Case of the Day: Microsoft v. Goldah.com
Posted on October 31, 2017
The case of the day is Microsoft Corp. v. Goldah.com Network Technology Co. (N.D. Cal. 2017). Microsoft sued Goldah, Changsha Xunyou Network Technology Co., Hunan Yigiyou Technology Co., and other Chinese defendants, alleging that they were trafficking in stolen Microsoft account credentials. Microsoft obtained a temporary restraining order and then a preliminary injunction. The defendants then moved to dismiss, arguing insufficient service of process. The court had authorized service by email under FRCP 4(f)(3); there was no indication that the defendants’ addresses were unknown.
Somewhat bizarrely, the defendants framed their motion as a motion under FRCP 60. The judge recognized that this was wrong, as no judgment had entered, and it instead treated the motion as a motion for reconsideration of the decision under FRCP 4(f)(3). This seems again to miss the mark: the motion was really one to dismiss under FRCP 12(b)(4). But in any event, the substantive question was clear: had the court erred by allowing service of process by email?
I have stopped writing about every single district court decision allowing service by email when the Hague Service Convention applies. They are mostly the same: they mostly rely on an early case that says something like, “an objection to Article 10 is effective only to prevent the methods of service it names, so if China didn’t expressly object to service by email, service by email is permitted.” Today’s case, while equally wrong, is a little different. The judge seemed to miss the point that the Convention is exclusive:
The Hague Convention did not govern Microsoft’s form of service because Federal Rule of Civil Procedure 4(f) does not require conformance with the Hague Convention. … Because Rule 4(f)(3) authorizes service that does not conform with the Hague Convention, service under Rule 4(f)(3) is permissible so long as it “is not prohibited by international agreement. … This Court’s May 19, 2017 order, which authorized service on Defendants “by registered electronic mail to the unique email addresses used by Defendants,” was consistent with Rule 4(f)(3). ECF No. 6 at 5. Thus, the Court rejects Defendants’ contention that Microsoft’s service was improper because the email service did not conform with the Hague Convention. Defendants’ claim incorrectly assumes that the Hague Convention is the only means of effecting service.
This is a mistake, and one that doesn’t make much sense. FRCP 4(f)(3) is drafted particularly so as to prevent collisions with the Convention. It allows only those methods of service that the Convention does not prohibit, and the Convention prohibits all methods of service that it does not authorize or at least permit—that’s just what it means to say that the Convention is exclusive.
The judge then went on to make the standard mistake I noted above: because China’s Article 10 objection does not mention service by email, service by email is permissible under the Convention (though no provision of the Convention that authorizes or permits it is mentioned).