Loyal Health & Fitness, Inc. v. Taskoob, Inc. et al, No. 3:2023cv00382 - Document 11 (S.D. Cal. 2023)
Court Description: Amended ORDER denying 6 Motion to Dismiss for Lack of Jurisdiction. Signed by District Judge Robert S. Huie on 6/9/2023. (sjt)
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Loyal Health & Fitness, Inc. v. Taskoob, Inc. et al Doc. 11 1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA 10 11 LOYAL HEALTH & FITNESS, INC., Case No.: 23-CV-00382-RSH-NLS Plaintiff, 12 13 v. 14 TASKOOB, INC., et al., AMENDED ORDER DENYING DEFENDANT’S MOTION TO DISMISS Defendants. 15 [ECF No. 6] 16 17 18 On December 8, 2022, Plaintiff Loyal Health & Fitness, Inc. brought this civil action 19 against Defendants Taskoob, Inc. (“Taskoob”), Ramin Geramianfar, Mehrad Mehrain, and 20 individual Does 1–50 in San Diego Superior Court. ECF No. 1-2. Defendants removed the 21 case to federal court on February 28, 2023. ECF No. 1. 22 On March 21, 2023, Defendants filed a motion to dismiss for lack of personal 23 jurisdiction and insufficient service of process (the “Motion”). ECF No. 6. The Motion has 24 been fully briefed (ECF Nos. 8–9), and the Court finds the matter suitable for determination 25 without oral argument. See Civ. L.R. 7.1. As set forth below, the Motion is denied. 26 I. Background 27 The Complaint alleges as follows. Plaintiff is a Delaware corporation with its 28 principal place of business in Cardiff-by-the-Sea, California. ECF 1-2 ¶¶ 1, 9. Defendant 1 23-CV-00382-RSH-NLS Dockets.Justia.com 1 Taskoob is a Canadian corporation with its principal place of business in Ontario, Canada. 2 Id. ¶ 2. Defendants Geramianfar and Mehrain, the founders of Taskoob, are both residents 3 of Ontario, Canada. See id. ¶¶ 2, 10. 4 On September 28, 2022, Plaintiff purchased the assets of Taskoob through the 5 execution of an Asset Purchase Agreement (“APA”) between Plaintiff and Defendants. Id. 6 ¶ 10. The purchase price under the APA was $4,500,000, of which Plaintiff has paid 7 $4,000,000 to date. Id. ¶ 10. Plaintiff alleges that the purchased assets include certain 8 advertising accounts located on a platform owned by the technology company Meta (the 9 “Meta Accounts”). Id. ¶ 10. Plaintiff brings three claims, each one arising from 10 Defendants’ failure to transfer these accounts to Plaintiff: (1) for fraudulent inducement; 11 (2) for rescission based on unilateral mistake; and (3) for rescission based on mutual 12 mistake. Id. ¶¶ 14, 24–53. 13 Plaintiff alleges that Defendants fraudulently induced Plaintiff into entering the APA 14 by representing that the Meta Accounts would be transferred to Plaintiff, while never 15 intending to effect the transfer. Id. ¶ 19. Plaintiff seeks damages and rescission. Id. at p. 16 11. Plaintiff alleges, in the alternative, that it is entitled to rescission of the APA based on 17 unilateral or mutual mistake—either because Plaintiff mistakenly believed that Defendants 18 would transfer the Meta Accounts, id. ¶¶ 45–46, or because both parties to the APA 19 mistakenly believed that the transfer of the Meta Accounts to Plaintiff could be 20 accomplished without also transferring a Taskoob “business account” on the same 21 platform, which Defendants were unwilling to do, id. ¶¶ 50–51. 22 On March 17, 2023, over three months after Plaintiff filed this lawsuit in Superior 23 Court, Defendant filed an action against Plaintiff for breach of contract in the U.S. District 24 Court for the District of Delaware, Taskoob Inc. v. Loyal Health & Fitness, Inc., 1:23-cv- 25 00299-UNA (D. Del. Mar. 17, 2023). 26 /// 27 /// 28 /// 2 23-CV-00382-RSH-NLS 1 II. Legal Standards 2 A. 3 A defendant may move to dismiss a case based on lack of personal jurisdiction under 4 Federal Rule of Civil Procedure 12(b)(2). “Where, as here, no federal statute authorizes 5 personal jurisdiction, the district court applies the law of the state in which the court sits.” 6 Mavrix Photo, Inc. v. Brand Technologies, Inc., 647 F.3d 1218, 1223 (9th Cir. 2011); see 7 Fed. R. Civ. P. 4(k)(1)(A). Under California’s long-arm statute, courts “may exercise 8 personal jurisdiction on any basis not inconsistent with the Constitution of this state or of 9 the United States.” Cal. Civ. Proc. Code § 410.10. “Because California’s long-arm 10 jurisdictional statute is coextensive with federal due process requirements, the 11 jurisdictional analyses under state law and federal due process are the same.” 12 Schwarzenegger v. Fred Martin Motor Co., 374 F.3d 797, 800–01 (9th Cir. 2004); accord 13 Mavrix Photo, 647 F.3d at 1223. “For a court to exercise personal jurisdiction over a 14 nonresident defendant consistent with due process, that defendant must have ‘certain 15 minimum contacts’ with the relevant forum ‘such that the maintenance of the suit does not 16 offend traditional notions of fair play and substantial justice.’” Id. (quoting Int’l Shoe Co. 17 v. Washington, 326 U.S. 310, 316 (1945)). Federal Rule of Civil Procedure 12(b)(2) 18 “In opposing a defendant’s motion to dismiss for lack of personal jurisdiction, the 19 plaintiff bears the burden of establishing that jurisdiction is proper.” CollegeSource, Inc. v. 20 AcademyOne, Inc., 653 F.3d 1066, 1073 (9th Cir. 2011). “Where, as here, the defendant’s 21 motion is based on written materials rather than an evidentiary hearing, ‘the plaintiff need 22 only make a prima facie showing of jurisdictional facts to withstand the motion to 23 dismiss.’” Id. (quoting Brayton Purcell LLP v. Recordon & Recordon, 606 F.3d 1124, 1127 24 (9th Cir.2010)); accord Data Disc, Inc. v. Sys. Tech. Assocs., Inc., 557 F.2d 1280, 1285 25 (9th Cir. 1977). To establish a prima facie case, a plaintiff must “demonstrate facts that if 26 true would support jurisdiction over the defendant.” Harris Rutsky & Co. Ins. Servs. v. Bell 27 & Clements Ltd., 328 F.3d 1122, 1129 (9th Cir. 2003) (quoting Doe v. Unocal Corp., 248 28 F.3d 915, 922 (9th Cir. 2001)). “Although the plaintiff cannot simply rest on the bare 3 23-CV-00382-RSH-NLS 1 allegations of its complaint, uncontroverted allegations in the complaint must be taken as 2 true.” Schwarzenegger, 374 F.3d at 800 (internal citations and quotation marks omitted). 3 B. 4 “Service of process” is the legal term for the formal delivery of documents—the 5 summons and complaint—that gives a defendant notice of a pending lawsuit. 6 Volkswagenwerk Aktiengesellschaft v. Schlunk, 486 U.S. 694, 700 (1988). “[S]ervice of 7 process is the means by which a court asserts its jurisdiction over [a] person.” S.E.C. v. 8 Ross, 504 F.3d 1130, 1138 (9th Cir. 2007). “Defendants must be served . . . or there is no 9 personal jurisdiction.” Jackson v. Hayakawa, 682 F.2d 1344, 1347 (9th Cir. 1982). When 10 a defendant challenges service, the plaintiff bears the burden of establishing its sufficiency. 11 See Brockmeyer v. May, 383 F.3d 798, 801 (9th Cir.2004). Federal Rule of Civil Procedure 12(b)(5) 12 Federal Rule of Civil Procedure 4 governs service of process and outlines various 13 requirements depending on the kind of defendant being served. Fed. R. Civ. P. 4(c)(1). 14 “Neither actual notice, nor simply naming the person in the caption of the complaint, will 15 subject defendants to personal jurisdiction if service was not made in substantial 16 compliance with Rule 4.” Jackson, 682 F.2d at 1347 (internal citations omitted). 17 Where a case is removed from state court to federal court, state law governs the 18 question of whether service of process was sufficient prior to removal. See Whidbee v. 19 Pearce County State Mun. Ct., 857 F.3d 1019, 1023 (9th Cir. 2017). California law requires 20 service of process to comport with the terms of the Hague Convention on the Service 21 Abroad of Judicial and Extrajudicial Documents in Civil or Commercial Matters (“Hague 22 Service Convention”) if process is served “[o]utside the United States.” Cal. Civ. Proc. 23 Code § 413.10(c). 24 Under the Hague Service Convention, because service here was attempted in Ontario 25 Canada, the Ontario Rules of Civil Procedure govern sufficiency of service. See 26 Convention on the Service Abroad of Judicial and Extrajudicial Documents in Civil or 27 Commercial Matters art. 5(1)(a), Nov. 15, 1965, 20 U.S.T. 361. Specifically, Article 5 of 28 the Hague Service Convention requires service in a given state to comport with “a method 4 23-CV-00382-RSH-NLS 1 prescribed by [the state’s] internal law for the service of documents in domestic actions 2 upon persons who are within its territory.” Id. 3 Under the Ontario Rules of Civil Procedure, “originating process” can be served 4 personally or by a specified alternative to personal service. Ontario Rules of Civil 5 Procedure, R.R.O. 1990, Reg. 194 § 16.01(1). Rules 16.02 and 16.03, respectively, 6 describe the personal and alternative service standards with respect to individuals and 7 corporations. Id. §§ 16.02, 16.03. 8 Personal service on an individual can be effected “by leaving a copy of the document 9 with the individual.” Id. § 16.02(1)(a). Alternatively, where “an attempt is made to effect 10 personal service at a person’s place of residence and for any reason personal service cannot 11 be effected,” service may be effected by: 12 (a) leaving a copy, in a sealed envelope addressed to the person, at the place of residence with anyone who appears to be an adult member of the same household; and (b) on the same day or the following day mailing another copy of the document to the person at the place of residence . . . . 13 14 15 16 Id. § 16.03(5). 17 Personal service on a corporation can be effected by “leaving a copy of the document 18 with an officer, director or agent of the corporation, or with a person at any place of 19 business of the corporation who appears to be in control or management of the place of 20 business.” Id. § 16.02(1)(c). Alternatively, service by mail is permitted “where the head 21 office, registered office or principal place of business of a corporation . . . cannot be found 22 at the last address recorded with the Ministry of Government and Consumer Services.” Id. 23 § 16.03(6). 24 III. Analysis 25 Defendants argue that this Court does not have personal jurisdiction over any of the 26 Defendants. ECF No. 6 at 9–16; ECF No. 9 at 5–10. Additionally, Defendants argue that 27 none of the Defendants has been properly served with process. ECF No. 6 at 6–9; ECF No. 28 9 at 2–5. Plaintiffs argue that the Court has personal jurisdiction over each Defendant and 5 23-CV-00382-RSH-NLS 1 that Plaintiff properly served each Defendant under the Ontario Rules of Civil Procedure. 2 ECF No. 8 at 5–15. 3 A. 4 In opposing Defendants’ motion to dismiss, Plaintiff does not argue that Defendants 5 are subject to general jurisdiction in California, but rather that Defendants are subject to 6 specific jurisdiction. Id. at 5–12. The Ninth Circuit analyzes specific jurisdiction using a 7 three-prong test: 8 Motion to Dismiss for Lack of Personal Jurisdiction (1) the non-resident defendant must purposefully direct his activities or consummate some transaction with the forum or resident thereof; or perform some act by which he purposefully avails himself of the privilege of conducting activities in the forum, thereby invoking the benefits and protections of its laws; (2) the claim must be one which arises out of or relates to the defendant’s forum-related activities; and (3) the exercise of jurisdiction must comport with fair play and substantial justice, i.e. it must be reasonable. 9 10 11 12 13 14 Mavrix Photo, 647 F.3d at 1227–28 (quoting Schwarzenegger, 374 F.3d at 802). A plaintiff 15 “bears the burden of satisfying the first two prongs.” Id. at 1228. If it does so, “the burden 16 then shifts to [the defendant] to set forth a ‘compelling case’ that the exercise of jurisdiction 17 would not be reasonable.” Id. (quoting Burger King Corp. v. Rudzewicz, 471 U.S. 462, 477 18 (1985)). 19 1. Purposeful Availment 20 The Complaint alleges several meaningful contacts with Plaintiff in California. 21 Plaintiff’s principal place of business is in California. ECF No. 1-2 ¶ 1. Plaintiff negotiated 22 the APA with Taskoob from California. Id. ¶ 23. Taskoob made the alleged 23 misrepresentations to Plaintiff while Plaintiff was in California. Id. ¶¶ 12–13, 23. Plaintiff 24 signed the APA in California. Id. ¶ 23. Plaintiff performed the APA in California, including 25 funding an escrow and taking ownership of purchased apps. Id. Taskoob sent its 26 representatives to Plaintiff in California, in order to transfer the computer code to Plaintiff 27 pursuant to the APA. Id. Indeed, Defendant Mehrain submitted a declaration stating that 28 he met with Plaintiff and its agents in California shortly after the APA was executed “for 6 23-CV-00382-RSH-NLS 1 the sole purpose of explaining how to access and compile the source code for the purchased 2 applications.” ECF No. 6-1 at ¶ 10. 3 Additionally, in responding to the Motion, Plaintiff submitted a declaration stating 4 that Taskoob hired a negotiator located in California to negotiate the APA on Taskoob’s 5 behalf and that nearly all the negotiations took place in California. ECF No. 8-2 at ¶ 3. 6 Defendants respond that their contact with Plaintiff was “fortuitous,” ECF No. 9 at 7 1, and that Defendants’ actions were directed “at Plaintiff” rather than “toward California,” 8 id. at 6. Defendants rely on the Supreme Court’s decision in Walden v. Fiore, 571 U.S. 9 277, 284 (2014), which held that, “[f]or a State to exercise jurisdiction consistent with due 10 process, the defendant’s suit-related conduct must create a substantial connection with the 11 forum State.” 12 In Walden, a police officer seized cash at the airport in Atlanta, Georgia, from airline 13 passengers who had connections to Nevada. Id. at 279–81, 288–89. The Supreme Court 14 held that the police officer lacked the minimal contacts with Nevada that were a 15 prerequisite to the exercise of jurisdiction over him in Nevada. Id. at 288. The officer 16 approached, questioned, and searched the individuals, and seized the cash at issue, in 17 Georgia. Id. But the officer “never traveled to, conducted activities within, contacted 18 anyone in, or sent anything or anyone to Nevada.” Id. at 289. The Court concluded that “it 19 is the defendant, not the plaintiff or third parties, who must create contacts with the forum 20 State. . . . Petitioner’s relevant conduct occurred entirely in Georgia, and the mere fact that 21 his conduct affected plaintiffs with connections to the forum State does not suffice to 22 authorize jurisdiction.” Id. at 291. 23 The facts presented here are different. As discussed above, Defendants negotiated a 24 $4.5 million commercial contract with a California-based company, with negotiations, 25 execution, and performance all occurring partially in California. Defendant used a 26 27 28 7 23-CV-00382-RSH-NLS 1 California-based negotiator.1 One of Taskoob’s two owners, Defendant Mehrain, travelled 2 to California to meet with Plaintiff in connection with performance under the APA. The 3 Court concludes that Defendants satisfied the first prong of Mavrix Photo, under which 4 “the non-resident defendant must purposefully direct his activities or consummate some 5 transaction with the forum or resident thereof; or perform some act by which he 6 purposefully avails himself of the privilege of conducting activities in the forum, thereby 7 invoking the benefits and protections of its laws.” Mavrix Photo, 647 F.3d at 1227–28; see 8 Glob. Commodities Trading Grp., Inc. v. Beneficio de Arroz Choloma, S.A., 972 F.3d 1101, 9 1108 (9th Cir. 2020) (“In cases where we have held that a contract between a forum resident 10 and a non-resident did not give rise to specific jurisdiction in the forum, we have done so 11 because the business relationship between the parties was fleeting or its center of gravity 12 lay elsewhere.”); Harris Rutsky, 328 F.3d at 1130 (“The purposeful availment requirement 13 is met if the defendant performed some type of affirmative conduct which allows or 14 promotes the transaction of business within the forum state.”) (internal quotation marks 15 omitted). 16 2. Arises Out Of Or Relates To 17 Defendants also argue a lack of nexus between Defendants’ forum-related activities 18 and Plaintiff’s claims. ECF No. 6 at 13–14; ECF No. 9 at 7. Defendants contend that the 19 “only in-person meeting in California post-dated the finalization of the parties’ 20 agreements.” ECF No. 6 at 14. As described above, this is not Defendants’ only contact 21 with California. The Complaint alleges that the representations that are the subject of this 22 23 24 25 26 27 28 1 Defendants argue in their reply brief that the Court should disregard the evidence that Taskoob hired a negotiator in California because that allegation was not included in the Complaint. ECF No. 9 at 6. But Defendants neither deny this fact nor offer any evidence to the contrary. The Court may consider this evidence. See Zeller v. Optavia, LLC, No. 22CV-434-DMS-MSB, 2022 WL 17858034, at *2 (S.D. Cal. Dec. 22, 2022) (“In resolving a Rule 12(b)(2) motion, the court may consider evidence outside the pleadings, including affidavits and other materials submitted on the motion.”). 8 23-CV-00382-RSH-NLS 1 lawsuit were made to Plaintiff, a California-based company, while Plaintiff was in 2 California; and that the contract at issue was negotiated, executed, and performed in part 3 in California. The Court thus concludes that Plaintiff’s claims “arise[] out of or relate[] to 4 the defendant’s forum-related activities.” See Mavrix Photo, 647 F.3d at 1227–28. 5 3. Reasonableness 6 Defendants argue that even if Plaintiff were able to satisfy the first two prongs of the 7 Ninth Circuit’s specific jurisdiction test, the final prong, reasonableness, is not satisfied. 8 ECF No. 6 at 14–16. The Court disagrees. 9 10 11 12 13 14 15 In making the reasonableness determination, the Ninth Circuit considers the following seven factors: (1) the extent of the defendants’ purposeful interjection into the forum state’s affairs; (2) the burden on the defendant of defending in the forum; (3) the extent of conflict with the sovereignty of the defendants’ state; (4) the forum state’s interest in adjudicating the dispute; (5) the most efficient judicial resolution of the controversy; (6) the importance of the forum to the plaintiff’s interest in convenient and effective relief; and (7) the existence of an alternative forum. 16 CE Distrib., LLC v. New Sensor Corp., 380 F.3d 1107, 1112 (9th Cir. 2004) (citing Harris 17 Rutsky, 328 F.3d at 1132). 18 Here, the first factor is neutral. There is no evidence that Defendants specifically 19 marketed their mobile applications to Plaintiff or to other California companies. 20 Nonetheless, Defendants actively sought to develop a business relationship with Plaintiff 21 through negotiating and executing the APA. 22 The second factor is likewise neutral. Defendants do not argue that litigating in the 23 United States is burdensome. Indeed, Defendants have sued Plaintiff in the District of 24 Delaware for breach of contract. Defendants argue that it would be “burdensome” for them 25 to litigate in two forums at the same time. ECF No. 6 at 15. However, there is no indication 26 that the burden of defending a lawsuit in federal court in California is any greater for 27 Plaintiff than the burden of prosecuting a lawsuit in federal court in Delaware. 28 9 23-CV-00382-RSH-NLS 1 Additionally, Defendants assumed this burden by filing their lawsuit in Delaware months 2 after the instant action had been filed by Plaintiff. 3 The third factor favors exercising jurisdiction. Defendants do not assert that 4 litigating this matter in California would create any conflict with the sovereignty of 5 Canada, Defendants’ country of residence. 6 The fourth factor favors exercising jurisdiction. Plaintiff is a California-based 7 company bringing claims arising from Defendant’s contacts with Plaintiff in California. 8 California has an interest in adjudicating the dispute. The APA contains a provision 9 allowing, but not requiring, suit to be brought in state or federal court in Delaware. ECF 10 No. 6 at 15. 11 The fifth factor favors exercising jurisdiction. In evaluating where the dispute can 12 be most efficiently resolved, the Ninth Circuit primarily looks at where the witnesses and 13 the evidence are likely to be located. Menken v. Emm, 503 F.3d 1050, 1060–61 (9th Cir. 14 2007). Although Plaintiff is incorporated in Delaware, witnesses and evidence relevant to 15 the representations made by Defendants are more likely to be located in California than in 16 Delaware. 17 18 The sixth factor favors exercising jurisdiction. Plaintiff chose to litigate in the forum where its business and witnesses are located. 19 The seventh factor is neutral. Although there is a pending lawsuit between the same 20 parties relating to the same agreement in another forum, the instant action was filed first, 21 such that that Defendants could reasonably expect to defend this action here. 22 The majority of the factors weigh in favor of exercising jurisdiction. For the Court 23 to decline the exercise of personal jurisdiction due to unreasonableness would require the 24 Defendant to “present a compelling case that the presence of some other considerations 25 would render jurisdiction unreasonable.” See Burger King, 471 U.S. at 477. Defendants 26 have not carried their burden here. 27 28 Accordingly, the Court denies Defendants’ motion to dismiss for lack of personal jurisdiction. 10 23-CV-00382-RSH-NLS 1 B. 2 Defendants argue that Plaintiff did not satisfy the personal or alternative standards 3 of service under the Ontario Rules of Civil Procedure with respect to any of the Defendants. 4 ECF No. 9 at 2–5. Plaintiff argues that alternative service under Rule 16.03(5) was effected 5 with respect to Defendants Mehrain and Geramianfar (ECF No. 8 at 14–15), and that both 6 the personal and alternative service standards are satisfied with respect to Defendant 7 Taskoob. Id. at 14. 8 Motion to Dismiss for Insufficient Service 1. Defendant Mehrain 9 Plaintiff does not claim that Defendant Mehrain was personally served.2 Rather, 10 Plaintiff asserts that the alternative service standard under the Ontario Rules of Civil 11 Procedure Rule 16.03(5) was satisfied by leaving a copy of the Summons and Complaint 12 with Defendant Mehrain’s mother, Mahvash Mehrain, at 59 Baltic Street; and by mailing 13 another copy to the same address. ECF No. 8 at 14–15. Plaintiff states that this alternative 14 method of service was used only after personal service on defendant Mehrain was 15 attempted three times. Id. at 15. 16 Defendants contend that the alternative service standard was not satisfied here 17 because Defendant Mehrain does not reside at 59 Baltic Street. ECF No. 9 at 4. Defendants 18 offer a declaration from Defendant Mehrain stating that as of January 30, 2023 (the date 19 that his mother was served), he did not live at 59 Baltic Street, and has not lived there since 20 then. ECF No. 6-1 ¶ 13. They also offer a declaration from Ms. Mahvash Mehrain stating 21 22 23 24 25 26 27 28 2 The proof of service attached to Plaintiff’s Complaint indicated that the process server personally served both Defendants Mehrain and Geramianfar. ECF No. 1-4. However, in its opposition to the pending Motion, Plaintiff included updated proofs of service, which Plaintiff obtained from its process server after Defendants’ counsel contacted Plaintiff’s counsel and stated that Defendants had not been served. ECF No. 8 at 4. These updated proofs of service indicate that Defendants Mehrain and Geramianfar were served by “substituted service,” not “personal service.” See ECF Nos. 8-10, 8-11. 11 23-CV-00382-RSH-NLS 1 that this is her home; that she has never been in any way affiliated with Taskoob; and that 2 her son no longer lived at the address in January 2023. ECF No. 6-5 ¶¶ 4, 5, 11. 3 The documentary evidence undermines these declarations. As set forth in Canadian 4 public filings, Taskoob is an active corporation, incorporated in 2018. ECF No. 8-5 at 1. It 5 has two directors, Defendants Mehrain and Geramianfar. Id. at 2. The address of the 6 corporation is 59 Baltic Street, Richmond Hill, Ontario, Canada. ECF No. 8-6 at 1. 7 Defendant Mehrain has the same address as the corporation, while Defendant Geramianfar 8 has the address of 56 George Kirby Street, Vaughan, Ontario, Canada. Id. The form 9 containing these addresses was signed by Defendant Mehrain. Id. 10 Additionally, the complaint filed by Taskoob in Delaware attaches the APA as an 11 exhibit. ECF No. 8-13 at 9. The APA is dated as of September 28, 2022. Id. It identifies 12 Taskoob’s address as 59 Baltic Street, and identifies Defendants Mehrain and Geramianfar 13 as Taskoob’s founders. Id. The APA provides that all notices to Taskoob shall be made to 14 Taskoob at 59 Baltic Street, and includes both Defendants Mehrain and Geramianfar as 15 addressees at that same address for purposes of receiving notice. Id. at 27. The APA was 16 signed by Defendant Mehrain as well as the other parties. Id. at 30. 17 In short, Taskoob’s address is, and at all relevant times has been, 59 Baltic Street. 18 Defendant Mehrain represented in Canadian corporate filings that this was his address too, 19 and in December 2022, signed the APA similarly identifying that address as his own. This 20 address belongs to his mother, who lives there. Defendants are asking the Court to accept 21 that Defendant Mehrain moved out, but that the house where Ms. Mehrain lives continues 22 to serve as the business address of Taskoob—even though Ms. Mehrain herself has no 23 affiliation with the company. The Court rejects this apparent gamesmanship and concludes, 24 based on Defendant Mehrain’s own signed statements and Taskoob’s corporate filings, that 25 for purposes of service of process, 59 Baltic Street is Defendant Mehrain’s “place of 26 residence.” 27 /// 28 /// 12 23-CV-00382-RSH-NLS 1 2. Defendant Geramianfar 2 In contrast, the record does not reflect that Defendant Geramianfar resides or has 3 ever resided at 59 Baltic Street. Although the APA identifies him as an addressee at that 4 location, this fact—when considered in connection with corporate records reflecting that 5 59 Baltic Street is his co-founder’s address and that Defendant Geramianfar lives at a 6 different address—is insufficient to establish that 59 Baltic Street is his “place of 7 residence.” That service is ineffective and will be quashed. See Pathak v. Omaha Steaks 8 Intern., Inc., No. CV 10-7054, 2011 WL 1152656, at *1 (C.D. Cal. Mar. 28, 2011) (“If the 9 Court determines that the plaintiff has not properly served the defendant in accordance with 10 Federal Rule of Civil Procedure 4, the Court has discretion to either dismiss the action for 11 failure to effect proper service, or instead retain the action and quash the ineffective service 12 that has been made on the defendant in order to provide the plaintiff with the opportunity 13 to properly serve the defendant.”). 14 In cases removed from state court, a plaintiff may serve process after removal if 15 service of process was defective or was not attempted before removal. Whidbee, 857 F.3d 16 at 1023 (holding that the Federal Rules of Civil Procedure apply to a civil action after 17 removal). Rule 4, which governs service of process in a civil action after removal, is “a 18 flexible rule that should be liberally construed so long as a party receives sufficient notice 19 of the complaint.” Id. (quoting Direct Mail Specialists, Inc. v. Eclat Computerized Techs., 20 Inc., 840 F.2d 685, 688 (9th Cir. 1988)). 21 While Rule 4(m) generally provides the applicable time limit within which service 22 has to be effected, it “does not apply to service in a foreign country[.]” Fed. R. Civ. P. 23 4(m); Lucas v. Natoli, 936 F.2d 432, 432 (9th Cir. 1991) (holding that the requirement of 24 service within the time limit prescribed by Rule 4 was inapplicable to service in a foreign 25 country). Accordingly, the Court grants Plaintiff leave to serve Defendant Geramianfar 26 within sixty (60) days from the date of this Order. In the event that Plaintiff fails to effect 27 service within this period, Defendants may renew their motion to dismiss for lack of service 28 of process as to Defendant Geramianfar. 13 23-CV-00382-RSH-NLS 1 3. Defendant Taskoob 2 The personal service standard for a corporation under the Ontario Rules of Civil 3 Procedure Rule 16.02(1)(c) requires “leaving a copy of the document with an officer, 4 director or agent of the corporation, or with a person at any place of business of the 5 corporation who appears to be in control or management of the place of business.” Ontario 6 Rules of Civil Procedure, R.R.O. 1990, Reg. 194 § 16.02(1)(c). Plaintiff contends that this 7 requirement was fulfilled by leaving the Summons and Complaint with Defendant 8 Mehrain’s mother, Ms. Mehrain, the only adult present at Taskoob’s registered address. 9 ECF No. 8 at 14. 10 Defendants argue that leaving the Summons and Complaint with Ms. Mehrain was 11 not sufficient to effect personal service on Taskoob because Ms. Mehrain has never been 12 professionally affiliated with Taskoob nor ever been authorized to accept service on behalf 13 of Taskoob. ECF No. 6 at 8; ECF No. 9 at 3. As discussed above, the Court concludes that 14 59 Baltic Street is the business address of Taskoob. Ms. Mehrain identifies this address as 15 “my home,” ECF No. 6-5 ¶ 5, and she was the person present when service was attempted, 16 id. ¶ 7. It follows that she was “a person at any place of business of the corporation” who 17 appeared to be in control or management of “the place of business,” whether or not she 18 appeared to be in control of Taskoob as a company.3 Accordingly, personal service under 19 Rule 16.02(1)(c) has been properly effected with respect to Defendant Taskoob. 20 /// 21 /// 22 /// 23 /// 24 /// 25 26 27 28 3 Ontario courts have interpreted Rule 16.02(1)(c) to require “service on a person who ‘appears’ to be in control or management of the premises.” Darlind Const., Inc. v. Rooflifters, LLC, 2009 CanLII 13617, para. 28 (Can. Ont. Sup. Ct. J.) (emphasis added). 14 23-CV-00382-RSH-NLS 1 IV. Conclusion 2 For the foregoing reasons, Defendants’ motion to dismiss is DENIED. ECF No. 6. 3 Service of process as to Defendant Geramianfar is QUASHED; the Court GRANTS 4 Plaintiff leave to serve Defendant Geramianfar within sixty (60) days from the date of this 5 Order. 6 7 8 IT IS SO ORDERED. Dated: June 9, 2023 ____________________ Hon. Robert S. Huie United States District Judge 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 15 23-CV-00382-RSH-NLS
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