Service of Process at the CIT, Part I

In two recent decisions of the Court of International Trade, Judge Reif has used a number of movie and television references in the course of deciding, among other things, whether a defendant had been properly served. This post will cover the first of those decisions.

Service of the summons and complaint is a necessary step because it alerts the a party of the filing of a law suit and allows defendant to  properly respond. If service is not properly accomplished, the case may be dismissed. In the Court of International Trade, service is controlled by Rule 4.  Relevant here is Rule 4(b), which states that in cases commenced by the concurrent filing of a summons and complaint, the plaintiff is required to serve the defendant. Furthermore, Rule 4(l) dictates that:

If a defendant is not served within 90 days after the complaint is filed, the   court – on motion or on its own after notice to the plaintiff – must dismiss the action without prejudice against that defendant or order that service be made within a specified time. But if the plaintiff shows good cause for the failure, the court must extend the time for service for an appropriate period. 

That brings us to the first of a pair of decisions: United States v. Chu-Chiang "Kevin" Ho, et al. (Slip Op. 20-56). Here, the question was whether the Court of International Trade should grant the United States extra time to successfully complete service on Mr. Ho. For his part, the defendant moved to quash the attempted service and have the case dismissed. As you can tell from the case caption, this is a penalty case, so the onus was on the United States to serve the defendant.

The basic facts are that the United States attempted to serve Mr. Ho through a professional process server on June 30, 2019, just 9 days after filing the complaint and early on in the 90 day time allowed for service. Although the process server reported having completed service, Mr. Ho later established that he was out of the country on that date and could not have been served. The U.S. then tried to serve him again on September 26, which was seven days after the end of the allowed 90 days. This attempt at service was also not successful. Finally, service was completed on October 16, 2019. The U.S. then moved for an extension of time to make late that service timely.

Rule 4(l) provides two means by which the Court may grant additional time for service. First, if the plaintiff shows "good cause," the Court must extend the time. In the absence of good cause, the Court may exercise its discretion and grant additional time.

Good cause is a tricky thing. It is a very subjective standard. The federal courts have, therefore, put some gloss on the phrase to give guidance to the bar and to lower courts. Generally, good cause for an extension of the time to serve process means that the plaintiff can show it has made reasonable efforts to effect service. There must be real diligence and that diligence must take into account that the case may be dismissed. If the statute of limitations has run or will run soon--meaning the case cannot be refiled--the level of diligence required is greater. 

Here, the Court found that the United States did not show good cause. The failure to properly serve within the 90 days would have resulted in the end of the case. Thus, the United States was obligated to act "meticulously." Despite that, there were period of "relative inaction" by the government. This inaction was sufficient for the Court to find it was not obligated to grant the requested extension.

Nevertheless, the Court found that Mr. Ho had actual knowledge of the complaint due to other ongoing litigation. Moreover, he did (eventually) receive the summons and complaint, albeit late. At the same time, dismissing the case would cause prejudice to the United States in that the case would not be decided on the merits. The defendant, for its part, had not shown comparable prejudice in its his ability to defend against the claims. Thus, the Court granted the motion for an extension of the time to serve Mr. Ho. 

In reaching this result, Judge Reif reminded us of the 2002 movie Serving Sara in which Matthew Perry plays a process server seeking to serve papers on a character played by Elizabeth Hurley. A rival process server calls to warn her with the line "Hey, lady, when is getting served papers any good, huh? Don't be stupid, hang up and get out." Should you have forgotten what appears to have been a forgettable film, here is the trailer.


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