A.I.M. International, Inc. v. Battenfeld Extrusions Systems, Inc.

116 F.R.D. 633, 8 Fed. R. Serv. 3d 1166, 1987 U.S. Dist. LEXIS 7351
CourtDistrict Court, M.D. Georgia
DecidedAugust 12, 1987
DocketCiv. A. No. 86-215-2-MAC (WDO)
StatusPublished
Cited by6 cases

This text of 116 F.R.D. 633 (A.I.M. International, Inc. v. Battenfeld Extrusions Systems, Inc.) is published on Counsel Stack Legal Research, covering District Court, M.D. Georgia primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
A.I.M. International, Inc. v. Battenfeld Extrusions Systems, Inc., 116 F.R.D. 633, 8 Fed. R. Serv. 3d 1166, 1987 U.S. Dist. LEXIS 7351 (M.D. Ga. 1987).

Opinion

ORDER

OWENS, Chief Judge.

Defendants Battenfeld Extrusionstechnik, GmbH (“BEG”), Dr. Willi Dalhoff and Heinrich Schmiedeskamp urge this court to reconsider its June 2, 1987, order in which the court determined that “defendants’ motions to dismiss will be carried with the case and decided upon the trial of the case.” Specifically, defendants ask this court to grant their motion to dismiss on the basis of a lack of in personam jurisdiction. By so requesting, defendants have omitted from this motion grounds asserted previously, including insufficiency of process and insufficiency of service of process. Those assertions were the subject of a conference call involving the parties and this court during which defendant, through counsel, “agreed to acknowledge service subject to all of their constitutional and legal defenses and rights____” See Order of this court dated March 19, 1987. Pleadings filed subsequent to the issuance of that order, however, again raised objections regarding the sufficiency of service of process. Therefore, in the interests of judicial economy, this court will consider the service of process issue.

In addition, and again to further judicial economy, this court will include within its consideration of the issues the status of a fourth defendant, Battenfeld Extrusions Systems, Inc. (“BESI”). Defendant BESI is represented by the same counsel as the other three defendants and has been a party to all prior pleadings excepting this most recent motion to reconsider.

Facts

Defendant BEG is a corporation organized and existing under the laws of the Federal Republic of Germany (“West Germany”) with its principal place of business at Bad Oeynhausen, West Germany. Defendant BESI is a corporation organized and existing under the laws of the State of Texas with its only place of business at Arlington, Texas. Defendant Dalhoff is a resident of West Germany, a member of the Board of Management of defendant BEG and an officer and representative of defendant BESI. Defendant Schmiedeskamp is a resident of West Germany, general manager of defendant BEG and former acting president of defendant BESI.

A.I.M. International, Inc. (“A.I.M.”), a Georgia corporation, and individuals Tom Robert and Willem Boltong, Georgia residents and officers of A.I.M., are the plaintiffs in this action. They filed this action on July 29, 1986, based on the following allegations.

On or about January, 1985, plaintiffs met with representatives of the corporate defendants in Atlanta, Georgia, “to discuss issues and problems with the plaintiffs’ responsibilities as agents for the sale of defendants’ products.” See Affidavit of Tom Robert. On or about September, 1985, in West Germany, plaintiffs and defendants entered into an oral contract establishing plaintiffs as defendants’ agents in the southeastern United States. Id. Pursuant to the oral contract, believing themselves to be and representing themselves as defendants’ agents, plaintiffs made substantial sales of defendants’ products, including sales to Georgia corporations DYKA U.S.A., Inc. and Jack’s Plastic Company. Plaintiffs point to defendants’ leasing of a warehouse in Macon, Georgia, as an indication of the defendants’ activities pursuant to this contract.

[635]*635A second meeting occurred in Atlanta, Georgia, on or about March 21, 1986, during which the parties “entered negotiations and discussions on a proposed modification of the oral contract.” Id. Following the collapse of these negotiations, plaintiffs brought this action seeking damages for commissions earned but as yet unpaid. Plaintiffs further seek damages for defendants’ fraudulent inducement and bad faith.

Plaintiffs’ attorney mailed copies of the “Acknowledgment of Receipt of Summons and Complaint” to each defendant at defendant BESI’s place of business in Arlington, Texas. In so doing, plaintiffs’ attorney relied upon Rule 4(c)(2)(C)(ii) of the Federal Rules of Civil Procedure. Conflicting interpretations of what followed cloud the record. In essence, however, plaintiffs allege, and defendants dispute, that defendants represented an intent to acknowledge service. The 120-day period allotted for proper service expired on November 26, 1986. See Fed.R.Civ.P. 4(j). On January 30, 1987, Gerhard Folie, President of defendant BESI, signed the acknowledgment, which was received by the clerk of this court on February 9, 1987.

Service of Process

Defendants essentially assert three reasons why the service of process was insufficient in this case. First, defendants argue that the service of process by mail was invalid from the start. See Defendants’ Response to Plaintiffs’ Brief in Opposition to Defendants’ Motion to Dismiss (“Defendants’ Response”). Second, defendants contend that, assuming the validity of service by mail, defendants were not served before the expiration of the 120-day period. Id.. Finally, as to the two West German individuals and the West German corporation, defendants argue that service of process must be effectuated pursuant to the Convention on the Service Abroad of Judicial and Extrajudicial Documents in Civil and Commercial Matters, 20 U.S.T. 361, T.I.A.S. No. 6638 (the “Hague Convention”). Id.

The construction of Rule 4(c)(2)(C)(ii)1 has been the subject of some debate among the various federal courts. One school of thought held that the provision, an amendment to the Rule that became effective on February 26, 1983, allows service by mail without regard to state law on the manner of service. Chronister v. Sam Tanksley Trucking, Inc., 569 F.Supp. 464, 469 (N.D. Ill. 1983) (federal courts no longer dependant on the forum state’s rules regarding service of process); Boggs v. Darr, 103 F.R.D. 526 (D.Kan.1984) (though amenability to jurisdiction continues to be governed by state long arm statutes, method of service shall be governed by Rule 4(c)(2)(C)(ii)). These cases, however, have been discredited within their respective districts. Pursuant to a motion to reconsider, the district court held that, notwithstanding the provisions for service by mail contained in the Federal Rules, the defendant must be personally served in accordance with Illinois law. Chronister v. Sam Tanksley Trucking, Inc., 109 F.R.D. 1 (N.D. Ill. 1983); see also Epstein v. Wilder, 596 F.Supp. 793, 797 (N.D. Ill. 1984) (because Rule 4(c)(2)(C)(ii) did not supersede Rule 4(e), service not authorized by forum state rules cannot be used for extraterritorial service). Similarly, Boggs has been brought into question in Reno Distributors v. West Texas Oil Field Eq., 105 F.R.D. 511 (D. Kan. 1985). The court in Reno Distributors found service [636]*636by mail unavailable outside the territorial limitations established in Rule 4(f) unless Congress intended to exempt from such limitations the 1983 amendments to the Rule. Finding an absence of such legislative intent, the court concluded that Rule 4(c)(2)(C)(ii) was subject to the territorial limits in Rule 4(f).

The Reno Distributors’ court relied heavily upon William B. May Co., Inc. v. Hyatt, 98 F.R.D. 569 (S.D.N.Y.1983), the first case in which the meaning of Rule 4(c)(2)(C)(ii) was considered. In Hyatt,

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116 F.R.D. 633, 8 Fed. R. Serv. 3d 1166, 1987 U.S. Dist. LEXIS 7351, Counsel Stack Legal Research, https://law.counselstack.com/opinion/aim-international-inc-v-battenfeld-extrusions-systems-inc-gamd-1987.