United States v. Barajas ( 2022 )

1 2 3 4 UNITED STATES DISTRICT COURT 5 NORTHERN DISTRICT OF CALIFORNIA 6 7 8 UNITED STATES OF AMERICA, Case No. 22-cv-00418-JSC 9 Plaintiff, 10 v. 11 ORDER DENYING MOTION FOR 12 DEFAULT JUDGMENT WITHOUT PAULO BARAJAS, PREJUDICE 13 Defendant. 14 Re: Dkt. No. 16 15 16 Plaintiff alleges Defendant is delinquent on payment of back wages and the associated 17 penalties and fees resulting from a Department of Labor (“DOL”) investigation of Defendant’s 18 business. (Dkt. No. 1.) After assessing penalties, the DOL referred the case to the Department of 19 the Treasury, which then referred the matter to the Department of Justice for debt collection. (Id.) 20 The Department of Justice then initiated the instant case. (Id.) 21 Defendant has failed to appear in the case and Plaintiff has moved for default judgment. 22 (Dkt. No. 12.) Based on the Court’s review of the March 14, 2022, Proof of Service and 23 accompanying “Declaration re Diligence to Effect Personal Service” by the process server of the 24 complaint and summons, Plaintiff has not demonstrated that Defendant was properly served. 25 (Dkt. No. 8.) Therefore, as set forth below, the Court denies without prejudice Plaintiff’s motion 26 for default judgment. 27 PROCEDURAL HISTORY 1 of process multiple times until its final attempt on March 6, 2022, (Dkt. No. 8 at 1-2). See Fed. R. 2 Civ. P. 4. Plaintiff first attempted service of process at a work address for Defendant in Vallejo, 3 California, on four occasions. (Dkt. No. 8 at 1-2.) On the final occasion, on February 20, 2022, 4 the store manager informed Plaintiff that Defendant had been let go approximately four months 5 earlier—months before Plaintiff filed its Complaint. (Id.) 6 The Certificate of Indebtedness attached to Plaintiff’s Complaint listed an address for 7 Defendant in American Canyon, California, (Dkt. No. 1-1 at 1), but Plaintiff did not then attempt 8 service there, (Dkt. No. 8 at 1-2). Instead, Plaintiff next attempted service of process at a 9 residence in Napa. (Id.) Plaintiff attempted to serve Defendant at the Napa residence on four 10 occasions, but never found Defendant there. (Id.) On the fifth attempt to serve Defendant at the 11 Napa residence, Plaintiff served someone the process server listed as, “Maya Calderon Wife & 12 Co-Tenant.” (Id.) 13 Defendant failed to answer the Complaint and Plaintiff moved for entry of Defendant’s 14 default. (Dkt. No. 12.) In Plaintiff’s motion for entry of Defendant’s default, DOL’s private 15 counsel attests he spoke with Defendant in Spanish a few months after Plaintiff filed its complaint. 16 (Id. at 2:2-12.) At Plaintiff’s request, the Clerk entered default on June 8, 2022. (Dkt. No. 14 at 17 1.) 18 Plaintiff subsequently filed the pending motion for default judgment and attempted to send 19 a copy to Defendant via U.S. mail to the Napa address where Plaintiff attempted service of 20 process. (Compare Dkt. Nos. 16-1, 16-2 with Dkt. No. 8.) Plaintiff now requests the Court enter 21 judgment in its favor in the total amount of $19,854.94. (Dkt. No. 16 at 2:7-8.) This amount 22 includes: (1) $12,975.78 in principal; and (2) the difference in “additional penalties, administrative 23 fees and interest.” (Id. at 2:4-5.) 24 DISCUSSION 25 “A federal court does not have jurisdiction over a defendant unless the defendant has been 26 served properly under Fed. R. Civ. P. 4.” Direct Mail Specialists, Inc. v. Eclat Computerized 27 Techs., Inc., 840 F.2d 685 (9th Cir. 1988). Therefore, before granting default judgment, a district 1 court should ensure the adequacy of the service of process on the party against whom default 2 judgment is requested. Bricklayers & Allied Craftworkers Loc. Union No. 3 v. Palomino, No. 3 C09-01589-CW DMR, 2010 WL 2219595, at *2 (N.D. Cal. June 2, 2010). 4 A default entered in the absence of proper service of process may be set aside as void. 5 See Mason v. Genisco Tech. Corp., 960 F.2d 849, 851 (9th Cir. 1992) (reversing district court’s 6 grant of summary judgment on grounds the default judgment entered against the plaintiff in a 7 previous action involving the same parties was void and had no res judicata effect because the 8 complaint in the previous action was not properly served). Where the party seeking a default 9 judgment has not shown that the defendant was provided with adequate notice of an action, “it is 10 inappropriate to conclude the defendant has failed to plead or otherwise defend” under Federal 11 Rules of Civil Procedure Rule 55(a). McFadden v. Deutsche Bank Nat. Tr. Co., No. 2:10-CV- 12 03004 JAM, 2012 WL 2839810, at *2 (E.D. Cal. July 10, 2012) (internal citations and quotations 13 omitted), report and recommendation adopted, No. CIV-S-10-3004-JAM, 2012 WL 3756579 14 (E.D. Cal. Aug. 28, 2012). When construing service rules, service of process must still be “in 15 substantial compliance with Rule 4.” Jes Solar Co. Ltd. v. Tong Soo Chung, 725 F. App’x 467, 16 470 (9th Cir.), amended on denial of reh’g, 716 F. App’x 635 (9th Cir. 2018) (internal citations 17 and quotations omitted). 18 Under Federal Rules of Civil Procedure Rule 4(e) an individual within a judicial district of 19 the United States may be served by: 20 (1) following state law for serving a summons in an action brought in courts of general jurisdiction in the state where the district court is 21 located or where service is made; or 22 … (2)(B) leaving a copy of [the summons and complaint] at the 23 individual’s dwelling or usual place of abode with someone of suitable age and discretion who resides there. 24 25 Plaintiff bears the burden of proving proof of service of process. Brockmeyer v. May, 383 F.3d 26 798, 801 (9th Cir. 2004). Specifically, Plaintiff must demonstrate it has met its burden of 27 “demonstrating legally sufficient service of process in accordance with the requirements” of Rule 1 4. Fed. R. Civ. P. 4; Downing v. Wanchek, No. CIV S-07-1599JAMEFB, 2009 WL 256502, at *3 2 (E.D. Cal. Jan. 30, 2009), report and recommendation adopted, No. CIVS07-1599 JAM EFB, 3 2009 WL 1211658 (E.D. Cal. Apr. 29, 2009). Plaintiff has not met this burden. 4 1. The requirements under Rule 4(e)(2)(B) for substitute service of process are not met. 5 The Federal Rules of Civil Procedure allow for substitute service of process. 6 Fed. R. Civ. P. 4(e)(2)(B). Substitute service of process occurs when the summons and complaint 7 are left with a person of “suitable age and discretion who resides there” at the defendant’s 8 “dwelling or usual place of abode.” Id. Here, Plaintiff has not established it left the summons and 9 complaint at Defendant’s dwelling or usual place of abode. 10 The process server’s declaration states he served the appropriate papers on Defendant’s 11 wife “at the dwelling house or usual abode of the party.” (Dkt. No. 8 at 1-2.) The declaration 12 does not explain why Plaintiff believed this Napa address was Defendant’s dwelling or usual place 13 of abode. (Id.) The declaration also does not explain why Plaintiff did not attempt service at the 14 address for Defendant listed on Plaintiff’s Certificate of Indebtedness. (Compare Dkt. No. 1-1 at 15 1 (listing Defendant’s address as one in American Canyon) with Dkt. No. 8 at 2-2 (listing 16 Defendant’s home address as one in Napa).) The declaration further does not explain why the 17 process server believed Ms. Maya Calderon, who received process, was Defendant’s wife and that 18 she also lived at the residence. (Dkt. No. 8.) Thus, the process server’s declaration is insufficient 19 to meet Plaintiff’s burden. See Raynor v. District of Columbia, 296 F. Supp. 3d 66, 70-71 (D.D.C. 20 2017) (finding service was improper where “the only evidence plaintiff mustered to prove that 21 defendant resided with sister were the signed return of service and a private investigator’s letter, 22 neither document provided a factual basis for defendant’s alleged residence, and without more, the 23 bare assertions were simply not enough to establish that the service address was defendant’s 24 dwelling or usual place of abode”); see also United States v. Rose, 437 F. Supp. 2d 1166, 1173 25 (S.D. Cal. 2006) (finding substitute service of process valid when the person serving process 26 declared, “he was informed by the security guard on duty that [plaintiff] . . . lived . . . at the 27 property”). Plaintiff’s claim it served Defendant’s wife at the residence is insufficient absent 1 evidence that Defendant also lives at that residence and evidence that the woman served is 2 Defendant’s wife. See DeFazio v. Wright, 229 F. Supp. 111, 113 (D.N.J. 1964) (finding service of 3 process inadequate when performed upon a wife and daughter who were not living with the 4 defendant at the time). 5 The documents before the Court do not demonstrate Plaintiff’s substitute service of 6 process upon Defendant was legally sufficient to meet the requirements of Federal Rule of Civil 7 Procedure 4(e)(2)(B). 2. The requirements for service of process under California’s rules governing 8 substitute service are not met. 9 California law closely resembles federal law for substitute service. Where a plaintiff fails 10 to personally serve a defendant with a summons and complaint through “reasonable diligence,” 11 they may serve a defendant 12 [b]y leaving a copy of the summons and complaint at the person’s dwelling house, usual place of abode . . . in the presence of a 13 competent member of the household or a person apparently in charge of his or her . . . usual mailing address . . . at least 18 years of age, who 14 shall be informed of the contents thereof. 15 Cal. Civ. Proc. Code § 415.20(b). In addition to not explaining why Plaintiff believed this address 16 in Napa was Defendant’s home and the person served was Defendant’s wife, Plaintiff did not 17 explain why it believed the residence was Defendant’s “usual mailing address” at the time of 18 service of process. (Dkt. No. 8 at 2-2.) Further, Plaintiff did not state it informed Ms. Maya 19 Calderon, the recipient of service, of the contents of service when it attempted substitute service of 20 process upon her. (Id.) 21 The documents before the Court do not demonstrate Plaintiff’s service of process upon 22 Defendant was legally sufficient to meet the requirements of California Code of Civil Procedure 23 Section 415.20(b). Therefore, service of process did not meet the requirements of Federal Rule of 24 Civil Procedure 4(e)(1). 25 3. Defendant’s purported actual notice does not preclude the need for proper service of 26 process. 27 Plaintiff raises the possibility of actual notice waiving the need for appropriate service of 1 process. (Dkt. No. 16 at 4:22-24 (stating Defendant contacted Plaintiff's counsel about the 2 || lawsuit).) However, actual notice does not defeat the need for proper service of process. See 3 Jackson v. Hayakawa, 682 F.2d 1344, 1347 (9th Cir. 1982) (“actual notice . . . will [not] subject 4 || defendants to personal jurisdiction if service was not made in substantial compliance with Rule 5 || 4%). 6 CONCLUSION 7 Because Plaintiff's motion does not establish that Defendant was properly served with the 8 summons and complaint, the Court DENIES Plaintiff's Motion for Default Judgment without 9 || prejudice. A case management conference is scheduled for November 3, 2022 at 1:30 p.m. via 10 || Zoom video. If Plaintiff has not renewed its motion for default judgment, it shall submit a case 11 management statement one week in advance. a (12 IT IS SO ORDERED. 13 Dated: September 21, 2022 ' ne 14 ACQUELINE STOTT CORLE 3 15 United States District Judge 16 = 17 Z 18 19 20 21 22 23 24 25 26 27 28