Howard v. Technosystems Consolidated Corp.

536 S.E.2d 753, 244 Ga. App. 767, 2000 Fulton County D. Rep. 3039, 2000 Ga. App. LEXIS 858
CourtCourt of Appeals of Georgia
DecidedJune 30, 2000
DocketA00A0784
StatusPublished
Cited by7 cases

This text of 536 S.E.2d 753 (Howard v. Technosystems Consolidated Corp.) is published on Counsel Stack Legal Research, covering Court of Appeals of Georgia primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Howard v. Technosystems Consolidated Corp., 536 S.E.2d 753, 244 Ga. App. 767, 2000 Fulton County D. Rep. 3039, 2000 Ga. App. LEXIS 858 (Ga. Ct. App. 2000).

Opinion

Miller, Judge.

Lynnell F. Howard filed a pro se complaint alleging claims for negligence, breach of contract, fraud and deceit, and misrepresentation against Technosystems Consolidated Corporation, Intromark, Inc., and Invention Submission Corporation (“ISC”).1 To attempt to effectuate service against these nonresident corporations, Howard served the Secretary of State under OCGA § 14-2-1510 (b) and mailed the defendants copies of the , complaint and summons by “restricted delivery.” After Howard obtained an order declaring them in default, the defendants successfully petitioned to open that default. Discovery ensued, and the defendants eventually prevailed on summary judgment.

In this appeal, Howard contends that the trial court erred in opening default and by awarding summary judgment. After reviewing the record and finding no merit to either purported error, we affirm.

The underlying case arose after Howard, a self-declared “inventor,” entered into several contractual agreements with ISC. Howard claimed to be the inventor of a pen and pencil that would emit musical tones upon activation. Howard dubbed the product, “E-rasers.” After executing a submission agreement in August 1995 with ISC that obligated her to make scheduled payments in excess of $7,100, Howard fell into arrears on those payments. Seven months later, in April 1996, Howard and ISC reached a settlement in which ISC agreed to cancel the past due balance of $7,454.92 and Howard agreed not to disparage ISC in any manner.

Shortly after that settlement, Howard informed ISC that she had discovered a similar product being distributed by Pentech International (“Pentech”) and being sold at Wal-Mart stores. Howard claimed that the original idea for this musical pen “was stolen from her by ISC and divulged to PenTech.” In late September 1996, Howard began picketing outside ISC’s Atlanta office and eventually accused ISC of conspiring to kill her, firing gunshots at her, and attempting to run her over with a car.2

ISC introduced evidence to establish that Ran Artsi, the president of Mega Sound Technologies Limited (“Mega Sound”), an Israeli [768]*768company, invented the “Song Writer Musical Ballpoint Pen” at issue. Artsi testified that he created the prototype for the pen and applied for a patent in 1992, nearly four years before Howard approached ISC with her idea.

Artsi testified that Mega Sound had been formed in late 1991 to start work on a project, the musical pen. According to Artsi, the electronics, components, modules, and prototypes were created in Israel in early 1992, while the plastic molds were created in the Orient in 1993. Artsi testified that although a U. S. patent had been applied for in August 1992, that effort was later abandoned due to the expense. According to Artsi’s uncontradicted testimony, in early 1994, The Disney Store, Limited, in London contracted with Mega Sound to produce a musical pen with a sound chip for the song “A Friend Like Me” from the movie Aladdin.

Artsi’s testimony was supported by nearly 50 documents including correspondence, faxes, purchase orders, technical drawings, and invoices substantiating the existence of Mega Sound’s contract with The Disney Store to make a musical pen featuring the song, “A Friend Like Me.” This documentation includes a purchase order dated June 22, 1994, from The Disney Store for the manufacture of 10,000 of these musical pens by Mega Sound.

Artsi testified that in January 1995 he met Norman Melnick, a representative of Pentech at a trade fair in Frankfurt, Germany. After Melnick expressed interest in the Disney pen, Mega Sound started working on other projects for Pentech to distribute and sell. Artsi testified that he had never heard of Howard’s invention or seen any drawings of the E-raser before learning about her lawsuit.

Melnick confirmed that Pentech distributed the musical pen at issue to retailers including Wal-Mart. Melnick testified that the musical pen from Mega Sound was the “only musical ballpoint that Pentech ever purchased or distributed.” According to Melnick, Pentech “stopped distributing the Musical Pen in 1996 because sales for the product were poor.”

1. Howard asserts that the trial court erred in opening default. We disagree.

Under OCGA § 9-11-55 (b), a prejudgment default may be opened upon any one of three grounds provided that four conditions are met.3 The three grounds are: providential cause, excusable neglect, and proper case; the four conditions are: (1) showing made under oath, (2) offer to plead instanter, (3) announcement of ready to proceed with trial, and (4) setting up a meritorious defense.4 Opening [769]*769default is a matter resting within the sound discretion of the trial court, and the exercise of that discretion will not be disturbed absent a showing of abuse.5

Howard attempted service on these foreign corporations under OCGA § 14-2-1510 (b). This statute, however, applies only to those corporations who fail to obtain a certificate to transact business or fail to appoint a registered agent for service as required by law.6 Process mailed to a corporation must strictly comply with the statutory terms of subsection (b).7 Even assuming arguendo that Howard was entitled to utilize this statute, she failed to use it properly. Howard sent copies of the summons and complaint via priority mail, certified return receipt with the additional designation of “restricted delivery.” All six sets so mailed were returned to her marked “REFUSED.” Although corporate president Berger testified that these companies maintain their principal offices at 217 Ninth Street in Pittsburgh, Howard sent the summons and complaint by certified mail, restricted delivery, to 903 Liberty Avenue and 701 Smithfield Street.

When Howard designated that the mail be processed via “restricted delivery,” she enhanced the complexity of service and made it less likely for the addressees to receive the mail intended for them. Howard also failed to direct the mail to the appropriate address of the principal office. Because there is considerable doubt that Howard complied with the requirements of OCGA § 14-2-1510 (b), service was arguably defective.8 Defective or doubtful service makes out a proper case for opening default.9

The petition to open default complied with the statutory requirements set forth in OCGA § 9-11-55 (b). The defendants announced they were ready to proceed with trial and supported the motion with evidence. In a supporting affidavit, Berger testified that he did not learn about the lawsuit untii after default; Berger denied conspiring with Pentech or selling or appropriating Howard’s invention; and he asserted having a complete and meritorious defense to all claims. In these circumstances, the trial court did not abuse its discretion in opening default.10

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Bluebook (online)
536 S.E.2d 753, 244 Ga. App. 767, 2000 Fulton County D. Rep. 3039, 2000 Ga. App. LEXIS 858, Counsel Stack Legal Research, https://law.counselstack.com/opinion/howard-v-technosystems-consolidated-corp-gactapp-2000.