Europacific Asset Management Corp. v. Tradescape, Corp.

233 F.R.D. 344, 64 Fed. R. Serv. 3d 66, 2005 U.S. Dist. LEXIS 29869, 2005 WL 3182528
CourtDistrict Court, S.D. New York
DecidedNovember 29, 2005
DocketNo. 03 Civ. 4556(PKL)
StatusPublished
Cited by15 cases

This text of 233 F.R.D. 344 (Europacific Asset Management Corp. v. Tradescape, Corp.) is published on Counsel Stack Legal Research, covering District Court, S.D. New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Europacific Asset Management Corp. v. Tradescape, Corp., 233 F.R.D. 344, 64 Fed. R. Serv. 3d 66, 2005 U.S. Dist. LEXIS 29869, 2005 WL 3182528 (S.D.N.Y. 2005).

Opinion

OPINION AND ORDER

LEISURE, District Judge.

This action has reached the point at which the Court must determine whether plaintiffs recalcitrance, repeated failures to appear at pre-trial conferences, and dilatory tactics rise to a level warranting involuntary dismissal pursuant to Federal Rule of Civil Procedure 41(b). Plaintiffs original claims for breach of contract, tortious interference with contractual relations, and breach of fiduciary duty relating to a failed loan transaction were divided among three defendants. Two defendants now remain, since defendant Credit Suisse First Boston Corp.’s (“CSFB”) motion to dismiss all of the claims against it was granted by Order dated March 2, 2005. However, a review of the history of the case reveals that plaintiffs claims have languished in an inchoate state for almost two years. Despite warnings from the Court, plaintiff has failed to effectuate service on defendant Softbank Finance Corp. (“Softbank”) and neglected to advance its enforcement of a default judgment entered against defendant Tradescape, Corp. (“Tradescape”). Having carefully weighed the case law of the Rule 41(b) remedy, the Court hereby dismisses plaintiffs remaining claims with prejudice pursuant to Rule 41(b) for failure to prosecute them for the reasons set forth below.

[346]*346BACKGROUND

While the Court’s July 25, 2005 Order outlined the facts pertinent to this order (July 25, 2005 Order), the Court is mindful of the need to provide a clear and complete record of its reasoning in deciding a Rule 41(b) motion1 and, therefore, a detailed factual history of this case follows.

Plaintiff, Europacific Asset Management Corp., a Republic of Panama corporation (Compl. 1f 1), filed its complaint against Tradescape and CSFB on June 23, 2003, alleging claims for breach of contract against Tradeseape (id. HH 20-22); and tortious interference with contractual relations (id. HH 23-28) and breach of fiduciary duty against CSFB (id. HH 29-31). On October 7, 2003, plaintiff filed an amended complaint against “Tradescape, Corp. d/b/a Tradescape, Inc. and/or Trades-cape.com Inc.,” CSFB, and Softbank, a Japanese corporation (Am.Compl. H 4), re-alleging its claims from the original complaint, adding breach of contract (id. HH 35-40) and breach of good faith and fair dealing claims against CSFB (id. HH 41-46), and adding a breach of contract claim against Softbank (id. HH4752).

I. Factual History

A. Plaintiffs Failure to Serve Softbank with the Amended Complaint

Plaintiff has failed to effectuate service on Softbank for almost two years since filing the amended complaint on October 7, 2003. Plaintiffs counsel, Gregory D. Frost, Esq., first informed the Court at the second pretrial conference on March 2, 2004 — almost five months after filing the amended complaint — that the amended complaint had been provided to a process server, but that service would take an additional three to six months because Softbank is a foreign entity. On July 28, 2004, Mr. Frost failed to appear at the scheduled pre-trial conference.2 Over six months after telling the Court that service would take an additional three to six months, on September 14, 2004, Mr. Frost informed the Court at a pre-trial conference that he would seek to serve process on Softbank’s counsel in lieu of service on Softbank itself. Almost two months later, and more than one year after filing the amended complaint, Mr. Frost informed the Court, by letter dated November 9, 2004, that he had learned that Softbank had been served process in another matter pending in the Southern District of New York3 through service on the New York Secretary of State. (Letter from Gregory D. Frost, Esq. to the Court, Nov. 9, 2004.) He contacted Softbank’s counsel in that case, James H. Carter, Esq., and asked if Mr. Carter would accept service on behalf of his client, but Mr. Carter declined. (Id.) Nonetheless, Mr. Frost decided to pursue the method of service on the New York Secretary of State. (Id.) The corresponding Affidavit of Service, which was filed with the Court on November 22, 2004, evidences service on (1) Softbank at a New York, New York address and (2) the New York Secretary of State (Aff. of Service), with instructions to serve Softbank at the New York, New York address (id. Ex.).

Mr. Carter wrote a letter to Mr. Frost, dated December 15, 2004, stating that he had reviewed the Affidavit of Service and that such services was improper because Softbank is a Japanese corporation without a New York office that is not registered to do business in New York. (Letter from James H. Carter, Esq., to Gregory D. Frost, Esq., Dec. 15, 2004.) Therefore, service pursuant to section 306 of New York’s Business Corporation Law, which provides for service of process on the agent of a domestic or authorized foreign corporation in New York, is not proper and lawful. (Id.) Mr. Carter surmised that Mr. Frost had intended to perfect ser[347]*347vice according to section 307 of New York’s Business Corporation Law, but that such service could not be effected because it did not, pursuant to Federal Rule of Civil Procedure 4(f), conform to the Hague Convention on the Service Abroad of Judicial and Extra-Judicial Documents (the “Hague Convention”). (Id.) He concluded by telling Mr. Frost that proper service could only be effected if it was made in conformance with the requirements of the Hague Convention. (Id.) Thereafter, at a pre-trial conference on December 16, 2004, Mr. Frost informed the .Court of the service made, as well as his belief that Mr. Carter was incorrect in claiming service was improper.

Mr. Frost’s second failure to appear at a pre-trial conference occurred on March 3, 2005. The conference was adjourned to March 8, 2005, but Mr. Frost failed to appear again, resulting in his third absence. That day, Mr. Frost told the Court by phone that, notwithstanding Mr. Carter’s directions regarding proper service, he was resolute that service had been proper. At Mr. Frost’s request, a schedule was set for plaintiff to file a motion to find Softbank in default for failure to respond to .the summons and complaint served on the New York Secretary of State.

Thereafter, on March 15, 2005, Mr. Frost contacted Mr. Carter by letter, contesting both the legal and factual bases of Mr. Carter’s December 15, 2004 letter, notifying Mr. Carter that he believed Softbank was in default, setting out the motion schedule to find Softbank in default, and threatening to move for Rule 11 sanctions if Mr. Carter declined to have Softbank accept process. (Letter from Gregory D. Frost, Esq., to James H. Carter, Esq., Mar. 15, 2005.) Mr. Carter responded by letter dated March 16, 2005, stating that, as he had already informed Mr. Frost in December 2004, Soft-bank had been served in the other Southern District of New York proceeding through the Hague Convention.4 (Letter from James H. Carter, Esq., to Gregory D. Frost, Esq., Mar. 16, 2005.) In response, Mr. Frost told the Court that it would serve process on Softbank through the Hague Convention.5 [348]*348(Letter from Gregory D. Frost, Esq., to the Court, Mar.

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233 F.R.D. 344, 64 Fed. R. Serv. 3d 66, 2005 U.S. Dist. LEXIS 29869, 2005 WL 3182528, Counsel Stack Legal Research, https://law.counselstack.com/opinion/europacific-asset-management-corp-v-tradescape-corp-nysd-2005.