USA v. Wilfran Agricultural Indus. Inc.
| Decision Date | 11 August 2010 |
| Docket Number | Court No. 07-00231.,Slip Op. 10-89. |
| Citation | 716 F.Supp.2d 1352 |
| Parties | UNITED STATES of America, Plaintiff, v. WILFRAN AGRICULTURAL INDUSTRIES, INC., Defendant. |
| Court | U.S. Court of International Trade |
OPINION TEXT STARTS HERE
Tony West, Assistant Attorney General; Jeanne E. Davidson, Director, and Patricia M. McCarthy, Assistant Director, Commercial Litigation Branch, Civil Division, United States Department of Justice (Roger Allen Hipp), for Plaintiff.
The government filed suit against Wilfran Agricultural Industries, Inc. (“Wilfran”) seeking to recover penalties and duties for violation of section 592 of the Tariff Act of 1930, as amended, 19 U.S.C. § 1592. Proof of service was filed on October 31, 2007. (Doc. No. 7 (“Service Affidavit”).) Wilfran did not answer the complaint, and the Clerk of Court entered Wilfran's default on February 12, 2008. (Doc. No. 22.) During the course of reviewing the government's subsequent motion for the entry of default judgment (Doc. No. 23), the Court found the record unclear as to whether process was properly served upon Wilfran.
Proper service of process being essential for the Court to exercise personal jurisdiction, the Court requested briefing of the issue. The government submitted a memorandum of law (Doc. No. 27 (“First Service Mem.”)), accompanied by a sworn declaration by government counsel which supplemented the Service Affidavit with additional facts regarding service of process upon Wilfran (“Service Decl.”). In response to a request by the Court for supplementary briefing, the government also submitted a supplemental memorandum of law. (Doc. No. 30 ( ).) Defendant did not answer the complaint or submit any papers.
Having reviewed the record and the law, the Court determines that Plaintiff's service of process upon Defendant was proper under USCIT Rule 4. The Court thus may properly exercise personal jurisdiction over Defendant.
In the Service Affidavit filed by Plaintiff's counsel on October 31, 2007, counsel indicated that, on October 26, 2007, “I personally delivered copies of the summons and first amended complaint” to the home of William W. Franks, who, “[a]ccording to records maintained by the Pennsylvania Department of State ... is the president of Wilfran.” (Service Affidavit at 1.) The facts surrounding the service of process, described in the Service Affidavit and elaborated upon in the Service Declaration, are as follows.
Counsel could not confirm the current validity of the home address of Mr. Franks or office address of Wilfran listed on the Pennsylvania Department of State Records, but was able to determine Mr. Franks's home and business addresses “[b]ased upon online searches.” (Service Decl. at 1-2.) Counsel went to Mr. Franks's home address and left a copy of the summons and complaint with Mr. Franks's wife, Anne Franks, who identified herself and accepted the papers. (Service Affidavit at 1, Service Decl. at 2.) Counsel then “also personally delivered copies of the summons and complaint to Mr. Franks at his place of business,” where “Mr. Franks refused to accept delivery.” (Service Affidavit at 1.)
Counsel states that when he arrived at Mr. Franks's place of business, “I informed the employee who greeted me at the door that I had a personal delivery for William Franks.” (Service Decl. at 2.) Counsel was then escorted to the desk of a man who identified himself as Mr. Franks. ( Id.) Counsel states, “I identified myself and stated that I was serving the summons and first amended complaint upon Wilfran.” ( Id.) When counsel tried to hand a copy of the papers to Mr. Franks, Mr. Franks “refused to accept the papers.” ( Id.) Mr. Franks informed Plaintiff's counsel that “his wife had telephoned him to tell him that I had given her” copies of the papers, then “told me that he considered me to be trespassing, and that if I did not leave the premises immediately, he would telephone the police.” ( Id. at 2-3.) Plaintiff's counsel states, “I placed the papers in my briefcase and left the premises.” ( Id. at 3.)
On November 15, 2007, Mr. Franks, through counsel, filed a motion to intervene in this suit. (Doc. No. 8 (“Mot. to Intervene”).) The motion noted that the government intended to satisfy any judgment obtained against Wilfran by filing a separate action to collect that judgment from Mr. Franks. ( Id. at ¶ 3 (citing Doc. No. 6, Notice of Filing of Amended Complaint).) Mr. Franks argued that he would therefore face “potential liability should judgment be entered against Wilfran,” which allegedly could not adequately represent Mr. Franks's interests because it has “no assets” and “discontinued its business operations in April 2000 and has been liquidated.” ( Id. at ¶¶ 4, 5.) Mr. Franks's counsel asserted that “Plaintiff filed its First Amended Complaint in this action on October 26, 2007, and served it on Wilfran Agricultural on the same date.” ( Id. ¶ 7 (emphasis added).) Counsel attached Mr. Franks's proposed “Answer to the First Amended Complaint” to the motion to intervene. ( Id., Attach. 6.) That answer asserted the affirmative defenses that Plaintiff's complaint failed to state a claim upon which relief could be granted and failed to name an indispensable party (Mr. Franks). ( Id., Attach. 6 at 2.) The motion was denied by order entered December 13, 2007. (Doc. No. 13.)
Mr. Franks thereafter filed a letter with the Court, dated January 27, 2008. (Doc. No. 19 (“Franks Letter”).) Mr. Franks's letter (which was unsworn) stated, in relevant part:
“ alter ego ” with Wilfran's “ principal address ” listed as William Franks' home.
( Id. at 1-3 (emphasis added).)
On October 29, 2007, government counsel saved Wilfran's business entity record from the Pennsylvania Department of State website as a permanent document. (Service Decl. at 1.) That record lists Wilfran's status as active as of October 29, 2007, and provides a single corporate officer, “William W. Frank” [sic], listed with the title of “President.” ( Id., Attach.)
In the Franks Letter, Mr. Franks stated that Wilfran (Franks Letter at 1.) Attached to the Franks Letter was a copy of a declaration by Mr. Franks, dated December 1, 2003, in which he stated that he (Franks Letter, Attach. 2 at ¶¶ 1, 3.)
The question here is whether Plaintiff's counsel succeeded in bringing Wilfran within this Court's jurisdiction by personally attempting to hand the summons and first amended complaint to Wilfran's president, who refused to accept the papers. Answering yes, the Court holds that the exercise of personal jurisdiction over Wilfran in order to consider Plaintiff's motion for entry of a default judgment is proper.
Plaintiff contends that its counsel satisfied the requirements of USCIT Rules 4(g)(1)(A) & 4(d)(1), as well as Pa. R. Civ. P. 424, when its counsel handed a copy of the papers to Mr. Franks, Wilfran's president, on October 26, 2007. 2 Plaintiff argues that Mr. Franks did not defeat service by refusing to accept the documents when government counsel attempted to hand them over. Plaintiff admits that it has located no Pennsylvania case directly on point. (Suppl. Service Mem. at 2.) While citing Pennsylvania cases that establish that an individual cannot defeat service by knowingly refusing to accept papers from a process server (Service Mem. at 2-4), Plaintiff could locate no Pennsylvania case explicitly extending that principle to service on a corporation (Suppl. Service Mem. at 2). Plaintiff asserts, however, that “[t]here is no reason to believe that Pennsylvania courts would depart from what appears to be a universal American rule that service is accomplished when the person to be served refuses personal delivery of process.” (Suppl. Service Mem. at 2 (citing cases).)
Plaintiff also argues that the Franks Letter acknowledges that Mr. Franks received notice of service and that government counsel went to the Franks's home to serve the lawsuit, and, by discussing the case in detail, reveals that Wilfran received actual notice of the contents of the lawsuit. (Suppl. Service Mem. at 4-5.)
Defendant has not taken part in these proceedings, although all filings after the summons and complaint have been served upon the corporation's president pursuant to USCIT R. 5.
Proper service of the summons and complaint under the relevant procedural rules is required before a federal court may exercise personal jurisdiction over a defendant. United States v. Ziegler Bolt & Parts...
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