Case of the Day: United States ex rel. Bunk v. Gosselin Worldwide Moving

The case of the day is United States ex rel. Bunk v. Gosselin Worldwide Moving, N.V. (E.D. Va. 2016). Kurt Bunk and Ray Ammons sued Gosselin Worldwide Moving, N.V. under the False Claims Act, alleging that Gosselin had acted wrongfully (the opinion doesn’t say exactly how) in connection with its participation in two military shipping programs, the Direct Procurement Method program and the International Through Government Bill of Lading program. The government intervened in the action with respect to the ITGBL claims. By then, Gosselin had sold its ITGBL business to GovLog. The final judgment held Gosselin liable for $24 million on the DPM claims and held it was not liable on the ITGBL claims. The government had also asserted claims for successor liability against GovLog, but those claims failed; the government had appealed but the appeal hadn’t been decided by the times relevant for the case.

The government served a writ of garnishment on GovLog with the aim of compelling GovLog to pay any assets owed to Gosselin to the government instead. It served the writ on GovLog’s counsel, who had appeared in the case, under FRCP 5, and it served the writ on GovLog by mail at its offices in Belgium under FRCP 4 (Belgium has not objected to service by mail under Article 10(a) of the Hague Service Convention).

Garnishment proceedings are governed by the Federal Debt Collection Procedure Act. The main holding of the case is that in cases where the garnishee is already a party to the action, you can serve the writ of garnishment on its lawyer via FRCP 5. I’m not sure this is right, but I’m not sure there is a right answer. Here are the considerations:

  • Rule 4, or Rule 5? It seems that the writ should be served under FRCP 4 rather than FRCP 5, because it is a form of process, not just an ordinary judicial document that can be served on a party’s lawyer under FRCP 5.
  • Rule 4, or Rule 4.1? FRCP 4 governs service of summonses, and FRCP 4.1 governs service of all other forms of process (except subpoenas). But FRCP 4.1 provides that service must be effected by a marshal or deputy marshal, and it does not provide for service by mail. Since we know that Article 10(a) of the Hague Service Convention permits but does not authorize service by mail, and since FRCP 4.1 also does not authorize service by mail, it seems the service by mail in Belgium would fail. And it seems that there is no real way for the government to make service under FRCP 4.1, since the Rule expressly limits service to the “territorial limits of the state where the district court is located” unless a federal statute applies otherwise. The Federal Debt Collection Procedure Act does provide otherwise: under 28 U.S.C. § 3004(b)(2)(A), the writ can be served “in any State.” But it makes no provision for service abroad.

Today’s court solves this problem by choosing FRCP 5. Other cases solve it by choosing FRCP 4. See Export-Import Bank of the U.S. v. Asia Pulp & Paper Co., 2009 U.S. Dist. LEXIS 33052 (S.D.N.Y. 2009). I don’t know of any case that chooses FRCP 4.1, which on its face is the applicable rule. I think that a legislative or rules solution would be necessary to clarify the situation.

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