Opinion
01 Civ. 1941 (CSH) (JCF)
June 26, 2002
REPORT AND RECOMMENDATION
This is an action for breach of contract and copyright infringement in connection with the licensing of certain musical compositions. The plaintiffs, BMG Music Publishing Ltd. and BMG Songs, Inc. (collectively "BMG"), allege that they sublicensed their rights in the compositions to the defendants, Croma Music Co. and its president, Patricia S. Rankin, but that the defendants then failed to remit royalties as required and continued to exploit the compositions after the license was terminated.
When the defendants failed to answer or move with respect to the complaint, the Honorable Charles S. Haight, U.S.D.J. entered a default judgment and referred the action to me for an inquest on damages. Before any inquest was held, however, Ms. Rankin sent a letter dated September 26, 2001, to Judge Haight asserting that she had never been served with the summons and complaint and asking that the judgment be set aside. Judge Haight construed this letter as a notice of motion pursuant to Rule 60(b)(4) of the Federal Rules of Civil Procedure for relief from the judgment on the ground that the judgment is void, and he referred this motion to me for a Report and Recommendation. (Order dated October 4, 2001, at 2-3).
When efforts to reach an amicable settlement failed, a hearing on the adequacy of service was held on April 26, 2002. By this time, Ms. Rankin, who had been proceeding pro se, was represented by counsel. On the basis of the evidence presented at that hearing, I recommend that the defendants' motion be denied.
Background
At the hearing, BMG's process server, Joseph Hackett, described the steps he took to serve the summons and complaint. He first arrived at the lobby of Ms. Rankin's building, 80 Central Park West in Manhattan, at about 1:15 p.m. on March 9, 2001. (Tr. 8-10, Pl. Exh. 1). He asked to speak to her, and the doorman telephoned her apartment. (Tr. 10-11). When the doorman reported that there was no answer, Mr. Hackett left. (Tr. 11).
"Tr." refers to the transcript of the evidentiary hearing.
After serving papers elsewhere, Mr. Hackett returned to Ms. Rankin's apartment building at about 3:40 p.m. and told the doorman he was going up to her apartment. (Tr. 11-12, 21). The doorman said that was not allowed, and he again tried unsuccessfully to call Ms. Rankin. Mr. Hackett then served the summons and complaint on the doorman, who accepted them. (Tr. 12, 21). Mr. Hackett described the doorman as a white male, thirty to thirty-five years old, clean shaven, and wearing a uniform. (Tr. 12). Mr. Hackett also described the lobby area as including glass automatic double doors, a marble or linoleum composite floor, a beige chair, and a doorman's desk. (Tr. 14).
On March 14, 2002, Mr. Hackett mailed a copy of the summons and complaint to Ms. Rankin. (Tr. 15; Pl. Exh. 1). His firm's policy is to mail such documents in an envelope labeled "personal and confidential" and containing no identification other than the firm's return address. (Tr. 6). The mail sent to Ms. Rankin was never returned as undeliverable. (Tr. 6-7).
Ms. Rankin testified that on March 9, 2001 she was at home in her apartment all day, except for approximately twenty minutes when she chatted with a friend in the lobby. (Tr. 23-25). When this friend arrived at about 1:15 p.m., the doorman telephoned Ms. Rankin, who came downstairs to meet her. (Tr. 25). In support of her testimony Ms. Rankin proffered a telephone log produced by her answering machine. It shows a call at 1:17 p.m., which Ms. Rankin contends was the call from the doorman about her visitor. (Tr. 30-31; Def. Exh. A). There is no indication of any call at approximately 3:40 p.m. when Mr. Hackett reportedly returned to the building to effect service. (Tr. 30; Def. Exh. A).
Discussion
A. Legal Framework
Because there has as yet been no determination of damages in this case, Ms. Rankin's application is more properly viewed as a motion to set aside entry of a default pursuant to Rule 55(c) rather than a motion for relief from a default judgment under Rule 60(b). This is because "a default judgment cannot be entered until the amount of damages is ascertained," Enron Oil Corp. v. Diakuhara, 10 F.3d 90, 97 (2d Cir. 1993), and "Rule 55(c) applies when only a default has been entered, whereas Rule 60(b) applies when a default judgment has been entered." Barnes v. Printron, Inc., No. 93 Civ. 5085, 1999 WL 335362, at *1 (S.D.N.Y. May 25, 1999) (citation omitted). However, this distinction does not affect the analysis here. Just as a judgment obtained without proper service of the summons and complaint is void, Howard Johnson International, Inc. v. Wang, 7 F. Supp.2d 336, 339 (S.D.N.Y. 1998), so a default entered under similar circumstances should be vacated. See Marcantonio v. Primorsk Shipping Corp., F. Supp.2d 2002 WL 1286056, at *6 (D.Mass. Feb. 19, 2002); Barnes, 1999 WL 335362, at *2.
Service of the summons and complaint in an action in federal district court is governed by Rule 4, which provides that service may be effected:
(1) pursuant to the law of the state in which the district court is located, or in which service is effected, for the service of a summons upon the defendant in an action brought in the courts of general jurisdiction of the State.
Fed.R.Civ.P. 4(e). New York law, in turn, allows service:
1. by delivering the summons within the state to the person to be served; or
2. by delivering the summons within the state to a person of suitable age and discretion at the actual place of business, dwelling place or other usual place of abode of the person to be served and by either mailing the summons to the person to be served at his or her last known residence or by mailing the summons by first class mail to the person to be served at his or her actual place of business in an envelope bearing the legend "personal and confidential" and not indicating on the outside thereof, by return address or otherwise, that the communication is from an attorney or concerns an action against the person to be served, such delivery and mailing to be effected within twenty days of each other.
N.Y. C.P.L.R. ("CPLR") § 308.
In this case, if Mr. Hackett's testimony is credited, then service was properly made. There is no dispute that Ms. Rankin resided at 80 Central Park West. Because the doorman refused Mr. Hackett access to Ms. Rankin's apartment, the lobby of the building constituted the "outer bounds" of her dwelling place. See F.I. duPont, Glore Forgan Co. v. Chen, 41 N.Y.2d 794, 797-98, 396 N.Y.S.2d 343, 346 (1977); Vincent C. Alexander, Practice Commentary C308:3, 7B McKinney's Consolidated Laws of New York 20, 22 (2001) ("Alexander"). Furthermore, the doorman was a person of suitable age and discretion, capable of accepting service. See duPont, 41 N.Y.2d at 796-97, 396 N.Y.S.2d at 345-46; Alexander at 22. Thus, service on the doorman satisfied the delivery prong of New York's "deliver and mail" procedure under CPLR § 308(2). When the summons and complaint were mailed to Ms. Rankin, this fulfilled the remaining requirement of New York law and thus of Rule 4(e)(1) as well. Whether Mr. Hackett in fact performed the acts he testified to is the focal point of the dispute.
B. Analysis of the Evidence
Mr. Hackett's testimony was entirely credible. He described in detail the premises where he made service and the doorman to whom he delivered the documents. He recorded the steps he took to locate and serve Ms. Rankin. He not only served the doorman, but also mailed a copy of the summons and complaint to the defendant.
There is a discrepancy between Mr. Hackett's testimony that he first attempted service at 1:15 p.m. and an earlier affidavit in which he indicated that this took place about about 12:00 noon. (Affidavit of Joseph Hackett dated Oct. 26, 2001, ¶ 6, attached as Exh. 2 to Affirmation of Ronald L. Israel dated Nov. 9, 2001). This deviation is insignificant, however, and Mr. Hackett's hearing testimony is corroborated by the records he made on the day he effected service. (Pl. Exh. 1).
By contrast, Mr. Rankin's testimony strains credulity. She failed to explain how she could remember the unexceptional activities she engaged in on a day that was more than a year before the evidentiary hearing. Moreover, the exhibit she proffered — the record of incoming calls — does not support her story. First, it fails to show that the doorman did not call her apartment at Mr. Hackett's request because, as Ms. Rankin acknowledged, when the doorman calls her apartment on the intercom rather than by telephone, this is not reflected on her answering machine log. (Tr. 32-34). Second, the call that Ms. Rankin says she received from the doorman announcing the arrival of her friend was in fact a call that was picked up by the answering machine. (Tr. 37-38; Def. Exh. A).
It is conceivable that Ms. Rankin answered the call even though it was identified as having been picked up by the answering machine: she could have screened the call, picking it up after the machine was triggered. (Tr. 37).
In any event, even if Mr. Hackett had failed to ask the doorman to call Ms. Rankin, it would not be legally dispositive; there is no requirement that an attempt be made to hand process to a defendant before service can be made on a person of suitable age and discretion at the defendant's dwelling. See Alexander at 20 (delivery and mail is "immediate alternative" to personal delivery under CPLR § 308).
Finally, there is every reason to believe that the summons and complaint were mailed to Ms. Rankin as well and that she ignored them. Mr. Hackett's firm tracks undelivered mail, and these documents were not returned. Moreover, Ms. Rankin acknowledged that she was not on top of her affairs during this time and that essential mail was accumulating unopened. (Tr. 49-50). She admitted that this could have included the summons and complaint here. (Tr. 50).
Conclusion
For the reasons set forth above, I find that service was properly made on Ms. Rankin. Accordingly, I recommend that her motion for relief from the default judgment, alternatively considered as a motion to set aside the default, be denied. Pursuant to Rule 72 of the Federal Rules of Civil Procedure, the parties shall have ten (10) days from this date to file written objections to this Report and Recommendation. Such objections shall be filed with the Clerk of the Court, with extra copies delivered to the chambers of the Honorable Charles S. Haight, Room 1940, and to the undersigned, Room 1960, 500 Pearl Street, New York, New York 10007.