Rubicon Global Ventures, Inc. v. Chongquing Zongshen Group Import/Export Corp.Rubicon Global Ventures, Inc. v. Chongquing Zongshen Group Import/Export Corp.
Case Information
*2 Before: B. FLETCHER and PREGERSON, Circuit Judges, and WALTER, Senior District Judge. **
Appellants Rubicon Global Ventures, Inc. and Z Motors, Inc. appeal, inter alia : (a) the district court’s setting aside of the default judgments in District Court Docket Nos. 3:05-cv-01809 (“ Rubicon I ”), 3:09-cv-00818 (“ Rubicon II ”), and 3:09-cv-01397 (“ Rubicon III ”) on the basis of insufficiency of service; and (b) the district court’s dismissal of Ying Zuo and Zongshen USA Holdings, Inc. for lack of personal jurisdiction. For the reasons below, we find that service was sufficient on all appellees other than Zongshen Zuo. As to the dismissals for lack of personal jurisdiction, we find that the district court erred only as to Ying Zuo. We therefore The Honorable Donald E. Walter, Senior United States District Judge ** for Western Louisiana, sitting by designation .
affirm in part, reverse in part, and remand for further proceedings.
The district court set aside the defaults and default judgments on the grounds
that such judgments were void for insufficiency of service of process. The Ninth
Circuit has found that “[a] final judgment is ‘void’ for purposes of Rule 60(b)(4)
only if the court that considered it lacked jurisdiction, either as to the subject
matter of the dispute or over the parties to be bound, or acted in a manner
inconsistent with due process of law.”
United States v. Berke
,
“Service of process has its own due process component, and must be ‘notice
reasonably calculated . . . to apprise interested parties of the pendency of the action
and afford them an opportunity to present their objections.’”
S.E.C. v. Ross
, 504
F.3d 1130, 1138 (9th Cir. 2007) (quoting
Mullane v. Cent. Hanover Bank & Trust
Co.
,
We agree with the district court that it was not necessary in this case for the
appellants to comply with the Convention on Service Abroad of Judicial and
Extrajudicial Documents in Civil Commercial Matters, November 15, 1965 (Hague
Service Convention), [1969] 20 U.S.T. 361, T.I.A.S. No. 6638. Instead, we must
apply Oregon law. In determining whether service is adequate under Oregon law,
the question is: “was the method of service selected . . . ‘reasonably calculated to
apprise the defendant of the existence and pendency of the action?’”
Baker v. Foy
,
We first address service on Chongquing Zongshen Group (“ZS Group”),
which we understand to be one and the same as the entities commonly referred to
in this case as Zongshen Industrial Group, Co. Ltd. (“ZIGCL”) and Zongshen
Industrial Group (“ZIG”). ZS Group was served through Zongshen, Inc., as agent
of ZS Group. The record reflects that Zongshen, Inc. was 95% owned by ZS
Group, with the other 5% ownership held by Dexiu Yuan, who has positions in
both companies. We conclude that ZS Group had sufficient, reasonable notice via
service on Zongshen, Inc., given the following factors: (a) the substantial common
ownership links between the two entities; (b) Mr. Xie Yenong’s 2004 letter to the
EPA representing Zongshen, Inc. to be the agent for ZS Group; and (c) the decision
in
Volkswagenwerk Aktiengesellschaft v. Schlunk,
ZIGCL is the ultimate parent company of Chongquing Zongshen Group
Import/Export Corp. (“ZSIE”). As was the case with the domestic subsidiary in
Schlunk, supra
, Zongshen, Inc. was listed as the agent for service of process for
ZSIE for the purpose of receiving notices under the National Traffic and Motor
*6
Vehicle Safety Act (“NTMVSA”). Not only was Zongshen, Inc. placed in the
foreground as the American face of all Chinese Zongshen entities, it was registered
as ZSIE’s agent for suits arising under the NTMVSA
and
shared officers with the
other Zongshen entities. Based on
Schlunk
, we find that ZSIE and Zongshen, Inc.
were so closely related that the latter was ZSIE’s agent for service as a matter of
law, “notwithstanding [ZSIE’s] failure or refusal to appoint [Zongshen, Inc.]
formally as an agent.”
See Schlunk,
As to Zongshen Zuo, the only service attempted was substitute service on his spouse, Dexiu Yuan, at her usual place of abode in Florida. We agree with the district court’s assessment that Zongshen Zuo was not served pursuant to ORCP 7(D)(2)(b), as the Florida residence was not his usual place of residence or abode. Likewise, such service did not provide reasonable notice of suit as there is no evidence that the summons and complaint were mailed to Zongshen Zuo in China or that he otherwise received notice of the pendency of the actions against him. Thus, we affirm the district court’s ruling as to insufficiency of service of process on Zongshen Zuo.
The only remaining issue which this Court must address is the district
court’s dismissal of Ying Zuo and Zongshen USA Holdings, Inc. (“ZUSA”) for
lack of personal jurisdiction
.
We review a dismissal for lack of personal
*7
jurisdiction
de novo
.
Mavrix Photo, Inc. v. Brand Techs., Inc.
,
The appellants allege specific personal jurisdiction over Ying Zuo, which is
personal jurisdiction arising out of a defendant’s contacts with the forum.
See
Wells Fargo & Co. v. Wells Fargo Exp. Co.,
This court will not exercise general personal jurisdiction over defendant Ying Zuo. During the relevant time frame, defendant Ying Zuo was a college student and was not involved in the day-to-day activities of the corporate defendants and had no involvement with the alleged fraud that occurred. Accordingly, this court lacks specific personal jurisdiction over her.
The district court ordered further briefing on matters unresolved by its June 7 th order. The appellees also filed motions for dismissal based on the district court’s th June 7 rulings. On August 25, 2010, the district court dismissed Ying Zuo for
lack of personal jurisdiction, ruling that there had “been no allegations of any conduct by Ying Zuo that would subject her to this court’s jurisdiction or subject her to any liability in these cases, through RICO or otherwise.”
Thereafter, the district court seems to have reversed itself in its November 19, 2010 ruling, by stating:
Plaintiffs’ new allegation that Ying Zuo actively participated in the alleged fraud by meeting with plaintiffs and making representations that induced plaintiffs to enter the agreement with defendants provides prima facie evidence to support jurisdiction over her.
However, this Court can find no “new” allegations, creating jurisdiction where none existed before. In the operative Rubicon II complaint, the appellants had alleged:
The individual defendants include. . . (3) Ying Zuo, who on information and belief resides in Florida and is vice president, secretary, treasurer and director of [ZUSA]. Defendant Zuo met with plaintiffs and made certain false representations to them in order to induce them to market Zongshen products as discussed below. Both defendants Dexiu and Ying conspired with the other defendants to sell illegal motorbikes in the United States through Zongshen, Inc., plaintiffs and other persons like plaintiffs.
It is clear that the relevant complaint included allegations that Ying Zuo met with *9 the appellants in her capacity as a Zongshen officer and made false representations upon which the appellants, corporations registered in the forum state, relied. Even if these allegations were considered “bare bones” or legal conclusions, they are supported by the declarations of Tracy Titus (paralegal to appellants’ counsel) and Mohammad Rahman (main investor in the corporate appellants).
Although the appellants offered extensive affidavits, only the declaration of
Tracy Titus was specifically offered in opposition to the motion to dismiss. The
other referenced affidavit, that of Mohammad Rahman, was only offered in
opposition to the appellees’ motions to set aside default judgments. However, both
affidavits were filed and made part of the record before the district court ruled on
the motion to dismiss Ying Zuo.
See Dist. Council No. 16 of Int'l Union of
Painters & Allied Trades, Glaziers, Architectural Metal & Glass Workers, Local
1621 v. B & B Glass, Inc.
,
The appellants attempted to allege personal jurisdiction over ZUSA by virtue of the fact that ZUSA is a Zongshen entity, and all other Zongshen entities are subject to personal jurisdiction. However, this cannot suffice to make out a prima facie case for personal jurisdiction over ZUSA. Because the appellants failed to allege sufficient facts for the court to assert personal jurisdiction over ZUSA, there was no error in dismissing ZUSA.
Each party should bear their own costs.
AFFIRMED IN PART, REVERSED IN PART AND REMANDED.