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allowing service via two e-mail addresses and Whatsapp message after service by mail failed and contact was established with the defendant's corporate officer
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20 Civ. 7937
2021-03-12
CKR LAW LLP f/k/a Crone Kline Rinde, LLP., Petitioner, v. ANDERSON INVESTMENTS INTERNATIONAL, LLC, Paramount Services LLC a/k/a Paramount Services Ltd., Intech Holdings (HK) Limited a/k/a Intech International Group Co. Limited a/k/a Intech Holdings Inc., White Rock Electronic Trading LLC, BMR Consulting, Edmund White a/k/a Ravi Rach, Gulzhan Na mazbaeva, and Satyabrato Chakravarty, Respondents.
Michael James Maloney, Felicello Law P.C., New York, NY, for Petitioner.
Michael James Maloney, Felicello Law P.C., New York, NY, for Petitioner.
MEMORANDUM ORDER
JED S. RAKOFF, U.S.D.J.
Now before the Court is the renewed motion of Petitioner CKR Law LLP f/k/a Crone Kline Rinde, LLP for an order granting petitioner (1) leave pursuant to Fed. R. Civ. P. 4(f)(3) and 4(h)(2) to serve process by "alternative means" on respondents Anderson Investments International, LLC ("Anderson"); White Rock Electronic Trading LLC ("White Rock"); Paramount Services LLC a/k/a Paramount Services Ltd. ("Paramount"); BMR Consulting ("BMR"); Intech Holdings (HK) Limited a/k/a Intech International Group Co. Limited a/k/a Intech Holdings Inc. ("Intech"); Ravi Rach a/k/a Edmund White ("Rach"); and Satyabrato Chakravarty ("Chakravarty") and (2) leave pursuant to Fed. R. Civ. P. 4(m) to file at a later time a further renewed motion to serve process by other means on respondent Gulzhan Namazbaeva ("Namazbaeva"). For the reasons set forth below, the motion is granted.
Background
Familiarity with the general background and procedural history to this case is here assumed. See generally Memorandum Order dated November 10, 2020 ("Memorandum Order"), Dkt. No. 31. Petitioner is a law firm that served as an escrow agent in a series of financial transactions involving respondents. Petition to Compel Arbitration ("Pet."), Dkt. No. 1, ¶ 1. After other parties to the financial transactions alleged that the respondents engaged in fraud and other wrongful conduct in connection with the transactions, petitioner filed this action on September 25, 2020 to compel the respondents to arbitrate in New York all disputes related to the transactions. Id.
In a sworn declaration, Jeffery A. Rinde, petitioner's managing partner, asserts the following. Respondent Rach is an officer or principal of Anderson, Paramount, BMR, and White Rock; respondent Namazbaeva is a director of Anderson and Paramount; and respondent Chakravarty is an officer of Intech. Declaration of Jeffery A. Rinde in Support of Motion Pursuant to Fed. R. Civ. Proc. 4(f)(3) and 4(h)(2) ("Rinde Decl."), Dkt. No. 27, ¶¶ 13, 42. Rinde "understand[s]" that Rach and Chakravarty are both residents of Dubai, where they share and manage the above-mentioned entities from a shared office. Id. ¶¶ 35, 36, 40. In addition, Rinde believes that Namazbaeva is a resident of the United Kingdom. Id. ¶ 43. To determine Namazbaeva's residency, petitioner's counsel searched the United Kingdom Companies House website and found someone with her name who was listed as the sole shareholder, officer, and director of a company called Five Stars Design, Ltd. ("Five Stars"). See Declaration of Michael James Maloney in Support of Motion Pursuant to Fed. R. Civ. Proc. 4(f)(3) and 4(h)(2) ("Maloney Decl."), Dkt. No. 29, ¶¶ 23-25.
As for the corporate respondents, Rach represented to Rinde that respondents Anderson and Paramount are Nevis limited liability companies. Rinde Decl. ¶¶ 16, 17. In addition, certain documents executed by Anderson in connection with these disputed transactions state that its "principal business address" is "Main Street, PO Box 556, Charlestown, Nevis." Id. ¶ 17; Dkt. No. 27-3. As for respondents White Rock and BMR, Rinde points to the website "rachgroupofcompanies.com," which lists the two companies as members of an association of companies referred to as the "Rach Group of Companies." Rinde Decl. ¶ 24. The website provides a physical address in Dubai, an email address, and a telephone number. Id. Finally, Rinde asserts that Intech is a Hong Kong Corporation. Id. ¶ 33.
Between September 28 and October 1, 2020, the Clerk issued Summonses to respondents. See Maloney Decl. ¶¶ 5, 7; Dkt. Nos. 11-16. On October 1, 2020, Rinde received a series of messages on the WhatsApp messaging platform from someone named "Edmund White," which Rinde submits is Rach's pseudonym. Rinde Decl. ¶¶ 2, 50. In these messages, "White" asks why he is being sued. Dkt. No. 27-10.
The next day, petitioner's counsel attempted to effectuate service of process on each of the respondents. To serve Intech and Chakravaty, petitioner's counsel sent by FedEx copies of the Summonses, the Petition, the Notice of Court Conference, the Court's Individual Rules, and two copies of Requests for Waiver of Service of the Summons (the "Papers") to the address registered with the Hong Kong Companies Registrar and by email to the last known email addresses of Chakravaty: "intechholdingshk@gmail.com" and "s.chakravarty@intech-international.in." Dkt. No. 24; Maloney Decl. ¶¶ 17-20. However, petitioner's counsel received an electronic notice that his message to "s.chakravarty@intech-international.in" was unable to be delivered. Maloney Decl. ¶ 21.
To serve Anderson and Paramount, petitioner's counsel sent copies of the Papers by registered mail to their principal business address in Nevis and by FedEx International Priority Service to Rach's office address in Dubai. Id. ¶¶ 10, 11; Dkt. Nos. 29-1, 29-2. And to serve White Rock, BMR, and Rach, petitioner's counsel sent copies of the Papers to Rach's office address in Dubai and by email to the email address listed on the Rach Group website and also to dw@aiitld.com, which are alleged to be Rach's last known email addresses. Maloney Decl. ¶¶ 14-15; Dkt. Nos. 29-3, 29-4, 29-5. However, petitioner's counsel was thereafter notified by FedEx staff that they were unable to deliver the Papers to Rach's office address in Dubai. Maloney Decl. ¶ 29. After they were provided with the email and telephone number found on the Rach Group website, the delivery persons advised petitioner's counsel that they had spoken with Rach, who claimed that all of the corporate respondents were closed. Id. ¶ 30.
To serve Namazbaeva, petitioner's counsel sent copies of the Papers by FedEx to the registered address for Five Stars. Id. ¶ 26. Petitioner's counsel submits that service was completed successfully. Id. ¶ 27; Dkt. No. 29-10.
On October 14, 2020, the Court held an initial pretrial conference. No one appeared for any of the respondents. At that conference, petitioner was granted leave to file a motion for an order permitting alternative means of service on respondents. Petitioner filed such a motion on October 19, 2020. On November 10, 2020, the Court denied that motion without prejudice. The Court held that petitioner failed to provide sufficient information regarding why alternative service was necessary in this case. Memorandum Order at 7. The Court also found that it lacked a sufficient basis to confirm that the Namazbaeva that is named as a respondent in this action is the same person registered as a director of Five Stars. Id. at 7 n.1. But the Court granted Petitioner leave to renew its motion. Id. at 7. On January 28, 2021, petitioner renewed the motion. Notice of Renewed Motion Pursuant to Fed. R. Civ. Proc. 4(f)(3) and 4(h)(2) ("Renewed Motion"), Dkt. No. 32.
Legal Standard
The Federal Rules of Civil Procedure permit service on individuals outside the United States through three methods. The first is "any internationally agreed means of service," such as the Hague Convention. Fed. R. Civ. P. 4(f)(1). The second method of service is, where permitted by international agreement, to follow the foreign country's law or the directions of a foreign authority; or, if permitted by the country's law, to use in-person service or service by mail. Fed. R. Civ. P. 4(f)(2). The third method of service is "other means not prohibited by international agreement, as the court orders." Fed. R. Civ. P. 4(f)(3). The procedure for serving foreign companies is governed by Fed. R. Civ. P. 4(h), which incorporates the portions of Rule 4(f) relevant here. Assuming the proposed alternative method of service under Rule 4(f)(3) is prohibited neither by federal law nor international agreement, the Court may exercise its discretion to permit such service, so long as it comports with constitutional due process under Mullane v. Cent. Hanover Bank & Trust Co., 339 U.S. 306, 70 S.Ct. 652, 94 L.Ed. 865 (1950).
Discussion
I. Whether the Court Should Exercise its Discretion to Permit Alternative Service
The Court first determines whether it should exercise its discretion to permit alternative service of process under Rule 4(f)(3). While "there is no requirement that a party exhaust efforts to effect service pursuant to Rules 4(f)(1) or 4(f)(2)" before seeking alternative service under Rule 4(f)(3), courts will ordinarily permit alternative service only where the moving party shows that it "has reasonably attempted to effectuate service on the defendant," and that "the circumstances are such that the court's intervention is necessary." Convergen Energy LLC v. Brooks, 20-cv-3746 (LJL), 2020 WL 4038353, at *4 (S.D.N.Y. Jul. 17, 2020). "The purpose of this inquiry is to prevent parties from whimsically seeking an alternate means of service." Id. As discussed, the Court previously denied petitioner's motion on this prong, holding that petitioner failed to provide sufficient information regarding the expense and delay of effectuating service pursuant to the relevant local law or through the Hague Convention.
Along with this renewed motion, petitioner submits the declaration of Reid McNair, Vice President of ABC Legal Services, whom petitioner has retained to assist with service of process. See Declaration of Reid McNair ("McNair Decl."), Dkt. No. 34. McNair explains that petitioner has commenced service on Intech and Chakravarty in Hong Kong pursuant to the Hague Convention but that such service "is at the discretion of the Hong Kong central authority and may take 6 or more months to be completed." Id. ¶ 10. Likewise, McNair explains that serving Rach, Anderson, Paramount, White Rock, and BMR pursuant to local law in Nevis or Dubai would likely have to be by letters rogatory, would cost at least $13,625, and would require approximately 14-24 months, all while still carrying the risk of "be[ing] ignored ... by the foreign authorities." Id. ¶¶ 11-18. Given this showing, the Court finds that petitioner has reasonably attempted to effectuate service on respondents, and that the circumstances are such that the Court's intervention is necessary.
II. Whether the Proposed Alternative Methods of Service are Acceptable
Before approving any particular method of service, however, the Court must first ensure that the method is not prohibited by federal law or international agreement, and that the method comports with constitutional due process.
A. Individual Respondents
Petitioner seeks leave to serve Rach and Chakravarty pursuant to Fed. R. Civ. P. 4(f)(3). Petitioner also seeks leave, pursuant to Fed. R. Civ. P. 4(m), to file at a later time a further renewed motion to serve Namazbaeva.
1. Rach
Petitioner seeks leave to serve Rach by mail, email, and WhatsApp at his last known addresses. Renewed Motion at 2. Rach is alleged to reside in Dubai, which is in the United Arab Emirates ("UAE"). See Rinde Decl. ¶ 35. "[T]he UAE is not a signatory to the Hague Convention." Berdeaux v. OneCoin Ltd., No. 19-cv-4074 (VEC), 2020 WL 409633, at *2 (S.D.N.Y. Jan. 24, 2020). While petitioner does not discuss the issue, the Court is not aware of any other international agreement to which Dubai is a party that prohibits service by mail, email, or WhatsApp. Cf. S.E.C. v. Anticevic, No. 05-cv-6991 (KMW), 2009 WL 361739, at *4 (S.D.N.Y. Feb. 13, 2009) ("The Court is aware of no other international agreement to which Germany or Croatia is a party that prohibits service by publication."). Nor is the Court aware of any federal law that prohibits such service. Convergen, 2020 WL 4038353, at *5 n.4 ("It is undisputed that the [service by mail and email is] not prohibited by federal law."). Accordingly, the Court finds that such service is not prohibited by international agreement or federal law.
Turning to the due process analysis, the Court must determine whether petitioner's proposed means of service "would be reasonably calculated, under all the circumstances, to apprise [Rach] of the pendency of the action and afford [him] an opportunity to present [his] objections." Mullane, 339 U.S. at 314, 70 S.Ct. 652. Petitioner's proposal to serve Rach by mail to Rach's office address in Dubai is deficient. As discussed above, petitioner's first attempt to effectuate service at that address was unsuccessful; the delivery persons were told that the businesses had closed and the Papers were not delivered. Maloney Decl. ¶ 29; Dkt. No. 29-5. Because petitioner provides the Court no reason to believe that service by mail to that address would be successful, the Court finds that such service would not be reasonably calculated to provide notice to Rach.
Petitioner, however, also proposes to serve Rach by email and WhatsApp. "Service by email alone comports with due process where a plaintiff demonstrates that the email is likely to reach the defendant." Convergen, 2020 WL 4038353, at *6. Here, petitioner seeks to serve Rach through two email addresses: "info@rachgroupofcompanies.com" and "dw@aiiltd.com," and through WhatsApp at the telephone number +971 52 359 9991. Petitioner's counsel states that the delivery persons managed to speak with Rach after being provided with the "Rach Group" email address and that phone number. Maloney Decl. ¶¶ 29-30. In addition, Rinde alleges that he received messages from Rach from that number as recently as October 2020. Rinde Decl. ¶ 50. Accordingly, the Court holds that service by email to "info@rachgroupofcompanies.com" and by WhatsApp to +971 52 359 9991 is reasonably calculated to notify Rach of this action. Therefore, the Court grants petitioner's motion to serve Rach by email to "info@rachgroupofcompanies.com" and by WhatsApp to +971 52 359 9991.
Petitioner provides no additional information regarding the "dw@aiiltd.com" address. Service through this email address, therefore, would not be reasonably calculated to apprise Rach of the action.
2. Chakravaty
Petitioner seeks to serve Chakravarty by registered mail to Intech's registered office in Hong Kong and by email to Chakravarty. Renewed Motion at 2.
Starting with email, petitioner proposes to serve Chakravarty through what is presumably Intech's email address: "intechholingshk@gmail.com." Petitioner alleges, but without any support, that this is Chakravarty's last known email address. Maloney Decl. ¶ 20. And petitioner suggests that because petitioner's counsel's previous email to this address did not "bounce back," there are "sufficient grounds for leave to serve" Chakravarty at that email address. Memorandum of Law in Support of Motion for Leave to Serve Process by Other Means, Dkt. No. 28, at 10. But the mere fact that it is an operative email address is plainly insufficient without some allegation that the email is somehow associated with Chakravarty. Because petitioner fails to allege having ever communicated with Chakravarty through that email address, the Court finds that service through that address would not be reasonably calculated to apprise Chakravarty of the pendency of the action.
Turning to mail, petitioner seeks to serve Chakravarty by FedEx International Priority service to the registered address for Intech on file with the Hong Kong Companies Registrar of 8-A, Kam Chung Commercial Building, 19-21 Hennessy Road, Wan Chai, Hong Kong Special Administrative Region. Maloney Decl. ¶ 17. Hong Kong is a signatory to the Hague Convention. See https://www.hcch.net/en/states/authorities/details3/?aid=393 (last visited March 10, 2021). "[I]n cases governed by the Hague Service Convention, service by mail is permissible if two conditions are met: first, the receiving state has not objected to service by mail; and second, service by mail is authorized under otherwise-applicable law." Water Splash, Inc. v. Menon, ––– U.S. ––––, 137 S. Ct. 1504, 1513, 197 L.Ed.2d 826 (2017).
Both conditions are met here. The first is met because Article 10 of the Hague Convention specifies that it will not "interfere with ... the freedom to send judicial documents, by postal channels, directly to persons abroad" "[p]rovided the State of destination does not object." Hague Convention, Art. 10(a). Because Hong Kong does not oppose Article 10(A), see https://www.hcch.net/en/states/authorities/details3/?aid=393 (last visited March 10, 2021), it does not oppose service of judicial documents by postal channel. The second condition is satisfied because service by mail is here authorized by "otherwise-applicable law" -- namely, Rule 4(f)(3), which authorizes any other means of service as long as it is not prohibited by international agreement. See Convergen, 2020 WL 4038353, at *5.
The final step in the analysis is to ensure that the proposed method of service comports with due process. Petitioner suggests that service on Chakravarty by mail to Intech comports with due process because he is an "officer, director and authorized representative" of Intech. Rinde Decl. ¶ 38. "Courts have sensibly held that service on a high-level employee's corporate employer ... is ‘reasonably calculated’ to apprise the employee of the pendency of the action and therefore comports with due process." Stream SICAV v. Wang, 989 F. Supp. 2d 264, 279 (S.D.N.Y. 2013). Accordingly, the Court finds that service by mail to Intech's office in Hong Kong is reasonably calculated to apprise Chakravarty of this action. Therefore, the Court grants petitioner's motion to serve Chakravarty by mail to Intech's office in Hong Kong.
3. Namazbaeva
Petitioner initially sought to serve Namazbaeva through registered mail to the registered address of Five Stars. See Notice of Motion Pursuant to Fed. R. Civ. Proc. 4(f)(3) and 4(h)(2) ("Motion"), Dkt. No 26, at 2. As the Court previously explained, however, "the only evidence that Namazbaeva is any way associated with Five Stars Design, let alone that she is a high-ranking employee, is that someone who shares her name is listed on the company's certificate of incorporation." Memorandum Order at 7 n.1. In its renewed motion, petitioner explains that it has "engaged the services of a private investigator in the United Kingdom with respect to Namazbaeva," but that "the investigation is not yet complete." Memorandum of Law in Support of Renewed Motion for Leave to Serve Process by Other Means, Dkt. No. 35, at 6. For that reason, petitioner requests "additional time to complete its investigation into Namazbaeva for purposes of completing service upon her." Id. at 9. That request is granted and petitioner is hereby granted leave to file a further renewed motion to complete service on Namazbaeva by March 22, 2021.
B. Corporate Respondents
Petitioner seeks leave to serve the corporate respondents pursuant to Fed. R. Civ. P. 4(h).
1. Anderson, Paramount, White Rock, and BMR
Petitioner seeks leave to serve Anderson, Paramount, White Rock and BMR by email and WhatsApp to Rach. Petitioner also seeks leave to serve Anderson and Paramount by registered mail to their last known mailing address in Nevis. Renewed Motion at 1-2. Anderson and Paramount are alleged to be organized under Nevis law; White Rock and CMR are alleged to be organized under the laws of the Emirate of Dubai. Rinde Decl. ¶¶ 19, 29. Neither country is a member of the Hague Convention. Id. ¶¶ 21, 30. Because, as discussed above, the Court is aware of no federal law or international agreement that would prohibit such service, the Court must determine whether the proposed methods of service would comport with constitutional due process.
Petitioner also seeks to serve Anderson, Paramount, White Rock and BMR by registered mail to Rach's office address in Dubai. For the reasons discussed above, such service would not comport with constitutional due process.
Petitioner proposes to serve Anderson, Paramount, White Rock, and BMR by email and WhatsApp to Rach, who is alleged to be a high-level officer and authorized representative of all four entities. See id. ¶¶ 16, 22. Courts permit service on a foreign corporation by email to its officer where there is "a high likelihood that [the officer] will receive and respond to emails sent to the address[ ]" and the officer is "likely to provide notice of [the] action to [the corporation]." See Convergen, 2020 WL 4038353, at *9. Here, as discussed above, petitioner has adequately shown that Rach receives communications through email and WhatsApp and that Rach is an officer or principal of all four entities. Therefore, the Court grants petitioner's motion to serve Anderson, Paramount, White Rock, and BMR by email and WhatsApp to Rach.
Petitioner proposes to also serve Anderson and Paramount by registered mail to their last known mailing address in Nevis. Based on petitioner's representation that it has located the addresses of both companies, the Court grants petitioner's motion to serve Anderson and Paramount by registered mail to their last known mailing address.
2. Intech
Finally, petitioner proposes to serve Intech by registered mail to Intech's registered office address in Hong Kong. For the reasons discussed above, the Court grants petitioner's proposal to serve Intech by registered mail to its office address in Hong Kong.
Conclusion
For the foregoing reasons, petitioner is hereby granted leave to serve Rach, White Rock, BMR, Anderson, and Paramount by email (to "info@rachgroupofcompanies.com") and by WhatsApp (to +971 52 359 9991); to also serve Anderson and Paramount by registered mail to their last known mailing address in Nevis; and to serve Intech and Chakravarty by registered mail to Intech's registered office in Hong Kong. In addition, petitioner is hereby granted leave to file a further renewed motion to complete service on Namazbaeva. by March 22, 2021
Finally, the Court will hold another telephonic initial pretrial conference on April 7, 2021 at 11:00 a.m. The dial-in information will be docketed in due course.
SO ORDERED.