Radiation Technology, Inc. v. Southern Rad, Inc.

68 F.R.D. 296, 1975 U.S. Dist. LEXIS 16313
CourtDistrict Court, N.D. Georgia
DecidedSeptember 5, 1975
DocketNo. C75-213A
StatusPublished
Cited by6 cases

This text of 68 F.R.D. 296 (Radiation Technology, Inc. v. Southern Rad, Inc.) is published on Counsel Stack Legal Research, covering District Court, N.D. Georgia primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Radiation Technology, Inc. v. Southern Rad, Inc., 68 F.R.D. 296, 1975 U.S. Dist. LEXIS 16313 (N.D. Ga. 1975).

Opinion

ORDER

MOYE, District Judge.

This case presents a collateral jurisdictional attack by defendants William and Rodney Price and W. Lewis Spear-man on a default judgment entered against them by the United States District Court for the District of New Jersey and subsequently registered in this Court by plaintiff under 28 U.S.C. § 1963.

The facts are as follows:

On August 3, 1975, after a course of dealing, defendant Southern Rad, Inc., a Georgia corporation, signed an exclusive distributorship contract with plaintiff Radiation Technology, Inc. [RTI], a New Jersey Corporation. Under the contract, Southern Rad obtained the exclusive right to distribute RTI’s polymer chemical products in the Southeastern United States. The contract provided in paragraph 11 for a minimum purchase by Southern Rad of products worth $100,000 during the first year. The contract contained the following notice, choice-of-law and jurisdiction provisions :

“(18) (b) Any notice required to be given by either party to the other under or in connection with this Agreement shall be in writing and delivered personally or by mail. Notices to Distributor [Southern Rad] shall be directed to Distributor or its representative at Distributor’s place of business; notices to RTI shall be directed to its representatives at RTFs place of business.
“(c) This Agreement is to be governed by and construed according to the laws of the State of New Jersey. The parties hereto expressly consent to and confer jurisdiction on the Courts of the State of New Jersey should any dispute arise pursuant to this Agreement.”

In connection with the contract, the six named individual defendants executed the following guarantee:

“The undersigned personally and in their individual capacities hereby guarantee the foregoing obligations of Southern Rad, Inc., to Radiation Technology, Inc., to purchase Products of Radiation Technology, Inc., in the sum of $100,000.00 invoice price within twelve (12) months from the date hereof.
“This 3d day of August, 1973. [signed] W. L. Spearman Rodney B. Price William R. Price Max K. Berry George Mclngvale Don DeLoach”

RTI sued Southern Rad and the six guarantors, supra,, of the distributorship agreement in the United States District Court for the District of New Jersey on October 18, 1973. The complaint recited four causes of action: (l)-(3) breach [298]*298of contract and book accounts, and (4) dishonored checks (due to insufficient funds) in the amount of $36,000 given in payment to RTI by Southern Rad. The complaint sought damages totaling $300,000.

Service was purportedly effected on Southern Rad, W. L. Spearman, Rodney Price and William Price, nonresident defendants, in Georgia, by registered or certified mail pursuant to N.J.R.R. 4:4-4(e) (New Jersey Rules of Court), effective in the United States District Court by Fed.R.Civ.P. 4(d), (e) and (f). The Marshal’s Return of Service shows that movant defendants R. Price, W. Price and W. L. Spearman were served on October 25, 1973, as evidenced by Certified Mail Numbers 383660, 383658 and 383661, respectively.

The defendants, through • Mr. Spear-man, attempted to file a motion to dismiss in the New Jersey court on November 30, 1973, alleging lack of jurisdiction, insufficiency of service of process, improper venue and failure to state a claim. However, the motion was never filed due to the failure of the corporate and individual defendants to proceed through New Jersey counsel.

RTI’s counsel in New Jersey, Mr. Stephen B. Judlowe, informed the defendants by letter dated December 14, 1973, that the Clerk of Court had informed him that, absent New Jersey counsel, the motion would not be filed. Mr. Judlowe continued:

“Please be advised that unless an Answer is received and filed within ten days from the date of this letter, or a proper Rule 12 motion made, plaintiff will move for a default judgment against all defendants.”

The New Jersey District Court subsequently entered a default judgment against the defendants on January 29, 1974. The default judgment recited the following:

“The summons and complaint in the above-entitled action having been duly served on the defendants Southern Rad, Inc., Max K. Berry, George Mc-Ingvale, William Price, Rodney Price and W. Lewis Spearman and the defendants having been defaulted for failure to appear in the action, and the plaintiff having filed an affidavit of the amount due,
“It is, on this 29th day of January, 1974,
“ORDERED that judgment be entered in favor of the plaintiff Radiation Technology, Inc., and against the defendants Southern Rad, Inc., Max K. Berry, George Mclngvale, William Price, Rodney Price and W. Lewis Spearman for $150,744.25.”

On February 5, 1975, pursuant to 28 U.S.C. § 1963, the plaintiff RTI registered the New Jersey judgment with the Clerk of this Court.

On May 19, 1975, three defendants in the New Jersey case, William Price, Rodney Price and W. Lewis Spearman filed the instant motion in this Court seeking (a) a declaratory judgment declaring that the default judgment registered in this Court from the New Jersey court is void as to these three defendants for lack of in personam jurisdiction within the State of New Jersey, and (b) a temporary and permanent injunction against the plaintiff’s enforcement of the judgment.

The motion, supported by affidavits from the three movants, recites the following :

“Movants do not reside and have not resided at any time material hereto within the State of New Jersey; have not entered into or been in the State of New Jersey; have not accepted service of process within the State of New Jersey; have not agreed to jurisdiction of the courts in New Jersey over their person; have not appeared in the case in which judgment therein was sought. Additionally, movants have not been served in any lawful manner to subject them to the [299]*299jurisdiction of the courts within the District of New Jersey, and the jurisdiction of such courts over the person of the movants in connection with such case has not been adjudicated.”

The plaintiff counters, stating that the New Jersey court had jurisdiction over these defendants under its long-arm jurisdiction and that proper and legal service was effected by mail under New Jersey law.

Neither side has briefed the question of the scope of this Count’s jurisdiction to challenge a “foreign” federal court default judgment registered in this Court pursuant to 28 U.S.C. § 1963. The Court first addresses itself to that issue.

Title 28 U.S.C. § 1963 provides as follows:

“§ 1963. Registration in other districts

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Bluebook (online)
68 F.R.D. 296, 1975 U.S. Dist. LEXIS 16313, Counsel Stack Legal Research, https://law.counselstack.com/opinion/radiation-technology-inc-v-southern-rad-inc-gand-1975.