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observing that "[t]he well-established definition of a managing or general agent is some person invested by the corporation with general powers involving the exercise of judgment and discretion," and holding that a part-time receptionist and salesperson was not a managing or general agent
Summary of this case from EMERALD EQUIPMENT LEASING, INC. v. SEA STAR LINE, LLCOpinion
03 Civ. 0165 (DF).
August 4, 2004
MEMORANDUM AND ORDER
INTRODUCTION
In this action, before me on consent pursuant to 28 U.S.C. § 636(c), defendants First International Travel, Inc. ("First International") and its president, Shi Ya Chen ("Chen") (collectively, "Defendants") have moved to dismiss the Complaint. Defendants' motion is made pursuant to Rules 12(b)(2) and 12(b)(5) of the Federal Rules of Civil Procedure, on the grounds that Defendants have not been properly served with process in this action and that the Court therefore does not have personal jurisdiction over them. Defendants also move, in the alternative, to drop First International as a defendant, pursuant to Rule 21 of the Federal Rules of Civil Procedure, on the ground that First International had no connection with the plaintiff, and thus is not a proper party to the action. Plaintiff Fujun Jiao ("Jiao" or "Plaintiff") has opposed the motion to dismiss, arguing that service of process was proper on both First International and Chen; Plaintiff has not, however, opposed Defendants' alternative motion to drop First International as a party.
For the reasons stated below, the motion to dismiss the action is denied with respect to the individual defendant Chen and granted with respect to the corporate defendant First International. Further, the motion to dismiss the Complaint against First International is granted with prejudice, as it appears that any attempt by Plaintiff to re-serve First International would be futile, given Plaintiff's failure to refute Defendants' sworn statements showing that First International had no involvement in the matters alleged and is thus not a proper party to this action.
BACKGROUND
On January 8, 2003, Jiao filed a Complaint against First International, Chen, and an unknown number of "John Does," asserting claims under the Fair Labor Standards Act ("FLSA"), the New York Minimum Wage Act ("NYMWA"), and New York labor law. ( See Compl.) On January 9, 2003, Plaintiff's counsel attempted to serve process upon both named defendants. On that date, Brixhilda Salihaj ("Salihaj"), a secretary in counsel's office, went to First International's actual place of business, and left two copies of the Summons and Complaint — one for First International and the other for Chen — with a part-time employee of First International, Mei Jederlinic ("Jederlinic"). ( See Affidavit of Personal Service, dated Jan. 10, 2003 ("Aff. of Serv.").) According to First International, Jederlinic worked for the company as a receptionist. ( See Affidavit in Support of Motion by Chen, dated June 4, 2003 ("6/4/03 Chen Aff."), ¶ 5.) Then, on January 10, 2003, Salihaj purportedly mailed an additional copy of the Summons and Complaint to Chen at her place of business, in an envelope marked "personal and confidential," with no indication on the envelope that the communication was from an attorney or concerned an action against her. ( See Aff. of Serv.) Chen, who was apparently out of the country during the time of the attempted service, and did not return to the United States until April 23, 2003 ( see 6/4/03 Chen Aff. ¶ 4 and Exhibit "B" annexed thereto), claims not to have received this mailing ( see Affidavit of Shi Ya Chen, dated July 25, 2003 ("7/25/03 Chen Aff."), ¶ 5).
By naming "John Does," Plaintiff purports to bring suit against business partners and/or persons acting in concert and/or managers of defendant First International. ( See Complaint ("Compl.") ¶ 11.) To date, it does not appear that any John Doe defendants have been identified or served.
Defendants filed their Motion to Dismiss the Complaint or to drop First International as a party on June 6, 2003. (Dkt. 10.)
DISCUSSION
I. MOTION TO DISMISS AS AGAINST DEFENDANT CHEN
Where a defendant challenges personal jurisdiction under Rule 12(b)(2), the plaintiff has the burden of establishing jurisdiction. See Robinson v. Overseas Military Sales Corp., 21 F.3d 502, 507 (2d Cir. 1994). In deciding a motion to dismiss for lack of personal jurisdiction, however, the Court has "considerable procedural leeway. It may determine the motion on the basis of affidavits alone; or it may permit discovery in aid of the motion; or it may conduct an evidentiary hearing on the merits of the motion." Nee v. HHM Fin. Serv., Inc., 661 F. Supp. 1180, 1181 (2d Cir. 1987) (internal quotation marks and citations omitted). Here, the Court can adequately address the motion on the basis of the affidavits and pleadings. In such a case, where a court
chooses not to conduct a full-blown hearing on the motion, plaintiff need only make a prima facie showing of jurisdiction through its affidavits and supporting materials. Eventually, of course, the plaintiff must establish jurisdiction by a preponderance of the evidence, either at a pretrial evidentiary hearing or at trial. But until such a hearing is held, a prima facie showing suffices, notwithstanding any controverting presentation by the moving party to defeat the motion.Marine Midland Bank, N.A. v. Miller, 664 F.2d 899, 904 (2d Cir. 1981); see also Metropolitan Life Ins. Co. v. Robertson-Ceco Corp., 84 F.3d 560, 566-67 (2d Cir. 1996); Ball v. Metallurgie Hoboken-Overpelt, S.A., 902 F.2d 194, 197 (2d Cir. 1990).
Where the motion is decided on affidavits and the pleadings, "the court must resolve disputed facts in the light most favorable to plaintiff." Nee, 661 F. Supp. at 1181 (citation omitted). The Court construes jurisdictional allegations liberally and take as true uncontroverted factual allegations. Square D Co. v. Niagara Frontier Tariff Bureau, Inc., 476 U.S. 409, 411 (1986); IUE AFL-CIO Pension Fund v. Herrmann, 9 F.3d 1049, 1052 (2d Cir. 1993). A plaintiff may not, however, establish a prima facie showing of personal jurisdiction merely through conclusory allegations without any supporting facts. See Jazini v. Nissan Motor Co., 148 F.3d 181, 185 (2d Cir. 1998) (rejecting allegations regarding jurisdiction that were nothing more than a "restatement" of the standards laid out in the case law); Cornell v. Assicurazioni Generali S.p.A. Consol., Nos. 97 Civ. 2262 (MBM) 98 Civ. 9186 (MBM), 2000 WL 284222, at *2 (S.D.N.Y. Mar. 16, 2000) (conclusory allegations "are insufficient to establish even a prima facie showing of personal jurisdiction").
Federal Rule of Civil Procedure 4(e), which specifies how individuals may be served with process, provides:
[S]ervice upon an individual . . . 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; or
(2) by delivering a copy of the summons and of the complaint to the individual personally or by leaving copies thereof at the individual's dwelling house or usual place of abode with some person of suitable age and discretion then residing therein or by delivering a copy of the summons and of the complaint to an agent authorized by appointment or by law to receive service of process.
In this case, Defendants correctly point out that the delivery of the Summons and Complaint to Jederlinic was insufficient to satisfy the requirements of Rule 4(e)(2), which allows service upon a person of suitable age and discretion only at an individual's home, not his or her place of business. The question, then, is whether, under Rule 4(e)(1), the service complied with New York Civil Practice Law and Rules Section 308, the relevant law of the State of New York.
C.P.L.R. Section 308 provides, inter alia, that personal service upon a natural person may be made:
by delivering the summons within the state to a person of suitable age and discretion at the actual place of business, dwelling place or usual place of abode of the person to be served and 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. 308(2). Under this section, a receptionist employed by a defendant qualifies as a person "of suitable age and discretion." Perez v. County of Westchester, 83 F. Supp.2d 435, 441 (S.D.N.Y. 2000); Charnin v. Cogan, 250 A.D.2d 513, 673 N.Y.S.2d 134 (1st Dep't 1998); Albilia v. Hillcrest Gen. Hosp., 124 A.D.2d 499, 508 N.Y.S.2d 10 (1st Dep't 1986). Chen does not dispute that, in this case, a copy of the Summons was delivered to a receptionist at Chen's actual place of business.
Chen does contend that she never received a mailed copy of the Summons addressed to her at her place of business. (7/25/03 Chen Aff. ¶ 5.) Plaintiff, however, has submitted an affidavit of service that attests to the mailing of the Summons to Chen's place of business on January 10, 2003, one day after personal delivery to the same address. ( See Aff. of Serv.) Even if Chen did not actually receive this mailing, Plaintiff has nonetheless demonstrated compliance with the provisions of Section 308(2). Service is valid under this provision as long as the summons is mailed, even if the defendant never receives the copy sent by mail. See Perez, 83 F. Supp.2d at 441; Public Adm'r of the County of New York v. Markowitz, 163 A.D.2d 100, 101, 557 N.Y.S.2d 348, 348 (1st Dep't 1990).
Chen argues that without a postal guarantee, i.e., a certificate of first class mailing obtained from the Post Office, there can be no proof that the follow-up mailing step was ever actually effectuated, and thus Jiao cannot show proper service. ( See Reply, dated July 25, 2003, ¶¶ 10-11.) This argument fails, as there is no requirement that a postal guarantee be submitted to the Court as proof of mailing; an affidavit of service is sufficient. See, e.g., Waite v. Coombe, 247 A.D.2d 663, 664, 668 N.Y.S.2d 767, 769 (3d Dep't 1998) (finding that service of process pursuant to Section 308(2) was void only because the record was devoid of an affidavit of mailing).
Jiao has therefore adequately demonstrated that Chen was served with process under C.P.L.R. Section 308(2), and was thus properly served under Federal Rule of Civil Procedure 4(e). As Defendants' Motion to Dismiss the Complaint against Chen is based solely on the supposed inadequacy of service, the motion to dismiss against Chen is denied.
II. MOTION TO DISMISS AS AGAINST DEFENDANT FIRST INTERNATIONAL
Rule 4(h)(1) of the Federal Rules of Civil Procedure, which governs service of process upon domestic corporations, provides that service upon a domestic corporation may be effected pursuant to the law of the state in which the district court is located, "or by delivering a copy of the summons and of the complaint to an officer, a managing or general agent, or to any other agent authorized by appointment or by law to receive service of process. . . ." Fed.R.Civ.P. 4(h)(1). Similarly, C.P.L.R. Section 311 provides that service upon a corporation may be accomplished by delivering the summons "to an officer, director, managing or general agent, or cashier or assistant cashier or to any other agent authorized by appointment or by law to receive service." N.Y.C.P.L.R. § 311(a)(1). As Plaintiff does not claim that Jederlinic was an officer, director, cashier, assistant cashier, or agent specifically authorized or appointed to receive service on behalf of First International, the question becomes whether Jederlinic qualified as a managing or general agent under either New York or Federal law.
The well-established definition of a managing or general agent is "some person invested by the corporation with general powers involving the exercise of judgment and discretion, as distinguished from an ordinary agent . . ., who acts in an inferior capacity and under the direction and control of a superior authority, both in regard to the extent of his duty and the manner of executing it." Taylor v. Granite State Provident Assn., 136 N.Y. 343, 346, 32 N.E. 992, 993 (1893); see also Grammenos v. Lemos, 457 F.2d 1067, 1073 (2d Cir. 1972); Colbert v. International Security Bureau, Inc., 79 A.D.2d 448, 452-53, 437 N.Y.S.2d 360, 363-64 (2d Dep't 1981); Isaf v. Penn. R.R. Co., 32 A.D.2d 578, 579, 299 N.Y.S.2d 231, 233 (3d Dep't 1969).
According to First International, Jederlinic was only employed by the corporation as a part-time receptionist and salesperson, was acting in a position of inferior capacity and under the direction and control of a superior authority, and was not empowered with supervisory authority. (7/25/03 Chen Aff. ¶ 4.) Based on this description, Jederlinic would not qualify as a managing or general agent. See Arce v. Sybron Corp., 82 A.D.2d 308, 312-14, 441 N.Y.S.2d 498, 501-02 (2d Dep't 1981) (finding that a receptionist employed at company's office was not a managing agent for the corporation, and thus service made upon her was not good service upon the corporate defendant); Colbert, 79 A.D.2d 448, 452-53, 437 N.Y.S.2d 360, 363-64 (same). This would hold true even though Jederlinic may have been left to run the office in Chen's absence. Colbert, 79 A.D.2d 448, 453, 437 N.Y.S.2d 360, 363 (rejecting the argument that any corporate employee who has been left to mind an office in the absence of superior corporate officials can be deemed a managing agent for the purpose of service of process); Isaf, 32 A.D.2d 578, 579, 299 N.Y.S.2d 231, 233 (same).
Jiao has not refuted First International's showing as to Jederlinic's status at the company. As Jiao has not shown that process was delivered to an agent of First International deemed by law to be an appropriate representative to accept service, Defendants' motion to dismiss the Complaint against First International for lack of proper service and personal jurisdiction is granted. III. FIRST INTERNATIONAL'S ALTERNATIVE MOTION TO BE DROPPED AS A PARTY DEFENDANT
Ordinarily, defects in service can be readily cured by re-serving the defendant in accordance with the governing rules. A dismissal for improper service is, therefore, often granted without prejudice, to allow the plaintiff an opportunity to effectuate service. See, e.g., Moultry v. City of Poughkeepsie, 154 F. Supp.2d 809, 813 (S.D.N.Y. 2001) (dismissing claim without prejudice where plaintiff failed to properly serve defendants); Fed.R.Civ.P. 4(m) ("If service of the summons and complaint is not made upon a defendant within 120 days after the filing of the complaint, the court, upon motion or on its own initiative after notice to the plaintiff, shall dismiss the action without prejudice as to that defendant. . . ."). Here, however, First International argues in the alternative that, regardless of the adequacy of service, the company is not a proper party to this action, and it should therefore be dropped as a named defendant under Federal Rule of Civil Procedure 21. In the interest of judicial economy, the Court will consider First International's alternative argument at this time, so as to determine whether a further attempt at service of this defendant would be futile.
Rule 21 provides, in pertinent part, that "[p]arties may be dropped or added by order of the court on motion of any party . . . at any stage of the action and on such terms as are just." Fed.R.Civ.P. 21. "[T]he [C]ourt may rely on Rule 21 to delete parties that have no connection to the claims asserted." Glendora v. Malone, 917 F. Supp. 224, 227 n. 3 (S.D.N.Y. 1996). When evaluating whether a defendant is properly a party to a lawsuit, courts have looked to affidavits filed by the defendants challenging the allegations made against them in the complaint. See, e.g., In re Rezulin Prods. Liability Litig., 133 F. Supp.2d 272, 281 (S.D.N.Y. 2001). Further, where a plaintiff fails to respond to a defendant's affidavit, wherein the defendant asserts that he is not a proper party to the action, courts have accepted the defendant's assertions as true when determining whether joinder was, in fact, improper. See id. ("Plaintiffs have not responded to the [defendants'] affidavits in any way. In consequence, the Court can conclude only that the joinder of these [defendant] sales representatives lacked any reasonable basis in fact."); see also Trumps v. Harley of New York Assoc., No. 94 Civ. 7080 (CSH), 1995 WL 65983, at *3 (S.D.N.Y. Nov. 8, 1995) (allegations in affidavits submitted by defendants in support of removing them as parties were presumed true for purposes of determining whether defendants were fraudulently joined, where the plaintiff failed to offer evidence to controvert assertions).
In this case, First International asserts that it has had no connection to the alleged labor violations that form the basis of Jiao's Complaint. According to Chen's sworn affidavit, submitted on behalf of First International, Jiao was a resident of a seven-room guest house located on the third floor of 21 East 33rd Street, New York, New York. (6/4/03 Chen Aff. ¶ 8.) During his spare time, Jiao did miscellaneous work such as laundry and cleaning for the guest house, in exchange for free room and board. ( Id.) First International, located on the second floor of the same address, describes itself as being completely separate and apart from the third floor guest house. ( See id.) First International states that it has always had its own staff and business and has never employed Jiao in any capacity. ( Id. ¶ 7.) If, as stated by First International, it never employed Jiao, then Jiao would have no basis to assert claims against the company with respect to employment matters.
The Court notes that only First International has sought to be dropped as a defendant; Chen has made no similar argument on her own behalf. Although this is not addressed in Defendants' papers, it may be that, as alleged in the Complaint, Chen is involved with the guest house, in addition to being the president of First International. ( See Compl. ¶ 14 (alleging that Chen "controls, manages, owns, and operates a hotel in New York").)
Although Jiao's counsel has submitted an affidavit in opposition to Defendants' motion ( see Affidavit of Paul W. Siegert, Esq., dated July 14, 2003), nothing in that affidavit or elsewhere in Jaio's submissions responds to these assertions made by First International. The unrefuted statements by First International, which must be accepted by the Court as true ( see In re Rezulin Prods. Liability Litig., 133 F. Supp.2d at 281; Trumps, 1995 WL 65983, at *3), demonstrate that First International is not a proper party to this action, and should therefore be dropped as a defendant in this lawsuit, regardless of the adequacy of service.
CONCLUSION
For all of the foregoing reasons, Defendants' Motion to Dismiss the Complaint against defendant Shi Ya Chen is denied. Defendants' Motion to Dismiss the Complaint against defendant First International is granted, with prejudice, as First International has sufficiently demonstrated that it is not, in any event, a proper party to this action.
SO ORDERED.