Absolute Swine Insemination Co., (H.K.) Limited et al v. Absolute Swine Insemination Co., LLC et al
Filing
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ORDER Granting 24 Motion for Order Authorizing Alternative Service of Process on Defendant Mark Anderson. Proof of service due by 9/27/2012. Signed by Magistrate Judge Peggy A. Leen on 08/13/2012. (Copies have been distributed pursuant to the NEF - AC)
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UNITED STATES DISTRICT COURT
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DISTRICT OF NEVADA
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ABSOLUTE SWINE INSEMINATION CO.,
(H.K.) LIMITED, et al.,
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Plaintiffs,
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vs.
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ABSOLUTE SWINE INSEMINATION CO., LLC, )
et al.,
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Defendants. )
__________________________________________)
Case No. 2:12-cv-00606-KJD-PAL
ORDER
(Mtn to Appoint - Dkt. #24)
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This matter is before the court on Plaintiffs Absolute Swine Insemination Company (HK)
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Limited’s (“HK”) and David Yang’s Motion for Order Authorizing Alternate Service of Process on
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Defendant Mark Anderson Pursuant to Federal Rule of Civil Procedure 4(f)(3) (Dkt. #24) filed July 23,
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2012. The court has considered the Motion and Defendants Absolute Swine Insemination Company,
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LLC’s, (“ASIC”) and Pathway Technologies, LLC’s, (“Pathway”) Opposition (Dkt. #27) filed August
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7, 2012.
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BACKGROUND
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Plaintiffs filed the Complaint (Dkt. #1) on April 13, 2012, asserting claims for breach of
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contract, breach of duty of good faith and fair dealing, intentional interference with contractual
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relations, intentional interference with prospective economic advantage, and unjust enrichment against
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Defendants Absolute Swine Insemination Company, LLC (“ASIC”); Pathway Technologies, LLC; and
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Anderson. Plaintiffs allege that Anderson is the member/chairman/inventor/creator of ASIC and
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Pathway, and that ASIC and Pathway are registered Nevada corporations. See Complaint (Dkt. #1) at
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¶¶13, 18, 28-33. The Complaint invoked the court’s diversity jurisdiction. On June 4, 2012,
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Defendants ASIC and Pathway filed a Motion to Compel Arbitration, or Alternatively to Dismiss or for
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Summary Judgment (Dkt. #7). ASIC’s and Pathway’s Motion asserts that this case should be arbitrated
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pursuant to the parties’ agreement. Alternatively, it contends that the Complaint fails to state claims
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upon which relief can be granted under Rule 12(b)(6) of the Federal Rules of Civil Procedure, but if the
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court requires review of the relevant contracts in rendering its decision, summary judgment is
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appropriate under Rule 56 of the Federal Rules of Civil Procedure. Pursuant to Rule 4(m), service of
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the Complaint and summons must have been effected by August 13, 2012.
DISCUSSION
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I.
The Parties’ Positions.
The Motion represents that Plaintiffs have been unable to serve the summons and Complaint on
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Anderson. Upon information and belief, Plaintiffs contend Anderson resides in the Philippines, is
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aware of this case, and is involved in ASIC’s and Pathway’s defense. Plaintiffs have been unable to
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locate Anderson in Nevada and seek leave to serve the Complaint and summons on Anderson by
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international mail pursuant to Rule 4(f)(3) of the Federal Rules of Civil Procedure.
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Plaintiff’s assert service by international mail under Rule 4(f)(3) is appropriate because
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Anderson runs ACIS and Pathway–both registered Nevada corporations–from the Philippines.
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Plaintiffs represent that the Philippines is not a party to an international service treaty, including the
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Hague Convention on the Service Abroad of Judicial and Extra-Judicial Documents in Civil or
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Commercial Matters or the Inter-American Treaty on Letters Rogatory and the Additional Protocol.
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Plaintiffs also contend that neither Filipino nor international law prohibit service of process by
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international mail. However, even if the Philippines were a signatory to the Hague Convention, the
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Ninth Circuit has authorized service by international mail to Hague Convention member countries. See,
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e.g., Brockmeyer v. May, 383 F.3d 798, 802, 808-9 (9th Cir. 2004) (joining Second Circuit and noting
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“essentially unanimous view of other member countries of the Hague Convention” that Hague
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Convention allows service of process by international mail).
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ACIS and Pathway oppose the Motion. Counsel for ACIS and Pathway states that he does not
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represent Anderson but contends Plaintiffs’ Motion is premature, and the court should first rule on the
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Motion to Compel Arbitration. ACIS and Pathway assert they have standing to oppose the Motion
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because if Anderson appears, it “will add to the issues before the Court and the parties and increase the
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costs involved to all,” particularly where Plaintiffs seek to serve Anderson, an individual company
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representative. ACIS and Pathway assert that, on the merits, Plaintiffs have failed to demonstrate the
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necessity to use Rule 4(f)(3)’s alternative means of service and have stated no information about the
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efforts already undertaken to justify application of a special procedure.
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Finally, ACIS and Pathway point out that the Complaint alleges that Anderson resides in three
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different locations: Reno, Nevada; San Ramon, California; and the Philippines. They rely on the
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Supreme Court’s decision in Newman-Green, Inc. v. Alfonzo-Larrain to assert that if Plaintiffs have to
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serve Anderson in the Philippines, it means that the Philippines is Anderson’s place of residence. If
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Anderson resides in the Philippines, complete diversity is destroyed, and the court does not have
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jurisdiction over this case. See 490 U.S. 826, 828 (1989) (holding that if a party is a United States
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citizen but has no domicile in any state, that party is “stateless” for purposes of diversity jurisdiction,
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and “stateless” status destroys complete diversity). If, however, Plaintiffs “revert to the non-Philippine
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residency allegations in the Complaint, the Motion must be denied.” Opposition at 4:13-17.
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ACIS and Pathway also assert that the Complaint should be dismissed because it has not alleged
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the citizenship or domicile of Anderson or Yang. Instead, it only asserts that Yang is an individual with
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his principle place of business in Hong Kong, and Anderson resides in three locations. Complaint at ¶3,
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¶¶34-36. Because the allegations in the Complaint are insufficient to establish diversity jurisdiction,
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ACIS and Pathway argue the Complaint should be dismissed.
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II.
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Analysis
Rule 4(f) of the Federal Rules of Civil Procedure governs how to effect service on an individual
in a foreign country. It provides:
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Unless federal law provides otherwise, an individual—other than a minor, an
incompetent person, or a person whose waiver has been filed—may be served
at a place not within any judicial district of the United States:
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(1)
by any internationally agreed means of service that is reasonably
calculated to give notice, such as those authorized by the Hague
Convention on the Service Abroad of Judicial and Extrajudicial
Documents;
(2)
if there is no internationally agreed means, or if an international
agreement allows but does not specify other means, by a method that
is reasonably calculated to give notice:
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(A)
as prescribed by the foreign country's law for service in that
country in an action in its courts of general jurisdiction;
(B)
as the foreign authority directs in response to a letter rogatory
or letter of request; or
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unless prohibited by the foreign country's law, by:
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(I)
delivering a copy of the summons and of the
complaint to the individual personally; or
(ii)
using any form of mail that the clerk addresses and
sends to the individual and that requires a signed
receipt; or
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(3)
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by other means not prohibited by international agreement, as the court
orders.
Id.
The decision whether to allow alternative means of service of process under Rule 4(f)(3) is
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within the discretion of the district court. Rio Properties, Inc. v. Rio International Interlink, 284 F.3d
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1007, 1016 (9th Cir. 2002). In Rio, the Ninth Circuit interpreted Rule 4(f) and held that the plain
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language of Rule 4(f)(3) requires only that service be directed by the court and that it not contravene an
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international agreement. Id. at 1014. “No other limitations are evident from the text.” Id. at 1016.
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Service under this provision must “comport with constitutional notions of due process” and be
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reasonably calculated, under the circumstances, to “apprise the interested parties of the pendency of the
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action and afford them an opportunity to present [their] objections.” Id. at 1016 (citing Advisory
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Committee Notes to Rule 4(f)(3)). The Ninth Circuit explicitly observed that service under Rule 4(f)(3)
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is not a “last resort” or “extraordinary relief,” and instead, is one way among several to serve process on
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an international defendant. Id. at 1014 (“we hold that Rule 4(f)(3) is an equal means of effecting
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service of process under the Federal Rules of Civil Procedure, and we commit to the sound discretion of
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the district court the task of determining when the particularities and necessities of a given case require
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alternate service of process under Rule 4(f)(3)”).
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Here, the court finds that service by international mail is appropriate to serve the Complaint and
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summons on Anderson. The Motion asserts that Anderson resides in the Philippines and cannot be
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located in Nevada. Although Plaintiffs have not detailed the efforts undertaken to serve Anderson, they
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have alleged that they have been unable to serve Anderson and asserted that, as the chief executive
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officer of ACIS and Pathway, Anderson is aware of this litigation, involved in ACIS’ and Pathway’s
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defense, and attempting to evade process in the Philippines. Even assuming ACIS and Pathway have
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standing to oppose the Motion, they do not dispute these representations in the Opposition. If, as
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claimed, Anderson is the CEO of both companies, counsel for ACIS and Pathway must know where
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Anderson resides and is domiciled.
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Defendants do not claim that service by international mail violates international or Filipino law.
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Moreover, contrary to their assertion, Plaintiffs need not attempt every possible means of service before
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applying for alternative relief under Rule 4(f)(3) because service under subsection (f)(3) is not a last
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resort. Id. at 1015, 1016 (stating “the advisory notes indicate the availability of alternate service of
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process under Rule 4(f)(3) without first attempting service by other means”). There is no requirement
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to show “necessity” to effect service under Rule 4(f)(3). Id. at 1015 (“Rule 4(f)(3) includes no
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qualifiers or limitations which indicate its availability only after attempting service of process by other
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means”).
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Under the circumstances, service by international mail is reasonably calculated to apprise
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Anderson of this action and afford him an opportunity to respond to the Complaint. The court also
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reminds all of the Defendants of their duty under Rule 4(d)(1) to avoid unnecessary expenses associated
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with service of summons.
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The court need not address the merits of Defendants’ jurisdictional arguments as they may be
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raised in an appropriate motion after service is effected. Defendants’ pending Motion to Dismiss does
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not raise the sufficiency of the Complaint’s diversity jurisdiction allegations. Moreover, under 28
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U.S.C. § 1653, courts have the authority to grant leave to amend a complaint in order to cure defective
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allegations of jurisdiction. The statute provides, “Defective allegations of jurisdiction may be amended,
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upon terms, in trial or appellate courts.” Id.; see also Snell v. Cleveland, Inc., 316 F.3d 822, 828 & n.6
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(9th Cir. 2002) (citing Howard v. De Cordova, 177 U.S. 609, 614 (1900) and noting the trial court
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“could-and-should-have allowed amendment if it had been made aware of the pleading defect” and
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stating the trial court “certainly” should not have dismissed the complaint without leave to amend). / /
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Finally, Defendants’ request to delay service of process on Anderson until after the district judge
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disposes of the pending Motion to Dismiss and Compel Arbitration will result in unnecessary further
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delay of these proceedings, and is therefore denied.
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For the reasons set forth above,
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IT IS ORDERED:
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1.
Plaintiffs’ Motion for Order Authorizing Alternate Service of Process on Defendant
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Mark Anderson Pursuant to Federal Rule of Civil Procedure 4(f)(3) (Dkt. #24) is
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GRANTED.
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2.
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Plaintiffs shall have an additional forty-five days, or until September 27, 2012, in which
to serve the Complaint and summons on Anderson.
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John Pierceall and agents of Ancillary Legal Corporation are specially appointed,
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authorized, and directed to mail the summons, Complaint, and future pleadings in this
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action for service on Defendant Mark Anderson in the Philippines by United States
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International Mail.
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4.
The Defendants are reminded of their duty under Rule 4(d)(1) of the Federal Rules of
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Civil Procedure to avoid unnecessary expenses associated with service of the Complaint
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and summons.
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Dated this 13th day of August, 2012.
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________________________________________
___________ _______________________
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PEGGY A. LEEN
PEGGY A. LEEN
EGG
GY
EE
UNITED STATES MAGISTRATE JUDGE
UNITED
E
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