Hausler v. JP Morgan Chase Bank, N.A.

141 F. Supp. 3d 248, 2015 U.S. Dist. LEXIS 137784, 2015 WL 5853952
District Court, S.D. New York·Decided October 2, 2015·No. No. 09 Civ. 10289(VM)·Published·Cited by 2 cases

Opinion

DECISION AND ORDER

VICTOR MARRERO, District Judge.

Presently before the Court are: (1) the submission in this matter from petitioner Jeannette Hausler (“Hausler”) and JP Morgan Chase Bank, N.A. (“JPM Chase”) (collectively, the “Parties”), dated September 3, 2016 (“September 3 Submission,” Dkt. No. 641), made pursuant to Section IV of the Court’s Order dated August 4, 2015 (“August 4 Order,” Dkt. 638); (2) JPM Chase’s third-party petition alleging claims in the nature of interpleader (“In-terpleader Petition,” Dkt. No. 440); and (3) Hausler’s petition for turnover (“Tranche VI Petition,” Dkt. No. 421).

I. THE AUGUST 4 ORDER1

In the August 4 Order, the Court, among other things, denied JPM Chase’s Interpleader Petition with regard to Pablo Alcazar, Mayra Bustamante, and Rene Silva, Jr. (See August 4 Order Sections 11(B)(1)(a), IV.) However, the Court reserved judgment as to whether to grant the Interpleader Petition with respect to the Fundación Benéfica Nicolas S. Acea (“Fundación”), noting that “there is now a significant question as to whether service of the Interpleader Petition was properly effectuated on the Fundación,” and that “further submissions from the Parties are warranted.” (See id. § 11(B)(1)(b).)

Furthermore, the Court determined that Hausler has a right to execute upon the blocked assets (“Blocked Assets”) that are the subject of the Tranche VI Petition.2 (See id. § 11(C)(2).) However, because the Court was persuaded that further information from the parties related to the Fundación was necessary before making a final decision as to turnover, the Court did not issue an order of turnover at that time. (See id.) Instead, the Court stated that “[a]t a later date, following the review of the submissions from the parties as described ... infra ..., should the facts still warrant an order of turnover allowing Hausler to execute upon the Blocked Assets, the Court will issue such an order.” (Id.)

[251] The Court- then ordered, among other things, that the Parties make,-within thirty days, a joint submission or separate submissions, describing: (1) affirmative measures- the parties took that were reasonably calculated to provide notice and serve a copy of the Interpleader Petition and the August 4 Order upon the Fundación; and (2) a declaration stating whether or not any legitimate entity purporting to be or represent the Fundación has come forward and asserted a good faith claim averring that the Fundación was not nationalized by the Cuban government following the Cuban Revolution, and thus still legally exists and is entitled to ownership of interest in the funds at issue in this action. (See August 4 Order, § IV.)

The Court further ordered, in relevant part:

that in the event -the [Pjarties report in their submissions that no legitimate entity responded to the notice, and service provided for above asserting a good faith claim that it is or represents the Fundación and thus has any legal interest in the outcome of this action, the Court shall, deem the Interpleader Petition DENIED as to the Fundación, and Hausler’s petition for a turnover order in respect to the funds at issue in this action GRANTED without further filings by the parties.

Id.

II. THE SEPTEMBER 3 SUBMISSION

On September 3, 2015, the Parties made a submission in accordance with the August 4 Order. In a joint letter to the Court, the Parties described the affirmative measures taken to notify any existing Fundación claimants of the Interpleader Petition and- August 4 Order. These measures comprised 1) courier delivery by Petitioner of the August 4 Order and In-terpleader Petition to the Cuban Embassy in Washington, D.C., the Cuban Consulate in New York City, and Cuba’s Ministerio de Relaciones Exteriores in Havana (Dkt. No. 641, Ex. A, B, C, D, E, F); 2) courier delivery by Respondent to ten entities and individuals, in Cuba, and the United States,3 who could conceivably have knowledge of the Fundación trustees’ whereabouts (Dkt. No. 641, Ex. G); and 3) published notice, including a copy of the Interpleader Petition and August 4 Order, in three widely circulated print .and online publications — the Wall Street Journal, the Miami Herald and El. Nuevo Herald — for three consecutive days. (Dkt. No. 641, Ex. H, I, J, K.)

The deadline for response by any Fun-dación claimants passed on September 26, 2015. Both parties attest that as of the end of business on September 28, 2015, no person or entity purporting to represent the Fundación has come forward to assert a claim to funds or to assert that the Fundación was not nationalized by the Cuban government. (Dkt. Nos. 643, 644.)

III. SERVICE OF PROCESS

Having considered the September 3 submission, the Court now finds that [252] service of the Interpleader Petition and the August 4 Order was properly effectuated upon the Fundación. At the time of the August 4 Order, service of the Inter-pleader Petition had been made upon the Fundación by means of serving Pab]o Al-cazar, who accepted service on behalf of the Fundación. (See August 4 Order § 11(1)(B).) However, this method was not sufficient to serve the Fundación because, as discussed at.length in the August 4 Order, Pablo Alcazar has no standing to represent or act on behalf of the Funda-ción in any way. (See id. § 11(C).) The Court therefore could not grant — or even consider the merits of — the Interpleader Petition with regard to the Fundación. (See id.) The submission from the Parties indicates that this defect in service has now been remedied.

As discussed in the August 4 Order, the Fundación has never-come forward to participate in this action, and its whereabouts are unknown. “The Blocked Assets have been frozen for over forty years, and the Tranche VI, Petition, which is a matter of public record, was filed in 2011.” (August 4 Order § 11(C)(1)(a).) The measures Hausler and JPM Chase took to serve notice on Fundación claimants of the In-terpleader Petition and August 4 Order satisfy the requirements of effective service where the party to be served is missing and possibly nonexistent.

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Hausler v. JP Morgan Chase Bank, N.A., 141 F. Supp. 3d 248, 2015 U.S. Dist. LEXIS 137784, 2015 WL 5853952 (S.D.N.Y. 2015).

141 F. Supp. 3d 248 (Hausler v. JP Morgan Chase Bank, N.A.) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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