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All Points Capital Corporation, A New York v. Foster and Sons General Engineering Contractors

December 12, 2010

ALL POINTS CAPITAL CORPORATION, A NEW YORK CORPORATION,
PLAINTIFF,
v.
FOSTER AND SONS GENERAL ENGINEERING CONTRACTORS, INC., A CALIFORNIA CORPORATION, JAMES B. FOSTER, AN INDIVIDUAL, AND OTILIA T. FOSTER, AN INDIVIDUAL,
DEFENDANTS.



The opinion of the court was delivered by: Gary S. Austin United States Magistrate Judge

FINDINGS AND RECOMMENDATIONS TO DISMISS DEFENDANT FOSTER AND SONS GENERAL ENGINEERING CONTRACTORS, INC.

PROCEDURAL BACKGROUND

On May 7, 2010, Plaintiff All Points Capital Corporation filed a complaint against Defendants Foster and Sons General Engineering Contractors, Inc., James B. Foster and Otilia T. Foster, for breach of promissory note and security agreement, breach of guaranty, and foreclosure on security agreement. (Doc. 2.)

On May 10, 2010, this Court issued summonses directed to the three Defendants: Foster and Sons General Engineering Contractors, Inc. (Doc. 4), James B. Foster (Doc. 5) and Otilia T. Foster (Doc. 6). Additionally, an initial scheduling conference was scheduled for August 26, 2010, before the undersigned. (Doc. 7.) On August 20 and October 15, 2010, Plaintiff's counsel requested the scheduling conference be continued. His requests were accommodated and an Initial Scheduling Conference was set for November 22, 2010. (See Docs. 8-9.)

Prior to the scheduling conference, it came to this Court's attention that Defendants had either not been served with service of process and/or had not entered any appearance in the action. Accordingly, on November 18, 2010, this Court issued an Order to Show Cause directed to Plaintiff to show cause why the summons and complaint had not been served upon Defendants in compliance with Rule 4 of the Federal Rules of Civil Procedure. (Doc. 10 at 2.) Plaintiff was advised that it was to show cause in writing why it had failed to file documents establishing proof of service as required by Rule 4(l) of the Federal Rules of Civil Procedure, and why it had failed to accomplish service within 120 days as required by Rule 4(m) of the Federal Rules of Civil Procedure. Additionally, the Initial Scheduling Conference was vacated and the matter was set for a Status Conference on December 16, 2010. (Doc. 10 at 2.) Plaintiff has failed to respond in writing to the Order to Show Cause as of this date, despite being ordered to do so no later than December 2, 2010.

Although Plaintiff did not respond in writing, on November 18, 2010, it filed a Proof of Service form indicating that individual Defendant James B. Foster had been served via substitute service on May 26, 2010, at 1559 N. McCall Avenue in Sanger, California. (Doc. 12.) A similar document was filed indicating that individual Defendant Otilia T. Foster had also been served via substitute service on May 26, 2010, at 1559 N. McCall Avenue in Sanger, California. (Doc. 13.) Plaintiff then filed a Request for Entry of Default, asking the Clerk of the Court to enter default against all Defendants, including Foster and Sons General Engineering Contractors, Inc. Counsel for Plaintiff Dean P. Sperling's declaration provided that "[o]n or about May 26, 2010, Defendants were all subserved . . .." (Doc. 14 & Sperling Decl., ¶ 2.)

On November 23, 2010, the Clerk of the Court entered default as to Defendants James B. Foster and Otilia T. Foster. The Clerk did not enter default as to Foster and Sons General Engineering Contractors, Inc., because no proof of service was filed for this Defendant. (See Doc. 15.)

DISCUSSION

Failure to Serve Summons and Complaint Rule 4(m) of the Federal Rules of Civil Procedure provides as follows:

If service of the summons and complaint is not made upon a defendant within 120 days after the filing of the complaint, the court, upon motion or on its own initiative after notice to the plaintiff, shall dismiss the action without prejudice as to that defendant or direct that service be effected within a specified time; provided that if the plaintiff shows good cause for the failure, the court shall extend the time for service for an appropriate period.

The rule "encourages efficient litigation by minimizing the time between commencement of an action and service of process." Electric Specialty Co. v. Road and Ranch Supply, Inc., 967 F.2d 309, 311 (9th Cir. 1992) (addressing former Fed. R. Civ. P. 4(j)).

Here, more than 120 days have elapsed since Plaintiff filed the summons and complaint in this action. More specifically, more than 210 days have elapsed since Plaintiff filed this action. Plaintiff has filed proofs of substitute service as to Defendants James B. Foster and Otilia T. Foster (Docs. 12 & 13), however, all Defendants have not yet been served.

Plaintiff was expressly advised in this Court's Order to Show Cause that a failure to accomplish service of the summons and complaint would result in a recommendation of dismissal. (Doc. 10 at 2:14-16.) Nevertheless, Plaintiff has failed to file a document establishing that service was effected upon Defendant Foster and Sons General ...


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