Lai v. Lu

• Court: District Court, N.D. California
• Decided: June 5, 2025
• Docket: 5:24-cv-06470
• Status: Unknown

Opinion

1 2 3 4 UNITED STATES DISTRICT COURT 5 NORTHERN DISTRICT OF CALIFORNIA 6 SAN JOSE DIVISION 7 8 XIAOYONG LAI, Case No. 24-cv-06470-VKD

9 Plaintiff, ORDER RE DEFENDANT MENGJING 10 v. LU’S MOTION TO QUASH SERVICE

11 MENG JING LU, et al., Re: Dkt. No. 23 Defendants. 12

13 14 Attorney Xiaoyong Lai, who is representing himself, filed this action against a client, 15 Mengjing Lu,1 and her niece, Lu Zhang, to recover $422,463 in fees and costs Mr. Lai claims he is 16 owed for legal services rendered. Mr. Lai alleges that Ms. Lu failed to pay the fees and costs at 17 issue and fraudulently transferred assets, including to Ms. Zhang. The complaint invokes federal 18 diversity jurisdiction, 28 U.S.C. § 1332, and asserts claims for breach of contract and common 19 counts against Ms. Lu, as well as claims for fraudulent transfer and conspiracy against both 20 defendants. Dkt. No. 1. In her answer and counterclaims, Ms. Lu does not dispute that she had 21 agreements with Mr. Lai for the provision of legal services. However, she disagrees that all work 22 performed by Mr. Lai was within the scope of the parties’ agreements, which she maintains were 23 one-sided and oppressive. She further contends that Mr. Lai’s billed time is excessive. The 24 upshot, according to Ms. Lu, is that Mr. Lai owes her more than $175,000. See Dkt. No. 37. 25 After obtaining an extension of time to complete service of process (Dkt. No. 10), Mr. Lai 26

27 1 The complaint indicates that Ms. Lu is also known as “Meng Jing Lu.” The Court refers to Ms. 1 filed two documents indicating that Ms. Lu and Ms. Zhang were each served via certified mail, 2 with a return receipt requested, on January 22, 2025 at an address in Las Vegas, Nevada. See Dkt. 3 Nos. 13, 14. The two postal return receipts bear a signature “Lu Zhang” next to a checked box 4 labeled “Agent.” See id. According to Mr. Lai, Ms. Zhang’s response to the complaint was due 5 by February 24, 2025. When Ms. Zhang did not appear or respond to the complaint, Mr. Lai 6 asked the Clerk of Court to enter her default. Dkt. No. 19.2 7 Meanwhile, Ms. Lu, who is representing herself, does not dispute that she has been served 8 with process. She has appeared and filed a number of motions with the Court. Among them is the 9 present “Motion to Quash Service,”3 in which Ms. Lu says that she (not Ms. Zhang) signed the 10 postal receipts, reportedly without realizing that the mail contained legal documents, including the 11 complaint and summons. While Ms. Lu notes that Ms. Zhang has “authorized [her] to sign non- 12 legal documents on her behalf,” Ms. Lu says that she does not have authority to accept service of 13 process for Ms. Zhang. See Dkt. No. 23 at ECF 2; Dkt. No. 23-1 ¶ 4; Dkt. No. 30. Ms. Lu avers 14 that when she realized her mistake in signing the postal receipt for Ms. Zhang, she went to the post 15 office and had the mail returned to the sender/process server. See Dkt. No. 23-1 ¶ 5; see also Dkt. 16 No. 23-2. 17 Mr. Lai opposes the motion to quash. Dkt. No. 26. He argues that Ms. Zhang properly 18 was served under California statutes that allow for service on persons outside the state “by first- 19 class mail, postage prepaid, requiring a return receipt.” See Cal. C.C.P. §§ 415.40, 417.20. 20 Noting that Ms. Lu’s motion to quash was filed well after the deadline for Ms. Zhang’s response 21 to the complaint, Mr. Lai argues that Ms. Lu’s motion to quash is also untimely and that Ms. Lu 22 has no authority, in any event, to seek relief from the Court on Ms. Zhang’s behalf. Dkt. No. 26. 23 Ms. Lu indicates that her sole purpose in filing the motion to quash is to bring to the 24 Court’s attention what she says was her mistake in signing the postal receipt for Ms. Zhang. See 25

26 2 Mr. Lai’s request for entry of default remains pending.

27 3 Ms. Lu’s motion to quash is deemed suitable for determination without oral argument. Civil 1 Dkt. No. 30 at 2. Insofar as Ms. Lu acknowledges that she cannot represent Ms. Zhang in this 2 action or seek relief on her behalf (see id.), the Court declines to grant the motion to quash. 3 At the same time, however, to the extent Mr. Lai seeks an order finding that Ms. Zhang 4 properly has been served with process, the Court is unable to so conclude on the record presented. 5 For individuals within a judicial district of the United States, Rule 4 of the Federal Rules of Civil 6 Procedure allows for service by “following state law for serving a summons in an action brought 7 in courts of general jurisdiction in the state where the district court is located or where service is 8 made.” See Fed. R. Civ. P. 4(e)(1). As noted above, California law allows for service on persons 9 outside the state “by first-class mail, postage prepaid, requiring a return receipt.” Cal. C.C.P. 10 § 415.40. Such service is valid only if it “include[s] evidence satisfactory to the court establishing 11 actual delivery to the person to be served, by a signed receipt or other evidence.” Cal. C.C.P. § 12 417.20. 13 As a general legal principle, the Court is not persuaded by Ms. Lu’s argument that her 14 authority to accept mail on Ms. Zhang’s behalf necessarily excludes accepting service of legal 15 process here. See Dkt. No. 30 at 3. Where a defendant has designated another to receive mail on 16 her behalf, receipt of that mail by the person authorized constitutes actual delivery to the 17 defendant. Neadeau v. Foster, 129 Cal. App. 3d 234, 238 (1982). Mr. Lai maintains that a postal 18 receipt is not a legal document, and that if Ms. Lu is authorized to accept mail for Ms. Zhang, she 19 did in fact accept certified mail on Ms. Zhang’s behalf, and thus Ms. Zhang was properly served. 20 However, complicating the analysis in this particular case are Ms. Lu’s assertions— 21 unrefuted and not addressed by Mr. Lai—that Ms. Zhang does not live in the United States, was 22 not living in the United States at the time service purportedly was made by certified mail, and has 23 no notice of this lawsuit. See Dkt. No. 23 at 2; Dkt. No. 30 at 2. Elsewhere in the docket are 24 documents suggesting that Ms. Zhang is a Chinese citizen residing in China (see Dkt. No. 24-1 at 25 ECF 1; Dkt. No. 27 at ECF 3)—an assertion that Mr. Lai appears willing to accept for purposes of 26 Ms. Lu’s separately filed motion to transfer venue, and which he, in any event, does not address at 27 all in opposing Ms. Lu’s motion to quash service. The record presented thus raises several 1 which are expressly subject to the Hague Convention, see Cal. C.C.P. § 413.10(c); whether the 2 || Hague Convention applies under the particular circumstances presented here; and whether service 3 on Ms. Zhang is required to be made pursuant to Rule 4(f), which governs service of process on 4 || individuals in a foreign country and authorizes service by several methods, including “by any 5 internationally agreed means of service that is reasonably calculated to give notice,” or “as 6 || prescribed by the foreign country’s law for service in that country,” or “by other means not 7 || prohibited by international agreement, as the court orders.” Fed. R. Civ. P. 4(f). 8 Accordingly, the record presented does not provide sufficient basis to grant the motion to 9 quash service or to determine that Ms. Zhang has been served. In these circumstances, the Court 10 || denies Ms. Lu’s motion to quash service, without prejudice to a later determination regarding the 11 propriety of service on Ms. Zhang. This order terminates Dkt. No. 23. 12 IT IS SO ORDERED. 13 Dated: June 5, 2025

gz Virginia K. DeMarchi = 16 United States Magistrate Judge = 17 18 19 20 21 22 23 24 25 26 27 28