Carol Baker Puckett v. Nationwide Coin & Bullion Reserve, Inc.

• Court: Court of Appeals for the Eleventh Circuit
• Decided: August 14, 2020
• Docket: 19-12692
• Status: Unpublished

Opinion

Case: 19-12692 Date Filed: 08/14/2020 Page: 1 of 12

[DO NOT PUBLISH]

IN THE UNITED STATES COURT OF APPEALS

FOR THE ELEVENTH CIRCUIT ________________________

No. 19-12692 Non-Argument Calendar ________________________

D.C. Docket No. 1:17-cv-02978-CAP

CAROL BAKER PUCKETT, As Executor of the Will and Estate of Mark T. Puckett,

Plaintiff-Appellee,

versus

MELIDA RAMIREZ,

Defendant,

NATIONWIDE COIN & BULLION RESERVE, INC.,

Defendant-Appellant.

________________________

Appeal from the United States District Court for the Northern District of Georgia ________________________

(August 14, 2020) Case: 19-12692 Date Filed: 08/14/2020 Page: 2 of 12

Before BRANCH, GRANT and BLACK, Circuit Judges.

PER CURIAM:

Defendant–Appellant Nationwide Coin & Bullion Reserve, Inc.

(Nationwide) appeals the district court’s order denying Nationwide’s motion to

vacate the default judgment against it, obtained by Tommie Puckett, the original

Plaintiff in this case.1 On appeal, Nationwide challenges the district court’s

conclusion that Puckett exercised reasonable diligence in attempting to serve

Nationwide’s registered agent, such that she was permitted to perfect service

through the Texas Secretary of State. After review, we agree and reverse the

district court’s order denying Nationwide’s motion to vacate.

I. BACKGROUND

A. Plaintiff Puckett’s Efforts to Serve Nationwide

In August 2017, Plaintiff Tommie Puckett initiated the underlying action

against Nationwide. Puckett’s amended complaint generally alleged Nationwide,

along with its sole director, Melida Ramirez, fraudulently induced Puckett to

purchase various coins at inflated prices. Puckett asserted various claims arising

under Georgia law, and sought compensatory and punitive damages.

1 After the entry of default but before Nationwide moved to vacate that default, the original Plaintiff, Tommie Puckett, passed away. The district court allowed Mark T. Puckett— Tommie Puckett’s sole heir and the executor of her estate—to be substituted as the party plaintiff. After the briefing was completed on appeal, Mark T. Puckett also passed away, and this Court substituted Carol Baker Puckett—the executor of Mark T. Puckett’s estate—as Appellee. 2 Case: 19-12692 Date Filed: 08/14/2020 Page: 3 of 12

In November 2017, Puckett sought and was granted an extension of time in

which to perfect service of process on Nationwide. 2 Puckett attached to her motion

a series of email communications between her legal counsel and a process serving

company. The correspondence occurred between August 10, 2017, and September

26, 2017, and purports to document the process server’s efforts to serve

Nationwide’s registered agent.

On August 10, Puckett’s counsel provided the process server with the name

of Nationwide’s registered agent, Mark Dykes, and the Texas address of the

registered office at which he could be served. On August 16, in response to

counsel’s request for an update, a representative of the process serving company

informed counsel the address provided was a “home address,” and the server had

“not found anyone at home.” The representative assured Puckett’s counsel that

“[w]e are still attempting.” On August 19, counsel informed the process server she

had “located another address for Mark E. Dykes, Registered [A]gent.” The address

was that of a law firm where Dykes apparently worked, and counsel suggested “we

try to get him served” at the firm, which was in an office suite.

2 Puckett also sought additional time to perfect service on Defendant Ramirez. However, following the entry of default, only Nationwide moved to vacate the judgment against it. As a result, this appeal concerns only the efforts Puckett made to serve Nationwide, and we limit our recitation of the facts to those efforts. 3 Case: 19-12692 Date Filed: 08/14/2020 Page: 4 of 12

On September 20, the representative from the process serving company

informed Puckett’s counsel that the “process server has come to a dead end.” As

to the address for the law firm, the representative stated the suite number provided

in the address did not exist in the building, and there was “not a Nationwide Coin

in the building.” Six days later, on September 26, counsel asked for another update

on any attempt to serve Dykes at his office and was told the process server had

“been told no one is in the office,” though he was “still attempting.”

That same day, counsel located Dykes’s home address and suggested “we

try to get him served there.” The representative responded that the server would

“work on this next.” The email correspondence does not indicate any attempts

were made to serve Dykes at his home address, nor does it document any follow-

up after counsel requested the server attempt to serve Dykes at that address.3

B. Service Through the Texas Secretary of State

In April 2018, Puckett filed a certificate of service showing that, on January

8, 2018, the Texas Secretary of State received the summons and complaint directed

to Nationwide. 4 To demonstrate it was proper under Texas law to perfect service

3 This email correspondence is the only evidence in the record documenting Puckett’s efforts to perfect service on Nationwide via its registered agent. 4 The Certificate of Service provided by the Texas Secretary of State notes that a copy of the summons and complaint was forward by certified mail to the address associated with Nationwide’s registered office c/o Mark Dykes. According to the Certificate, the process was returned to the Secretary of State “Bearing the Notation, Return to Sender, Vacant, Unable To Forward.” 4 Case: 19-12692 Date Filed: 08/14/2020 Page: 5 of 12

on Nationwide via the Texas Secretary of State, Puckett relied on the facts set forth

in her motion to extend time and the documents attached thereto, which she

incorporated by reference. According to Puckett, “[t]he facts set out in those

documents show duly diligent effort to serve Mark Dykes, the registered agent for

[Nationwide], both at his registered office and elsewhere.”

C. Default Judgment

In April 2018, Puckett filed a Motion to Enter Default, in which she argued

Nationwide was lawfully served through the Texas Secretary of State, and

Nationwide’s time to answer the complaint had expired. As a result, Puckett

requested default be entered under Federal Rule of Civil Procedure 55(b). The

district court granted the motion and directed Puckett to “move for default

judgment against [Nationwide] within forty-five (45) days.” Puckett subsequently

filed a Motion for Entry of Judgment by Default, and, following a hearing on

damages, the district court issued an order awarding Puckett $39,010.00 in actual

damages, $117,030.00 in treble damages, and $390,100.00 in punitive damages,

along with costs and attorney’s fees.

D. Motion to Vacate

In May 2019, Nationwide moved, pursuant to Federal Rule of Civil

Procedure 60(b)(4), to vacate the default judgment against it as void. Nationwide

argued it was improper for Puckett to serve it through the Texas Secretary of State

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because the email correspondence attached to Puckett’s motion to extend time

failed to show Puckett exercised reasonable diligence in her efforts to serve

Nationwide’s registered agent at the registered office. Nationwide argued the

email correspondence—the only record evidence showing Puckett’s efforts to

serve Dykes as Nationwide’s registered agent—showed only a single unsworn

statement stating the process server had “not found anyone at home.” Nationwide

insisted this one, nonspecific statement could not show diligence, as it did not

describe the date or time of the service attempt, nor did it describe how service was

attempted.

The district court denied Nationwide’s motion, finding the record evidence

showed Puckett exercised reasonable diligence in her attempts to serve

Nationwide’s registered agent. The district court noted the process server made

“multiple attempts to serve the registered agent, including at the address registered

with the Secretary of State and an alternative address for the registered agent.”

This appeal followed.

II. DISCUSSION

We review de novo the denial of a Rule 60(b)(4) motion to vacate a default

judgment as void for lack of service of process. De Gazelle Grp., Inc. v. Tamaz

Trading Establishment, 817 F.3d 747, 748 (11th Cir. 2016) (noting that, while we

generally review the denial of a Rule 60(b) motion for an abuse of discretion, “the

6 Case: 19-12692 Date Filed: 08/14/2020 Page: 7 of 12

district court’s failure to vacate a void judgment is per se an abuse of discretion”).

The party attacking the judgment on insufficiency of process grounds bears the

burden of demonstrating the judgment is void. See In re Worldwide Web Sys., Inc.,

328 F.3d 1291, 1298–99 (11th Cir. 2003).

Federal Rule of Civil Procedure 4(h) provides that a domestic corporation,

like Nationwide, may be served “in the manner prescribed by Rule 4(e)(1) for

serving an individual.” Fed. R. Civ. P. 4(h)(1)(A). Rule 4(e)(1), in turn, provides

that an individual “may be served in a judicial district of the United States

by . . . following state law for serving a summons in an action brought in courts of

general jurisdiction in the state where the district court is located or where service

is made.” Fed. R. Civ. P. 4(e)(1).

Here, Puckett filed her complaint in the District Court for the Northern

District of Georgia, and Nationwide was to be served in Texas. Georgia’s longarm

statute, like the federal rules, provides for service according to the law of the state

where service is made. O.C.G.A. § 9-10-94. Accordingly, all parties agree service

on Nationwide was to be made in compliance with Texas law.

Under Texas law, a corporation is required to continuously maintain a

registered agent for service of process and a registered office. Tex. Bus. Orgs.

Code Ann. § 5.201(a). If, however, a Texas entity’s registered agent “cannot with

reasonable diligence be found at the registered office of the entity,” the Texas

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Secretary of State becomes “an agent of an entity for purposes of service of

process.” Tex. Bus. Orgs. Code Ann. § 5.251(1)(B). “The statute does not require

that an attempt be made to find the registered agent at any other place than at the

entity’s registered office.” BLS Dev., LLC v. Lopez, 359 S.W.3d 824, 827 (Tex.

App. 2012). As a result, any attempts to find the registered agent at any other

address “are irrelevant to our determination of reasonable diligence.” 5 Id. In

determining “whether the reasonable-diligence requirement is satisfied,” courts

may consider “the record as a whole.” Ingram Indus., Inc. v. U.S. Bolt Mfg., Inc.,

121 S.W.3d 31, 34 (Tex. App. 2003).

Here, even considering “the record as a whole,” Puckett did not exercise the

requisite reasonable diligence in attempting to serve Nationwide’s registered agent.

We note, as an initial matter, that the record in this case includes neither a return of

service from the process server nor an affidavit of due diligence specifying

Puckett’s attempts to serve Nationwide.6 Instead, the only record evidence

regarding the process server’s attempts to serve Nationwide at its registered office

were a series of email communications between Puckett’s counsel and a

representative of the process serving company. Those email communications

5 As such, we do not consider Puckett’s efforts to locate Dykes at any address other than the one associated with Nationwide’s registered office. 6 While the documents attached to Puckett’s Proof of Service included an affidavit of due diligence, that affidavit described only efforts to serve Defendant Ramirez. 8 Case: 19-12692 Date Filed: 08/14/2020 Page: 9 of 12

reveal only a single reference to any effort to serve Nationwide’s registered agent,

Mark Dykes, at Nationwide’s registered office. In an August 16, 2017, email, a

representative of the process serving company stated the address provided for

Nationwide’s registered office was a “home address” and the server had “not found

anyone at home.” This single, secondhand communication regarding the process

server’s efforts is insufficient under Texas law to demonstrate reasonable

diligence.

The Court of Appeals of Texas has stated that “default judgment obtained

after service on the Secretary of State cannot stand, even if a corporation has failed

to designate and maintain a registered agent and registered office,” where it is not

apparent “from the face of the record upon whom the attempted service of process

was made, where, when, how, and in what capacity.” Paramount Credit v.

Montgomery, 420 S.W.3d 226, 231 (Tex. App. 2013). All the email

correspondence shows is the process server went to the address on at least one

occasion, and no one was “at home.” This conclusory and nonspecific statement is

insufficient under Texas law to demonstrate reasonable diligence. See id.; see also

Maddison Dual Fuels, Inc. v. S. Union Co., 944 S.W.2d 735, 738 (Tex. App. 1997)

(finding no reasonable diligence where “the only indication of an attempted

service” was a “‘Diligence of Service’ form” on which the process server listed

“Bad Address” as “the cause of failure to execute”).

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We acknowledge, as Appellee notes, that Texas Courts have found

reasonable diligence after a single attempt where it was clear from the record

further attempts would be futile. See, e.g., Ingram, 121 S.W.3d at 34 (concluding

one attempt at service constituted reasonable diligence where the registered agent

no longer occupied the address and the location had been occupied by another

person or entity for years); BLS Dev., 359 S.W.3d at 827 (“Because the property

was vacant, any other attempts at the registered address would have been futile.”)

But in those cases, it was clear from the return of service or some other

contemporaneous documentation that the listed address was vacant. See Ingram,

121 S.W.3d at 34 (noting that the process sever stated in his affidavit that “he did

not find [the registered agent] at the registered address” and that “the people

occupying the address had been there for 10 years”); BLS Dev., 359 S.W.3d at 827

(“[T]he process server stated in his affidavit that he attempted service at . . . the

registered agent’s address, but that the property was vacant.”).

Here, in contrast, the record is devoid of any such contemporaneous

evidence. Rather, Appellee points to information obtained after Puckett made the

decision to perfect service via the Secretary of State that would supposedly show

Nationwide does not maintain a registered office at the address it provided.

Specifically, Appellee points to: (1) the certificate of service provided by the

Secretary of State, which stated the summons and complaint were returned to the

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Secretary of State “Bearing the Notation, Return to Sender, Vacant, Unable To

Forward”; and (2) extrinsic evidence showing the listed address for Nationwide’s

registered office is a vacant lot in a residential neighborhood.

Appellee essentially asks us to conduct an independent inquiry to determine

whether Nationwide properly maintained its registered office and whether service

at the registered address was practicable. But the relevant inquiry here is not

whether it would, in fact, have been futile to attempt to serve Nationwide at its

registered office, or, indeed, whether Nationwide properly maintained such an

office. See Paramount Credit, 420 S.W.3d at 231 (stating service through the

Texas Secretary of State is inappropriate where reasonable diligence is not evident

from the record “even if a corporation has failed to designate and maintain a

registered agent and registered office”). It is whether Puckett exercised due

diligence in her efforts to serve Nationwide’s registered agent at the registered

office—and specifically whether Puckett had put forth evidence of that diligence at

the time she purported to perfect service via the Secretary of State and moved for

default judgment. The record before us simply does not support a finding of

reasonable diligence.

Accordingly, we conclude Nationwide carried its burden of demonstrating

the default judgment entered against it was void under Rule 60(b)(4).

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III. CONCLUSION

For the reasons set out above, we reverse the district court’s order denying

Nationwide’s motion to vacate the default judgment against it, and remand for

further proceedings.

REVERSED AND REMANDED.