United States District Court, N.D. California
ORDER GRANTING MOTION FOR SUBSTITUTED SERVICE ON
FOREIGN DEFENDANTS RE: DKT. NO. 155
Gonzalez Rogers, United States District Court Judge
brings this action against defendants alleging breach of
contract and tort claims relating to a wooden pencil
distribution agreement. Currently, plaintiff has served the
following defendants: Axus Stationery (Hong Kong) Ltd.
(“Axus HK”), Andre Viegas, Highton Ltd., Roberta
Trading Corporation, Kenpark Ltd., Howin Investments Ltd.,
and Noblesse (Hong Kong) Limited (collectively, the
“Served Defendants”). On January 18, 2017, the
Court granted in part defendants' motion to dismiss,
dismissing all claims against Axus HK, Highton Ltd., Kenpark
Ltd., Howin Investments Ltd., and Noblesse (Hong Kong)
Limited. Currently, the litigation is proceeding against
Andre Viegas and Roberta Trading Corporation only.
is continuing its efforts to serve four other defendants, who
are located in the People's Republic of China
(“PRC”), namely: Shanghai Marco Stationery Co.
Ltd. (“Shanghai Marco”), Axus Stationery
(Shanghai) Ltd. (“Axus Shanghai”), Shanghai
Laikesheng Pen Material Co. Ltd. DBA Shanghai Lexon
(“Shanghai Lexon”) and Peifeng (Brian) Xu
(collectively, “Foreign Defendants”). After
eleven months of attempting to serve the Foreign Defendants
via the processes set forth under the Hague Convention,
plaintiff now moves for substituted service under Rule
4(f)(3), seeking to perfect service on the Foreign Defendants
through Hogan Lovells, LLP.
carefully considered the papers submitted and for the reasons
set forth below, the Court Grants
Plaintiff's motion to effectuate service on the Foreign
Defendants through Hogan Lovells, LLP.
Court adopts the background section in its order on
defendants' motion to dismiss (Dkt. No. 144), and adds
the following facts and procedural history relevant to the
filed its initial complaint in February 2016. (Dkt. No. 1.)
In April 2016, the Court granted plaintiff's Motion to
Enlarge Time to Serve Foreign Defendants under Fed.R.Civ.P.
4(m) and 6(b)(1), given plaintiff's diligent efforts to
effect service on the Foreign Defendants through the Hague
Convention. (Dkt. No. 54.) Since then, the Court has granted
five stipulations extending plaintiff's time to serve
Foreign Defendants. (Dkt. Nos. 85, 105, 138, 152, 184.)
Court dismissed the complaint for lack of personal
jurisdiction in June 2016, but granted leave to amend and
provided a period for jurisdictional discovery. (Dkt. No.
72.) In July 2016, the Court authorized substituted service
on Viegas to be effected through Hogan Lovells, Viegas'
counsel, based in the United States. (Dkt. No. 82.) Plaintiff
filed its amended complaint on September 19, 2016. (Dkt. No.
100.) Defendants again filed a motion to dismiss, and the
Court dismissed all parties and all claims except for Counts
One and Two against Roberta Trading Corporation, breach of
contract and of the implied covenant of good faith and fair
dealing, and Counts Three and Four against Viegas,
intentional interference with contract and with prospective
economic advantage. (Dkt. No. 144.)
regard to the Foreign Defendants, plaintiff has updated the
Court five times between May 2016 and March 2017 with its
efforts to effectuate service. (Dkt. Nos. 65, 95, 120, 141,
170.) Plaintiff retained Harris Bricken LLP, a law firm with
experience in serving defendants through the Hague
Convention, and on May 12, 2016, plaintiff submitted the
necessary documents for service to the Ministry of Justice
(“MOJ”) of the PRC. On May 19, 2016, a
representative of the MOJ confirmed receipt of
plaintiff's service documents and stated that those
documents would be transferred to the Supreme People's
Court. (Dkt. No. 65.) Plaintiff further avers that Harris
Bricken had confirmed that the MOJ forwarded plaintiff's
service documents to the Supreme People's Court on May
23, 2016, but that the MOJ does not keep track of the
documents once they have been forwarded to the Supreme
People's Court. (Dkt. No. 170.) As of March 2017, the MOJ
had no substantive updates on service of the Foreign
Defendants. (Id.) According to Harris Bricken,
service through these means has more recently been taking up
to eighteen months to complete, and in some cases years.
(Id.) To date, plaintiff has spent eleven months
attempting to effectuate service on Foreign Defendants
through the Hague Convention.
Rule of Civil Procedure 4(f)(3) provides that service upon an
individual in a foreign country may be perfected by any
“means not prohibited by international agreement, as
the court orders.” Fed.R.Civ.P. 4 (f)(3). The Ninth
Circuit has held thus with regard to court-ordered service
pursuant to Rule 4(f)(3):
By all indications, court-directed service under Rule 4(f)(3)
is as favored as service available under Rule 4(f)(1) or Rule
4(f)(2). Indeed, Rule 4(f)(3) is one of three separately
numbered subsections in Rule 4(f), and each subsection is
separated from the one previous merely by the simple
conjunction “or.” Rule 4(f)(3) is not subsumed
within or in any way dominated by Rule 4(f)'s other
subsections; it stands independently, on equal footing.
Moreover, no language in Rules 4(f)(1) or 4(f)(2) indicates
their primacy, and certainly Rule 4(f)(3) includes no
qualifiers or limitations which indicate its availability
only after attempting service of process by other means.
Rio Props., Inc. v. Rio Int'l Interlink, 284
F.3d 1007, 1017 (9th Cir. 2002) (internal citations omitted).
The Ninth Circuit further explained that a plaintiff need
only “demonstrate that the facts and circumstances of
the present case necessitate the district court's
intervention, ” and that court-ordered service is
“neither a ‘last resort' nor
‘extraordinary relief.'” Id. at
1015-16. Ultimately, the Court has discretion to determine
whether alternative service of process is required.
service of process between parties in the United States and
the PRC is governed by the Hague Convention. Fed.R.Civ.P.
4(f)(1); see Volkswagenwerk Aktiengesellschaft v.
Schlunk, 486 U.S. 694, 705 (1988); see also
Brockmeyer v. May, 383 F.3d 798, 804 (9th Cir. 2004).
Courts have held that the Hague Convention does not prohibit
service on a foreign defendant through counsel based in the
United States. Brown v. China Integrated Energy,
Inc., 285 F.R.D. 560, 565 (C.D. Cal. 2012); Richmond
Techs., Inc. v. Aumtech Bus. Sols., No. 11-CV-02460-LHK,
2011 WL 2607158, at *13 (N.D. Cal. July 1, 2011); In re
LDK Solar Sec. Litig., No. 07-CV-05182-WHA, 2008 WL
2415186, at *3 (N.D. Cal. June 12, 2008); Vanleeuwen v.
Keyuan Petrochemicals, Inc., No. 11-CV-9495-PSG, 2012 WL
5992134, at *3 (C.D. Cal. Nov. 30, 2012); RSM Prod. Corp.
v. Fridman, No. 06-CV-11512-DLC, 2007 WL 2295907, at *3
(S.D.N.Y. Aug. 10, 2007). Specifically, courts have allowed
service “upon a foreign defendant's United
States-based counsel” to prevent further delays in
litigation. Richmond Techs., 2011 WL 2607158, at
*13; Brown, 285 F.R.D. at 566. However, any
alternative method of service must meet the requirements of
due process in that it must be “reasonably calculated,
under all the circumstances, to apprise interested parties of