Qiu v. Shanghai Cuisine, Inc.

Background

Ting Qiu Qiu, Jian Wei Deng, Yu Bo Su, Zhaobang Bai, and Shaohong Zeng brought a putative collective action against Shanghai Cuisine, Inc., doing business as Shanghai Cuisine Bar & Restaurant; R & M Century, Inc.; United Restaurant Group, Inc.; Na Sun; Chenwen Ho, also known as Jonathan Ho; Jijie Hong; Wing Jing Lau; and Josephine Feng. They alleged unpaid wages and unpaid overtime under the Fair Labor Standards Act and the New York Labor Law.

The motions at issue were filed by Sun and Ho under Federal Rule of Civil Procedure 12(b)(5), which allows dismissal for insufficient service of process. The plaintiffs had attempted to serve Sun and Ho at the restaurant, at a New Jersey property, and at a New York apartment. The court had previously quashed the restaurant service and extended the deadline for service to August 21, 2020. The plaintiffs served the New Jersey address on August 8 and the New York address on September 21, but they did not obtain the court’s permission before using the method of service involved in those attempts.

New Jersey service

The plaintiffs used “nail-and-mail” service by affixing the papers to the door and mailing them. Under the applicable New York rule, the papers had to be affixed to the defendant’s actual place of business, dwelling place, or usual place of abode. The court held that the plaintiffs did not show that the New Jersey address was Sun and Ho’s usual place of abode. A deed listing the address, some mail, and a car at the property did not establish sufficient permanence. The court therefore found that service at the New Jersey address was improper.

New York service

The court found sufficient evidence that the New York address was Sun and Ho’s usual place of abode. The evidence included lease payments, utility bills, bank statements, school tuition bills, a New York tax document, a package, and a mailbox identifying Ho and the apartment number. The court also rejected Sun and Ho’s argument that the service affidavits were invalid because they were notarized by an attorney for the plaintiffs. The court concluded that the New York service complied with the applicable New York rule and Federal Rule 4.

Late service

Because the New York service occurred after the August 21 deadline, the court considered whether to extend the deadline retroactively. Rule 4(m) requires an extension when a plaintiff shows good cause and permits a discretionary extension even without good cause. The court did not decide whether the plaintiffs had shown good cause because it exercised its discretion to extend the deadline.

The court identified four factors supporting that decision: dismissal could cause many wage claims to become time-barred; Sun and Ho had actual notice through their participation in the case and the New York service; their delay in raising the service defect weighed in favor of accepting the late service; and the plaintiffs would suffer greater prejudice from dismissal than Sun and Ho would suffer from the extension. The court therefore extended the deadline and accepted the New York service retroactively.

Disposition

The court DENIED Sun and Ho’s motions to dismiss for insufficient service, Docs. 105 and 120. It ordered Sun and Ho to file answers or otherwise respond to the amended complaint by February 9, 2021. Because the ruling addressed service of process rather than whether the wage claims were legally valid, this was a procedural ruling.