Here is yet another post in our “How to Avoid Having to Hire Us” series.  Depending on your perspective, though, it could be viewed as “How to Recover the Fees You Pay Us” instead.

Frankly, I prefer the latter.  In this installment, we explore how to get the defendant to waive service or, looking at it from another angle, why a foreign defendant ought to waive.  [This pertains to federal suits, where service of process is governed by FRCP 4, found in its entirety here.]

The best way to avoid procedural headaches and the significant cost of serving abroad?  Ask the defendant to waive service.  Don’t get them to accept service—get them to waive.  Take a carrot & stick approach if need be, because with a waiver, everybody wins—the plaintiff avoids a hassle, the judge has one less issue to deal with on her docket, and the defendant can count on some much-needed grace from the judge later on.

The Carrot, 4(d)(3)

The upside to a waiver: extra time.  An ordinary civil summons requires a defendant in Paris to answer a complaint within 21 days of service, whether it’s the Paris in Texas or the one in France.  But if the U.S. defendant waives service, he gets sixty days, while the foreign defendant gets a full ninety days to answer.  Three months instead of three weeks… a handy negotiating tool when opposing counsel is on the phone telling you his client won’t authorize him to play ball.

The Stick, 4(d)(2)

Two downsides to a refusal: (1) a perturbed/annoyed/frustrated judge, and (2) fee-shifting, resulting in no small part from the judge’s perturbation.  The court has to assess fees to U.S. defendants who refuse a waiver—not only the fees to effect service, but also the cost for counsel to write and submit a motion to collect those fees.*

Important to note: the fact that a judge isn’t compelled to shift fees to foreign defendants doesn’t mean she can’t shift fees to foreign defendants.  The tool is available to plaintiffs, but it is very rarely used (I welcome readers’ thoughts as to why that is).  A bit of analysis is in order to support my contention that it can (and should) be done…

Rule 4(d)

Rule 4(d)(1) compels defendants to prevent the unnecessary expenses of serving process.  That means all defendants, without qualification.  And unless they can demonstrate a darned good basis for refusal, they have to reimburse the cost to serve them.

This fee-shifting is mandatory for U.S. defendants, as is clear from the plain language of 4(d)(2).   Less clear is how fee-shifting applies to foreign defendants.  For reasons not entirely fleshed out in the Advisory Committee Notes, 4(d)(2) doesn’t address the issue as to foreigners.  Arguably, it might seem to proscribe such fee-shifting by omission, and one statement in the 1993 Notes indicates that foreigners need not show good cause.  This argument is undermined by two ideas:  (1) the extra month offered to foreigners who waive, and (2) the extra time allowed for reply to a waiver request, as set forth in 4(d)(1)(F).  Moreover, the ’93 Notes go into significant detail as to why a foreign defendant is just as obliged as a U.S. defendant to avoid forcing a plaintiff to spend unnecessarily.  They even suggest that foreigners are even more obliged to waive in light of the significantly higher costs of serving them.

Serving process domestically isn’t that costly—a hundred bucks to a process server or local sheriff will usually do the trick.  But the bill for service abroad can reach the five-figure range, especially where pleadings are quite lengthy (e.g.: patent litigation) and must be translated.

If Apple, Inc. is accused of patent infringement, service is pretty simple and pretty cheap.   But if Samsung or LG are accused of the same infringement, the cost to serve them in Korea is astronomical.  Translation of a patent in the consumer electronics world can run into tens of thousands of dollars.  Likewise, serving GM or Ford in a product defect action is inexpensive and fairly straightforward.  But such an action against Volkswagen or BMW in Germany, Toyota or Honda in Japan, Hyundai or Kia in Korea… again, thousands of dollars.

All of these defendants profit significantly from the U.S. market, yet are the foreigners immune from the obligations placed on U.S. companies?  Highly doubtful that a judge would see it that way.

That 4(d)(2) identifies only U.S. defendants results from very confused diplomatic pressure by the United Kingdom, as detailed in Brockmeyer v. May, 383 F. 3d 798 (9th Cir., 2004) (begin at 807 for a bit of a lark).**  A conclusion that fees simply cannot be assessed to defendants who refuse to waive is flat wrong, and the ’93 Notes bear this out by describing specific conditions under which they should be excused.  Brockmeyer seems to say—in dicta, admittedly—that foreign defendants bear the same duty, and are therefore subject to the same penalty for refusal, as domestic defendants.

Policy

The reason underpinning the fee-shifting rule is simple: even contentious litigation must proceed under a certain code of conduct, lest the docket be unnecessarily clogged and the cost of litigation exceed already stratospheric levels.  As part of that code of conduct, parties are expected to concede certain inevitabilities; among them is the certainty that they will be served eventually, so making the plaintiff jump through flaming hoops is, at best, churlish.

My wife, Peggy, articulates this idea much more succinctly: Don’t Be a Jerk.  (And when I’m a jerk, this happens.)

Now, Peggy is a world-class expert in dispute resolution (seriously—she aced a master’s program in the field at a Jesuit school, and those Jesuit guys are hardcore).  She will argue until she’s blue in the face that a suitable resolution is far more likely if grown-ups act like grown-ups.  If a defendant is recalcitrant and refuses to waive service merely because they can refuse, it’s going to be a long, cold, lonely winter.  I’ll leave civility arguments to more learned colleagues, but it seems awfully clear that if a defendant is unwilling to waive service, they will probably be just as unwilling to fight under Queensberry rules after the opening bell.  Nobody on either side should expect the grace of an extra few days on a pleading deadline.

But it does not have to be that way.  If you’re defense counsel, I urge you to simply waive if the plaintiff asks nicely.  (On the other hand, if they proceed straight to service, let me take a look at it to ensure that it’s solid!)

Push the Issue, But Only If You Can Enforce a Judgment Here

The bottom line if you’re plaintiff’s counsel: ask for a waiver, following the steps outlined in 4(d)(1).  If they ignore or refuse your request, hire somebody to have service effected (or if you must, handle it yourself, but still outsource the translation), and then move for fee-shifting!  There is no reason that your client should bear the cost of serving a defendant who is obliged to avoid that cost in the first place.

Of course, tread lightly.  In light of the confused British objection, which I imagine would be joined by any number of other countries, plaintiffs may be wise to assert their right to fee-shifting only if the defendant has assets here in the United States.  If you have to go abroad to collect, you are better off eating the cost to serve, and collecting only on the judgment itself.

 


* Oddly enough, I’ve never had anybody take me up on my suggestion that they recoup my fees from a defendant who refused to waive.  Heck, I’ll even write the motion.

** Brockmeyer, incidentally, is part of a significant circuit split over the issue of mail service under the Hague Service Convention.  I insist that the Brockmeyer court got it wrong, rather than following Ackermann v. Levine (2d Cir., 1989).  Although Hague mail service is a bad idea, it’s legally valid, as I predict the Nine Eight Wise Souls will hold very soon.

UPDATE, May, 2017:  Brockmeyer has been overturned— unanimously– at least as far as its prohibition on Hague mail service is concerned.  That holding is no longer good law, but the dicta are still informative.

 

 

  • Dindunaffin

    Does it have any impact on the operation of the Hague Convention if you request a waiver under the Federal Rules of Civil Procedure or state rules of civil procedure?

    • Yes– if a defendant waives service, then the Hague Service Convention does not apply, because there is no “occasion to transmit” the documents for service.

      • Dindunaffin

        Thanks for such a quick response. What I was aiming at is-is there a difference between if a defendant waives services under Federal Rules of Civil Procedure, as opposed to state rules? I think it does not. Apologies if my question wasn’t clear. What a great blog and very useful articles!

        • No worries. The answer to that question really depends on the state. Many state procedural rules track the federal rules almost word for word. But in a larger sense, the same result holds– if a defendant waives, then there is no transmission necessary *for service*, so the Hague Service Convention does not apply.

  • bee

    It would be nice if it included the correct procedures to have service waived. I’m filing for divorce and I know the other party will waive service, I just don’t know how to go about doing that. Do they write on a small napkin “I waive service”?

    • Rule 4(d) governs federal cases, but state procedures are far too varied for this space.