In a decision issued just hours before a scheduled foreclosure auction, the U.S. District Court for the Eastern District of New York denied a defendant's last-minute bid to halt the sale of a Brooklyn property, closing out a case that had already cycled through default, vacatur, and summary judgment.
The dispute traces back to March 2022, when Herve Thomas, acting through an entity he formed called New Generation Holdings, LLC, executed a promissory note for $480,000 in favor of M&M Private Lending Group, LLC. The note was secured by a mortgage on property at 531 E. 81st Street in Brooklyn. Payments continued for roughly two years before New Generation stopped paying. M&M later assigned the mortgage to HANDL Capital 531, LLC, which filed suit three days after taking the assignment in November 2025 .
The case did not proceed smoothly for the defendant. New Generation initially defaulted, then successfully moved to vacate that default, conditioned on reimbursing HANDL's attorneys' fees. In granting that relief, the court had already signaled skepticism about the strength of the defenses New Generation intended to raise, though it applied the lenient standard courts use when evaluating motions to vacate. As the court had predicted at the time, the case simply worked its way back through the litigation process, and HANDL ultimately won summary judgment in April 2026 .
With the property set for auction, New Generation returned to court a third time. The motion sought two forms of relief: vacatur of the summary judgment ruling under Federal Rules of Civil Procedure 60(b)(3) and 60(b)(4), and a temporary restraining order to stop the auction. Both requests rested on the same argument that the underlying mortgage was a product of unconscionable misrepresentations and misconduct by the original lender, M&M.
Rule 60(b)
The court made short work of the Rule 60(b) arguments. Rule 60(b)(3), which allows relief from judgment based on fraud, misrepresentation, or misconduct, applies only to conduct by an opposing party in the litigation . Because M&M was not a party to the lawsuit, HANDL, as assignee, was the plaintiff and any alleged misconduct by M&M in originating the loan was simply outside the rule's reach.
That left Rule 60(b)(4), under which a movant must show the underlying judgment is void . The court explained that this provision is narrow, reaching only judgments premised on a jurisdictional error or a due process violation that deprived a party of notice or an opportunity to be heard . New Generation raised no jurisdictional challenge, and the court noted it had already given the defendant multiple opportunities to be heard on the motion to vacate the default and in opposing summary judgment, without the defendant ever meaningfully asserting an unconscionability defense. A judgment does not become void merely because it may have been wrong on the merits; Rule 60(b)(4), the court emphasized, is not a stand-in for an appeal.
TRO
Turning to the request for emergency injunctive relief, the court first pointed to the timing of the application itself. Courts in this circuit have repeatedly held that unexplained delay in seeking relief undermines a claim of irreparable harm, with delays of as little as ten weeks found sufficient to defeat the usual presumption . Waiting until hours before the sale to seek a TRO cut against New Generation's position from the outset.
Even setting the delay aside, the court found the substantive standard unmet. A TRO in this circuit is evaluated under the same standard as a preliminary injunction , requiring a showing of immediate and irreparable injury, meaning harm that, absent immediate intervention, would make it impossible for the court to provide effective relief later. New Generation argued that the property, owned and occupied by the Thomas family since 1980, represented the family's greatest financial and sentimental asset, and that losing it would be irreparable.
The court was unmoved. It characterized the argument as conflating a bare assertion of irreparable harm with an actual showing of one, and observed that displacement is an unfortunately routine consequence of mortgage default.
References
- HANDL Capital 531, 2026 WL 440558, at 3.
- Id.
- Fed. R. Civ. P. 60(b)(3).
- Fed. R. Civ. P. 60(b)(4).
- Romeril, 15 F.4th at 171.
- Weight Watchers, 423 F.3d at 144.
- Saidi, 544 F. Supp. 3d at 295.
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