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Copia Communications, LLC v. Amresorts, L.P.

United States District Court, E.D. Pennsylvania

June 20, 2017

COPIA COMMUNICATIONS, LLC
v.
AMRESORTS, L.P., et al.

          MEMORANDUM RE: SEAWIND'S MOTION TO LIFT ENTRY OF DEFAULT AND TO DISMISS AND PLAINTIFF'S MOTION FOR DEFAULT JUDGMENT

         I. Introduction

         Plaintiff Copia Communications, LLC ("Plaintiff), a Massachusetts limited liability company, brings this action against defendants AM Resorts, L.P., a Pennsylvania limited partnership ("AMR"), and Seawind Key Investments Limited, a Jamaican company ("Seawind") for alleged breach of contract and associated torts[1] arising out of an agreement between Plaintiff and Seawind for the provision of internet services by Plaintiff (the "Contract") at two of Seawind's Jamaican hotels, Secrets St. James Montego Bay and Secrets Wild Orchid Montego Bay (the "Resorts"). (See ECF 11, Amended Complaint, "Compl."; see ECF 1, Ex. E, Contract).

         Before the Court is Plaintiffs motion for the entry of default judgment[2], filed on April 3, 2017, against Seawind (ECF 18, "PI. Mot"), and Seawind's response, which also includes a motion to dismiss the Amended Complaint for lack of personal jurisdiction, pursuant to Federal Rule of Civil Procedure ("F.R.C.P.") 12(b)(2), and for insufficient service of process, pursuant to F.R.C.P. 12(b)(5). (ECF 23, “Seawind Opp'n”). Plaintiff filed its reply and opposition to Seawind's motion to dismiss on May 1, 2017. (ECF 24, “Pl. Reply”).

         Plaintiff subsequently filed a request for default against Seawind on April 12, 2017, which the clerk of court entered that same day.[3] The default was entered based upon the affidavit of Plaintiff's counsel in this case, Philip M. Giordano (ECF 20-1, “Giordano Aff.”), which stated, in pertinent part,

(1) On December 16, 2016, a bailiff engaged by Plaintiff's Jamaican counsel “served the Summons and Complaint upon an individual identified as Eyon Minto [“Minto”], Security Coordinator of Defendant Seawind, in Jamaica and who has been designated by Jamaican law to accept service of process upon the Defendant.” (Giordano Aff. ¶ 3)
(2) On February 22, 2017, a bailiff engaged by Plaintiff's Jamaican counsel “served the Summons and First Amended Complaint upon an individual identified as Ian McKell[ar] [“McKellar”], Assistant Security Manager of Defendant Seawind, in Jamaica and who has been designated by Jamaican law to accept service of process upon the Defendant.” (Id. ¶ 4)
(3) A document labeled “Proof of Service” was attached to the Affidavit as to both Minto and McKellar, and a box was checked next to the statement indicating that each was “designated by law to accept service of process on behalf of [Seawind].” (Id., Ex. A & B).
(4) Seawind had “failed to file responsive papers to the Plaintiff's pleadings and . . . such time has expired for the same.” (Id. ¶ 6).

         Notwithstanding this representation to the clerk of court, for the following reasons, the Court finds that Plaintiff did not properly serve Seawind. Therefore, the entry of default is void. See Gold Kist, Inc. v. Laurinburg Oil Co., Inc., 756 F.2d 14, 19 (3d Cir. 1985) (The entry of default “when there has been no proper service of the complaint is, a fortiori void, and should be set aside.”); see also Grant Entm't Group, Ltd. v. Star Media Sales, 988 F.2d 476, 493 (3d Cir. 1993) (holding that a default will be set aside if it was not properly entered). The Court will not, at this time, additionally grant Seawind's motion to dismiss the Amended Complaint for improper service, pursuant to F.R.C.P. 12(b)(5), since “there exists a reasonable prospect that service may yet be obtained.” Sampath v. Concurrent Techs. Corp, 227 F.R.D. 399, 401 (W.D. Pa. Apr. 20, 2005)

         II. Seawind Was Not Properly Served

         The Court first analyzes whether Plaintiff has satisfied its burden of proof with respect to the validity of service, and concludes that it has not. See Grand Entm't Group, 988 F.2d at 493 (“[T]he party asserting the validity of service bears the burden of proof on that issue.”).

         a. Compliance with the Contract

         The parties initially dispute whether Section 18.3 of the Contract displaces the requirements of F.R.C.P. 4, which typically governs service of process. Section 18.3 of the Contract explicitly provides that, in the event of litigation between the parties,

“[s]ervice of any legal proceedings concerning or arising out of this Agreement shall be effected by causing the same to be delivered to the statutory agent or company secretary of the party to be served at its registered office, or at such other address as may from time to time be notified in writing by the party concerned. Until further notice, the respective addresses for the parties shall be as first set forth above.”

(ECF 1, Complaint, Ex. E, Section 18.3) (emphasis added).

         Seawind argues that where, as here, the parties to a contract expressly agree on a manner of service, the contract controls. (Seawind Opp'n at 8). Accordingly, Seawind argues, service was improper here because Plaintiff failed to comply with Section 18.3 of the Contract. Plaintiff does not meaningfully dispute that it did not serve Seawind in accordance with the provision of the Contract, (see Pl. Mot. at 8-9), but rather argues that Section 18.3 of the Contract does not necessarily displace the operation of F.R.C.P. 4. (Id. at 9).

         As Seawind points out, there is some support in this Circuit for the proposition that a contractual provision designating a method of service trumps F.R.C.P. 4. See, e.g., Aviation Exch. Corp. v. Nightclub Mgmt. & Dec., LLC, 08-cv-533, 2009 WL 605397, at *2 (D. Del. Mar. 10, 2009) (“conformity to Rule 4 is not required where the defendant agrees to an alternative method of service”). However, the Court need not decide this issue as a matter ...


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