Later, Wells Fargo Bank, N.A., sued Robinson and others in the San Diego Superior Court for payment of a defaulted loan. The court, at Wells Fargo’s request, appointed a receiver for Robinson. Wells Fargo also brought an action against Robinson in Mexico, and the Mexican court imposed a lien in Wells Fargo’s favor on real property held in trust for the benefit of Robinson.

Landstar, evidently aware that Wells Fargo had put itself at the head of the line by chasing Robinson’s assets in Mexico, asked the San Diego court to issue a letter rogatory under the Inter-American Convention requesting that the Mexican court recognize the California judgment liens and assign the right to receive the proceeds of the sale of the property in trust to Landstar, and also sought a restraining order enjoining Robinson from transferring its rights to the Mexican property. The lower court granted all of the relief sought, and Robinson appealed. The issuance of the letter rogatory (but not the restraining order) was stayed pending the appeal. It turned out that the restraining order was improper as a matter of California law (though leaving aside any California-specific issues, it seems proper to me to issue an order in personam restraining a judgment debtor from transferring its property anywhere in the world). So I don’t consider the restraining order further here. Instead, let’s focus on the question whether it was proper to issue a letter rogatory in the first place.

The court correctly concluded that the Inter-American Convention did not authorize the letter rogatory. Article 2 of the Convention provides:

This Convention shall apply to letters rogatory, issued in conjunction with proceedings in civil and commercial matters held before the appropriate judicial or other adjudicatory authority of one of the States Parties to this Convention, that have as their purpose:
a. The performance of procedural acts of a merely formal nature, such as service of process, summonses or subpoenas abroad;
b. The taking of evidence and the obtaining of information abroad, unless a reservation is made in this respect.

The court construed the phrase “procedural acts of a merely formal nature.” a “Procedural act” is a step “taken according to rules that prescribe the manner of conducting litigation or other judicial business, as opposed to rules that define parties’ substantive rights and obligations.” “Formal,” according to the court, here means “adhering to accepted forms, conventions, or regulations,” such as the “special or stipulated solemnities or formalities required for an act to become effective.” Thus the Convention extends to “customary or conventional steps that are taken to provide a person with a legally sufficient notice of a proceeding or of a document filed or issued in a proceeding, but that do not alter the person’s substantive rights or obligations.” The obvious conclusion: the Convention does not authorize a letter rogatory aimed at obtaining a substantive remedy such as an attachment or recognition of a California judgment liens.

Does this mean that the California court was forbidden to send a letter rogatory seeking such relief? I don’t know of any reason why the California court couldn’t send such a request, even if it is not authorized by the Convention. How a Mexican court would treat such a request is really a question of Mexican law, to which I don’t know the answer. If Mexico grants substantive relief on a foreign judgment without first recognizing the judgment, then it seems to me that Mexico is an outlier.

Original article: Case of the Day: Landstar Global Logistics v. Robinson & Robinson. Letters Blogatory © 2013 Theodore J. Folkman and contributors. Some rights reserved.

Elcometer’s lawyer did manage to speak with Thoren by phone before a hearing on its motion for a preliminary injunction, but Thoren, who refused to remove the allegedly infringing marks from the Paintmeter website, “indicated that [Elcometer] had no available recourse since he lives in Panama.” Later, he wrote, using the paintmeter.com email address: “You are wasting your time and your client’s money pursuing this matter. You will recover nothing from me, not one dime, mark my words.” Note to defendants: emails like this just make plaintiffs angry.

Elcometer moved under FRCP 4(f)(3) for leave to serve Paintmeter and Thoren via email. Because Panama is a party to the Inter-American Convention but not the Hague Service Convention, and because the Inter-American Convention is not exclusive, there was no question in the case about whether a treaty barred service by email. Service by email was reasonably calculated to reach the defendants, as was evident from Thoren’s use of the email address. The judge took note of Rio Properties, the leading case condoning service by email. Easy case.

Original article: Case of the Day: Elcometer v. TQC-USA. Letters Blogatory © 2013 Theodore J. Folkman and contributors. Some rights reserved.

Honduras is a party to the Inter-American Convention on Letters Rogatory. Although Suncoast initially told the court that it was seeking to make service via a letter rogatory, ultimately it effected service by service on the office manager at the Honduran consulate general in Miami. Based on this service, a default judgment ultimately entered and Suncoast began garnishing assets in the hands of third parties. Hondutel then moved for relief from the judgment under FRCP 60(b) on the grounds that the judgment was void as it had never been properly served with process. Hondutel argued—and Suncoast didn’t really dispute—that it was an agency or instrumentality of the Honduran state, which means that Suncoast had to make service under the FSIA, specifically 28 USC § 1608(b). The statute provides:

Service in the courts of the United States and of the States shall be made upon an agency or instrumentality of a foreign state:
(1) by delivery of a copy of the summons and complaint in accordance with any special arrangement for service between the plaintiff and the agency or instrumentality; or
(2) if no special arrangement exists, by delivery of a copy of the summons and complaint either to an officer, a managing or general agent, or to any other agent authorized by appointment or by law to receive service of process in the United States; or in accordance with an applicable international convention on service of judicial documents; or
(3) if service cannot be made under paragraphs (1) or (2), and if reasonably calculated to give actual notice, by delivery of a copy of the summons and complaint, together with a translation of each into the official language of the foreign state—
(A) as directed by an authority of the foreign state or political subdivision in response to a letter rogatory or request or
(B) by any form of mail requiring a signed receipt, to be addressed and dispatched by the clerk of the court to the agency or instrumentality to be served, or
(C) as directed by order of the court consistent with the law of the place where service is to be made.

There was no evidence, according to the court, of an agreement that service could be made on the consulate general, thus § 1608(b)(1) did not apply. Section 1608(b)(2) also was inapplicable. Although there was some evidence that Suncoast had emailed a copy of the complaint to the Director General of Hondutel, it was unclear that the email address to which the documents were sent was his, and there was no evidence of receipt. (The court might also have noted that it is not clear that service by email can ever satisfy the requirement of “delivery” in § 1608(b)(2)). Finally, § 1608(b)(3) was inapplicable, because there was no evidence that the Director General received the copy of the papers Suncoast claimed to have sent to him by mail; the statute specifically calls for use of a return receipt.

Unlike service on a foreign state itself, service on an agency or instrumentality need only substantially comply with the FSIA, at least in the Ninth Circuit. But there was no evidence that Hondutel had actual notice of the action, and so there was no substantial compliance.

The judge therefore vacated the default judgment and directed Suncoast to serve the summons and complaint as required by the FSIA by a date certain.

Original article: Case of the Day: Suncoast Tech Corp. v. Hondutel. Letters Blogatory © 2013 Theodore J. Folkman and contributors. Some rights reserved.

Johnson’s first efforts were inauspicious. He tried to serve Berrocal and Arosemena by mail and by email, asserting that both methods of service were permissible under the California Code of Civil Procedure. But as the judge recognized, California law is irrelevant. While federal law incorporates state law on service of process when the defendant is to be served in a judicial district of the United States, it does not incorporate state law when the defendant is to be served abroad.

Johnson’s next effort was better in concept. He asked the clerk to address and mail the papers to the defendants under FRCP Rule 4(f)(2)(C)(ii), which permits service “using any form of mail that the clerk addresses and sends to the individual and that requires a signed receipt.” But for reasons that are unclear to me, the clerk “informed plaintiff that it does not provide that service.”

Panama is a party to the Inter-American Convention on Letters Rogatory, ¹ but rather than attempting service by the method prescribed by the Convention, Johnson sought and received leave to serve process by mail and email.

The interesting tidbit in this otherwise mundane case is the suggestion that at least some clerk’s offices do not facilitate service under Rule 4(f)(2)(C)(ii). This is surprising to me. I will see what I can get in the way of clarification from the Administrative Office of the US Courts.

Original article: Case of the Day: Johnson v. Mitchell. Letters Blogatory © 2013 Theodore J. Folkman and contributors. Some rights reserved.

Hughes and Ashton had a dispute over real property in California that they had jointly owned. Hughes wrote a letter concerning the dispute to Ashton at Ashton’s address in Chile, and she received a response from Ashton’s lawyer, Diaz. When the parties could not settle the dispute, Hughes sued. She served process by mailing the summons and complaint to Ashton’s address in Chile via registered mail, and she obtained a signed mailing receipt. When Ashton did not appear, Hughes sought and obtained a default judgment. Years later, Ashton sought to set aside the judgment.

The trial court found that Ashton had actually received the papers in Chile and signed the receipt. Ashton argued nevertheless that service by registered mail was impermissible. The Court of Appeals rejected the argument. First, it noted that service by mail was proper under the law of the forum, in particular sections 413.10 and 415.40 of the California Code of Civil Procedure.

Chile is a party to the Inter-American Convention but not the Hague Service Convention. Unlike the Hague Service Convention, the Inter-American Convention is neither mandatory nor exclusive. Therefore, whether the service complied with the Convention was immaterial. The court recognized that considerations of comity could lead to the conclusion that the plaintiff should use a method of service permitted by the law of the place where the service was accomplished, but the court held that in the circumstances of this case, where the defendant did not seek to quash the service at the time and waited for years after the judgment to seek relief, comity was not relevant.

The court did, however, note that the validity of the service under California law could not guarantee that the Chilean courts would enforce the judgment:

While it may be that Chile would not recognize the California judgment because Ashton purportedly was not served in a manner authorized under Chilean law, that does not mean that service was improper under California law and that the California judgment is void in this state.

I think the judge got everything about this case right. He recognized that in the first instance, the validity of the service depends on the law of the forum; he recognized that because the Inter-American Convention was non-exclusive, Chilean law did not apply, except as a matter of comity, which the court judge declined to grant; and he explained why, despite the outcome of the case, American plaintiffs would do well to bear the law of the state where the defendant is served in mind—if the ultimate goal is a judgment enforceable in a foreign state, the willingness of an American court to grant a judgment in the plaintiff’s favor is not enough.

Original article: Case of the Day: Hughes v. Ashton. Letters Blogatory © 2013 Theodore J. Folkman and contributors. Some rights reserved.

Today’s case of the day, Chevron Corp. v. Salazar (S.D.N.Y. 2011), relates to Chevron’s efforts to take the depositions of three of the Lago Agrio plaintiffs’ Ecuadorian lawyers, Pablo Fajardo Mendoza, Juan Pablo Saenz, and Julio Prieto Mendez, and to take the deposition of Luis Francisco Yanza, who is the co-founder of the Frente de Defensa de la Amazonia, known as the “ADF”.

In the action in which Chevron seeks a declaratory judgment that the multibillion dollar Ecuadorian judgment is not entitled to recognition or enforcement, most of the Lago Agrio defendants, as well as Fajardo and Yanza, defaulted rather than answer the complaint. Chevron issued notices to take the depositions of Fajardo, Saenz, Prieto, and Yanza, all of whom reside in Ecuador. It served the notices on counsel for the defendants who have appeared but not on the witnesses. Nor did Chevron seek to serve subpoenas on the four.

Fajardo failed to appear for his deposition, and the court believed the others would do likewise. Chevron moved to compel the defendants who had appeared to produce Fajardo, Saenz, Prieto, and Yanza for depositions in New York. Judge Kaplan denied the motion.

The judge noted that while the four witnesses were parties (albeit parties in default) to one of the two actions before him, they had not been served with the notices, and none of them had appeared through counsel. Presumably Chevron could seek to serve them with the notices in Ecuador, but this would require resort to the Inter-American Convention.

The judge also rejected Chevron’s argument that there was an “enterprise” comprising the Lago Agrio plaintiffs, their lawyers, etc. and that under Rule 30, the four witnesses, supposedly “managing agents” of the organization, should be required to appear. But the notices of deposition did not seek to depose the supposed “association,” and even if it had, the association is not a party to the case, and its deposition cannot, therefore, be compelled by a mere notice.

Last, the judge rejected Chevron’s argument that because three of the witnesses are the Lago Agrio plaintiffs’ lawyers, the LAPs who have appeared in the case can be compelled to produce them. He held that unlike an organization that receives a deposition notice under Rule 30(b)(6), an individual party cannot be required to produce his or her agent for deposition on a mere notice. A subpoena is required. While the judge found “strong arguments for the proposition” that Chevron was advancing, he noted that the Rules Advisory Committee had not “address[ed] this point in the entire history of the Federal Rules of Civil Procedure” making “improvisation unwise.”

Original article: Case of the Day Chevron Corp. v. Salazar. Letters Blogatory © 2013 Theodore J. Folkman and contributors. Some rights reserved.

Brazil is not a party to the Hague Service Convention, but it is a party to the Inter-American Convention on Letters Rogatory. The Inter-American Convention allows alternate methods of service, without specifying them. Thus under Fed. R. Civ. P. 4(f)(2)(C)(ii), service by certified mail could be an acceptable method of service, but only if the mail is sent by the clerk. Since JB Custom itself sent the documents, the court quickly discounted this possibility.

The remaining possibility was Rule 4(f)(2)(A), which permits service “as prescribed by the foreign country’s law for service in that country in an action in its courts of general jurisdiction.” But does this refer to Brazilian law that applies when a Brazilian files a lawsuit in Brazil, or to Brazilian law that applies to service in Brazil in a case brought elsewhere? The latter, the court held, because if a country has enacted laws specifically governing service of process in its territory where the action was brought abroad, it would be an affront to that country’s sovereignty to allow service under the law applicable in the country’s general domestic litigation. After reviewing competing expert affidavits, the judge determined that Brazilian law did require service by letter rogatory in cases against persons in Brazil in foreign jurisdictions. So the service by mail was improper under Rule 4(f)(2)(A).

JB Custom asked the court to approve an alternate method of service under Rule 4(f)(3). It noted that prior State Department guidance indicated it could take up to three years to serve a letter rogatory in Brazil. (The current State Department guidance does not include such a statement). But the court did not the difficulties of obtaining service via a letter rogatory persuasive:

But even if I were to presume that it remains difficult to obtain service in Brazil via letters rogatory, for the reasons just stated I will not override the laws a sovereign state like Brazil just because they are perceived to be slow or difficult. Any questions about the ways in which Brazil processes letters rogatory or complies with the Inter–American Convention are ultimately diplomatic issues for the executive branch. For me to impose by fiat a rule allowing service on Brazilians in a manner that Brazil has apparently resisted for decades would be to side-step the State department and its role in negotiating with the sovereign state of Brazil.

If the question is whether the court could authorize service by mail on the defendants in Brazil, then I think the court’s approach may be persuasive, particularly if Brazilian law actually forbids service by mail from abroad (it’s not clear from the court’s discussion whether that is so). But I don’t regard the decision as ultimately persuasive, because the court could authorize service on the Brazilian defendants’ US counsel without any offense to Brazilian sovereignty that I can see. So I think this case is probably not correctly decided.

Original article: Case of the Day: JB Custom, Inc. v. Amadeo Rossi, S.A.. Letters Blogatory © 2013 Theodore J. Folkman and contributors. Some rights reserved.

The court held that since the Inter-American Convention was neither mandatory nor exclusive, service by mail on Mirabella’s agent was permissible as long as not forbidden by Panamanian law. Thus the service was proper and Derrevere was entitled to a default judgment.

Original article: Case of the Day: Derrevere v. Mirabella Foundation. Letters Blogatory © 2013 Theodore J. Folkman and contributors. Some rights reserved.

According to the opinion, the government unsuccessfully attempted to serve process on several of the defendants in Mexico under the Inter-American Convention. The government later served fourteen of the defendants by serving process “at the San Diego, California offices of Wilson Batiz LLC, ‘a Batiz family business.’” Based on this service, the clerk entered a default against those defendants, and the government moved for a default judgment. Thirteen of the fourteen then appeared and moved to set aside the default and to dismiss the action for failure to serve process.  The government withdrew its motion for a default judgment. But the government did not know most of the defendants’ addresses, and their lawyer would not reveal them. The government, after attempting to obtain the addresses through third-party discovery, sought leave to authorize service on the defendants’ attorney in the United States under Rule 4(f). The court granted the motion. Following service on the attorney, the defendants moved to dismiss. The court denied the motion as to those defendants whose addresses were unknown. The court denied the motion without prejudice as to certain other defendants pending additional efforts to serve them via the Mexican central authority, as prescribed by the Hague Service Convention.

The court’s decision seems plainly correct. We have seen this issue in several prior cases. Because the Hague Service Convention applies only when “there is occasion to transmit a judicial or extrajudicial document for service abroad,” the Convention does not apply when service within the United States (on an agent, by publication, or whatever)  is sufficient under U.S. law to constitute service on a defendant who is abroad. There might be a question of due process in particular cases (e.g., if a notice by publication is not reasonably calculated to give actual notice to the defendant), but in general, if the court authorizes alternate means of service that do not require transmission of a document abroad, the Hague Service Convention does not make the service invalid. (Enforcement of the judgment in Mexico in these circumstances is, of course, another matter).  And indeed, in this case, the Hague Service Convention does not apply at all, since under Article 1(1), “This Convention shall not apply where the address of the person to be served with the document is not known.”

Original article: Case of the Day: United States v. Distribuidora Batiz CGH, S.A. de C.V.. Letters Blogatory © 2013 Theodore J. Folkman and contributors. Some rights reserved.

Feliz v. United States (D. Mass. 2011). Feliz sued MacNeill, a physician and a citizen and resident of Ireland, for medical malpractice and wrongful death on account of the death of her child. MacNeill moved to dismiss for insufficient service of process. After several extensions of time to effect service, the court granted MacNeill’s motion. The parties stipulated to entry of separate and final judgment against MacNeill under Rule 54(b) to facilitate an appeal (the claims against the other defendants remained pending in the district court), and Feliz appealed to the First Circuit. But contrary to the stipulation, Feliz then moved in the district court to vacate the dismissal. The court denied the motion on the grounds that in light of the appeal, it lacked jurisdiction. The First Circuit then remanded for an explanation of the district court’s conclusion that there was “no just reason for delay” in entry of the separate and final judgment as to MacNeill. (By way of background, the policy of the courts is against piecemeal appeals, and it is generally impermissible to enter a final judgment when some claims have not been finally resolved, but there is an exception in cases where the court finds “no just reason for delay.” Here, the First Circuit seemed concerned that the parties and the district court had collusively agreed to entry of a final judgment against MacNeill in order to create appellate jurisdiction). The court held that there was no excuse for Feliz’s failure to attempt service under the Hague Service Convention. An immediate appeal was justified, in the district judge’s view, because if the First Circuit disagreed with the dismissal, there would still be time to bring MacNeill into the case to have the claims against him considered with the claims against the other defendants.

Original article: Digest for March 14, 2011. Letters Blogatory © 2013 Theodore J. Folkman and contributors. Some rights reserved.