First American Title Insurance Company v. Ram Abstract, Ltd. et al

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UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF NEW YORK
FIRST AMERICAN TITLE INSURANCE
CO.,
Plaintiff,
v.
RAM ABSTRACT, LTD., EIVAZOV, LLC,
VAYSBAUM & KAZAKEVICH, P.C.,
ALEX VAYSBAUM, ESQ., JOHN DOE #1
through JOHN DOE #10, the last ten
names being fictitious and unknown to
plaintiff,
Defendants.
MEMORANDUM & ORDER
23-CV-6462 (NRM)(RML)
NINA R. MORRISON, United States District Judge:
This 	case 	arises 	from 	a 	dispute 	regarding 	fraudulent 	mortgage 	payoff
statements in a real estate transaction. Plaintiff First American Title Insurance Co.
(“First American”) hired Defendant Ram Abstract, Ltd. (“Ram”) as a limited agent to
issue title insurance policies on its behalf. 	Ram then served as the title closer for
Omar Lozada Xochimitl and Christian Ezequiel Lozada Xochimitl (the “Purchasers”),
who sought to buy a residential property from Defendant Eivazov, LLC (“Seller”). At
all relevant times, Seller was represented by Defendants Vaysbaum & Kazakevich,
P.C. and Alex Vaysbaum, Esq. (the “Vaysbaum parties”).
During closing, Ram attempted to clear title for the Purchasers by paying off
two mortgages encumbering the property. However, Seller and the Vaysbaum parties
received a fraudulent payoff statement by email from an unknown third party, who
was not the true mortgage holder. That payoff statement was forwarded to Ram, who
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then incorrectly made the mortgage payments to the fraudsters. 	After discovering
the fraud, Plaintiff properly cleared title and brought this diversity action against
Ram, Seller, and the Vaysbaum parties to indemnify its losses. Compl., ECF No. 1.
On May 17, 2024, the Vaysbaum parties moved to dismiss all claims against
them. 	Mot. to Dismiss, ECF No. 34. 	On January 29, 2025, this Court respectfully
referred 	the 	motion 	to 	Magistrate 	Judge 	Robert 	M. 	Levy 	for 	a 	Report 	and
Recommendation (“R&R”). Order Referring Mot. to Dismiss dated January 29, 2025.
On September 16, 2025, Judge Levy issued an R&R recommending that the Court
grant the motion to dismiss. 	R. & R., ECF No. 55. 	Defendant Ram timely filed
objections. Obj. to R. & R. (“Obj.”), ECF No. 57. Plaintiff did not object.
For the reasons that follow, the Court adopts Judge Levy’s thorough and well-
reasoned R&R in its entirety.
DISCUSSION
A district court “may accept, reject, or modify, in whole or in part, the findings
or recommendations made by the magistrate judge.” 28 U.S.C. § 636(b)(1)(C). “When
a party submits timely and specific objections to a report and recommendation, the
district court reviews de novo the parts of the report and recommendation to which
the party objected.” Mancuso v. Kijakazi, No. 22-CV-5633 (KMK), 2023 WL 6311289,
at *1 (S.D.N.Y. Sep. 28, 2023). 	Until recently, courts in this circuit have generally
adhered to the rule that “objections which merely recite the same arguments to the
magistrate judge[] are reviewed for clear error.” 	New York City Dist. Council of
Carpenters v. Allied Design & Constr., LLC, 335 F. Supp. 3d 349, 351 (E.D.N.Y. 2018)
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(quoting O’Diah v. Mawhir, No. 08-CV-322 (TJM), 2011 WL 933846, at *1 (S.D.N.Y.
Mar. 16, 2011)); see, e.g., Burrell v. Maciol, No. 19-CV-1629 (TJM), 2022 WL 856878,
at *1 (N.D.N.Y. Mar. 23, 2022). 	However, the Second Circuit recently clarified that
“that principle should be applied only ‘when the objections are nonspecific or merely
perfunctory responses argued in an attempt to engage the district court in a
rehashing of the same arguments set forth in the original petition.’” Nambiar v. Cent.
Orthopedic Grp., LLP, 158 F.4th 349, 361 (2d Cir. 2025) (emphasis in original)
(quoting Miller v. Brightstar Asia, Ltd., 43 F.4th 112, 120 (2d Cir. 2022)); see also id.
at 360–61 (noting the “indispensable” role that Magistrate Judges play in the federal
judicial system, while underscoring the need to preserve litigants’ constitutional right
of access to an Article III judge). 	Thus, “[w]here a litigant’s objections take ‘issue
with a specific legal conclusion in the report and recommendation,’ they should be
considered de novo, even if they repeat an argument raised before the magistrate
judge.” Id. at 361 (quoting Miller, 43 F.4th at 121).
In its objections, Ram raises two challenges to the R&R. First, Ram reiterates
the claim from its opposition to the Motion to Dismiss that the Vaysbaum parties had
a near-privity relationship with Plaintiff. See Obj. at 3–5;1 Mem. in Opp’n to Mot. to
Dismiss (“Opp’n”) at 11–16, ECF No. 36. 	Ram then argues that it is premature to
dismiss the Vaysbaum parties as the potential assumption of a duty is a matter to be
determined at discovery. The Court finds neither claim persuasive.
1 Unless otherwise indicated, all page references use the pagination generated
by the Electronic Case Filing System.
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I. 	No Privity Between Plaintiff and the Vaysbaum Parties
Ram argues that the Vaysbaum parties assumed a duty of care to Plaintiff
because the Vaysbaum parties “transferred the Fraudulent payoff letters to the
Buyer and knew that the Buyer relied on such payment.” Obj. at 4. This is the same
argument that Ram made in its opposition to the Motion to Dismiss. See Opp’n at 8–
10 (arguing that by “circulating the Fraudulent Payoff, the Vaysbaum Parties
unquestionably knew that the other parties in the transaction relied upon the
attorney representations”). 	However, because Ram identifies and takes issue with
the R&R’s specific finding that there is no privity between Plaintiff and the
Vaysbaum parties, the Court reviews the claim de novo.
Ram’s argument is unpersuasive. Ram relies on a number of cases in which
courts found an assumed duty between an attorney and a non-client, but none of these
cases present facts similar to those here. 	For example, in Crossland Sav. FSB v.
Rockwood Ins. Co., 700 F. Supp. 1274 (S.D.N.Y. 1988), the court ruled that a law firm
may have assumed a duty to a third party where the firm executed an opinion letter
for the benefit of the third party at the client’s direction and request, and the letter
“specifically state[d] that it may be relied upon by [the third party].” Id. at 1283. And
in Schwartz v. Greenfield, Stein and Weisinger, 396 N.Y.S.2d 582 (Sup. Ct. 1977), the
court found that an attorney violated an assumed duty to a third party where the
attorney failed to file a copy of the security agreement as required by UCC § 9-401(1)
after “draw[ing] the required documents[ and] agree[ing] to file and thereby perfect
the security agreement.” Id. at 582. See also Curtis v. Berutti, 176 N.Y.S.3d 423, 431
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(Sup. Ct. 2022) (finding a “near privity” relationship where it was “patently obvious”
that the law firm was retained for the third party’s benefit as replacement counsel,
and where “it [wa]s indisputable that [the law firm] Defendants were aware that their
services would be used” in such fashion).
Here, by contrast, Plaintiff has not pled facts showing any similar affirmative
action taken by the Vaysbaum parties to create a near-privity relationship with
Plaintiff. 	In its objections, Ram points only to the fact that the Vaysbaum parties
forwarded the email containing the fraudulent payoff statement to the Buyer. 	But
as the R&R notes, not only would such an action “fall short of what is required to
show an assumption of duty,” Plaintiff’s complaint does not even allege that it was
the Vaysbaum parties — rather than the Seller — who forwarded the email. R. & R.
at 11–12; see Compl. ¶¶ 38, 46, ECF No. 1 (alleging that “Seller and the Vaysbaum
Parties received a second email” with the fraudulent payoff statement, then that
“Ram’s title closer[] was provided the Fraudulent Payoff at the closing”).
Finally, Ram does not address or attempt to distinguish this case from First
Am. Title Ins. Co. v. Liberty Land Abstract Inc., No. 600326-22, 2022 WL 19573929
(N.Y. Sup. Ct. July 26, 2022), which presented nearly identical circumstances, and on
which the R&R relies. 	See R. & R. at 12–13. 	In that case, Liberty, acting as title
closer for First American, was also duped by a fraudulent payoff statement sent by
fraudsters masquerading as the true mortgage holders. 	Liberty Land Abstract Inc.,
2022 WL 19573929, at *1–3. 	The fraudsters sent the false statement to the seller,
who forwarded it to their attorneys, who then forwarded it to Liberty. Id. The court
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found that plaintiff failed to “allege that the [] Defendants assumed a duty to provide
an 	accurate 	payoff 	statement . . . . The 	Complaint 	merely 	asserts 	that 	the 	[]
Defendants transmitted the Fraudulent Payoff Statement and does not contain any
factual allegations that the [] Defendants represented that they would verify the
accuracy of that payoff statement.” 	Id. at *8. 	The same is true here. 	And while
Liberty Land is not strictly binding on this Court, its reasoning is instructive and
highly persuasive.
II. 	Not Premature to Dismiss Prior to Discovery
Ram next argues that it is premature to grant a motion to dismiss at this stage
because “there is certain discovery that is outstanding to confirm the Vaysbaum
[parties] had a 	duty, or even assumed 	a duty, in the underlying real estate
transaction.” 	Obj. at 5. 	As a threshold matter, this is a new argument not raised
before Judge Levy, and “it is well established law that a district judge will not
consider new arguments raised in objections to a magistrate judge’s report and
recommendation that could have been raised before the magistrate but were not.”
Allied Design & Constr., LLC, 335 F. Supp. 3d at 351 (quoting Illis v. Artus, 06-CV-
3077 (SLT), 2009 WL 2730870, at *1 (E.D.N.Y. Aug. 28, 2009)).
In any case, the claim is without merit. While determining the existence of a
near-privity relationship between two parties is one that could potentially be further
developed in discovery, that would only be the case had the Complaint actually
alleged that the Vaysbaum parties had assumed or otherwise generated such a duty.
The problem, as clearly identified in the R&R, remains that Plaintiff simply “does not
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allege facts establishing privity or a relationship closely resembling privity between
it and the Vaysbaum parties.” 	R. & R. at 11. 	And neither Ram nor Plaintiff is
“entitle[d] to discovery to develop new claims or defenses that are not already
identified in the pleadings.” United States ex rel. Bilotta v. Novartis Pharms. Corp.,
No. 11-CV-0071 (PGG), 2015 WL 13649823, at *2 (S.D.N.Y. July 29, 2015) (quoting
Fed. R. Civ. P. 26(b)(1) Advisory Committee Note–2000 Amendments); see also
Tottenham v. Trans World Gaming Corp., No. 00-CV-7697 (WK), 2002 WL 1967023,
at *2 (S.D.N.Y. June 21, 2022) (“Discovery . . . is not intended to be a fishing
expedition, but rather is meant to allow parties to flesh out allegations for which they
initially have at least a modicum of objective support.”) (quoting Cleveland-Goins v.
City of New York, No. 99-CV-1109 (AGS), 1999 WL 673343, at *2 (S.D.N.Y. Aug. 30,
1999))).
CONCLUSION
For the foregoing reasons, the Court adopts the well-reasoned R&R in its
entirety. 	Defendants Vaysbaum & Kazakevich, P.C. and Alex Vaysbaum, Esq.’s
motion to dismiss is granted, and all claims against those defendants are dismissed
with prejudice.
/s/ Nina R. Morrison
NINA R. MORRISON
United States District Judge
Dated: 	January 28, 2026
Brooklyn, New York
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