Joe Hand Promotions, Inc. v. Koda et al

Filing 40

OPINION AND ORDER directing as follows: (1) def Club BTS, LLC's 17 MOTION to Set Aside Default is granted; (2) the 11 order of default previously entered against def Club BTS, LLC is vacated; (4) def Steven Hiro Koda's 26 MOTI ON to Dismiss is denied; (5) by no later than 8/23/2016, both defs are to respond to the complaint in this case; (6) plf Joe Hand Promotions, Inc.s 38 notice of error in filing is construed as a motion to Strike the improperly denominated 34 Request for Waiver of Service and is granted. Signed by Honorable Judge Myron H. Thompson on 6/29/16. (djy, )

IN THE DISTRICT COURT OF THE UNITED STATES FOR THE
MIDDLE DISTRICT OF ALABAMA, NORTHERN DIVISION
JOE HAND PROMOTIONS, INC., )
)
Plaintiff,
)
)
v.
)
)
STEVEN HIRO KODA and CLUB )
BTS, LLC d/b/a Club BTS,
)
)
Defendants.
)

CIVIL ACTION NO.
2:14cv623-MHT
(WO)

OPINION AND ORDER
Plaintiff Joe Hand Promotions, Inc. brought this
lawsuit against defendants Club BTS, LLC, and its sole
member,

Steven

Hiro

Koda,

asserting

that

they

unlawfully intercepted broadcast signals transmitted by
Joe Hand in violation of 47 U.S.C. §§ 553 or 605.1

The

1. One of those provisions creates a private right
of action against a party who intercepts cable
transmissions
without
authorization,
47
U.S.C.
§ 553(a), and the other creates a private right of
action against a party who intercepts satellite
transmissions without authorization, § 605(a).
Joe Hand alleges in its complaint that it is unable
to determine, without discovery, which provision was
violated.

court has subject-matter jurisdiction under 28 U.S.C.
§ 1331 (federal question) and 47 U.S.C. §§ 553(c)(1)
and 605(e)(3)(A).
This

case

is

currently

before

the

court

on

two

motions, one by each defendant, both claiming that Joe
Hand failed to perfect service of process.
moves

the

court

to

set

aside

the

Club BTS

default

entered

against it, while Koda moves the court to dismiss the
claims against him.
During
discuss

an

these

on-the-record
motions,

telephone

however,

conference

counsel

for

to

both

defendants agreed to accept service on their behalves;
the time for Joe Hand to perfect service was extended
accordingly.

See Order (doc. no. 32).

Club BTS have now waived service.

Both Koda and

See Koda Waiver of

Service (doc. no. 36), Club BTS Waiver of Service (doc.
no. 37).
In light of these waivers, and for the reasons that
follow, Club BTS’s motion to set aside default will be

2

granted, and Koda’s motion to dismiss will be denied as
moot.

I.
On

CLUB BTS’S MOTION TO SET ASIDE DEFAULT

June

23,

2014,

Joe

against Koda and Club BTS.

Hand

filed

its

complaint

Joe Hand attempted to serve

Club BTS by certified mail at the Alabama address for
Club BTS’s registered agent, Robert Cox, on July 17,
2014.

The return receipt bears a signature which is

illegible, though not inconsistent with “Robert Cox.”
Return

Receipt

(doc.

no.

5).

Two

boxes,

labeled

“Agent” and “Addressee,” appear next to the signature;
neither is checked.

Id.

The deadline for Club BTS to answer the complaint
was August 7, 2014.

On September 23, 2014, Joe Hand

moved for entry of default, and, on January 12, 2015,
this court entered an order of default.

On October 20,

2015, Club BTS filed a motion to set aside the entry of
default,

arguing

that

service

perfected.
3

was

not

in

fact

Federal

Rule

of

Civil

Procedure

55(c)

allows

a

court to set aside the clerk’s entry of default for
“good cause.”

The decision is within the discretion of

the court, Robinson v. United States, 734 F.2d 735, 739
(11th Cir. 1984), and the good-cause standard is “not
susceptible
Interamericana

to

a

precise

formula,”
S.A.

Export-Import,

Compania
Compania

v.

Dominicana, 88 F.3d 948, 951 (11th Cir. 1996).

Courts

should consider “whether the default was culpable or
willful, whether setting it aside would prejudice the
adversary, and whether the defaulting party presents a
meritorious defense.”
is

insufficient,”

Id.

“Where service of process

however,

“the

void and must be set aside.”

entry

of

default

is

Insituform Techs., Inc.

v. AMerik Supplies, Inc., 588 F. Supp. 2d 1349, 1352
(N.D. Ga. 2008) (Batten, J.) (citing Varnes v. Local
91, Glass Bottle Blowers Ass’n, 674 F.2d 1365, 1368
(11th Cir. 1982)).
Club BTS does not dispute that service by certified
mail is proper under Federal Rule of Civil Procedure
4

4(h)(1)(A) and Alabama Rule of Civil Procedure 4(i)(2),
nor does it dispute that Robert Cox is its agent and
authorized

to

receive

service

of

process

within

the

meaning of Federal Rule of Civil Procedure 4(h)(1)(B).
Instead, it simply disputes that Cox is the person who
signed the certified-mail receipt.
In order to challenge the sufficiency of service of
process,

“the

defendant

first

bears

the

burden

of

producing affidavits that, in non-conclusory fashion,
demonstrate the absence of jurisdiction.”

Carrier v.

Jordaan, 714 F. Supp. 2d 1204, 1211 (S.D. Ga. 2008)
(Wood,

J.)

(citation

and

quotation

marks

omitted).

Here, the court is presented with an affidavit from
Koda, in which he attests: “Cox and I are the only
individuals authorized to receive service of process on
behalf of Club BTS, LLC.
been

served

lawsuit.”

on

behalf

Neither Cox nor I have ever
of

Club

BTS,

LLC

in

this

Koda Aff. (doc. no. 17, ex. A) at 1.

Although Koda is attesting to the non-occurrence of
an

event,

Club

BTS

could
5

have

offered

a

less

“conclusory” denial, less reliant on unadorned hearsay.
An

affidavit

from

Cox

himself--attesting

more

specifically that he did not sign the certified-mail
receipt filed by Joe Hand as proof of service, or was
not present at the address in question on that date the
certified-mail receipt was signed--would more squarely
have been the sort of “specific factual declaration[]
within the affiant’s personal knowledge” that courts
ought to credit.

Posner v. Essex Ins. Co., 178 F.3d

1209, 1215 (11th Cir. 1999).
Koda’s

affidavit

as

However, the court views

sufficient.

Were

Club

BTS

attempting to rely on the affidavit to avoid a merits
adjudication of the claim against it, the court might
well view it with more skepticism.
BTS

seeks

only

to

avoid

default,

Here, however, Club
so

a

modicum

of

leniency is therefore appropriate.
Thus, the burden to show that service was in fact
perfected shifts back to Joe Hand.
present

“enough

evidence

directed verdict.”

to

The plaintiff must

withstand

a

motion

for

Carrier, 714 F. Supp. 2d at 1211
6

(citation
Because

and

internal

service

was

quotation

attempted

via

marks
a

omitted).

mechanism

made

available by state statute, this court must construe
the provision in accordance with the decisions of state
courts.

Cf. Sculptchair, Inc. v. Century Arts, Ltd.,

94 F.3d 623, 626-27 (11th Cir. 1996) (explaining that
when personal jurisdiction is obtained under Florida’s
long-arm statute as incorporated into Federal Rule of
Civil

Procedure

4(e),

“the

extent

of

the

long-arm

statute is governed by Florida law, [and so] federal
courts are required to construe it as would the Florida
Supreme Court” and that, “[a]bsent some indication that
the Florida Supreme Court would hold otherwise, we are
bound

to

courts.”

adhere

to

(citations

decisions
and

of

internal

its

intermediate

quotation

marks

omitted)).
Alabama

law

provides:

“[T]he

only

presumption

created ... by the trial court clerk's mailing of the
summons[]

and

complaint

to

[an

address]

and

the

subsequent return of the signed certified-mail receipts
7

from that address [is] a presumption that the process
[was] properly mailed and properly delivered to [that
address].

Standing alone, service of process at the

proper address [does] not give rise to a presumption
that

the

proper

person

was

served.

Additionally,

[defendants] [do] not bear the burden of proving that
the proper person was not served.”
So.

3d

1031,

1036

(Ala.

Civ.

Johnson v. Hall, 10
App.

2008).

When

defendants deny receiving service, “[t]he signatures on
the return receipts do not offer any assistance because
they are illegible[,] [and] [t]he record contains no
other evidence to establish that an authorized agent
for

[the]

defendant

was

served

with

process,”

plaintiffs have failed to demonstrate that service was
perfected.

Id.

Here, as in Johnson, Joe Hand’s only evidence that
service on Club BTS was perfected is a certified-mail
receipt with an illegible signature.

Although it may

well be the case that the signature does belong to
Robert Cox, “any doubts regarding whether to set aside
8

an entry of default should be resolved in favor of the
party seeking relief,” Insituform, 588 F. Supp. 2d at
1352 (citing Davis v. Parkhill-Goodloe Co., 302 F.2d
489, 495 (5th Cir. 1962)), in light of the court’s
“strong policy of determining cases on their merits”
and the attendant “disfavor” with which defaults are
viewed, In re Worldwide Web Systems, 328 F.3d 1291,
1295 (11th Cir. 2003).
The court therefore finds good cause to set aside
the default previously entered against Club BTS.2
Fed.

R.

Civ.

P.

55(c).

Now

that

service

has

See
been

waived, Club BTS must file an answer or motion pursuant
to Rule 12 of the Federal Rules of Civil Procedure.

2. Joe Hand also contends that it will be
prejudiced by the court’s decision to set aside the
order
of
default
entered
against
Club
BTS;
specifically, it states, first, that the resultant
delay
in
litigation
might
make
discovery
more
difficult, and, second, that the defendant might
destroy evidence or fraudulently transfer assets.
Joe
Hand has not, however, substantiated either of these
concerns, so the court sees no need to weigh them in
considering whether to grant Club BTS’s motion.
9

II.

KODA’S MOTION TO DISMISS

Koda sought dismissal of the claims against him,
contending that he has not properly been served.

As he

has now waived service, this motion is due to be denied
as

moot.

He,

too,

must

answer

or

file

a

Rule

12

motion.

* * *
It is therefore ORDERED as follows:
(1) Defendant Club BTS, LLC’s motion to set aside
default (doc. no. 17) is granted.
(2) The order of default (doc. no. 11) previously
entered against defendant Club BTS, LLL is vacated.
(4) Defendant Steven Hiro Koda’s motion to dismiss
(doc. no. 26) is denied.
(5) By
defendants

no
are

later
to

than

respond

August
to

the

23,

2016,

complaint

in

both
this

case.
(6) Plaintiff Joe Hand Promotions, Inc.’s notice of
error in filing (doc. no. 38) is construed as a motion
10

to strike the improperly denominated Request for Waiver
of Service (doc. no. 34), and is granted.
DONE, this the 29th day of June, 2016.
_ /s/ Myron H. Thompson
UNITED STATES DISTRICT JUDGE