Case of the Day: JBR, Inc. v. Cafe Don Paco, Inc.

The case of the day is JBR, Inc. v. Café Don Paco, Inc. (N.D. Cal. 2013). Rogers Family Coffee (“JBR”) was in the business of providing community aid for sustainable coffee farming. Café Café Don Paco, Inc. was a Texas business that imported and distributed coffee from Café Don Paco, S.A., its Nicaraguan affiliate. Roberto Bendaña and Alvaro Montealgre, both of whom lived in Nicaragua, were principals of Café Don Paco. JBR sued Bendaña and Montealgre after a dispute arose. He first sought to serve process on them at the Texas company’s registered address in San Antonio, without success. He tried also to serve Bendaña by email (without seeking leave of court first) and to serve Montealgre at a Texas home formerly owned by Montealgre and his wife. For good measure, Rogers emailed the documents to someone who worked at one of Montealgre’s “publicly listed organizations,” who said she would personally deliver them to Montealgre.

When the clerk refused to enter defaults in light of this record of attempted service, Rogers asked the court to authorize service by email under FRCP 4(f)(3). The judge correctly held that service by email was not prohibited by international agreement, as Nicaragua is not a party to the Hague Service Convention. The judge also pointed out that the Inter-American Convention is not in force between the United States and Nicaragua because Nicaragua is not a party to the Additional Protocol, although the judge might have gone on to note that even if the Convention did apply, it would not prohibit service by email, because it is non-exclusive. The judge also held that there were no due process problems, as there was “reasonable assurance,” based on past correspondence with the two, that their email addresses were valid and that the documents would reach them.

The judge went on to hold that the earlier service by email on Bendaña, without leave of court, was effective, finding that there was no prejudice to Bendaña (who had actual notice) but taht Rogers, which had been diligent, faced a statute of limitations problem. In light of the plain language of FRCP 4(f)(3) I am not sure this was within the judge’s discretion.

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