Brinks Glob. Servs. USA v. Bonita Pearl Inc.

686 F.Supp.3d 357

BRINKS GLOBAL SERVICES USA, INC., Plaintiff, v. BONITA PEARL INC., et al., Defendants.

22-CV-6653 (PGG) (BCM)

United States District Court, S.D. New York

Signed August 14, 2023

Robert F. Redmond, Jr., Matthew D. Fender, McGuireWoods LLP, Richmond, VA, Katherine A. Garland, McGuire Woods, New York, NY, for Plaintiff.

Robert R. Viducich, Law Office of Robert R. Viducich, New York, NY, for Defendants Bonita Pearl Inc., Forty-Seventh & Fifth, Inc., Hawaiian Design Jewelry, Co., Kimimoto Jewelry, Lams Jade Center, Inc., Lees International Jewelry Inc., Pan Lovely Jewelry, Petri Gems. Inc., S & N Diamond Corp., Supreme Collection Corporation, Treasure Connection Fine Jewelry, Inc.

MEMORANDUM AND ORDER

BARBARA MOSES, United States Magistrate Judge.

Plaintiff Brink's Global Services USA, Inc. (Brink's) moves pursuant to Fed. R. Civ. P. 4(d)(2) to recover its expenses incurred in serving defendants with process after they failed to waive such service, and for its attorneys' fees incurred in making the motion, in the aggregate amount of $27,234.15. (Dkt. 85.)¹ For the reasons set forth below, plaintiff's motion will be granted in part, and it will be awarded a total of $25,427.16.

I. BACKGROUND

Defendants in this action are corporations and sole proprietorships in the business of selling jewelry at gem and jewelry shows. Compl. ¶¶ 2-15. Defendants contracted with Brink's to transport their jewelry from show to show. Id. ¶¶ 16-18. On July 10, 2022, at approximately 2:00 a.m., an armored truck owned and operated by Brink's was burglarized at a highway rest stop in California, and jewelry owned by the defendants was stolen. Id. ¶¶ 19-22. Brink's filed this action less than a month later, on August 4, 2022, seeking a declaration that the Brink's Global Services Valuable Transport Contract (the Contract) limits each defendant's maximum recovery to the value of its jewelry as declared in the Pickup Manifest signed by or on behalf of that defendant, notwithstanding that, according to Brink's, they "substantially under-declared the value of their shipments on the Pickup Manifest," apparently to save associated insurance costs. Id. ¶¶ 16-17, 22, 40-43.²

Plaintiff's attorneys Robert E. Redmond and Katherine A. Garland state that on August 10 and 11, 2022, Brink's "served the Defendants by First-Class Mail with: (1) notices of lawsuit and request to waive service of summons (the 'Notices'); (2) waiver of service of summons forms (the 'Waivers'); (3) copies of the Complaint; and (4) prepaid return envelopes addressed to Brink's counsel" (hereafter the "Waiver Packets"). Redmond Decl. (Dkt. 86) ¶ 4; see also id. Exs. A, B; Garland Decl. (Dkt. 96) ¶ 2. As to the ten corporate defendants named in the Complaint (the Corporate Defendants), the Waiver Packets were mailed to their "designated agents for service of process," as reflected on the websites of the secretaries of state for the states in which they were registered. Garland Decl. ¶¶ 3, 5; id. Ex. A (printouts of secretary of state website entries). As to the three sole proprietorships (the Sole Proprietorship Defendants), Brink's was "not able to locate secretary of state filings," but instead searched "commercial databases" and mailed the Waiver Packets to addresses found there. Id. ¶¶ 4, 5, & Ex. B (printouts of commercial database listings).

On August 15, 2022, the Hon. Paul G. Gardephe, United States District Judge, issued a Notice of Pretrial Conference (Notice) (Dkt. 55), scheduling the conference for November 3, 2022, and on August 18, 2022, Brink's "provided further notice of [this] Action" by mailing a copy of the Notice to each defendant, along with a copy of Judge Gardephe's Individual Rules of Practice. Redmond Decl. ¶ 5 & Ex. C.

On August 22, 2022, all 13 defendants herein, represented by lawyers including Gerald L. Kroll of Kroll Law and Walter J. Lack and Steven C. Shuman of Engstrom, Lipscomb & Lack, filed a complaint in California Superior Court (the California Action) against Brink's and others. In the California Complaint (Cal. Compl.) (Dkt. 70-1), defendants asserted claims for breach of contract and unfair business practices (against Brink's), negligence, fraud, and conversion (against Brink's and three of its employees), and premises liability (against the owners and operators of the rest stop where the theft occurred). Cal. Compl. ¶¶ 4-76. Defendants allege, among other things, that the liability-limiting language upon which Brink's relies was printed on the reverse of the Pickup Manifests they signed "in gray type on yellow papers" and in "microscopic print," such that it was "illegible," and that, in any event, they "did not have the opportunity to read it" before they signed the Pickup Manifest. Id. ¶ 14. In addition, defendants assert that the terms of the Contract are so one-sided and unfair as to be unenforceable. Id. ¶¶ 21-27. In California, defendants seek the full value of their stolen jewelry, estimated at $100 million, plus lost profits and "general" damages to be determined at trial, treble damages, and other relief. Id. ¶¶ 22-23.

Brink's received a copy of the California Complaint on or about August 25, 2022. Redmond Decl. ¶ 6. Four days later, on August 29, 2022, attorney Garland sent a letter to the attorneys representing defendants in the California Action, by email, to "provide you with notice of [this] Action and to obtain your client's consent to a waiver of service." Redmond Decl. ¶ 7 & Ex. D.³ Attached to the August 29 email were additional copies of the Waiver Packets, as well as the Notice and Judge Gardephe's Individual Practices. Id. Ex. D, at ECF pp. 4-90. In her letter, attorney Garland asked the California attorneys to "advise if your clients have executed the Waivers." Id. Ex. D, at ECF p. 2.

Later that day, attorney Redmond telephoned Walter Lack "at the telephone number listed below Mr. Lack's signature block on the California Complaint" and "left a voicemail message asking Mr. Lack if his clients would agree to waive service of the Complaint and summons issued in this Action[.]" Redmond Decl. ¶ 8. The following day, having received no response, attorney Redmond left attorney Lack a second voicemail. Id.⁴

As of "early September, 2022, no Defendants had signed or returned the Waivers[.]" Redmond Decl. ¶ 9. Nor had defendants' California counsel responded in any way to the August 29 email, the letter mailed that same day, or the voicemails left on August 29 and 30, 2023. Id. ¶ 9. Consequently, in order to "satisfy its obligations and effectuate service within the 90-day deadline set forth under [Rule 4(m)]," Brink's "initiated formal service of process under Rules 4(c) and (h)." Id. ¶ 9.

Plaintiff initially retained Classic Legal Support Services, Inc. (Classic Legal), which was able to serve four defendants "at their designated addresses for service of process." Redmond Decl. ¶ 10. Classic Legal served Arat Jewelry Corp. (Arat), Forty-Seventh and Fifth, Inc. (Forty-Seventh), Lam's Jade Center, Inc. (Lam's), and Lee's International Fine Jewelry (Lee's). Id. However, Classic Legal "encountered obstacles serving the remaining Defendants and concluded that [their] known business addresses were either incorrect, vacant, or closed." Id.⁵ Brink's concluded that it would have to "identify the personal addresses of the officers or agents of [the remaining] Defendants" and serve them through those agents. Id. On September 14, 2022, plaintiff retained First Legal Investigations (First Legal), "a process server capable of conducting 24-hour surveillance upon those officers and/or agents, and effectuating service against Defendants through those officers and/or agents during non-business hours." Redmond Decl. ¶ 11. "On October 11, 2022, First Legal completed its service efforts in this Action[.]" Id.⁶

On November 9, 2022, Brink's filed its motion to recover its service of process costs, together with its fees incurred in making the motion, pursuant to Rule 4(d)(2). Based on the invoices from Classic Legal and First Legal, plaintiff seeks $26,019.15 in service costs. See Pl. Mem. (Dkt. 87) at 9.⁷ Additionally, it seeks $1,215 for "two hours of attorney time solely devoted to the time spent preparing this Motion and supporting Declaration," bringing the total amount sought to $27,234.15. Id.

After the motion was fully briefed, two of the original 13 defendants - Arat and El Dorado Jewelry, Inc. (El Dorado) - entered into settlements with Brink's. As a result, plaintiff dismissed its claims against Arat and El Dorado, with each party to bear its own fees and costs. (Dkts. 123, 136.)

II. LEGAL STANDARDS

Rule 4(d) "permits a plaintiff to request that a defendant waive the formal requirements of service of process and further allows the plaintiff to recover the costs of complying with those requirements if the defendant refuses to waive formal service." Stapo Inds., Inc. v. M/V/ Henry Hudson Bridge, 190 F.R.D. 124, 125 (S.D.N.Y. 1999). The notice and request must:

(A) be in writing and be addressed:

(i) to the individual defendant; or

(ii) for a defendant subject to service under Rule 4(h), to an officer, a managing or general agent, or any other agent authorized by appointment or by law to receive service of process;

(B) name the court where the complaint was filed;

(C) be accompanied by a copy of the complaint, 2 copies of the waiver form appended to this Rule 4, and a prepaid means for returning the form;

(D) inform the defendant, using the form appended to this Rule 4, of the consequences of waiving and not waiving service;

(E) state the date when the request is sent;

(F) give the defendant a reasonable time of at least 30 days after the request was sent--or at least 60 days if sent to the defendant outside any judicial district of the United States--to return the waiver; and

(G) be sent by first-class mail or other reliable means.

Fed. R. Civ. P. 4(d)(1).

"An individual, corporation, or association that is subject to service under Rule...