8 UNITED STATES DISTRICT COURT 9 EASTERN DISTRICT OF CALIFORNIA 10
11 FERNANDO GASTELUM, Case No. 1:21-cv-01079-JLT-SAB
12 Plaintiff, FINDINGS AND RECOMMENDATIONS RECOMMENDING DENYING 13 v. PLAINTIFF’S MOTION FOR DEFAULT JUDGMENT dba FAIRFIELD INN & SUITES BY (ECF Nos. 20, 22) FOURTEEN DAY DEADLINE 16 Defendant.
18 19 Currently before the Court is Plaintiff Fernando Gastelum’s motion for default judgment, 20 filed on March 21, 2022. (ECF No. 20.) No oppositions were filed and the deadline to do so has 21 now expired. Having considered the moving papers, the declarations and exhibits attached 22 thereto, supplemental briefing, as well as the Court’s file, the Court issues the following findings 23 and recommendations recommending Plaintiff’s motion for default judgment be DENIED for 24 inadequate service of the summons and complaint. 25 I. 27 A. Procedural History Plaintiff, proceeding pro se, filed this action against Defendant Central Valley Hospitality 1 LLC, doing business as Fairfield Inn & Suites by Marriott Bakersfield Central on July 12, 2021. 2 (ECF No. 1.) On October 25, 2021, Plaintiff submitted an executed summons as to Defendant. 3 (ECF No. 10.) Defendant did not appear or respond in this action. Thereafter, Plaintiff filed an 4 application to enter default and a renewed motion to enter default against Defendant. (ECF Nos. 5 13, 16.) On January 24, 2022, default was entered against Defendant. (ECF No. 18.) 6 On March 21, 2022, Plaintiff filed the instant motion for default judgment. (ECF No. 7 20.) The Court, finding it could not determine whether service of process was properly effected 8 or whether Plaintiff adequately alleged his claims, ordered Plaintiff to file supplemental briefing 9 to address these issues. (ECF No. 21.) The hearing on the motion was continued to June 1, 10 2022, to permit Plaintiff time to supplement his motion. Plaintiff was also ordered to serve 11 notice to Defendant regarding the new hearing date and to file proofs of service with the Court. 12 (Id.) Plaintiff did not file any additional notice or proof of service with the Court, but does 13 indicate he emailed the documents to attorney Daniel Klingenberger, who is purportedly 14 representing Defendant in this matter. As noted, no opposition to Plaintiff’s motion has been 15 filed. On April 22, 2022, Plaintiff filed supplemental briefing in response to the Court’s March 16 24, 2022 order. (ECF No. 22.) On May 26, 2022, the Court vacated the June 1, 2022 hearing, 17 finding that the motion was suitable for decision without oral argument. (ECF No. 24.) 18 B. Plaintiff’s Allegations 19 The complaint asserts claims for violations of the Americans with Disabilities Act 20 (“ADA”), and “California civil rights law” against Defendant Central Valley Hospitality LLC, 21 doing business as Fairfield Inn & Suites by Marriott Bakersfield Central.1 (ECF No. 1 at 1.) 22 Plaintiff clarifies in the instant motion for default judgment that he seeks relief from violations of 23 the ADA and California’s Unruh Civil Rights Act. (ECF No. 20 at 2.) This is one of sixteen 24 cases Plaintiff has initiated, pro se, in the Eastern District.2 The Court additionally notes
25 1 Plaintiff’s complaint does not identify discrete claims for relief. While his complaint states that the hotel in question “was not compliant with the Americans with Disabilities Act and the California’s civil rights laws and 26 California disabled person’s law” (ECF No. 1 ¶ 4), he does not identify the particular statute or statutes on which he bases his state law claims. In view of the complaint’s request for “[d]amages under California law for $4,000 per 27 violation,” (id. at 2), it appears Plaintiff seeks to assert a claim under the Unruh Act. See Cal. Civ. Code § 52(a). 2 See Gastelum v. Bed Bath & Beyond Inc., No. 2:21-cv-02274-KJM-DB; Gastelum v. Nw. Target LLC, No. 1:21- 1 Plaintiff appears to have brought approximately 133 similar ADA cases, represented by counsel 2 Peter Strojnik, in the Phoenix, Arizona area. See, e.g., Gastelum v. Canyon Hosp. LLC, No. CV- 3 17-02792-PHX-GMS, 2018 WL 2388047 (D. Ariz. May 25, 2018) (citing ten related cases and 4 noting 133 other accessibility cases brought by Plaintiff in Arizona). Plaintiff alleges Defendant 5 operates a hotel, a public accommodation under the ADA and California’s civil rights laws. 6 (ECF No. 1 at 1; ECF No. 20 at 2.) 7 Plaintiff reports he is “missing a leg and use[s] a wheelchair for mobility.” (ECF No. 1 ¶ 8 1.) Plaintiff does not allege where he resides in the complaint; however, the caption of the 9 complaint lists Plaintiff’s address as being in Casa Grande, Arizona. (See id.) Defendant owns 10 or operates a hotel located at 3540 Rosedale Hwy, Bakersfield, CA 93308 (the “Hotel”). (Id. at ¶ 11 2.) Plaintiff visited the Hotel on July 4, 2021. (Id. at ¶ 3.) According to Plaintiff, when he got 12 to the Hotel, he “noted that it was not compliant with the Americans with Disabilities act and the 13 California’s civil rights laws and California disabled person’s laws.” (Id. at ¶ 4.) Specifically, 14 Plaintiff alleged: 15 a. No access aisle in passenger loading zone. This condition makes it more difficult for me to enter and exit the lobby on 16 the shortest possible route. 17 b. Doors require twisting of the wrist. This condition makes it more difficult for me to enter through the doors. 18 c. Doors require greater than five pounds of force to open. 19 This condition makes it more difficult for me to enter through the doors. 20 d. Unsecured carpets. This condition makes it more difficult 21 for me to move my wheelchair over unsecured carpets. 22 e. No accessible parking near main entrance. This condition makes me travel further from accessible parking to the 23 lobby. 24
25 of Bakersfield LLC, No. 1:21-cv-01230-JLT-BAK; Gastelum v. Dick’s Sporting Goods Inc., No. 1:21-cv-01289- DAD-JLT; Gastelum v. Nw. Target LLC, No. 1:21-cv-01330-AWI-BAK; Gastelum v. Kohl’s Dep’t Stores Inc., No. 1:21-cv-01740-JLT-BAM; Gastelum v. Veer Hosp. LLC, No. 1:22-cv-00112-DAD-BAK; Gastelum v. Easiness LP, 26 No. 1:22-cv-00166-DAD-BAK; Gastelum v. Tilly’s, Inc., No. 1:22-cv-00178-DAD-BAK; Gastelum v. Tractor Supply Co., No. 1:22-cv-00209-JLT-SAB; Gastelum v. Jackson IV LLC, No. 2:21-cv-01321-TLN-CKD; Gastelum 27 v. LL Sacramento LP, No. 2:21-cv-01481-KJM-JDP; Gastelum v. Arden Fair Assocs., No. 2:21-cv-01722-JAM-AC; Gastelum v. Macy’s Inc., No. 2:22-cv-00065-KJM-DB; Gastelum v. Penney OpCo, LLC, No. 2:22-cv-00283-KJM- 1 f. Accessible parking is not dispersed to all accessible entrances. This condition requires me to travel further from 2 accessible parking [to] the entrances. 3 (Id.) Thus, Plaintiff asserts he “was denied equal access to the [hotel] by defendant by not 4 complying with the ADA and California’s civil rights law as stated above.” (Id. at ¶ 5.) Further, 5 Plaintiff reports he “will not want to revisit the [Hotel] because it is not fully compliant with the 6 Americans with Disabilities Act and the California’s civil rights laws and California civil rights 7 laws [sic].” (Id. at ¶ 6.) As a result of the aforementioned violations, Plaintiff seeks injunctive 8 relief, costs, and $4,000 per violation (pursuant to the Unruh Act). (See id. at 2–3; ECF No. 20 9 at 3–4.) 10 II. 12 “Our starting point is the general rule that default judgments are ordinarily disfavored,” 13 as “[c]ases should be decided upon their merits whenever reasonably possible.” NewGen, LLC 14 v. Safe Cig, LLC, 840 F.3d 606, 616 (9th Cir. 2016) (quoting Eitel v. McCool, 782 F.2d 1470, 15 1472 (9th Cir. 1986)). Pursuant to Federal Rule of Civil Procedure (“Rule”) 55, obtaining a 16 default judgment is a two-step process. Entry of default is appropriate as to any party against 17 whom a judgment for affirmative relief is sought that has failed to plead or otherwise defend as 18 provided by the Federal Rules of Civil Procedure and where that fact is made to appear by 19 affidavit or otherwise. Fed. R. Civ. P. 55(a). After entry of default, a plaintiff can seek entry of 20 default judgment. Fed. R. Civ. P. 55(b). Rule 55(b)(2) provides the framework for the Court to 21 enter a default judgment: 22 (b) Entering a Default Judgment. 23 (2) By the Court. In all other cases, the party must apply to the court for a default judgment. A default judgment may be entered 24 against a minor or incompetent person only if represented by a general guardian, conservator, or other like fiduciary who has 25 appeared. If the party against whom a default judgment is sought has appeared personally or by a representative, that party or its 26 representative must be served with written notice of the application at least 7 days before the hearing. The court may conduct hearings 27 or make referrals--preserving any federal statutory right to a jury trial--when, to enter or effectuate judgment, it needs to: 1 (A) conduct an accounting; 2 (B) determine the amount of damages; 3 (C) establish the truth of any allegation by evidence; or 4 (D) investigate any other matter. 5 Fed. R. Civ. P. 55. 6 The decision to grant a motion for entry of default judgment is within the discretion of 7 the court. PepsiCo, Inc. v. Cal. Sec. Cans, 238 F. Supp. 2d 1172, 1174 (C.D. Cal. 2002); see also 8 TeleVideo Sys., Inc. v. Heidenthal, 826 F.2d 915, 917 (9th Cir. 1987) (“Rule 55 gives the court 9 considerable leeway as to what it may require as a prerequisite to the entry of a default 10 judgment.”). The Ninth Circuit has set forth the following seven factors (the “Eitel factors”) that 11 the Court may consider in exercising its discretion: (1) the possibility of prejudice to the 12 plaintiff; (2) the merits of the plaintiff’s substantive claim; (3) the sufficiency of the complaint; 13 (4) the sum of money at stake in the action; (5) the possibility of a dispute concerning material 14 facts; (6) whether the default was due to excusable neglect; and (7) the strong policy underlying 15 the Federal Rules of Civil Procedure favoring decisions on the merits. Eitel, 782 F.2d at 1471– 16 72. 17 Generally, once default has been entered, “the factual allegations of the complaint, except 18 those relating to damages, will be taken as true.” Garamendi v. Henin, 683 F.3d 1069, 1080 (9th 19 Cir. 2012) (quoting Geddes v. United Fin. Grp., 559 F.2d 557, 560 (9th Cir. 1977)); see also Fed. 20 R. Civ. P. 8(b)(6) (“An allegation — other than one relating to the amount of damages — is 21 admitted if a responsive pleading is required and the allegation is not denied.”). Accordingly, the 22 amount of damages must be proven at an evidentiary hearing or through other means. Microsoft 23 Corp. v. Nop, 549 F. Supp. 2d 1233, 1236 (E.D. Cal. 2008). However, “necessary facts not 24 contained in the pleadings, and claims which are legally insufficient, are not established by 25 default.” Cripps v. Life Ins. Co. of N. Am., 980 F.2d 1261, 1267 (9th Cir. 1992) (internal 26 citation omitted). Finally, the relief sought must not be different in kind or exceed the amount 27 that is demanded in the pleadings. Fed. R. Civ. P. 54(c). /// 3 The Court must first determine whether it properly has jurisdiction in this matter before it 4 may turn to the Eitel factors to determine whether default judgment should be entered. Here, 5 because the Court finds it lacks jurisdiction due to a lack of service of process, it does not reach 6 analysis of the Eitel factors. 7 A. Subject Matter Jurisdiction 8 Federal courts are courts of limited jurisdiction and their power to adjudicate is limited to 9 that granted by Congress. U.S v. Sumner, 226 F.3d 1005, 1009 (9th Cir. 2000). Pursuant to 28 10 U.S.C. § 1331, federal courts have original jurisdiction over “all civil actions arising under the 11 Constitution, laws, or treaties of the United States.’ “A case ‘arises under’ federal law either 12 where federal law creates the cause of action or where the vindication of a right under state law 13 necessarily turns on some construction of federal law.” Republican Party of Guam v. Gutierrez, 14 277 F.3d 1086, 1088 (9th Cir. 2002) (internal punctuation omitted) (quoting Franchise Tax Bd. 15 v. Constr. Laborers Vacation Tr., 463 U.S. 1, 8–9 (1983) (citations omitted)). “[T]he presence or 16 absence of federal-question jurisdiction is governed by the ‘well-pleaded complaint rule,’ which 17 provides that federal jurisdiction exists only when a federal question is presented on the face of 18 the plaintiff’s properly pleaded complaint.” Republican Party of Guam, 277 F.3d at 1089 19 (citations omitted). 20 Plaintiff brings this action alleging violations of the ADA of 1990, 42 U.S.C. § 12101, et 21 seq. Therefore, the Court has original jurisdiction under 28 U.S.C. § 1331. In addition, the 22 Court may exercise supplemental jurisdiction pursuant to 28 U.S.C. § 1367 over Plaintiff’s 23 related state law claims under the Unruh Act, California Civil Code §§ 51, et seq.3 24 3 In light of the Court’s finding that it lacks jurisdiction over Defendant due to insufficient service, the Court does 25 not reach a merits analysis of the Eitel factors, including consideration of whether exercising supplemental jurisdiction over Plaintiff’s Unruh Act claim is appropriate. Nonetheless, the sheer volume of Plaintiff’s filings of accessibility litigations in federal court is noteworthy. Plaintiff is advised that, had the Court addressed the 26 underlying merits of this action, it would have been inclined to issue a recommendation to decline to exercise supplemental jurisdiction over the Unruh Act claim, on the basis that exercising supplemental jurisdiction over 27 Plaintiff’s Unruh Act claim in this case “would not further the interest of judicial economy, convenience, fairness and comity.” See Johnson v. Techbusiness Res., LLC, No. 20-cv-06048-BLF, 2020 WL 7013596, at *3 (N.D. Cal. 1 B. Service of Process on Defendant 2 As a general rule, the Court considers the adequacy of service of process before 3 evaluating the merits of a motion for default judgment. See J & J Sports Prods., Inc. v. Singh, 4 No. 1:13-cv-1453-LJO-BAM, 2014 WL 1665014, at *2 (E.D. Cal. Apr. 23, 2014); Penpower 5 Tech. Ltd. v. S.P.C. Tech., 627 F. Supp. 2d 1083, 1088 (N.D. Cal. 2008); Mason v. Genisco 6 Tech. Corp., 960 F.2d 849, 851 (9th Cir. 1992) (stating that if party “failed to serve [defendant] 7 in the earlier action, the default judgment is void and has no res judicata effect in this action.”). 8 Service of the summons and complaint is the procedure by which a court having venue and 9 jurisdiction of the subject matter of the suit obtains jurisdiction over the person being served. 10 Miss. Publ’g Corp. v. Murphree, 326 U.S. 438, 444–45 (1946); see Direct Mail Specialists, Inc. 11 v. Eclat Computerized Techs., Inc. (Direct Mail), 840 F.2d 685, 688 (9th Cir. 1988) (“A federal 12 district courts to consider the state procedural requirements in ADA cases (similar to the instant matter) as a basis 13 for declining to exert supplemental jurisdiction over the plaintiff’s Unruh and other state law claims. See, e.g., Brooke v. Suites LP, No. 3:20-cv-01217-H-AHG, 2020 WL 6149963, at *6 (S.D. Cal. Oct. 19, 2020) (finding plaintiff sufficiently pled ADA claim but declining to exercise supplemental jurisdiction over Unruh Act claim 14 “because it substantially predominates over [the plaintiff’s] federal claim under the ADA and exceptional circumstances favor dismissal, including the Court’s interests in comity and discouraging forum-shopping.”); 15 Brooke v. Tides Hosp. LLC, No. 8:21-cv-00755-JLS-JDE (C.D. Cal. Jun. 4, 2021) (order to show cause why the court should not decline to exercise supplemental jurisdiction over plaintiff’s Unruh Act claim); Whitaker v. Mac, 16 411 F. Supp. 3d 1108 (C.D. Cal. 2019) (denying defendant’s motion to dismiss plaintiff’s ADA claim but granting defendant’s request to decline to exercise supplemental jurisdiction over plaintiff’s Unruh claim); Langer v. Kiser, 17 516 F. Supp. 3d 1066 (S.D. Cal. 2021) (entering judgment in defendant’s favor after bench trial on ADA claim, and declining to retain supplemental jurisdiction over plaintiff’s Unruh claim based on compelling interests of comity 18 and discouraging forum shopping); Marquez v. KBMS Hosp. Corp., 492 F. Supp. 3d 1058 (C.D. Cal. 2020) (following sua sponte order to show cause why court should not decline to exercise supplemental jurisdiction over 19 plaintiff’s Unruh claim, dismissing Unruh claim without prejudice to refiling in state court and retaining jurisdiction over ADA claim only). More specifically, California Code of Civil Procedure § 425.55(b) defines a “high- 20 frequency litigant” as a plaintiff or attorney who has filed 10 or more complaints alleging a construction-related accessibility violation that includes a claim under the Unruh Act within the 12-month period immediately preceding 21 the filing of the current complaint alleging a construction-related accessibility violation, and requires that “additional safeguards apply so as to ensure that the claims are warranted.” “Additional safeguards” required of such “high- 22 frequency litigants” include: identifying the number of complaints alleging a construction-related accessibility claim that the high-frequency litigant has filed during the last 12 months prior to the filing of the complaint; the reason the 23 individual was in the geographic area of the defendant’s business; the reason why the individual desired access to the defendant’s business, including the specific commercial, business, personal, social leisure, recreational, or other 24 purpose; the complaint must be verified; and the litigant must pay a $1,000 filing fee at the time of the filing of the initial complaint in addition to the standard filing fees. Cal. Code Civ. P. § 425.50; Cal. Gov’t Code § 70616.5. The 25 legislature justified these additional requirements for “high-frequency litigants” on the express basis that “more than one-half . . . of all construction-related accessibility complaints filed between 2012 and 2014 were filed by two law firms. . . . Moreover, these lawsuits are frequently filed against small businesses on the basis of boilerplate 26 complaints, apparently seeking quick cash settlements rather than correction of the accessibility violation. This practice unfairly taints the reputation of other innocent disabled consumers who are merely trying to go about their 27 daily lives accessing public accommodations as they are entitled to have full and equal access under the state’s Unruh Civil Rights Act . . . and the federal Americans with Disability Act of 1990.” Cal. Code Civ. P. § 1 court does not have jurisdiction over a defendant unless the defendant has been served properly 2 under Fed. R. Civ. P. 4.”). 3 The Federal Rules of Civil Procedure provide for two ways to effectuate service on a 4 corporation, association, or partnership. Pursuant to Rule 4(h), a corporation “or a partnership or 5 other unincorporated association that is subject to suit under a common name” must be served: 6 (A) in the manner prescribed by Rule 4(e)(1) for serving an individual; or 7 (B) by delivering a copy of the summons and of the complaint to 8 an officer, a managing or general agent, or any other agent authorized by appointment or by law to receive service of process 9 and—if the agent is one authorized by statute and the statute so requires—by also mailing a copy of each to the defendant. . . . 10 11 Fed. R. Civ. P. 4(h)(1)(A)–(B). 12 Rule 4(e) provides that service may be effectuated on a competent, adult individual by: 13 (1) delivering a copy of the summons and the complaint to that person personally; (2) leaving a 14 copy of each at the individual’s dwelling or usual place of abode with someone of suitable age 15 and discretion who resides there; or (3) delivering a copy of each to an agent authorized by 16 appointment or by law to receive service of process. Fed. R. Civ. P. 4(e)(2)(A)–(C). 17 Rule 4 also permits service on an individual in accordance with state law. Fed. R. Civ. P. 18 4(e)(1). In California, a corporation may be served by delivery to the person designated as an 19 agent for service of process, or to the “president, chief executive officer, or other head of the 20 corporation, a vice president, a secretary or assistant secretary, a treasurer or assistant treasurer, a 21 controller or chief financial officer, a general manager, or a person authorized by the corporation 22 to receive service of process.” Cal. Civ. Proc. Code § 416.10(a)–(b). In California, a general or 23 limited partnership may be served by delivery: “to the person designated as agent for service of 24 process in a statement filed with the Secretary of State or to a general partner or the general 25 manager of the partnership.” Cal. Civ. Proc. Code § 416.40(a). Other unincorporated 26 associations may be served by delivery: “to the person designated as agent for service of process 27 in a statement filed with the Secretary of State or to the president or other head of the 1 general manager, or a person authorized by the association to receive service of process.” Cal. 2 Civ. Proc. Code § 416.40(b). 3 “Rule 4 is a flexible rule that should be liberally construed so long as a party receives 4 sufficient notice of the complaint.” Direct Mail, 840 F.2d at 688 (quoting United Food & Com. 5 Workers Union v. Alpha Beta Co., 736 F.2d 1371, 1382 (9th Cir. 1984)). “[A] signed return of 6 service constitutes prima facie evidence of valid service which can be overcome only by strong 7 and convincing evidence.” SEC v. Internet Sols. for Bus., Inc., 509 F.3d 1161, 1163 (9th Cir. 8 2007). However, “without substantial compliance with Rule 4, ‘neither actual notice nor simply 9 naming the defendant in the complaint will provide personal jurisdiction.’ ” Direct Mail, 840 10 F.2d at 688 (quoting Benny v. Pipes, 799 F.2d 489, 492 (9th Cir. 1986)). Further, “[o]nce 11 service is challenged, plaintiffs bear the burden of establishing that service was valid under Rule 12 4.” Brockmeyer v. May, 383 F.3d 798, 801 (9th Cir. 2004) (citations omitted). 13 Here, Plaintiff submitted an executed summons as to Defendant on October 25, 2021. 14 (ECF No. 10.) Plaintiff’s process server personally served Angie Early at the address of 8312 15 Espresso Drive, Bakersfield, California 93312 on October 18, 2021, at 5:07 p.m. (ECF Nos. 10, 16 12.) The executed summons and supplemental certificate of service affidavit indicate Ms. Early 17 is the “General Manager” for Valley Hospitality, LLC. (ECF No. 10 at 1; ECF No. 12 at 1.) 18 However, a review of the California Secretary of State’s business search website for Central 19 Valley Hospitality, LLC indicates that the agent for service of process for Central Valley 20 Hospitality, LLC is Raju Verma, located at the address 8300 Granite Falls Drive, Bakersfield, 21 California 93312.4 (See ECF No. 21 at 3.) By contrast, the address at which Ms. Early was 22 served is for the Residence Inn Bakersfield West,5 which suggests Ms. Early was the general 23
24 4 The Court takes judicial notice of the business entity details contained on the California Secretary of State’s webpage pursuant to Federal Rule of Evidence 201. See also Reyn’s Pasta Bella, LLC v. Visa USA, Inc., 442 F.3d 25 741, 746 n.6 (9th Cir. 2006); L’Garde, Inc. v. Raytheon Space & Airborne Sys., 805 F. Supp. 2d 932, 938 (C.D. Cal. 2011) (taking judicial notice of records searches on the California Secretary of State corporate search website as the accuracy of such record searches “can be determined by readily accessible resources whose accuracy cannot 26 reasonably be questioned.”)
27 5 An independent review by the Court of judicially noticeable facts reveals the address at which Ms. Early was served is the location of the Marriott Residence Inn Bakersfield West. See MARRIOTT HOTELS OVERVIEW, 1 manager of the Hotel, not the corporate entity Valley Hospitality, LLC. Further, Plaintiff served 2 the instant motion for default judgment on yet another person, attorney Daniel Klingenberger at 3 5001 E. Commercenter Drive, Suite 300, P.O. Box 12092, Bakersfield, California 93389-2090. 4 (See ECF No. 20 at 4.) Plaintiff has averred Mr. Klingenberger currently represents Defendant 5 in this matter, though it is unclear when such representation commenced. Also unclear is 6 whether Plaintiff provided copies of the summons and complaint to Mr. Klingenberger. As 7 noted previously, the multiple inconsistencies regarding service made it unclear to the Court 8 whether service on Defendant complied with or substantially complied with Rule 4; accordingly, 9 the Court ordered Plaintiff to submit supplemental briefing, including declarations or other 10 exhibits as necessary, to explain the inconsistencies and demonstrate service was properly 11 effected on Defendant. (ECF No. 21 at 1–4.) The Court additionally, in an abundance of 12 caution, directed Plaintiff to serve both the agent for service of process designated by Defendant 13 Central Valley Hospitality, LLC’s business certificate (Raju Verma) as well as the purported 14 “General Manager” for Central Valley Hospitality, LLC (Angie Early), copies of the motion for 15 default judgment with the updated hearing date, and file proofs of service with the Court. (Id. at 16 4, 6–7.) 17 On April 22, 2022, Plaintiff filed supplemental briefing in response to the Court’s March 18 24, 2022 order. (ECF No. 22.) However, he did not separately file any additional notices or 19 proofs of service as directed to do by the Court.6 Instead, the supplemental briefing indicates 20 that, after the process server served Ms. Early at the Hotel on October 18, 2021, Plaintiff 21 received an email from Mr. Klingenberger advising that he represents Defendant and stating, “I 22 have authority to accept service of process on behalf of Central Valley Hospitality, LLC for this 23 matter only.” (Id. at 1; Ex. 1, ECF No. 22 at 5.) 24 Nonetheless, the Court finds Plaintiff’s email exhibits do not establish service of the 25 summons and complaint on Defendant in “substantial compliance” with Rule 4, with respect to 26 either the original service on Ms. Early or the subsequent communications with Mr.
27 6 In his supplemental briefing, which is verified, Plaintiff states he emailed a copy of the Court’s March 24, 2022 order to Mr. Klingenberger on April 18, 2022, and “other filings [unspecified] . . . to Mr. Klingenberger previously.” 1 Klingenberger, for the reasons discussed herein. 2 1. Angie Early 3 With respect to the service of process effected on Ms. Early, the Court cannot find 4 Plaintiff established compliance with Rule 4. As noted above, Rule 4(h) permits an individual to 5 be served on behalf of a corporation pursuant to Rule 4(e), Fed. R. Civ. P. 4(h)(1)(A), or by 6 personally serving “an officer, a managing or general agent, or any other agent authorized by 7 appointment or by law to receive service of process,” Fed. R. Civ. P. 4(h)(1)(B). Plaintiff has 8 not complied with subdivision (B), as the proper officer/managing or general agent/other 9 authorized agent to accept service of process on behalf of the corporate entity Central Valley 10 Hospitality, LLC is not Ms. Early, but Mr. Raju Verma. See CALIFORNIA SECRETARY OF STATE 11 BUSINESS SEARCH, https://bizfileonline.sos.ca.gov/search/business (last visited Jun. 7, 2022). 12 Indeed, Mr. Klingenberger advises Plaintiff of the same during their email correspondence, when 13 he states: 14 From what I can tell regarding the paperwork in this matter you did not serve the agent for service of process for Central Valley 15 Hospitality LLC. The agent for service of process is Mr. Raju Verma. Inasmuch as service was not accomplished correctly, I 16 request that you withdraw your Application for Enter [sic] Default. 17 (ECF No. 22 at 5.)7 18 Nor does the Court find Plaintiff has complied with subdivision (A) for personal service 19 as permitted under Rule 4(e)(1).8 As noted above, California law, like Rule 4, requires service 20 on a corporate entity to be effected on the person designated as an agent for service of process, or 21 the “president, chief executive officer, or other head of the corporation, a vice president, a 22 secretary or assistant secretary, a treasurer or assistant treasurer, a controller or chief financial 23 officer, a general manager, or a person authorized by the corporation to receive service of 24
25 7 It is unclear why Defendant never made a special appearance to move to set aside the entry of default, as this would have been the proper course of action to ensure denial of the instant motion for default judgment.
26 8 None of the provisions under Rule 4(e)(2) are applicable here. That is, the summons and complaint were not “personally” delivered to Defendant Central Valley Hospitality, LLC, a corporation; nor does Defendant, a corporate 27 entity, have a “usual place of abode.” Fed. R. Civ. P. 4(e)(2)(A)–(B). Finally, “delivering a copy of each to an agent authorized . . . to receive service of process” did not occur, Fed. R. Civ. P. 4(e)(2)(C), for the same reasons 1 process.” Cal. Civ. Proc. Code § 416.10(a)–(b). As the Court has noted, Ms. Early holds none 2 of these positions with Central Valley Hospitality, LLC, and she is not the designated agent for 3 service of process for Central Valley Hospitality, LLC on the corporate information page on the 4 Secretary of State’s website. 5 Plaintiff’s argument that service on Ms. Early was appropriate because she is a “general 6 manager” is unavailing. Nothing in the record demonstrates Ms. Early is a “general manager” of 7 Central Valley Hospitality, LLC within the sense contemplated by Cal. Civ. Proc. Code § 8 416.10; at most, she appears to be a “general manager” at the Hotel, which is where Ms. Early 9 was served. California courts have held these job titles are not equivocal for purposes of 10 effecting service on a corporate entity. In Bakersfield Hacienda, Inc. v. Superior Court In & For 11 Kern County, for example, the California Fifth District Court of Appeal provided an extensive 12 explanation of the differences between the two positions when it declined to find service on the 13 “general manager” of the Hacienda Motel constituted personal service on the corporation, 14 Bakersfield Hacienda, Inc.: 15 [T]he general manager of a motel is not the general manager of the corporation. The legislative history of section 411 of the Code of 16 Civil Procedure shows that the term “general manager” was substituted by the Legislature for the term “managing agent” that 17 formerly occupied the same position in the section; this fact reinforces our assurance that the intention of the Legislature as 18 expressed in the present code section is to permit service to be made upon the general manager of the corporation and not simply 19 on a managing agent of one part of its business. 20 Black’s Law Dictionary (4th ed. 1957) page 814, defines general manager as follows: 21 “One having general direction and control of corporation’s affairs, 22 and who may do everything which corporation could do in transaction of its business. . . . A manager for all general purposes 23 of the corporation.” 24 The term “general manager of a corporation” indicates one who has general direction and control of the business of the corporation 25 as distinguished from one who has the management only of a particular branch of the business; he may do everything which the 26 corporation could do in transaction of its business. 27 199 Cal. App. 2d 798, 803–04 (Ct. App. 1962) (internal citations omitted). In sum, Ms. Early 1 Valley Hospitality. 2 Finally, to the extent Plaintiff suggests service on Ms. Early was proper via substituted 3 service, such argument also fails. As potentially relevant here, California law permits substitute 4 service at the defendant’s “usual place of business,” after personal service has been attempted 5 with reasonable diligence, and provided that service is effected on a “person apparently in 6 charge,” who is “at least 18 years of age, [and] who shall be informed of the contents” of the 7 summons, and copies must thereafter be mailed to the defendant at the same address where the 8 documents were left. Cal. Civ. Proc. Code § 415.20(b). “[T]he burden is upon the plaintiff to 9 show reasonable diligence to effect personal service and each case must be judged upon its own 10 facts.” Evartt v. Super. Ct., 89 Cal. App. 3d 795, 801 (Cal. Ct. App. 1979). “Although there is 11 no established formula for reasonable diligence, two or three attempts to personally serve 12 defendant at a ‘proper place’ ordinarily qualifies as ‘reasonable diligence.’ ” Johnson v. 13 Bozorghadad, No. 17-cv-06536-SVK, 2020 WL 963377, at *3 (N.D. Cal. Feb. 28, 2020) 14 (citation, internal quotation marks, and alteration omitted), report and recommendation 15 adopted, No. 17-cv-06536-HSG, 2020 WL 1245122 (N.D. Cal. Mar. 16, 2020). 16 Here, neither the executed summons nor service affidavit includes facts demonstrating 17 compliance with any of the requirements of substitute service. As an initial note, the Court is 18 unpersuaded that the Hotel constitutes Defendant’s “usual place of business.” To the contrary, 19 Defendant’s corporate statement filed with the Secretary of State indicates both the principal 20 address and mailing address for Central Valley Hospitality, LLC is 8300 Granite Falls Drive, 21 Bakersfield, California 93312, and not 8312 Espresso Drive, Bakersfield, California 93312, 22 where Ms. Early was served. Nor do the executed summons or service affidavit indicate the 23 process server made any prior attempts to serve Mr. Verma at Defendant’s 8300 Granite Falls 24 Drive address before serving Ms. Early at the Hotel. Thus, reasonable diligence is not 25 established. Cal. Civ. Proc. Code § 415.20(b); Johnson, 2020 WL 963377, at *4 (rejecting 26 service not effected at correct place of business); see also Bakersfield Hacienda, Inc., 199 Cal. 27 App. 2d at 803–05 (finding “utter failure to show any diligence whatsoever in attempting to 1 attempted on the general manager of the motel and not the general manager of the corporation). 2 Nor do the executed summons or service affidavit aver facts demonstrating Ms. Early 3 was “a person apparently in charge” or of “suitable age and discretion.” (See generally ECF 4 Nos. 10, 12); see also Cal. Code Civ. Proc. § 415.20(b). The “apparently in charge” requirement 5 is vital because, “[f]or substituted service to be reasonably calculated to give an interested party 6 notice of the pendency of the action and an opportunity to be heard, service must be made upon a 7 person whose relationship to the person to be served makes it more likely than not that they will 8 deliver process to the named party.” Produce v. Cal. Harvest Healthy Foods Ranch Mkt., No. C- 9 11-04814 DMR, 2012 WL 259575, at *3 (N.D. Cal. Jan. 27, 2012) (internal quotation marks, 10 alteration, and citations omitted). “[I]f service [is] improper, that may well explain the failure of 11 a defendant to appear in a lawsuit.” Folkmanis, Inc. v. Uptown Toys LLC, No. 18-cv-00955- 12 EMC, 2018 WL 4361140, at *2 (N.D. Cal. Sep. 13, 2018) (internal quotation marks and citation 13 omitted). The mere statement that Ms. Early is a “general manager” is conclusory. 14 Similarly, the service affidavit states in conclusory fashion that Ms. Early was “informed 15 . . . of the contents [of the documents being served],” but no facts are proffered to demonstrate 16 Ms. Early actually understood the significance of the documents being handed her, or that she 17 was required to forward the documents to Central Valley Hospitality, LLC. “This requirement is 18 critical because if [the person who is “apparently in charge”] did not know or understand the 19 significance of the documents that [the process server] handed him, the documents may have 20 ended up in a junk pile or recycling bin, rather than in [the defendant’s] hands.” Bouyer v. 603 21 San Fernando Rd., LLC, No. CV-20-3853-MWF (PVCx), 2020 WL 7711840, at *2 (C.D. Cal. 22 Nov. 2, 2020). The Court also notes the service affidavit includes boilerplate language 23 indicating service was effected “in compliance with state statutes,” but it does not actually 24 identify which rule or statute was followed in order to establish that substitute service was, in 25 fact, in compliance with any of the aforementioned legal authorities, or otherwise aver any facts 26 to describe how the substitute service was completed. 27 Finally, neither the executed summons nor service affidavit indicate that, after effecting 1 the same address, as required by Cal. Code Civ. Proc. § 415.20(b). 2 Based on this record, the Court finds adequate service was not made on Defendant 3 Central Valley Hospitality, LLC through Angie Early. 4 2. Daniel Klingenberger 5 Nor can the Court conclude that adequate service of process was effected on Defendant 6 through Mr. Klingenberger. Plaintiff attaches a series of email communications between himself 7 and Mr. Klingenberger, presumably in support of the contention that he served Defendant in 8 substantial compliance with Rule 4. (See ECF No. 22 at 5–14.) Plaintiff proffers that after Ms. 9 Early was served on October 18, 2021, he received an email from Mr. Klingenberger on 10 November 30, 2021. (Id. at 1.) In the November 30, 2021 email, Mr. Klingenberger informs 11 Plaintiff that he represents Defendant Central Valley Hospitality, LLC, and that he has authority 12 to accept service of process on behalf of Defendant “for this matter only.” (Id. at 1, 5.) 13 However, there is no indication that Plaintiff ever subsequently served process on Mr. 14 Klingenberger, or that Mr. Klingenberger accepted such service on behalf of Defendant. Instead, 15 the only document Mr. Klingenberger acknowledges receiving from Plaintiff is a letter dated 16 November 10, 2021, which contained Plaintiff’s draft application to enter default.9 (See id. at 5.) 17 Indeed, conspicuously absent from the record — including all of Plaintiff’s attached 18 email communications and averments — is any acceptance of service, any acknowledgment of 19 receipt of a copy of the summons and complaint, or any waiver of service by Mr. Klingenberger. 20 For example, Plaintiff avers that he emailed a copy of his renewed request for entry of default to 21 Mr. Klingenberger (ECF No. 16 at 1–2); he mailed a copy of his motion for default judgment to 22 Mr. Klingenberger (ECF No. 20 at 4; ECF No. 22 at 2); and he emailed a copy of his 23 supplemental briefing in support of the motion for default judgment to Mr. Klingenberger (ECF 24
25 9 Subsequent communications in the attached emails include several attachments (though the attachments themselves are not provided and therefore cannot be verified) that Plaintiff sent to Mr. Klingenberger, titled “Photos” (ECF No. 22 at 7), “2022-01-13 RENEWED APP FOR DEFAULT” (id. at 8), “Doc 18 – Entry of 26 Default” and “Doc 17 – Order Directing Clerk to Enter Default” (id. at 9), “2022-02-21 email to Daniel Klingerberger” (id. at 12), “2022-03-17 M4Default Judgment” (id. at 13), “2022-04-15 Response to Default Order 27 ECF 21,” “2022-04-15 Exhibits 1 – Email String,” “Doc 21 – Order Setting Hearing on Motion for Default Judgment,” and “2022-04-15 Acceptance of Service” (id. at 14), and various “image.png” attachments (see id. at 9, 1 No. 22 at 3). And, as already noted, the executed summons and service affidavit indicate only 2 Ms. Early was served a copy of the summons and complaint by the process server (and nothing 3 in the record reflects that she forwarded those documents to Mr. Klingenberger). (ECF Nos. 10, 4 12.) In sum, nothing in the record indicates that Plaintiff provided Mr. Klingenberger a copy of 5 the summons and complaint.10 Based on this record, the Court finds adequate service was not 6 made on Defendant Central Valley Hospitality, LLC through Daniel Klingenberger. 7 As noted, “without substantial compliance with Rule 4, ‘neither actual notice nor simply 8 naming the defendant in the complaint will provide personal jurisdiction.’ ” Direct Mail, 840 9 F.2d at 688; Benny, 799 F.2d at 492. For the foregoing reasons, the Court finds Plaintiff did not 10 substantially comply with Rule 4, despite being provided an opportunity to supplement the 11 record and demonstrate compliance. Because the Court finds an utter failure to effect service of 12 process of Defendant in this matter, it lacks jurisdiction over Defendant, Direct Mail, 840 F.2d at 13 688, and therefore does not reach the merits of whether Plaintiff adequately alleged his claims or 14 analysis of the remaining Eitel factors for purposes of this motion for default judgment. 15 IV. 17 Based on the foregoing, IT IS HEREBY RECOMMENDED that Plaintiff’s motion for 18 default judgment (ECF No. 23) be DENIED for inadequate service of the summons and 19 complaint. 20 Plaintiff is HEREBY ORDERED to mail a copy of these findings and recommendations 21 to Defendant at the principal/mailing address designated with the California Secretary of State 22 and via its attorney, Daniel Klingenberger. 23 These findings and recommendations are submitted to the district judge assigned to this 24 action, pursuant to 28 U.S.C. § 636(b)(1)(B) and this Court’s Local Rule 304. Within fourteen 25 (14) days of service of this recommendation, any party may file written objections to these 26 10 The Court also notes that, in an email dated April 14, 2022, Plaintiff requested Mr. Klingenberger sign an 27 Acceptance of Service of Process document on April 14, 2022, though Mr. Klingenberger’s response to the email, if any, is not provided in Plaintiff’s exhibits. This very recent email exchange lends further support to the conclusion 1 | findings and recommendations with the Court and serve a copy on all parties. Such a document 2 | should be captioned “Objections to Magistrate Judge’s Findings and Recommendations.” The 3 | district judge will review the magistrate judge’s findings and recommendations pursuant to 28 4|US.C. § 636(b)(1)(C). 5 The parties are advised that failure to file objections within the specified time may result 6 | in the waiver of the “right to challenge the magistrate’s factual findings” on appeal. Wilkerson 7 |v. Wheeler, 772 F.3d 834, 839 (9th Cir. 2014) (citing Baxter v. Sullivan, 923 F.2d 1391, 1394 8 | (9th Cir. 1991)). 9 10 IT IS SO ORDERED. DAM Le 11 | Dated: _June 9, 2022 __ UNITED STATES MAGISTRATE JUDGE
13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28