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Case of the Day: Lac Vieux Desert Band of Lake Superior Chippewa Indians v. Cardona

The case of the day is Lac Vieux Desert Band of Lake Superior Chippewa Indians Holdings Mexico, LLC v. Cardona (Ariz. Ct. App. 2013). The Lac Vieux Desert Band of Lake Superior Chippewa Indians loaned more than $6 million to Arturo Rojas Cardona, Juan Jose Rojas Cardona, Juegos De Entretenimiento Y Videos de Guadalupe, Entretenimiento de Meico, Atlantica de Inversiones Corporativas, and Guadalupe Recreation Holdings LLC in return for an ownership share in a casino to be built in Guadalupe. The tribe claimed that the defendants breached the contract and converted funds to their own use. The procedural history of the case is confused but ultimately unimportant for our purposes. The tribe moved for leave to make service of process by alternate means, namely, by service on the defendants’ attorneys of record by certified mail, service on all defendants by Fedex in Mexico, and service of Juan Cardona via email. The judge also deemed service on Arturo Cardona complete because he had been served by mail at his US addresses (though there was no return receipt).

The foreign defendants—not including Guadalupe Recreation Holdings, a Nevada LLC—moved to dismiss for insufficient service of process, and the judge denied the motion. On an interlocutory appeal, the Arizona Supreme Court held that the only avid method of service was service via the Mexican Ministry of Foreign Affairs, and it vacated the judge’s order denying the defendants’ motion and remanded the case. Cardona v. Kreamer, 235 P.3d 1026 (Ariz. 2010). On remand, the judge dismissed the action as to all defendants, including GRH. The tribe appealed.

On appeal, the court held that the judge had erred in dismissing the claims against GRH, which was a domestic company served with process in the United States and which in any case had not moved for dismissal on grounds of insufficient service of process. But the court affirmed the dismissal as to all of the other defendants. The court’s decision rests mostly on points of Arizona law that I will not comment on here. I note, however, that as to the service by email on Jose Cardonna, the court was in my view correct in holding that such service was impermissible in Mexico. Mexico is a party to the Hague Service Convention, and readers will recall my view that the Convention does not permit service by email when it applies.