ to choose the information that is worth disclosing
‘would create an end-run around the strictly created system’ of bankruptcy administration.”
Id. (citing Pongvitayapanu, 487 B.R. at 140). “[M]ateriality does not require showing that the
creditors were prejudiced by the false statement.” Id. (citing In re Robinson, 506 F.2d 1184,
1188 (2d Cir. 1974)).
“Once the movant satisfies its initial burden of proving that a false statement was
made, the burden of production shifts to the debtor to proffer a ‘credible explanation.’” Cameo,
677 B.R. at 172 (quoting Pergament v. Smorto (In re Smorto), No. 07-CV-2727 (JFB), 2008
WL 699502, at *4 (E.D.N.Y. Mar. 12, 2008)). “If the defendant does not produce an adequate
explanation, ‘a court may infer fraudulent intent.’” Id. (quoting Manno-DeGraw, 2016 WL
3708062, at *2). “However, the overall burden of proof remains with the moving party.”
Moreo, 437 B.R. at 59 (citation omitted).
C. Plaintiffs Have Established a Claim under § 727(a)(4)(A) by a
Preponderance of the Evidence.
1. 	First element of a claim under § 727(a)(4)(A): Statement Under Oath.
Here, the Petition, Schedules, and SOFA filed by Defendant as well as statements and
omissions made by Defendant during the Rule 2004 Examination and § 341 Meeting are all
statements under oath for the purposes of § 727(a)(4)(A). See Omogun, 2022 WL 2517160, at
*9; Venticinque, 643 B.R. at 736, McDonald, 614 B.R. at 811. Defendant signed the Petition,
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Schedules and SOFA under penalty of perjury, declaring the information disclosed therein
was true and correct, and Defendant was duly sworn at the Rule 2004 Examination and the
§ 341 Meeting. During Defendant’s testimony at the § 341 Meeting, he affirmed under oath
that he did not wish to make any corrections or updates to his petition and that he had listed
all his assets and liabilities. See Ex.5, § 341 Hr’g Tr. at 4:7-11; 6:15-17. Thus, the first element
of a claim under § 727(a)(4)(A) has been satisfied.
2. 	Second element of a claim under § 727(a)(4)(A): False Statement.
Defendant’s Bankruptcy Filings omitted Nest Capital entirely even though Nest
Capital’s operating agreement reveals that Defendant is one of two members of this limited
liability company. See Ex. 92, Nest Cap. Op. Agreement. On September 13, 2018, Defendant
and Mr. Kornreich each signed as a “Shareholder, officer, Director” of Nest Capital the
corporate resolution, authorizing the sale of the 72 West Shore Rd. property by Nest Capital
for $769,000. See Pls.’ SOMF ¶ 37; Ex. 91, Authorization Resolution. Under question 19 of
Schedule A/B, which inquires whether a debtor has any non-publicly traded stock and
interests in incorporated or unincorporated businesses, including a limited liability company,
Defendant failed to disclose Nest Capital. In addition, Defendant failed to disclose Nest
Capital in response to question 27 of the SOFA, which asks if the debtor has any connections
to any businesses within the 4 years before filing for bankruptcy, including as a member of a
limited liability company or officer or director of a corporation. On December 11, 2018, which
was within 4 years of his bankruptcy filing, Defendant held an interest in Nest Capital when
it transferred the 72 West Shore Rd. property; consequently, Defendant’s omission of his
interest in Nest Capital constitutes a false statement for the purposes of § 727(a)(4)(A). See
Cameo, 677 B.R. at 171; Omogun, 2022 WL 2517160, at *9 (“A debtor’s failure to identify a
business owned and/or controlled by the debtor in the schedules or statement of financial
affairs gives rise to a false oath.”).
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Defendant made a false statement by failing to disclose his connection as an officer of
RC Rush in his Bankruptcy Filings. In particular, question 27 of the SOFA asks if the debtor
has a connection to any business within the 4 years before filing for bankruptcy, including as
an officer, director, or managing executive of a corporation. On July 2017, which was within
the 4 years prior to Defendant’s bankruptcy filing, RC Rush and K&G Capital entered into
two joint venture agreements, which expressly stated that Defendant was an officer of RC
Rush. See Ex. 15, 20, JV Agreements. Furthermore, Defendant’s father, Richard Cole, and
Maria Zaffarese, Defendant’s associate, 	testified 	at their depositions that Defendant
effectively controlled RC Rush—in other words, he was an officer or managing executive. See
Ex. 12-13, Dep. of Richard Cole at 20, 95, 189-192, 230; Ex. 11, Dep. of Maria Zaffarese at
30:24-25, 31:2-7, 34:10-14. Defendant’s statements in response to questions during the Rule
2004 Examination were also false. Defendant clearly answered “No” to the question “Do you
have any affiliation with RC Rush Equities?”, and he affirmatively stated: “I’m not an officer
of RC Rush . . . .” Such omissions in Defendant’s Bankruptcy Filings and misstatements made
during examinations are false statements for the purposes of § 727(a)(4)(A). See Cameo, 677
B.R. at 171; Omogun, 2022 WL 2517160, at *9 (finding defendant made a false oath when
considering the numerous omissions and misstatements made in his schedules, statement of
financial affairs, and § 341 testimony concerning undisclosed business interests and real
estate properties).
Lastly, Defendant made false statements during the § 341 Meeting regarding his
affiliation with ENL and his consent and knowledge of the rental and occupancy of 20 Frost
Valley Road by Mr. Rodriguez. Defendant affirmatively denied any affiliation with ENL,
including as an officer; however, on August 2009, he and Mr. Vertucci signed on behalf of
ENL a mortgage agreement between ENL and the plaintiffs Mr. and Mrs. LaRosa. See § 314
Hr’g Tr. at 50:14-16, 50:20, 50:23-25, 51:7-10; Ex. 129, Mortgage Agreement. In addition,
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Defendant, Mr. Vertucci, and the LaRosas signed the document for Chase Bank to open up a
corporate bank account for ENL, where Defendant signed as the “President” of ENL. See Pls.’
SOMF ¶ 133; Ex. 128, Chase Acct. Signature Page. The record thus reveals that Defendant
had an affiliation with ENL and that he was an officer of ENL.
Defendant’s statements concerning his consent and knowledge of the rental and
occupancy by Mr. Rodriguez of the 20 Frost Valley Road property were also false. The chapter
7 trustee asked Defendant when Defendant first had knowledge that Mr. Rodriguez was
occupying the property. Defendant replied that he did not consent to Mr. Rodriguez’s
occupying the property before March 1, 2020 and that he first had knowledge of Mr.
Rodriguez’s occupancy on February 26 or 27, 2020. See § 314 Hr’g Tr. at 24:12-16, 25:3-9,
25:15-19. However, Defendant, Rachel Cole, and Ty Rodriguez all signed the lease (with
option to purchase) agreement dated February 11, 2020, pertaining to the 20 Frost Valley
Road property.14 See Pls.’ SOMF ¶ 144; Rodriguez Aff. ¶ 16, Ex. 8, Lease Agreement.
Moreover, the text messages on February 26, 2020 between Defendant and Mr. Rodriguez
show that Mr. Cole consented to and knew of Mr. Rodriguez’s rental and occupancy of the
property before March 1, 2020. Rodriguez Aff. ¶ 19; Ex. 11, Text Messages. In fact, it was
Defendant who asked Mr. Rodriguez if Defendant could have access to the property for “about
20 minutes on Friday at 10am,” and the Defendant who stated that he was “looking to drag
[the sale] out . . . 6-8 months”—to which Mr. Rodriguez replied that Defendant would able to
“pocket the $5k a month for as long as you can.” See id. 	Thus, Defendants’ affirmative
14 During the § 341 Meeting, the chapter 7 trustee mentioned this lease agreement dated February 11,
2020 to Defendant, and the Defendant replied that his wife “wrote up a lease agreement and an option
to me” and that “he [Mr. Rodriguez] had changed everything.” Ex. 5, § 314 Hr’g Tr. at 23:7-13.
However, the Court finds that this statement (alleging that Ms. Cole drafted the lease agreement and
Mr. Rodriguez changed the terms) is not relevant to the question of whether Defendant had consented
to and had knowledge of the rental and occupancy of the property by Mr. Rodriguez. The fact that
Defendant signed the lease agreement on February 11, 2020 shows that Defendant had consented to
and had knowledge of the rental and occupancy of the property by Mr. Rodriguez before March 1, 2020.
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misstatements made to the chapter 7 trustee constitute a false statement for the purposes of
§ 727(a)(4)(A). See Cameo, 677 B.R. at 171 (observing that affirmative misstatements made
and not corrected during an examination constitutes a false statement under § 727(a)(4)(A)).
Based on the foregoing, the second element of a claim under § 727(a)(4)(A) has been satisfied.
3. 	Third element of a claim under § 727(a)(4)(A): Knowledge of Falsity
As an initial matter, the Court notes that Defendant is a businessman with experience
singlehandedly managing a portfolio of investment properties and related businesses. Given
his background, it is implausible to conclude that Defendant did not understand the meaning
of the questions asked of him in the Schedules and SOFA regarding his interest or role in
any businesses or corporations, especially when he was represented by counsel at that time.
And, the testimonial and documentary evidence support the conclusion that Defendant had
actual knowledge of his omissions and false statements. See Botticelli, 2022 WL 17683407,
at *9 (quoting In re Chlad, 922 F.3d at 862) (finding “actual knowledge of the omitted
information itself suffices to fulfill this element”).
Defendant had actual knowledge of his membership interest in Nest Capital because
he executed the operating agreement of Nest Capital, which provided for his membership
interest. See Ruggieri, 2025 WL 2775308, at *3 (finding that defendant had knowledge of a
false statement when failing to disclose a residential lease in her schedules because she knew
of the omitted residential lease, having entered into the lease agreement). In addition, on
September 13, 2018, Defendant signed as a shareholder, officer, and director of Nest Capital
when authorizing the sale by Nest Capital of the 72 West Shore Rd. property for $769,000,
with the sale taking place on December 11, 2018. See Pls.’ SOMF ¶¶ 37, 252; Ex. 90,
Indenture; Ex. 91, Authorization Resolution. The sale was a sizeable real estate transaction,
occurring within 12 months of Defendant’s bankruptcy filing. The Court finds that Defendant
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knew of his interest in Nest Capital and thus knowingly and intentionally omitted this
interest from his Bankruptcy Filings.
The record evidence also shows that Defendant had actual knowledge of his
connection to RC Rush. On July 2017, Defendant signed the joint venture agreement (which
expressly stated that Defendant was an officer of RC Rush), concerning the purchase,
rehabilitation, and sale of 60 Rush Street. See Ex. 15, JV Agreement. Defendant personally
guaranteed the loan made in connection with this joint venture agreement. See Ex. 16, Pers.
Guarantee. Furthermore, the sale of 60 Rust Street for $395,000 occurred less than two
months before Defendant’s bankruptcy filing. It is highly unlikely that Debtor did not know
of such a sizeable real estate transaction so close to his bankruptcy filing—especially since
he had personally guaranteed the loan to K&G Capital—when he omitted his connection to
RC Rush in his SOFA. Moreover, as noted earlier, the deposition testimony of Defendant’s
father and his associate Maria Zaffarese reveals that Defendant essentially ran RC Rush.
The Defendant also affirmatively stated in the Rule 2004 Examination, which
occurred on November 24, 2020, that he had no affiliation with and was not an officer of RC
Rush. See Ex. 4 Rule 2004 Dep. at 23:2-9. However, in May 2020 (6 months before the Rule
2004 Examination), RC Rush had sold the 326 East Garden City Street property for $449,000.
See Pls.’ SOMF ¶ 75; Ex. 23, Suffolk County Land Records and Deed, Indenture. On
November 13, 2020 (11 days before the Rule 2004 Examination), a deed was recorded,
evidencing the sale by RC Rush of the 20 Whitman Avenue property for $363,000, in the
Suffolk County Clerk’s Office (and as mentioned above, Defendant had personally guaranteed
the loan related to the purchase, rehabilitation, sale of this property). See Pls.’ SOMF ¶¶ 71-
73; Ex. 22, Suffolk County Land Records and Deed. In the light of these sizeable real estate
transactions, the Court finds that Defendant had actual knowledge of his connection to RC
Rush when he made false statements during the Rule 2004 Examination. The Court also
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finds that the evidence in the record supports the inference that Defendant knowingly and
intentionally omitted his connection to RC Rush and misstated his affiliation with RC Rush.
Lastly, Defendant knowingly made false statements during the § 341 Meeting.
During this meeting, Defendant affirmatively stated that he had no affiliation with ENL and
was never any type of officer of ENL. See Ex. 5, § 314 Hr’g Tr. at 50:20, 50:23-25, 51:7-10.
However, on August 2009, the Defendant was one of the signatories of a mortgage agreement
between ENL and the LaRosas. See Ex. 129, Mortgage Agreement. On June 17, 2009, the
Defendant, Mr. Vertucci, and Mr. and Mrs. LaRosa signed the document for Chase Bank to
open up a corporate bank account for ENL, and the Defendant signed as the “President” of
ENL. See Pls.’ SOMF ¶ 133; Ex. 128, Chase Acct. Signature Page. Thus, the Court may infer
Defendant had actual knowledge of his affiliation with ENL because he signed the mortgage
agreement on behalf of ENL and signed as an officer of ENL to open up a corporate bank
account. See Ruggieri, 2025 WL 2775308, at *3.
The Court may also infer that Defendant knowingly made false statements to the
chapter 7 trustee about his consent and knowledge of the rental and occupancy of the 20
Frost Valley Road property. The text messages between Defendant and Mr. Rodriguez on
February 26, 2020 show that Defendant knew of Mr. Rodriguez’s rental and occupancy before
March 1, 2020. See Rodriguez Aff. ¶ 19; Ex. 11, Text Messages. In addition, on February 11,
2020, Defendant, Rachel Cole, and Mr. Rodriguez executed a lease agreement pertaining to
20 Frost Valley Road. See Pls.’ SOMF ¶ 144; Rodriguez Aff. ¶ 16, Ex. 8, Lease Agreement.
Thus, Defendant had actual knowledge of the rental and occupancy of the premises by Mr.
Rodriguez before March 1, 2020, and as result, Defendant knowingly made misstatements to
the chapter 7 trustee regarding this matter. See Ruggieri, 2025 WL 2775308, at *3; Davidson,
2025 WL 2730796, at *4 (finding that debtor knowingly made a false statement when
swearing that the income from his business was zero, while at the same time, “prolifically
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writing checks and executing transactions from the business account”). Thus, based on the
foregoing, the third element of a claim under § 727(a)(4)(A) has been satisfied.
4. 	Fourth element of a claim under § 727(a)(4)(A): Fraudulent Intent
The Court finds that fraudulent intent has been established by the circumstantial
evidence in this case and the inferences drawn from the course of Defendant’s conduct. See
Omogun, 2022 WL 2517160, at *10. In addition, the Court finds that Defendant has exhibited
a reckless indifference to the truth because (1) the omissions and misstatements made by
Defendant related to interests and transactions that would directly affect the bankruptcy
estate and the chapter 7 trustee’s ability to investigate and dispose of assets; (2) Defendant
was a sophisticated businessman with financial savvy and in-depth knowledge of his matrix
of real estate companies; and (3) Defendant has made no attempt to amend his Bankruptcy
Filings or correct any of his omissions or misstatements. See id.
Defendant’s omission of Nest Capital from his Bankruptcy Filings supports an
inference of fraudulent intent by reckless indifference to the truth. The omission of Nest
Capital directly related to property of the estate under § 541(a)(1) because Defendant had a
membership interest in this limited liability company. Section 541(a)(1) of the Bankruptcy
Code provides that the bankruptcy estate comprises “all legal or equitable interests of the
debtor in property as of the commencement of the case.” 11 U.S.C. § 541(a)(1). Courts have
found that a debtor’s membership interest in a limited liability company constitutes property
of the estate. See In re Maidan, No. 8-19-77027-las, 2023 WL 2190228, at *5 (Bankr. E.D.N.Y.
Feb. 23, 2023) (quoting Garcia v. Garcia (In re Garcia), 494 B.R. 799, 810 (Bankr. E.D.N.Y.
2013)) (“[W]hen a member of an LLC files a bankruptcy petition, his interest in the LLC, and
any rights he has under the LLC's operating agreement, becomes property of the estate.”).
Furthermore, the transfer on December 11, 2018 by Nest Capital of the 72 West Shore Rd.
property, which was within 12 months of Defendant’s bankruptcy filing, would affect
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property of the estate and be subject to investigation by the chapter 7 trustee. In addition,
Defendant was a sophisticated businessman who had direct and in-depth knowledge of his
real estate investment portfolio. There is nothing in the record to conclude that Defendant’s
omission of his membership interest in Nest Capital was due to inadvertence or ignorance.
And, it bears repeating that Defendant made no attempt to amend his Bankruptcy Filings to
disclose his interest in Nest Capital or disclose the transfer of 72 West Shore Rd. See Cameo,
677 B.R. at 172 (“A failure to amend schedules can give rise to an inference of fraud.”).
Defendant’s omission of his connection to RC Rush from his Bankruptcy Filings and
misstatements made during the Rule 2004 Examination also support an inference of
fraudulent intent. It is undisputed that Defendant signed a joint agreement stating that he
was an officer of RC Rush, see Ex. 15, JV Agreement, and that RC Rush had transferred real
property within one year of Defendant’s bankruptcy filing and also post-petition:
• 	On or about September 23, 2019, less than two months before Defendant’s bankruptcy
filing, RC Rush sold the real property located at 60 Rush Street for $395,000. See Pls.’
SOMF ¶ 68; Ex. 18, Suffolk County Land Records and Deed, Indenture.
• 	On May 2020, more than six months after Defendant’s bankruptcy filing, RC Rush
sold the real property located at 326 East Garden City Street for $449,000. See Pls.’
SOMF ¶ 75; Ex. 23, Suffolk County Land Records and Deed, Indenture.
• 	On November 13, 2020, a deed was recorded, showing that RC Rush had sold the real
property located at 20 Whitman Avenue for $363,000. See Pls.’ SOMF ¶ 73; Ex. 22,
Suffolk County Land Records and Deed.
Not only did Defendant fail to disclose his connection as an officer of RC Rush in his
Bankruptcy Filings, but he expressly denied any affiliation with RC Rush or being an officer
of RC Rush in the Rule 2004 Examination held on November 24, 2020. Defendant’s pattern
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of misstatements made during examinations and omissions from his Bankruptcy Filings
gives rise to an inference of fraudulent intent. See Keswani, 2022 WL 90605, at *11 (finding
debtor’s false statements and repeated failure to disclose asset information in her schedules
and at the § 341 meeting were sufficient to establish fraudulent intent); Harrington v.
Kupersmith (In re Kupersmith), 614 B.R. 428, 440 (Bankr. D. Conn. 2020) (citing Singh, 585
B.R. at 339) (“The [d]ebtor's pattern of failure to present accurate information, and to remedy
inaccurate information, enables the Court to conclude the [d]ebtor made the statements at
issue with intent to deceive.”).
Defendant’s misstatements made during the § 341 Meeting likewise support an
inference of fraudulent intent. During the meeting, Defendant denied any affiliation with
ENL when asked if he was familiar with this entity. See Pls.’ SOMF ¶ 132; Ex. 5, § 314 Hr’g
Tr. at 50:14-16. However, in 2009, Defendant and Mr. Vertucci signed on behalf of ENL, a
mortgage agreement between ENL and the LaRosas, as well as a document to open up a
corporate bank account for ENL (where Defendant signed as the “President” of ENL). See Ex.
129, Mortgage Agreement; Pls.’ SOMF ¶ 133; Ex. 128, Chase Acct. Signature Page.
Defendant’s failure to disclose his relationship to ENL hindered the chapter 7 trustee’s ability
to discover and dispose of assets.
Regarding 20 Frost Valley Road and in response to the trustee’s questions, Defendant
made misstatements about his consent to and knowledge of the rental and occupancy of the
property by Mr. Rodriguez before March 1, 2020. See Ex. 5, § 314 Hr’g Tr. at 24:12-16, 25:3-
9, 25:15-19. Defendant knew he could not dispose of 20 Frost Valley Road, which was property
of the estate, without authorization by the chapter 7 trustee. See Ex. 5, § 341 Hr’g Tr. at 22:1-
10. Further, the estate was not benefitting from any rent proceeds collected from the rental
of this property. The text messages on February 26, 2020 between Defendant and Mr.
Rodriguez show that Defendant intended to “drag” out the sale of the 20 Frost Valley Road
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property in his chapter 7 bankruptcy. See Rodriguez Aff. ¶ 19; Ex. 11, Text Messages. Mr.
Rodriguez stated that Defendant would then be able to collect the $5,000 in rent proceeds for
a longer period of time. See id. Defendant answered by saying, “I need to get through the
summer after that I should be good to go.” Id. In the light of these facts, the Court finds that
circumstantial evidence supports an inference that Defendant made misstatements to the
chapter 7 trustee with fraudulent intent. Furthermore, Defendant’s repeated misstatements
under oath concerning significant transactions affecting the administration of the estate, his
knowledge of such misstatements, and the lack of meaningful corrections by the Defendant
demonstrate a reckless disregard for the truth. See Moreo, 437 B.R. at 64 (citing Shah, 388
B.R. at 38-39) (“[T]he aggregate of misstatements and omissions of fact can demonstrate a
pattern of reckless disregard for the truth and intent of concealing information from the
Court and its creditors.”).
Accordingly, the Court finds that circumstantial evidence, Defendant’s course of
conduct, and Defendant’s reckless disregard for the truth support the inference that the
omissions and misstatements of the Defendant were made with fraudulent intent. Thus, the
fourth element of a claim under § 727(a)(4)(A) has been satisfied.
5. 	Fifth element of a claim under § 727(a)(4)(A): Materiality
The Court finds that the omissions and misstatements of the Defendant made in this
case were material because they related to the bankruptcy estate, the discovery and
disposition of property, the business dealings of Defendant, and information that creditors
and the trustee would have regarded as significant in identifying and liquidating assets. See
Omogun, 2022 WL 2517160, at *10.
The omission of Defendant’s interest in Nest Capital was material because it related
to property of the estate under § 541(a)(1). See 11 U.S.C. § 541(a)(1); Maidan, 2023 WL
2190228, at *5. In addition, the omission resulted in concealment of the transfer of a
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significant asset, namely the 72 West Shore Rd. property for $769,000, which would have
affected the trustee’s ability to discover and dispose of assets. Nest Capital was also a real
estate company related to Defendant’s business of “flipping” real estate properties.
The omission of Defendant’s connection as an officer of RC Rush was material because
RC Rush, like Nest Capital, was a real estate company related to Defendant’s business
dealings. In particular, RC Rush was involved in significant real estate transactions within
one year of the Defendant’s bankruptcy filing as well as post-petition. Debtor’s connection to
RC Rush and such transactions would have been information that creditors and the trustee
would have likely regarded as significant in identifying and liquidating assets. For that
reason, Defendant’s misstatements 	made 	during the Rule 2004 Examination, where
Defendant denied any affiliation with RC Rush, were also material.
Lastly, Defendant’s misstatements made during the § 341 Meeting as to ENL were
material. Defendant denied any affiliation with ENL or being an officer of ENL. See Ex. 5, §
314 Hr’g Tr. at 50:20, 50:23-25, 51:7-10. Yet, the record belies the statements made under
oath by Defendant. His failure to disclose his relationship to ENL inhibited any investigation
by the trustee into any transactions involving ENL and how such transactions impacted the
administration of the bankruptcy estate. In addition, Defendant’s misstatements concerning
his consent and knowledge of the rental and occupancy of 20 Frost Valley Road by Mr.
Rodriguez were material because it related to the trustee’s ability to dispose of the real
property and collect rental proceeds, all of which constituted property of the estate.
Thus, the Court finds that Defendant’s omissions and misstatements were material
and that the fifth element of a claim under § 727(a)(4)(A) has been satisfied.
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6. 	Defendant Has Failed to Proffer a Credible Explanation or Probative
Evidence to Show that a Genuine Issue of Material Fact Exists.
Defendant has not filed a response to Plaintiffs’ motion for summary judgment, nor
has Defendant provided any credible explanation on the record for his omissions and
misstatements. “While judgments as to the credibility of a debtor’s explanation generally
should not be decided at the summary judgment stage . . . courts in the Second Circuit have
granted summary judgment under § 727(a)(4) where facts and circumstances clearly
demonstrate a fraudulent intent to make a false oath on the part of the debtor.” Omogun,
2022 WL 2517160, at *12 (citations omitted); see also Cameo, 677 B.R. at 174-75 (reasonably
inferring fraudulent intent because defendant “failed to provide a credible explanation for his
false statements” and granting plaintiff’s motion for summary judgment because “there
[were] no disputes respecting material facts”); Kupersmith, 614 B.R. at 440 (granting
plaintiff’s motion for summary judgment where plaintiff properly supported its motion and
debtor failed to “affirmatively set forth facts showing that there is a genuine issue for trial”);
Singh, 585 B.R. at 340 (granting plaintiff’s motion for summary judgment denying discharge
under § 727(a)(4)(A) where plaintiff “amply established a prima facie case” and debtor failed
to provide a credible explanation for his misstatements); Antoniou, 515 B.R. at 25 (granting
plaintiffs’ summary judgment denying discharge where plaintiffs “amply established a prima
facie case” that debtor “made material misstatements with fraudulent intent” and debtor
failed to provide a credible explanation).
Defendant had the opportunity to correct his omissions and misstatements by
amending his Bankruptcy Filings or disclosing his omitted interests or connections at the §
341 Meeting or Rule 2004 Examination. He failed to do so. Further, he did not respond to
Plaintiffs’ motion for summary judgment or provide any credible explanation for his glaring
omissions and misstatements.
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V. 	Conclusion
Based on the foregoing, the Court grants Plaintiffs’ motion for summary judgment
with respect to the fourth cause action of the Complaint under § 727(a)(4)(A), and Defendant’s
discharge is denied under § 727(a)(4)(A). Because the Court has concluded that Defendant’s
discharge is denied under § 727(a)(4)(A), the Court need not, and does not, address whether
Defendant’s discharge is denied under § 727(a)(2)(A), (a)(2)(B), (a)(3), (a)(5), or (a)(6)(A), or
whether Defendant’s debts must be excepted from discharge under § 523(a)(2)(A), (a)(4), or
(a)(6). The Court will enter a judgment consistent with this Memorandum Decision and
Order.
SO ORDERED.
____________________________
Louis A. Scarcella
United States Bankruptcy Judge
Dated: August 28, 2026
Central Islip, New York
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