Case of the Day: Mezu v. Progress Bank of Nigeria

The case of the day, Mezu v. Progress Bank of Nigeria, plc (D. Md. 2013), is a mess. Dr. Sebastian Okechukwu Mezu was the chairman of Emekuku Community Bank Nigeria Ltd. Mezu had previously obtained a default judgment against Progress Bank of Nigeria, plc, from the Federal Court in Port Harcourt, Nigeria. Progress Bank had been liquidated, and under Nigerian law, according to Mezu, both Progress and the Nigeria Deposit Insurance Corp. were liable on the judgment. The amount of the judgment was roughly ₦ 2 million, which according to the plaintiff was approximately $23,000 in US dollars.

Muzu sought recognition and enforcement of the Nigerian judgment in Maryland. Both Progress and the NDIC defaulted. The judge recognized and enforced the judgment.

So what’s the problem? Let’s count them.

First, subject matter jurisdiction. Muzu argued, and the judge apparently agreed, that the court had diversity jurisdiction. Muzu’s “application” to the court does not comply with FRCP 8(a), governing the contents of a complaint. If it had, it would have indicated the citizenship of the parties and the amount in controversy. The amount in controversy was only $23,000, which is less than the $75,000 required by the statute, 28 U.S.C. § 1332(a). Moreover, while it seems that Mezu himself lived in Maryland, the decision makes it clear that he was suing on behalf of the Emekuku Community Bank Nigeria Ltd. On the apparently safe assumption that Emekuku was a Nigerian bank, it seems that Emekuku is the real party in interest, and so both the plaintiff and the defendants were aliens. There is no diversity of citizenship jurisdiction over an action between two aliens, so it appears that the court lacked subject matter jurisdiction.

Second, service of process. Muzu served the NDIC by Fedex. Assuming that Fedex counts as service by mail under FRCP 4(f)(2)(C)(ii), it appears the package was sent by Muzu’s lawyer, not by the clerk. Moreover there is no signed receipt, nor is it clear whether a signed receipt was required by Fedex, as FRCP 4(f)(2)(C)(ii) requires. I am assuming, by the way, that the NDIC is not an instrumentality of the Nigerian state. If it is, then under the FSIA Muzu had many more subject-matter jurisdiction and service of process problems than I am outlining here!

Third, personal jurisdiction. As far as the Nigerian judgment discloses, the NDIC was not a party to the Nigerian lawsuit. Even if you agree with me that it’s a mistake to apply ordinary rules of personal jurisdiction to recognition and enforcement cases, the NDIC is not a judgment debtor; it seems to me that Muzu would have to show on the merits that under applicable law NDIC is liable for the judgment against Progress Bank. What is the basis for exercising personal jurisdiction over the NDIC in Maryland, or indeed, anywhere in the United States? I have no idea.

This is a careless decision. The subject matter jurisdiction issue is particularly egregious, since it’s the court’s obligation to determine its own jurisdiction sua sponte. Because the NDIC did not really appear in the action (it sent a letter to the clerk, but the clerk rejected it on the grounds that a corporation cannot appear pro se), it likely still has an opportunity to seek relief from the judgment on the grounds that the judgment is void.

About Ted Folkman

Ted Folkman is a shareholder with Murphy & King, a Boston law firm, where he has a complex business litigation practice. He is the author of International Judicial Assistance (MCLE 2d ed. 2016), a nuts-and-bolts guide to international judicial assistance issues, and of the chapter on service of process in the ABA's forthcoming treatise on International Aspects of US Litigation, and he is the publisher of Letters Blogatory, the Web's first blog devoted to international judicial assistance, which the ABA recognized as one of the best 100 legal blogs in 2012, 2014, and 2015.

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