Chicago Heights Check Cashers, Inc. v. United States Postal Service

Filing 17

MEMORANDUM Opinion and Order Signed by the Honorable Marvin E. Aspen on 5/31/2018: Defendant's motion to dismiss pursuant to Rule 15(b)(5) 8 is granted, without prejudice. Case dismissed without prejudice. Status hearing of 6/7/2018 stricken. Civil case terminated. Mailed notice(mad, )

Case: 1:18-cv-00990 Document #: 17 Filed: 05/31/18 Page 1 of 7 PageID #:73

IN THE UNITED STATES DISCTRICT COURT
NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION
CHICAGO HEIGHTS CHECK
CASHERS, INC.,
Plaintiff,
v.
UNITED STATES POSTAL SERVICE,
Defendant.

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No. 18 C 990
Hon. Marvin E. Aspen

MEMORANDUM OPINION AND ORDER
MARVIN E. ASPEN, District Judge:
Plaintiff Chicago Heights Check Cashers, Inc. filed this action against Defendant United
States Postal Service in the Circuit Court of Cook County, Illinois, alleging Defendant is liable
for payment to Plaintiff on a check issued to a third party. Defendant removed the case to this
court pursuant to 28 U.S.C. § 1442(a) and 39 U.S.C. § 409(a). (Notice of Removal (Dkt. No. 1).)
Presently before us is Defendant’s motion to dismiss Plaintiff’s complaint pursuant to Federal
Rule of Civil Procedure 12(b)(5) for insufficient service of process. (Dkt. No. 9.) For the
reasons set forth below, we grant Defendant’s motion, without prejudice.
BACKGROUND
Plaintiff filed a complaint against Defendant in the Circuit Court of Cook County, Illinois
on August 15, 2017. (Notice of Removal ¶ 1.) Plaintiff alleges Defendant issued a check on
March 2, 2017 in the amount of $1,000.00 payable to Joseph A. Minotti and drawn on

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Defendant’s bank account. (Resp. (Dkt. No. 14) at 1.)1 Plaintiff is a business that provides
check-cashing services, and it alleges that it paid cash to Minotti in exchange for the check. (Id.)
However, the check was later dishonored when presented to Defendant for payment. (Id.) As a
result, Plaintiff was charged a $25.00 “return check” fee by its bank. (Id.) Plaintiff’s complaint
asserted claims pursuant to the Illinois Uniform Commercial Code, 810 ILCS 5/1–101, et seq.
Defendant removed the case on February 7, 2018 under 29 U.S.C. ¶ 409(a), which
provides that any state court action in which the United States Postal Service is a party may be
removed to federal district court as set forth in 28 U.S.C. § 1442(a). (Id. ¶ 5.) See also
28 U.S.C. § 1442(a)(1) (providing that “[a] civil action . . . that is commenced in a State court
and that is against or directed to . . . [t]he United States or any agency thereof” may be removed
to the district court for the district and division embracing the place wherein it is pending).
Defendant filed the instant motion to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(5)
on March 14, 2018, arguing Plaintiff failed to perfect service of process. (Mem. in Support of
Mot. to Dismiss (“Mem.”) (Dkt. No. 9).)
Relying on a letter received from Defendant in an unrelated case, Plaintiff alleges it
believed Defendant was amenable to service of process at its Tort Claims Office, located
at 433 West Harrison Street, Second Floor, Chicago, Illinois 60699. (Resp. at 3.) Plaintiff
contends it attempted to serve Defendant at the Tort Claims office by placing its Summons and
Complaint with the Cook County, Illinois Sheriff’s Department. (Id. at 4.) Plaintiff alleges “the
Sheriff was unable to serve Defendant, and a Special Process Server again attempted to serve
Defendant” at the Tort Claims Office, but was notified by an employee there that “service of

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Defendant failed to attach the complaint to the notice of removal. We therefore recount the
relevant background facts from the parties’ briefs, as the facts about the underlying claims are
not in dispute for purposes of deciding this motion.
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process must be sent to Eagan, MN.” (Id.) Plaintiff asserts service was thereafter effectuated on
Defendant on October 16, 2017 at 2825 Lone Oak, Eagan, Minnesota 55121. (Id.)
LEGAL STANDARD
Pursuant to Federal Rule of Civil Procedure 12(b)(5), a defendant may move to dismiss a
complaint for insufficient service of process. Fed. R. Civ. P. 12(b)(5). “The plaintiff bears the
burden to demonstrate that the district court has jurisdiction over each defendant through
effective service.” Cardenas v. City of Chi., 646 F.3d 1001, 1005 (7th Cir. 2011); see also
Chapman v. U.S. Marshal for N. Dist. of Ill., 584 F. Supp. 2d 1083, 1090 (N.D. Ill. 2008)
(“When a defendant challenges the sufficiency of service, the burden is on the [p]laintiff to
affirmatively demonstrate otherwise.”). Where the plaintiff has not met its burden “and lacks
good cause for not perfecting service, the district court must either dismiss the suit or specify a
time within which the plaintiff must serve the defendant.” Cardenas, 646 F.3d at 1005 (citing
Fed. R. Civ. P. 4(m)). “[T]he decision of whether to dismiss or extend the period for service is
inherently discretionary.” Id.
ANALYSIS
Under the Federal Rules of Civil Procedure, within 90 days of the date of removal, a
plaintiff “must ensure that each defendant receives a summons and a copy of the complaint
against it” in order to avoid possible dismissal. Cardenas, 646 F.3d at 1004;
Fed. R. Civ. P. 4(b), (c)(1), (m); see also Fed. R. Civ. P. 81(c)(1) (providing the Federal Rules of
Civil Procedure apply to a civil action after it is removed from state court). “These service
requirements provide notice to the parties, encourage parties and their counsel to diligently
pursue their cases, and trigger a district court’s ability to exercise jurisdiction over a defendant.”
Cardenas, 646 F.3d at 1005 (citations omitted). “Actual notice to the defendant is insufficient;

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the plaintiff must comply with the directives of Rule 4.” McMasters v. United States,
260 F.3d 814, 817 (7th Cir. 2001).
Federal procedural rules govern proper service over the United States Postal Service.
39 U.S.C. § 409(b) (“[T]he provisions of title 28 relating to service of process . . . in suits in
which the United States, its officers, or employees are parties, and the rules of procedure adopted
under title 28 for suits in which the United States, its officers, or employees are parties, shall
apply in like manner to suits in which the Postal Service, its officers, or employees are parties.”).
To properly serve a United States agency or corporation, a party must deliver the summons and
complaint to the agency, and it must also serve the United States. Fed. R. Civ. P. 4(i)(2). To
serve the United States, a plaintiff must deliver a copy of the summons and complaint to (1) the
United States Attorney for the district where the action is brought (or a designated employee),
and (2) the Attorney General of the United States. Fed. R. Civ. P. 4(i)(1). If the plaintiff fails to
properly serve an agency but properly served either the United States Attorney or the Attorney
General of the United States, the court must allow the plaintiff a reasonable time to cure its
failure. Fed. R. Civ. P. 4(i)(4)(A). Here, Plaintiff served neither the United States Attorney nor
the Attorney General, and it has provided no reason for its failure to do so. Accordingly, service
was improper. See McMasters, 260 F.3d at 818 (finding improper service where the plaintiff
mailed a copy of the summons and complaint to the Attorney General, but failed to serve the
United States Attorney); Tuke v. United States, 76 F.3d 155, 157 (7th Cir. 1996) (stating that a
plaintiff must comply with both prongs of 4(i)(1) “for good reason: that’s what the rule says”).
Having determined Plaintiff improperly served Defendant, we next decide whether to
dismiss Plaintiff’s case or grant Plaintiff an extension of time to perfect service. Under
Rule 4(m), “a district court must first inquire whether a plaintiff has established good cause for

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failing to effect timely service,” because if good cause is shown, “the court shall extend the time
for service for an appropriate period.” Panaras v. Liquid Carbonic Indus. Corp.,
94 F.3d 338, 340 (7th Cir. 1996). “If, however, good cause does not exist, the court may, in its
discretion, either dismiss the action without prejudice or direct that service be effected within a
specified time.” Id.; see also United States v. McLaughlin, 470 F.3d 698, 700 (7th Cir. 2006)
(“In other words, if good cause for the delay is shown, the court must extend the time for service,
while if good cause is not shown, the court has a choice between dismissing the suit and giving
the plaintiff more time.”).
Here, while Plaintiff recounts its efforts in attempting to serve the Postal Service,
Plaintiff has not so much as attempted to demonstrate good cause for failing to serve the United
States Attorney and the Attorney General. “[A] lawyer who does not read the rules lacks good
cause.” Tuke, 76 F.3d at 157 (affirming dismissal pursuant to Rule 12(b)(5) where the plaintiff
failed to serve the Attorney General, and rejecting plaintiff’s argument that he was “led astray”
by a letter from the United States Attorney, as the letter did not “imply that the plaintiff could
ignore Rule 4(i)(1)(B)”). Rule 4(i)(1) is “direct and clear” and plaintiff has provided no reason
for ignoring or misunderstanding its straightforward requirements. Id. Plaintiff has thus not
shown good cause for failing to properly serve Defendant.
We nevertheless consider a number of factors in exercising our discretion to dismiss the
case or grant Plaintiff an extension of time to serve Defendant. Cardenas, 646 F.3d at 1006–07;
Manzanales v. Krishna, 113 F. Supp. 3d 972, 977 (N.D. Ill. 2015). Although “Rule 4(m) does
not specify which factors the district court must consider in exercising its discretion,” relevant
considerations include (1) whether the expiration of a statute of limitations would prevent
refiling; (2) the harm to the defendant’s ability to defend; (3) whether the defendant received

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actual notice of the lawsuit; (4) whether the defendant evaded service; (5) whether the defendant
was eventually served; (6) whether the plaintiff requested an extension from the court due to the
difficulties in perfecting service; (7) plaintiff’s diligence in pursuing timely service. Cardenas,
464 F.3d at 1006–07. “[T]he plaintiff who fails to demonstrate good cause for his delay throws
himself on the mercy of the district court.” McLaughlin, 470 F.3d at 700.
Plaintiff argues it relied on Defendant’s correspondence indicating it could be served at
its Tort Claims Office, located at 433 West Harrison Street, Second Floor, Chicago, Illinois.
(Resp. at 3.) Plaintiff asserts it unsuccessfully attempted to serve Defendant at the Tort Claims
Office using the Cook County Sheriff’s Department and a special process server, but a Postal
Service employee eventually notified Plaintiff that service of process “must be sent to
Eagan, MN.” (Id. at 4.) Plaintiff argues it then acted “upon the good faith belief that the Eagan
address was the proper place to serve Defendant, [and] service was effectuated at the Eagan
address on October 16, 2017.” (Id.) Plaintiff further argues that “it is simply not possible that
Plaintiff could have been explicitly notified that service at the Eagan address would be improper
for effectuating service upon Defendant.” (Id.)
However, regardless of Plaintiff’s good faith misunderstanding as to the proper place for
serving Defendant, it has provided no indication of any efforts to properly serve the United
States via the United States Attorney and Attorney General, as required under Rules 4(i)(1)
and 4(i)(2). Moreover, Defendant argues—and Plaintiff does not dispute—that it never received
actual notice of the lawsuit, and it did not attempt to evade service. Cardenas,
464 F.3d at 1006–07. Nor did Plaintiff show any attempt to comply with Rule 4 or to seek an
extension of time to complete proper service. Id. Accordingly, we find the relevant factors
weigh in favor of dismissing Plaintiff’s suit for failure to serve process within the time

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prescribed by Rule 4. We therefore grant Defendant’s motion and dismiss Plaintiff’s case
pursuant to Rule 12(b)(5), without prejudice.2 Cardenas, 646 F.3d at 1007; United
States v. Ligas, 549 F.3d 497, 501 (7th Cir. 2008).
CONCLUSION
For the foregoing reasons, Defendant’s motion to dismiss pursuant to Rule 15(b)(5) is
granted, without prejudice. It is so ordered.

____________________________________
Marvin E. Aspen
United States District Judge
Dated: May 31, 2018
Chicago, Illinois

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Defendant argues Plaintiff should “be required to file a new suit in federal court rather than be
allowed to amend their complaint, which would allow it to continue to ignore the rules of service
in order to avoid this court’s filing fees.” (Mem. at 6.) Defendant also asserts a “new suit would
also avoid the derivative jurisdiction bar that a properly served complaint in this removed statecourt case would encounter after proper service of process.” (Id.) Because we are dismissing
Plaintiff’s complaint without prejudice, we need not address these arguments.
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