In re GLG Life Tech Corp. Securities Litigation
287 F.R.D. 262
| S.D.N.Y. | 2012Background
- Plaintiffs allege GLG Life Tech Corp, Luke Zhang, and Brian Meadows violated federal securities laws and seek service on Zhang by alternative means under Rule 4(f)(3).
- Zhang is a Canadian citizen and GLG's Chairman/CEO; Meadows is GLG's CFO; GLG was served Feb. 17, 2012, and Meadows was served in Vancouver via the Hague Convention on Mar. 2, 2012.
- Zhang's residential address in China was sought after attempts to serve at GLG’s Vancouver office failed; locating an address in China proved costly and uncertain.
- On Aug. 9, 2012, plaintiffs moved for leave to serve Zhang by alternative means, proposing service on GLG’s counsel, on GLG’s registered agent, or by email if discovery reveals Zhang’s address.
- GLG opposed; the motion papers later disclosed a Chinese address offered by GLG’s counsel’s office, but the source and accuracy of the address were not fully substantiated.
- The court deemed GLG's submissions as amicus curiae and granted leave to serve Zhang by alternate means, finding the methods (counsel or domestic agent) would provide constitutionally adequate notice.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| May GLG oppose the 4(f)(3) motion on behalf of Zhang? | GLG lacks standing since served parties must object for redressable injury. | GLG’s submissions are relevant; as related to Zhang, amicus input aids decision. | GLG treated as amicus; motion considered on its merits. |
| Does Rule 4(f)(3) authorize alternative service on Zhang via counsel or domestic agent given Hague concerns? | 4(f)(3) permits court-ordered alternatives when Hague service is slow or impractical. | Service via counsel or agent may be sufficient notice and avoid delay. | Yes; alternative service authorized on GLG’s counsel and GLG’s domestic agent. |
| Does the proposed alternative service satisfy due process? | Notice will be reasonably calculated to inform Zhang of the action. | Address reliability and transmission accuracy require scrutiny. | Due process satisfied; notice reasonably calculated to apprise Zhang. |
Key Cases Cited
- Madu, Edozie & Madu, P.C. v. Socketworks Ltd. Nigeria, 265 F.R.D. 106 (S.D.N.Y. 2010) (co-defendants lack standing to contest improper service claims)
- S.E.C. v. Lines, 2009 WL 2431976 (S.D.N.Y. 2009) (recognizes standing limitations for third-party objections)
- Rio Props., Inc. v. Rio Int'l Interlink, 284 F.3d 1007 (9th Cir. 2002) (4(f)(3) discretion; service methods not hierarchically ordered)
- Advanced Aerofoil Techs., AG v. Todaro, 2012 WL 299959 (S.D.N.Y. 2012) (no hierarchy among Rule 4(f) subsections)
- Swarna v. Al-Awadi, 2007 WL 2815605 (S.D.N.Y. 2007) (Rule 4(f)(3) discretion; factors for alternative service)