Lesnik v.Eisenmann SE

Background

Gregor Lesnik and Stjepan Papes filed their initial complaint on March 7, 2016, and later filed three amended complaints. Their third amended complaint was filed on October 31, 2018.

The Plaintiffs filed a return of summons in March 2019 that purported to show service on D2N Tehnologije d.o.o. They then sought entry of default. The Clerk entered default in January 2020, but the court later denied Plaintiffs’ motion for default judgment because they had not addressed subject-matter and personal jurisdiction or the relevant factors for default judgment.

D2N Tehnologije later appeared specially and moved to set aside the default, arguing that service violated the Hague Service Convention. On February 10, 2021, the court granted that motion, finding that service violated Federal Rule of Civil Procedure 4(h) and the Hague Service Convention and that good cause supported setting aside the default. In a March 17, 2021 joint case-management statement, Plaintiffs acknowledged that they had not yet taken action to serve D2N Tehnologije in accordance with the Convention.

Court’s Analysis

The court explained that Federal Rules of Civil Procedure 4(h)(2) and 4(f) govern service on a foreign corporation but do not set an express deadline for that service. The court also noted that the Ninth Circuit had not specifically imposed a time limit for serving a foreign defendant. However, district courts have authority to control their dockets and to set deadlines for serving foreign defendants. A court may also dismiss a case when service abroad is not pursued diligently.

Ruling

The court ordered Plaintiffs to serve D2N Tehnologije under Rule 4(h) and the Hague Service Convention and to file proof of service by April 19, 2021. The court stated that, otherwise, it would dismiss D2N Tehnologije from the case without prejudice. Judge Lucy Y. Koh’s order set a service deadline; it did not decide the merits of the underlying claims.