Millennium Franchise Group, LLC v. Bank of America, N.A.

• Court: District Court, N.D. California
• Decided: February 28, 2023
• Docket: 3:21-cv-08684
• Status: Unknown

Opinion

1 2 3 4 5 IN THE UNITED STATES DISTRICT COURT 6 FOR THE NORTHERN DISTRICT OF CALIFORNIA 7 8 MILLENNIUM FRANCHISE GROUP, Case No. 21-cv-08684-CRB LLC, 9

Plaintiff, ORDER DENYING PLAINTIFF’S 10 MOTION FOR SERVICE BY v. PUBLICATION 11 ARIC K. PERMINTER, et al., 12 Defendants. 13 Plaintiff Millennium Franchise Group (“Millennium”) brings various causes of 14 action against Defendants Aric K. Perminter (“Aric K.”), Aric D. Perminter (“Aric D.”), 15 and Lynx Technologies Partners (“Lynx”) (collectively, “Defendants”) stemming from 16 alleged embezzlement. First Am. Compl. (“FAC”) (dkt. 11). 17 Plaintiff now moves to serve Aric D. by publication. Mot. (dkt. 41). Defendants do 18 not respond. As explained below, finding this matter suitable for resolution without oral 19 argument pursuant to Civil Local Rule 7-1(b), the Court DENIES Plaintiff’s motion. 20 I. BACKGROUND 21 Plaintiff Millennium is an active limited liability company that conducts business in 22 the State of California. FAC ¶ 1. Defendant Lynx is a limited liability company in the 23 State of New York. Id. ¶ 2. Defendant Aric K. is a resident of the State of Pennsylvania 24 and is the chairman of the board, founder, and advisor of Lynx. Id. ¶ 3. Defendant Aric D. 25 is a resident of the State of Pennsylvania and was an employee of Lynx. Id. ¶ 4. 26 Millennium alleges that, while conducting business with Lynx, Aric D. and Aric K. stole 27 $87,657.65. Id. ¶ 11–16. 1 Millennium filed an amended complaint, alleging that Defendants embezzled funds 2 and bringing causes of action for concealment, conversion, breach of contract, unjust 3 enrichment, breach of fiduciary duty, constructive fraud, and negligence. FAC ¶¶ 24–66. 4 While Plaintiff served Aric K. and Lynx, it has been unable to serve Aric D. since 5 filing the complaint. In March and April 2022, two service processers attempted service at 6 Lynx’s business address. Hubins Decl. (dkt 42) ¶ 5–6. In July 2022, a third unsuccessful 7 attempt was made at a Pittsburgh address found by the process server, where management 8 told the server that Aric D. was a former tenant. Id. ¶ 8. Finally, Plaintiff’s counsel states 9 that “Westlaw public records and a general Google search” did not yield a different 10 address. Id. ¶ 11. 11 Plaintiff moves to serve Aric D. by publication. Mot. Plaintiff states that because it 12 made three unsuccessful attempts to serve Aric D., service cannot be made personally 13 upon him. Id. 14 II. LEGAL STANDARD 15 Federal Rule of Civil Procedure 4(e)(1) states that service may be made “following 16 state law for serving a summons in an action brought in courts of general jurisdiction in the 17 state where the district court is located or where service is made.” Fed. R. Civ. P. 4(e)(1). 18 Service by publication is permissible under California law where “it appears to the 19 satisfaction of the court in which the action is pending that the party to be served cannot 20 with reasonable diligence be served in another manner specified in this article” and “[a] 21 cause of action exists against the party upon whom service is to be made or he or she is a 22 necessary or proper party to the action.” Cal. Code Civ. Proc. § 415.50(a). 23 III. DISCUSSION 24 The Court denies Millennium’s motion to serve Aric D. by publication, without 25 prejudice to a future motion, provided that Millennium makes further efforts to serve Aric 26 D., as suggested herein. 27 Service by publication is permissible under California law where: (1) “the party to 1 cause of action exists against the party.” Cal. Code Civ. Proc. § 415.50(a). In the FAC, 2 Millennium states a cause of action against Aric D. for embezzlement. See FAC. The 3 question for the Court, therefore, is whether Aric D. “cannot with reasonable diligence be 4 served in another manner” pursuant to California law. See Cal. Code Civ. Proc. 5 § 415.50(a). 6 To determine whether a plaintiff has exercised “reasonable diligence,” a court must 7 examine the affidavit required by the statute to see whether the plaintiff “took those steps 8 which a reasonable person who truly desired to give notice would have taken under the 9 circumstances.” Donel, Inc. v. Badalian, 87 Cal. App. 3d 327, 333 (1978); see also Watts 10 v. Crawford, 10 Cal. 4th 743, 749 n.5 (1995) (“The term ‘reasonable diligence’ . . . denotes 11 a thorough, systematic investigation and inquiry conducted in good faith by the party or his 12 agent or attorney.”). Because of due process concerns, service by publication is allowed 13 “only as a last resort.” Id. Therefore, “[b]efore allowing a plaintiff to resort to service by 14 publication, the courts necessarily require him to show exhaustive attempts to locate the 15 defendant, for it is generally recognized that service by publication rarely results in actual 16 notice.” Espindola v. Nunez, 199 Cal. App. 3d 1389, 1392–93 (1988). The fact that a 17 plaintiff has taken one or a few reasonable steps does not necessarily mean that “all myriad 18 . . . avenues” have been properly exhausted to warrant service by publication. Donel, 87 19 Cal. App. 3d at 333. 20 Here, Millennium fails to demonstrate that it “took those steps which a reasonable 21 person who truly desired to give notice would have taken under the circumstances.” See 22 id. Although Millennium attempted personal service more than once through a process 23 server and conducted an Internet search, it did not pursue other avenues, e.g., contacting 24 Aric D.’s relatives or search city and telephone directories for his name. See Watts, 10 25 Cal. 4th at 749 n.5 (noting that “likely sources of information” that “must be searched 26 before resorting to service by publication” include inquiry of relatives, city and telephone 27 directories, voter registries, and so forth). Moreover, Millennium has not demonstrated 1 || [Chapter 4, Article 3 of the California Code of Civil Procedure].” Cal. Code Civ. Proc. § 2 |} 415.50(a). For example, service by mail at the Pittsburgh address could have resulted in 3 || the summons being forwarded to Aric D.’s current address, or Millennium could have 4 || obtained the forwarding address. Because “it is generally recognized that service by 5 || publication rarely results in actual notice,” Millennium has not demonstrated that service 6 || by publication is the last available option. See Espindola, 199 Cal. App. 3d at 1393. 7 Accordingly, because Millennium has not exhausted “all myriad . . . avenues” to 8 || warrant this “last resort’ method of service, the Court denies the motion for service by 9 || publication. See Donel, 87 Cal. App. 3d at 333. 10 || Iv. CONCLUSION 11 For the foregoing reasons, the Court DENIES Plaintiff's motion for service by 12 || publication. The Court’s denial is without prejudice to a future motion, provided that € 13 |} Millenntum makes further efforts to serve Aric D., as suggested herein. 14 IT ISSO ORDERED. Dated: February 28, 2023 oe a> CHARLES R. BREYER 16 United States District Judge

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