Commodity Futures Trading Commission v. Mikkelsen

Background

The Commodity Futures Trading Commission (CFTC) sued Casper Mikkelsen, also known as Casper Muller and by other names listed in the caption. The complaint alleged that Mikkelsen operated a fraudulent scheme involving an alleged company called GNTFX, solicited and misappropriated money from at least 101 individuals and entities, took at least $737,000 for personal use, and caused purported investors to lose at least $1.19 million. The complaint asserted three violations of the commodities laws.

The CFTC sought default judgment after Mikkelsen did not appear or answer. The CFTC had placed the summons and complaint in an envelope addressed to Casper Muller and sent it through DHL. DHL reported that the package was delivered in Denmark without a signature and that the person receiving it identified themselves as Casper Muller.

Service Under Rule 4(f)(1)

Federal Rule of Civil Procedure 4(f)(1) allows service on an individual outside the United States through internationally agreed methods. The CFTC relied on the Hague Service Convention and argued that delivery through DHL was valid service by mail.

The court held that the Hague Service Convention does not itself authorize service by mail. Because the CFTC relied only on that Convention, the court concluded that the DHL delivery was not valid service under Rule 4(f)(1).

Service Under Rule 4(f)(2)(A)

Rule 4(f)(2)(A) permits service by a method allowed by the law of the foreign country when no international agreement specifies another method. The CFTC argued that Denmark had not objected to service by mail and that Danish law authorized it.

The court agreed that the available evidence suggested Denmark had not objected to service by mail. But it was not persuaded that the Danish provision cited by the CFTC authorized the method used. That provision treated a document as served when the recipient received it, even if service did not comply with other rules. The court questioned whether it could rely on that provision before determining whether Mikkelsen actually received the documents. It also found the evidence insufficient to establish receipt: there was no sworn statement from the courier describing the delivery and no physical description of the person who allegedly received the package. The court therefore concluded that service was not shown to comply with Rule 4(f)(2)(A).

The court also noted that another Danish provision required a particular Danish postal form and stamp, requirements the CFTC acknowledged DHL delivery did not satisfy. A separate provision concerning service on corporations and other entities did not apply because Mikkelsen was an individual.

Service Under Rule 4(f)(2)(C)(i)

Rule 4(f)(2)(C)(i) allows personal delivery of the summons and complaint unless the foreign country’s law prohibits that method. The CFTC again relied on the Danish provision concerning receipt of documents. For the same reasons—uncertainty about whether the provision could be used and insufficient evidence that Mikkelsen received the documents—the court held that the CFTC had not shown proper service under Rule 4(f)(2)(C)(i).

Alternative Service Under Rule 4(f)(3)

Rule 4(f)(3) permits service by another method ordered by the court, so long as an international agreement does not prohibit it. The CFTC asked the court to approve the prior DHL delivery retroactively or authorize future service by courier, email, publication, or another method.

The court denied that request because the CFTC had not shown both that it had reasonably attempted to serve Mikkelsen and that court intervention was necessary. The CFTC had only placed the documents in an envelope and given them to DHL. The CFTC had not attempted service through Denmark’s Central Authority under Article 5 of the Hague Service Convention, apparently because it had been told that process could take up to eight months. The court stated that service through Denmark’s Central Authority is an internationally agreed method under Rule 4(f)(1) and does not require a separate Rule 4(f)(3) order. The court allowed the CFTC to renew its alternative-service request later if it could make the required showing.

Disposition

Judge John P. Cronan denied the CFTC’s motion for default judgment without prejudice to refiling if Mikkelsen failed to appear after proper service under Rule 4(f). The court granted the CFTC an additional 90 days to serve Mikkelsen and allowed it to seek more time if needed. The clerk was directed to terminate the pending default-judgment motion. The CFTC was also ordered to serve Mikkelsen with a copy of the opinion and order and file proof of that service.