Vega v. Trinity Realty Corp.

Background

Josue Vega sued Trinity Realty Corp., Joseph Phan, and Philip Phan in 2014. He alleged that the defendants violated the federal Fair Labor Standards Act and the New York Labor Law by failing to pay required overtime and minimum wages and by failing to provide proper wage statements. Joseph Phan had died before service could be completed, and the court later dismissed him from the case.

Trinity and Philip did not appear in the action. The court entered a default judgment in 2015 for damages, liquidated damages, statutory damages, attorneys’ fees, costs, prejudgment interest, and postjudgment interest. In 2020, Trinity and Philip moved under Federal Rule of Civil Procedure 60(b)(4) to vacate the judgment, arguing that improper service deprived the court of personal jurisdiction and made the judgment void.

Rule 60(b)(4) Standard

Rule 60(b)(4) permits a court to vacate a judgment that is void. The court explained that this provision applies when the court lacked personal jurisdiction because service of process was legally insufficient. Unlike many other requests to set aside a judgment, relief under Rule 60(b)(4) is not discretionary if the judgment is void. The court therefore focused on whether service gave it personal jurisdiction over each defendant, rather than applying the usual factors concerning willfulness, possible defenses, and prejudice.

Trinity Realty Corp.

Vega delivered the summons and complaint to the New York Secretary of State, which New York law authorizes to accept service for a corporation. Trinity did not dispute that delivery occurred. Instead, Trinity argued that the address in the Secretary of State’s records was wrong and that it never received actual notice.

The court held that service on Trinity was complete when Vega delivered the papers to the Secretary of State. The service was legally effective regardless of whether the papers later reached Trinity or whether Trinity received actual notice. The court therefore concluded that it had personal jurisdiction over Trinity and that the default judgment was valid as to the company.

The court also stated that, even if Trinity’s conduct were relevant, it would still deny relief. The court noted that Trinity had maintained the incorrect address in state records for more than two decades, had not corrected it, and had no living executive listed in those records after Joseph Phan’s death. The court concluded that these circumstances indicated a purposeful attempt to avoid service, although it emphasized that willfulness was not relevant to the Rule 60(b)(4) jurisdictional question.

Philip Phan

The court reached no final decision on whether Philip was properly served. Vega relied on an amended service affidavit stating that service occurred at 1401 Pelham Parkway North, rather than the 1401 Pelham Parkway East address listed in the original affidavit. Vega also submitted a GPS-stamped photograph and an affidavit concerning the location and the person named Trends Chung.

Philip disputed these facts. He stated that he lived at a different address in 2014 and did not know anyone named Trends Chung. Because the parties’ submissions did not resolve whether service occurred at Philip’s home or whether Chung was an appropriate recipient, the court found that an evidentiary hearing was required. The court reserved decision on Philip’s motion until after that hearing.

Disposition

The court DENIED the motion to vacate the default judgment with respect to Trinity Realty Corp. As to Philip Phan, the court did not grant or deny the motion; instead, it ordered the parties to submit a joint letter proposing dates for an evidentiary hearing and addressing whether the hearing should be conducted in person or remotely and whether Philip would need an interpreter.