Filho v. Chinatown Community Development Center, Inc.

Background

Pro se plaintiff Roberto Filho sued Chinatown Community Development Center, Inc. (CCDC) and Jason Bermak under the Fair Housing Act. Filho alleged that CCDC denied his request to move to a one-bedroom apartment with a private kitchen and bathroom that would better accommodate disabilities he identified as including traumatic brain injury, human immunodeficiency virus, and damage to bladder and prostate tissues.

Filho moved for a default judgment, which is a judgment requested because a defendant did not plead or otherwise defend. He argued that CCDC had been served by the U.S. Marshals Service on September 23, 2021, but did not answer by October 14, 2021. He sought the new apartment and $50,000. The clerk entered CCDC’s default on November 16, 2021. CCDC moved to set aside that entry and stated that it was ready to defend the lawsuit.

Service of Process

The court explained that Federal Rule of Civil Procedure 4(h) requires service on a corporation through specified people, including an officer, managing or general agent, or an agent authorized to receive service. California law also permits service on a corporation’s designated service agent or certain corporate officers. Substituted service under California law requires reasonable diligence in attempting personal service and mailing the papers afterward.

CCDC’s registered agent for service was Calvin Ho. The filed service forms were incomplete, and the form filed September 24, 2021, identified Loktin Law as the person purportedly served. CCDC said Law was an office manager who left CCDC’s employment on September 24, 2021, and was not its authorized service agent. The court stated that the records did not clearly show that anyone had been served with the summons and complaint. Even assuming Law received the papers, the court concluded that service would not satisfy the federal rule because Law was not an authorized agent. The court also found that service did not comply with California law because the required attempts and mailing for substituted service were not shown.

Ruling

The court stated that default judgments are disfavored and that CCDC appeared ready to litigate the case. Because service was apparently improper under both federal and California law, the court exercised its discretion to deny Filho’s motion for default judgment. It also found good cause to set aside the entry of default. CCDC’s pending motion to set aside default was terminated as moot, meaning no separate ruling on that motion was needed.

The court vacated the scheduled hearings. Filho had filed an amended complaint on December 9, 2021; the court deemed CCDC served with that complaint and allowed CCDC and Bermak until January 5, 2022, to file responsive pleadings or motions.