ABC Corporation I et al v. The Partnership and Unincorporated Associations Identified on Schedule "A"

Filing 199

MEMORANDUM Opinion and Order: The motions to dismiss 165 177 are denied. Signed by the Honorable Thomas M. Durkin on 4/1/2021. Mailed notice. (ecw, )

UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION
HANGZHOU CHIC INTELLIGENT
TECHNOLOGY CO.; and UNICORN
GLOBAL, INC.,
Plaintiffs,
v.

No. 20 C 4806
Judge Thomas M. Durkin

THE PARTNERSHIPS AND
UNINCORPORATED ASSOCIATIONS
IDENTIFIED ON SCHEDULE A,
Defendants.
MEMORANDUM OPINION AND ORDER
Plaintiffs allege that Defendants violate Plaintiffs’ patents by selling certain
hoverboard products. Two of the defendants—Dongguan Saibotan Nengyuan Keji
Co., Ltd. (d/b/a GYROOR US) and Dongguan Dongxin Baozhuang Zhipin Co., Ltd.
(d/b/a Tomoloo DX)—have moved to dismiss for insufficient service of process. R. 165;
R. 177. Those motions are denied.
This is one of many cases filed in this District alleging counterfeit product sales
in the United States, on internet market places like eBay and Amazon, by defendants
located outside the United States. Plaintiffs in these cases often join tens or hundreds
of defendants in a single case, but it is rare for any of the defendants to appear.
Almost all the claims are resolved by settlement or default judgment.
Because the defendants are located outside the United States and are allegedly
somewhat fly-by-night operations intent on evading U.S. laws, plaintiffs generally

seek temporary restraining orders through ex parte proceedings. Plaintiffs contend,
and district courts usually agree, that it is necessary to restrain the defendants’
assets without notice in order to prevent them from removing their assets from the
United States or otherwise hiding them. Those orders also usually permit service by
email based on the plaintiff’s allegation that true physical addresses for the
defendants are not readily ascertainable or verifiable.
On September 22, 2020, the Court entered a temporary restraining order in
this case permitting service by “electronic publication and e-mail,” R. 42 at 5 (¶ 6),
followed by a preliminary injunction entered on November 24, 2020, R. 113. On
November 25, Plaintiffs published copies of the preliminary injunction order and the
third amended complaint on a website dedicated to this case, hosted by Plaintiffs’
counsel. See R. 185-2 at 1 (¶ 3). Using third-party discovery permitted by the
injunction orders, Plaintiffs’ counsel obtained email addresses for the defendants who
bring these motions—Gyroor and Tomoloo—and sent them emails attaching the
complaint, the orders, and discovery requests, on December 28 and December 23,
respectively. See R. 185-2 at 2 (¶¶ 5-6). Gyroor and Tomoloo appeared in this case on
January 7 and 15, 2021. R. 152; R. 157.
Gyroor and Tomoloo argue that Plaintiffs should have served them with
process in accordance with the Hague Convention at their physical addresses in
China that are available on their Amazon webpages. Plaintiffs argue that any
addresses available for Gyroor and Tomoloo are not reliable, and in any case, the

2

Federal Rules of Civil Procedure do not require Plaintiffs to attempt service according
to the Hague Convention before asking the Court to order service by email.
The Court agrees with Plaintiffs that Hague Convention service is optional
under Federal Rule of Civil Procedure 4. In accordance with most other courts, this
Court has previously held that while Hague Convention service is certainly
satisfactory, Rule 4(f)(3) also allows service “by other means not prohibited by
international agreement, as the court orders.” See Monco v. Zoltek Corp., 2018 WL
3190817, at *4 (N.D. Ill. Apr. 24, 2018); Strabala v. Zhang, 318 F.R.D. 81, 115 (N.D. Ill.
2016); see also Rio Props., Inc. v. Rio Int’l Interlink, 284 F.3d 1007, 1015-16 (9th Cir.

2002). Thus, the Federal Rules of Civil Procedure did not require Plaintiffs to attempt
Hague Convention service prior to seeking alternative service pursuant to Rule
4(f)(3).
The real question on this motion is whether the allegations Plaintiffs made in
their motion for email service were sufficient for the Court to find that email service
was appropriate in this case. Plaintiffs supported their motion for email service with
a declaration from one of their attorneys asserting that:
E-commerce stores operating in foreign jurisdictions that
offer for sale or sell infringing products typically: (1)
provide incomplete and/or false names and physical
address information to conceal their locations and to avoid
liability for their unlawful conduct; and (2) primarily rely
on electronic communications to communicate with third
party service providers and customers.
Generally, when . . . e-commerce stores that offer for sale
or sell infringing products list[] a physical address, it is
likely illegitimate. E-mail is a reliable mechanism for
providing notice to e-commerce stores.

3

R. 24 at 1 (¶¶ 2-3). The motion was filed on August 18, 2020 and the Court granted it
on September 22, 2020, R. 41.
Defendants Gyroor and Tomoloo argue that Plaintiffs’ general contentions
about the availability and reliability of addresses for e-commerce stores are unsound
and insufficient to support an order that they in particular be served by email. They
point out that their addresses are available on their Amazon seller profile pages, a
fact that the Court has been able to verify by visiting the Amazon website. They also
contend that these are the same addresses listed on the Chinese search engine
Baidu.com. Gyroor and Tomoloo apparently mean to argue that these addresses are
reliable and should have been used to serve them because the same addresses are
listed on Amazon and Baidu.com. And service of process at a physical address in
China must be made in accordance with the Hague Convention because China has
objected to service of process by postal mail. See Luxottica Grp. S.p.A. v. P’ships &
Unincorporated Assocs. Identified on Schedule “A”, 391 F. Supp. 3d 816, 827 (N.D. Ill.
2019).
As an initial matter, it is not clear that Gyroor and Tomoloo provided addresses
on their Amazon websites at the time Plaintiffs filed their motion for email service.
Plaintiffs filed their motion on August 18, 2020, but Amazon only instituted the
requirement that sellers provide a physical address on the U.S. version of its website
on September 1, 2020. See AMAZON SERVICES SELLER FORUMS, “Advance notice:
Business name and address to be displayed on the seller profile page starting

4

September 1, 2020,” July 2020; 1 CNBC WEBSITE, “Amazon sellers in the U.S. will
have to list their names and addresses,” July 8, 2020; 2 CNET WEBSITE, “Amazon
sellers will need to list their business name, address on their profiles,” July 8, 2020. 3
Perhaps Gyroor and Tomoloo provided their addresses prior to Amazon’s
requirement. But they do not make that contention in their motion. This undermines
their argument that their addresses were discoverable by Plaintiffs at the relevant
time.
But even if their addresses were available, Gyroor and Tomoloo do not
challenge the other allegations that justified email service in this case. Plaintiffs
plausibly alleged that Gyroor and Tomoloo sell counterfeit products online and are
located outside the United States. Gyroor and Tomoloo may be able to point to
physical addresses provided on Amazon, but this does not change the fact that there
is an epidemic of counterfeit products being sold from outside the United States on
the internet, and that the characteristics of Gyroor’s and Tomoloo’s websites and
selling activities allegedly match those of thousands of other websites offering
counterfeit products. These allegations demonstrate exigent circumstances justifying
an injunction of Gyroor’s and Tomoloo’s websites and freezing of their associated
assets. Time is of the essence with an injunction in place, so the Court authorized
Available at https://sellercentral.amazon.com/forums/t/advance-notice-businessname-and-address-to-be-displayed-on-the-seller-profile-page-starting-september-12020/658140.
1

Available at https://www.cnbc.com/2020/07/08/amazon-sellers-in-the-us-will-haveto-list-their-names-and-addresses.html.
2

Available at https://www.cnet.com/news/amazon-sellers-will-need-to-list-theirbusiness-name-address-on-their-profiles/.

3

5

email service in order to provide Gyroor and Tomoloo (and the other defendants in
the case) with notice as quickly as possible. The injunction should not linger while
the parties and the Court wait for Hague Convention process when an instantaneous,
reliable, and traceable means of providing notice is available in the form of email.
In addition to arguing that Plaintiffs’ allegations did not justify email service,
Gyroor and Tomoloo argue that email service violates the Hague Convention and so
is not permissible under the terms of Rule 4(f)(3) because it is “prohibited by
international agreement.” But Gyroor and Tomoloo concede that the Hague
Convention does not mention email service. See Commodity Futures Trading Comm’n
v. Caniff, 2020 WL 956302, at *6 (N.D. Ill. Feb. 27, 2020) (“The Convention does not
affirmatively authorize, nor does it prohibit, service by email.”). Nevertheless, the
Supreme Court has held that the Hague Convention prohibits at least one form of
service without explicitly mentioning that form of service. See Volkswagenwerk
Aktiengesellschaft v. Schlunk, 486 U.S. 694, 703-04 (1988) (holding that the Hague
Convention implicitly prohibits “notification au parquet”); see also Luxottica, 391 F.
Supp. 3d at 825 (“Concluding that ‘[t]here is no question but that the Conference
wanted to eliminate notification au parquet,’ the [Supreme Court] pointed to Articles
15 and 16, which do not mention that or any other method of service.” (quoting
Schlunk, 486 U.S. at 703)). But the Supreme Court has also explained that
alternative means of service unmentioned by the Hague Convention are not
prohibited if “the receiving state has not objected to [that alternative form of service].”
Water Splash, Inc. v. Menon, 137 S. Ct. 1504, 1513 (2017) (citing Brockmeyer v.
6

May, 383 F.3d 798, 803-04 (9th Cir. 2004)); Commodity Futures, 2020 WL 956302, at
*5-6 (“apply[ing] the [Water Splash] analysis to service by email”). 4
Gyroor and Tomoloo argue that China would “object” to email service and so it
is not permissible according to Water Splash. They cite China’s objection to postal
service “in the territory of the People’s Republic of China” under the Hague
Convention. See HAGUE CONFERENCE WEBSITE, “Declarations of the People’s Republic
of China” (1992). 5 But many courts have rejected the analogy of postal service to email
service. Those courts observe that the instantaneous and traceable nature of email
cures the concerns with postal service. See Sulzer Mixpac AG v. Medenstar Indus.
Co., 312 F.R.D. 329, 332 (S.D.N.Y. 2015); Anova Applied Elecs., Inc. v. Hong King
Grp., Ltd., 334 F.R.D. 465, 471 (D. Mass. 2020); The Neck Hammock, Inc v.
Danezen.com, 2020 WL 6364598, at *4 (D. Utah Oct. 29, 2020). For this reason, “the
majority [of courts] have concluded that a country’s objection to [postal service under
the Hague Convention] does not equate to an objection to email service.” The Neck
Hammock, 2020 WL 6364598, at *4; see also Zanghi v. Ritella, 2020 WL 589409, at
*5 (S.D.N.Y. Feb. 5, 2020) (citing cases); Jackson Lab’y v. Nanjing Univ., 2018 WL
615667, at *4 (D. Me. Jan. 29, 2018) (citing cases); Rubie’s Costume Co., Inc. v. Yiwu

There is also a second element to this analysis that is not relevant here. The
Supreme Court explained that the alternative form of service must be “authorized
under otherwise-applicable law.” See Water Splash, 137 S. Ct. at 1513. By this the
Supreme Court meant that the alternative form of service must comply with the law
of the lawsuit’s forum. See id. (remanding in part for consideration of “whether Texas
law”—the law of the forum—“authorizes the methods of service [at issue]”). Gyroor
and Tomoloo do not argue that Illinois law prohibits email service.
4

Available at https://www.hcch.net/en/instruments/conventions/status-table/notifi
cations/?csid=393&disp=resdn.

5

7

Hua Hao Toys Co., 2019 WL 6310564, at *3 (W.D. Wash. Nov. 25, 2019); Genus
Lifesciences Inc. v. Tapaysa Eng’g Works Pvt. Ltd., 2021 WL 915662, at *3 (E.D. Pa.
Mar. 10, 2021). 6 Furthermore, unlike postal service, email does not require physical
intrusion on Chinese territory, which is China’s express objection to the availability
of postal service under the Hague Convention. For these reasons, the Court finds it
is inappropriate to interpret China’s objections to postal service under the Hague
Convention as encompassing service by email.
Gyroor and Tomoloo also argue that Chinese law prohibits service by email.
But the Chinese law provisions the parties cite permit email service under certain
circumstances. See, e.g., R. 24 at 6 (Article 87) (“Subject to the consent of the person
on which a procedural document is to be served, the document may be served by way
of . . . electronic mail[.]”). Most notably, Chinese law permits its courts to order service
by email on a party outside of China, in part because email permits the person to be
served to “acknowledge” receipt. See id. at 8 (p. 47, Article 267) (“A people’s court may
serve procedural documents on a party without a domicile within the People’s
Republic of China in the following ways: . . . Service by . . . e-mail and any other
means through which the receipt of the document may be acknowledged.”). If China
permits its courts to order service of Chinese process by email on defendants outside
China, it cannot credibly object to U.S. courts ordering the same on defendants

However, some courts have found that China’s objection to postal service implicitly
incorporates an objection to email service. See, e.g., Anova Applied Elecs., Inc. v. Hong
King Grp., Ltd., 334 F.R.D. 465, 471 (D. Mass. 2020); Gang Li v. Dolar Shop Rest.
Grp., LLC, 2019 WL 4393637, at *3 (E.D.N.Y. Sept. 13, 2019). This Court finds the
majority position more persuasive.

6

8

located in China. Thus, the Court finds that China has not “objected” to email service,
and the Court’s order of email service pursuant to Rule 4(f)(3) was appropriate.
Conclusion
Therefore, the motions to dismiss [165] [177] are denied.
ENTERED:
______________________________
Honorable Thomas M. Durkin
United States District Judge

Dated: April 1, 2021

9