BHTT ENTERTAINMENT, INCORPORATED, Plаintiff-Appellee, v. BRICKHOUSE CAFÉ & LOUNGE, L.L.C.; Brickhouse Restaurant and Bar, L.L.C; Jonah Investments, L.L.C., Defendants-Appellants.
No. 16-10687
United States Court of Appeals, Fifth Circuit.
FILED May 24, 2017
854 F.3d 310
JERRY E. SMITH, Circuit Judge
Accordingly, the judgment is AFFIRMED. Coleman‘s motion for a proposеd settlement is DENIED.
The dismissal of the complaint counts as a strike under
James Patrick Sullivan, Richard John Groos, John Bradford Thompson, King & Spalding, L.L.P., Austin, TX, for Plaintiff-Appellee.
Charles A. Caldwell, II, Law Offices of Charles A. Caldwell, P.L.L.C., Dallas, TX, for Defendants-Appellants.
Before SMITH and HAYNES, Circuit Judges, and JUNELL, District Judge.*
Brickhouse Café & Lounge, LLC, Brickhouse Restaurant аnd Bar, LLC, and Jonah Investments, LLC (collectively, “Brickhouse“), appeal a default judgment. BHTT Entertainment, Incorporated (“BHTT“), challenges this court‘s jurisdiction and contends that, in the event we do have appellate jurisdiction, we should affirm the default. We conclude that we do have jurisdiction and that the district court was correct to enter default judgment.
I.
This case began as a garden-variety trademark dispute. BHTT owns the trademarks to Brick House Tavern + Tap and Brick House Subs (collectively, “the BHTT Marks“). Brickhouse operates two restaurants in the Dallas area—one in Arlington, one in Desoto—promoted at various times as The Brickhouse Lounge, Brickhouse Café & Lounge, and Brickhouse Grill & Bar (collectively, “the Brickhouse Marks“). BHTT concluded that Brickhouse‘s usage of the Brickhouse Marks infringed on the BHTT Marks, so it sued Briсkhouse Café & Lounge LLC (and only that specific
After an entry of default against Brickhouse Café & Lounge, LLC, BHTT discovered that the other two defendants also had managerial roles with regard to the Brickhouse Lounge. BHTT amended its complaint to add them as defendants and attempted to serve its complaint on Charles Bailey, the registered agent for each component of Brickhouse. Bailey proved elusive; his listed address was an open field beside Interstate 20 in Grand Prairie, Texas, and attempts to contact him at other businesses and residences associated with him met with failure. Faced with Bailey‘s elusiveness, BHTT successfully moved for substituted service under
Brickhouse did not respond. BHTT moved for an entry of default, the clerk entered it, BHTT moved for a default judgment, and the district court entered a default judgment in April 2016. Only then did Brickhouse deign to appear; it did not contest the default judgment in district court but instead appealed.
Brickhouse‘s initial brief in this court was due August 1, 2016, but it failed to meet both that deadline and an extended deadline granted after a motion for extension of time. Faced with that dilatory conduct, the clerk of this court entered an order dismissing Brickhouse‘s appeal for want of prosecution pursuant to Fifth Circuit Rule 42.3. That dismissal returned the mandate to the district court. Brickhouse‘s counsel moved to reinstate the appeal; the clerk initially denied that motion but granted it upon reconsideration and reopened the case. The order the clerk issued reopening the case, however, did not state explicitly that it was recalling the mandate from the district сourt. Briefing in this case has continued without any major problems since that time.
BHTT avers that the clerk‘s order reopening the appeal did not suffice to recall the mandate and that the failure to recall the mandate divests us of appellate jurisdiction. In the alternative, BHTT contends that Brickhouse‘s failure to contest the default judgment first in the district court means that all its issues in the court оf appeals are waived, based on our well-known practice of generally not considering arguments not first made before the district court.1 And, finally, BHTT contends that the district court was correct in its judgment of default regardless. Brickhouse does not respond to the first two arguments raised by BHTT; it confines its appeal to challenges to service of process and answers to BHTT‘s trademark claims on the merits.2
II.
BHTT urges that this court never recalled the mandate that issued when this case was initially dismissed for want of prosecution and that the failure to recall the mandate is fatal to appellate jurisdiction. The list of cases in which this court
BHTT presents two theories why the clerk could nоt have recalled the mandate. First, it points out that the clerk‘s order reinstating this appeal merely stated that the “[c]ase is reopened“; BHTT suggests that that terse statement did not suffice to recall the mandate. Second, BHTT contends that, even in the event the clerk‘s pronouncement purported to recall the mandate, the clerk lacked the power to do so under thе Fifth Circuit‘s rules, and so any supposed recall was ineffective.
We dispense with the second argument first. The circuit‘s rules leave us with the firm conviction that the clerk can recall a mandate under the circumstances presented here. Fifth Circuit Rule 27.1.6 gives the clerk the authority to “reinstate appeals dismissed by the clerk“; this is the rule under which Brickhouse moved to reinstate its appeal. No оne contests that the mandate issues immediately upon the dismissal of an appeal by the clerk, and it would make little sense to give the clerk the authority to reinstate appeals he dismissed but to render any such reinstatement jurisdictionally infirm from its inception.
BHTT counters that Rule 27.2.7 explicitly states that only a judge is empowered to recall the mandate, as distinguished from the various motions that a clerk may rule on listed in Rule 27.1. This is correct, in some sense, though BHTT omits relevant context; Rule 27.2.7 permits a single judge to “stay the issuance of mandates or ... recall same pending certiorari.” It is silent on the power to recall a mandate where certiorari does not loom. Moreover, the internal operating procedures (“IOPs“) to Rule 27 state that “[t]he clerk or a single judge, as aрpropriate, decides a motion for stay or recall of mandate pending action on a petition for writ of certiorari....” Given the conflict between Rule 27.2.7 and its IOPs, as well as their limitation to situations in which certiorari is a factor, the clerk‘s power to recall a mandate is coterminous with his power to reinstate an appeal under Rule 27.1.
Did he do so here? True, the ordеr reopening this case did not explicitly recall the mandate, and Brickhouse‘s motion also called for reopening the case instead of recalling the mandate. But to hold that such a minor change in wording deprives us of appellate jurisdiction would be to privilege form too much over function. A motion to recall the mandate and a motion to reopen the case have the same effect; they both ask this court to resurrect a matter it had finally disposed of. Thus, we conclude that the clerk had the power to
III.
BHTT maintains that Brickhouse has waived its insufficient-service-of-process argument by failing to raise it first in the district court. In BHTT‘s view, аfter the default judgment was entered Brickhouse should have moved to set it aside under
There is a circuit split on this issue.7 But, given the weakness of Brickhouse‘s arguments for vacating the default judgment, choosing sides fully and finally is best left for another day. We assume arguendo that Brickhouse can challenge the default judgment without first bringing a
Brickhouse maintains that the default judgment must be set aside because service of process was invаlid. “This court reviews a district court‘s decision on entry of a default judgment for abuse of discretion.” Cambridge Toxicology Grp., Inc. v. Exnicios, 495 F.3d 169, 179 (5th Cir. 2007). The validity or invalidity of service of a defendant in a federal district court is governed by federal law,9 and the federal law of service is provided by
Although Brickhouse has not challenged its amenability to service, its briefing raises three arguments as to why service was improper under Texas law. First, it claims that “each of the sworn affidavits of service state [sic] that each defendant was served on March 12, 2016 at 3:35 pm, by the same process-server, at three different addresses, which is physically impossible.” Second, it posits that Section 5.251(1)(B) of the Texas Business Organizations Code requires that the Secretary of State be served if a corporation‘s registered agent cannot be located, but the Secretary of State was not served here. Finally, Brickhouse states without elaboration that “each of the affidavits fails to properly identify the address where process was served and/or fails to correctly indicate the time at which process was served, which violates the requirements of
To Brickhouse‘s first contention—under
In other words, the district court dirеcted BHTT to serve all three defendants at once, by leaving the summons and complaint with one person in one location. And the process-server stated in his affidavits that he served the defendants in the manner prescribed by the district judge. Contrary to Brickhouse‘s suggestion, those affidavits do not assert that the server was in three different places at the same time;
So too for its next argument. Brickhouse avers that the рrocedure in Section 5.251(1)(B)—namely, serving the Secretary of State if the registered agent for a corporate entity cannot be found—represents the only acceptable means of serving Brickhouse. Again, this notion is frivolous; Section 5.256—part of the very same subchapter—explains that “[t]his chapter does not preclude other means of service of process ... on a domestic or foreign entity as provided by other law.”
Brickhouse‘s final position is that the affidavits of service do not properly identify the time and location at which service was effected, rendering service invalid. Cited as authority is
Post-briefing, Brickhouse raised three additional barriers to proper service: two via Fifth Circuit Rule 28(j) letter and one at oral argument. In its Rule 28(j) letter, Brickhouse contends first that Harper Macleod establishes that Texas law governs service under the Texas Rules of Civil Procedure. We do not disagree. In Harper Macleod, 260 F.3d at 398-99, this circuit set aside a default judgment because service did not strictly comply with the relevant portion of Texas‘s service rules. But what Harper Macleod has to do with this case beyond that uncontroversial proposition is unclear. It dealt with service under Section 17.044(b) of the Texas Civil Practice and Remedies Code, which “provide[d] for substituted service on the Secretary for nonresident defendants doing business in Texas that do not maintain a regular place of business in Texas.” Harper Macleod, 260 F.3d at 398. As discussed above, Brickhouse‘s place of business is in Texas, so Section 17.044(b), and thus that portion of Harper Macleod, is neither here nor there.
The second case that appears for the first time in Brickhouse‘s Rule 28(j) letter is Uvalde Country Club v. Martin Linen Supply Co., 690 S.W.2d 884 (Tex. 1985) (per curiam). There the court deemed service improper where service nominally effected on Uvalde‘s registered agent, Henry Bunting, Jr., was in fact made on someone denoted on the return of service as just “Henry Bunting.” Id. Here, of course, Brickhouse‘s registered agent was never served, because he could not be located. Instead, service was effected in accordance with other relevant provisions of Texas law. Uvalde Country Club, too, is inapposite.
Finally, for the first time at oral argument, Brickhouse raised Bailey‘s Furniture, Inc. v. Graham-Rutledge & Co., 2012 WL 6554420 (Tex. App.—Dallas 2012, no pet.) (mem.), to recommend that, under Texas law, the only way to effect substituted service on a corporation is through the Secretary of State. Bailey‘s Furniture, however, does not even mention the Secretary of State. Instead, the court ruled service improper because “servicе was sought upon Bailey‘s Furniture, but the affidavit upon which the trial court based its decision to order substituted service identified the defendant as Charles Bailey.” Id. at *2.11 The dissonance between the affidavit accompanying the request for substituted service and the actual defendant rendered service improper in that case. Id. But no such conflict is present here.
Service in this case was unremarkable. The only wrinkle was Bailey‘s elusivenеss. Brickhouse‘s protestations to the contrary reveal not some heretofore unseen flaw in service but rather its apparent ignorance of proper methods of service under both Texas and federal law. The judgment of default is AFFIRMED.
JERRY E. SMITH
UNITED STATES CIRCUIT JUDGE