The Bank of New York Mellon vs. Schuetz, et al.,

Filing 10

ORDER Granting Plaintiffs' 8 Motion for Service by Publication. Plaintiffs have an additional sixty days up to and including 3/7/2016 to effectuate service of the Complaint and Summons on Defendant LVBP. Plaintiffs must serve a copy of the Complaint and Summons to Defendant LVBP via U.S. Mail at its last known address(es). Signed by Magistrate Judge Cam Ferenbach on 1/5/2016. (Copies have been distributed pursuant to the NEF - SLD)

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UNITED STATES DISTRICT COURT

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DISTRICT OF NEVADA

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***

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THE BANK OF NEW YORK MELLON FKA
THE BANK OF NEW YORK AS TRUSTEEE,
et al.,
Plaintiffs,

2:15-cv-01819-APG-VCF
ORDER

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vs.
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JERRY H. SCHUETZ, et al.,

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Defendants.

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This matter involves The Bank of New York Mellon FKA The Bank of New York as Trustee, for
the Certificateholders of the GSC Capital Corp. Mortgage Trust 2006-2, GSC Alternative Loan Trust

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Notes, Series 2006-2 against Defendants Jerry H. Schuetz, as Trustee for The Jerry H. Schuetz Trust, and
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LVBP Propoerties, LLC ("LVBP"), for quiet title, declaratory relief, and unjust enrichment regarding
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LVBP's status as the successful bidder following a public auction on a homeowner's association lien by
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Sunrise Ridge. (See Compl. (#1)). Before the court is Plaintiffs' Motion for Publication (#8). The period
in which to serve Defendant LVBP expires on January 20, 2016. (#1). Plaintiffs' motion was filed prior to
the expiration. As discussed in more detail below, Plaintiffs' motion is granted.

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DISCUSSION
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Plaintiffs' motion presents two questions: (1) whether Plaintiffs may have additional time to serve

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Defendant LVBP and (2) whether Plaintiffs may serve LVBP by publication. Both questions are addressed

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below.

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A.

Plaintiff’s Motion for Additional Time to Serve LVBP is granted.

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Courts have broad discretion to extend time for service under Rule 4(m). Efaw v. Williams, 473

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F.3d 1038, 1041 (9th Cir. 2003). The Supreme Court has stated that the 120–day time period (now 90 day

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time period) for service contained in Rule 4(m) “operates not as an outer limit subject to reduction, but as

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an irreducible allowance.” Henderson v. United States, 517 U.S. 654, 661 (1996). “On its face, Rule 4(m)

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does not tie the hands of the district court after the 120–day period has expired. Rather, Rule 4(m)

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explicitly permits a district court to grant an extension of time to serve the complaint after that 120–day

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period.” Mann v. American Airlines, 324 F.3d 1088, 1090 (9th Cir. 2003). The Advisory Committee Notes

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to Rule 4(m) state that the rule “explicitly provides that the court shall allow additional time if there is

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good cause for the plaintiff’s failure to effect service in the prescribed 120 days, and authorizes the court

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to relieve a plaintiff of the consequences of an application of [Rule 4(m)] even if there is no good cause

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shown.” See FED. R. CIV. P. 4(m), Advisory Committee Notes, 1993 Amendments.
Generally, “good cause” is equated with diligence. See WRIGHT & MILLER, FEDERAL PRACTICE

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PROCEDURE: CIVIL 3D § 1337. In the Ninth Circuit, a showing of good cause requires more than

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AND

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simple inadvertence, mistake of counsel, or ignorance of the rules. See National Union Fire Ins. Co. v.

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Monroe, No. 10–cv–0385, 2011 WL 383807, at *1 (D. Nev. Feb. 2, 2011). “At a minimum, good cause

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means excusable neglect. A plaintiff may also be required to show the following: (a) the party to be served

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personally received actual notice of the lawsuit; (b) the defendant would suffer no prejudice; and (c) the

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plaintiff would be severely prejudiced if his complaint were dismissed.” Boudette v. Barnette, 923 F.2d

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754, 756 (9th Cir.1991).

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Here, the Plaintiffs have satisfied this standard. The Secretary of State page shows that LVBP's

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business license has been revoked. (# 8-3). Plaintiffs have diligently attempted to serve LVBP at its last

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place of business, and by and through its resident agent, Elizabeth C. G., at her last known business

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addresses - 1204 Nugget Creek Drive, Las Vegas, Nevada 89108 and 3230 S. Buffalo Drive, Las Vegas,

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Nevada but were unsuccessful. (#8 at p. 2). Plaintiffs state that they are not able to locate another address

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for LVBP. Id.

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Here, this constitutes “diligence” as Plaintiffs have tried multiple times and ways to serve LVBP.

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Defendants Jerry H. Schuetz and The Jerry H. Schuetz Trust have not yet appeared in this matter.

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Defendants would suffer no prejudice and Plaintiffs would be severely prejudiced if their complaint were

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dismissed. Accordingly, the court grants Plaintiffs an additional sixty days, up to and including March 7,

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2016 to effectuate service of the Complaint and Summons on Defendant LVBP.

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B.

Plaintiffs' Motion to Serve LVBP by Publication is Granted.

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Federal Rules of Civil Procedure do not expressly permit service by publication. Rule 4(e)(1),

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however, permits a plaintiff to serve a defendant “following state law for serving a summons in an action

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brought in courts of general jurisdiction in the state where the district court is located or where service is

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made.” FED. R. CIV. P. 4(e)(1).

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In Nevada, Rule 4 of the Nevada Rules of Civil Procedure (“NRCP”) governs service of parties

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under state law. Parties are required to personally serve summons and the complaint upon defendants;

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however, when personal service proves impossible, Rule 4(e)(1)(i) provides that a party may move for

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service by publication when the opposing party “resides out of the state, or has departed from the state, or

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cannot, after due diligence be found within the state, or by concealment seeks to avoid the service of

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summons.” Id.

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“A party seeking service by publication must seek leave of court by filing an affidavit

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demonstrating its due diligence in attempting to personally serve the defendant. There are several key

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factors Nevada courts look to in evaluating a party’s due diligence in effecting service.” Id. Nevada courts

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principally consider the number of attempts made by a plaintiff to serve a defendant at his or her residence

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and other methods of locating defendants, such as consulting public directories and family members. Id.;

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citing Price v. Dunn, 106 Nev. 100, 787 P.2d 785, 786–7 (Nev. 1990), rev’d on other grounds, NC–DSH,

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Inc. v. Garner, 125 Nev. 647, 651 n. 3, 218 P.3d 853 (2009); Abreu v. Gilmer, 115 Nev. 308, 985 P.2d

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746, 747 (Nev. 1999); McNair v. Rivera, 110 Nev. 463, 874 P.2d 1240, 1241 (Nev. 1994).

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In Price, the Nevada Supreme Court found service by publication was not warranted, stating

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“where other reasonable methods exist for locating the whereabouts of a defendant, plaintiff should

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exercise those methods.” 787 P.2d at 786–7. There, the plaintiff contacted the defendant’s stepmother,

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and upon hearing that the defendant lived out of state, moved for service by publication. Id. at 105, 787

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P.2d 785. The Price court held that, “although [plaintiff’s] affidavit technically complies with NRCP

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4(e)(1)(i), her actual efforts, as a matter of law, fall short of the due diligence requirement to the extent of

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depriving [defendant] of his fundamental right to due process.” Id.

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In contrast, in Abreu, the Nevada Supreme Court determined that the plaintiff exercised due

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diligence in attempting service because it made three attempts at the defendant’s possible address and also

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consulted telephone company directories. See 115 Nev. at 311.

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NRCP 4(e)(1)(iii) also requires that in addition to in-state publication, “where the present

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residence of the defendant is unknown the order may also direct that publication be made in a newspaper

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published outside the State of Nevada.” Id. In cases “where the residence of a nonresident or absent

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defendant is known, the court or judge shall also direct a copy of the summons and complaint to be

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deposited in the post office.” Id.

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Additionally, Plaintiff has at least met the efforts displayed by the plaintiffs in Abrreu. As

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mentioned above, the process server has attempted to serve LVBP and LVBP's resident agent at their last

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known address(es) in Las Vegas. The court finds that this is sufficient to permit service of process by

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publication under Nevada law. Accordingly, the court grants the Plaintiffs' request to serve LVBP by

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publication.

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ACCORDINGLY, and for good cause shown,

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IT IS ORDERED that Plaintiffs' Motion for Publication (#8) is GRANTED. Plaintiffs have an

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additional sixty days, up to and including March 7, 2016 to effectuate service of the Complaint and

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Summons on Defendant LVBP.

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IT IS FURTHER ORDERED that service of the Summons and Complaint in this action be made

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upon Defendant LVBP by publication in a newspaper of general circulation in Las Vegas, Nevada, where

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this matter is currently pending. Said publications must run once per week for four consecutive weeks.

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The service of summons and amended complaint will be deemed complete upon the expiration of four

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weeks from the date of the first publication.

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IT IS FURTHER ORDERED that Plaintiffs must serve a copy of the Complaint and Summons to
Defendant LVBP via U.S. Mail at its last known address(es).

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IT IS SO ORDERED.

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DATED this 5th day of January, 2016.

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_________________________
CAM FERENBACH
UNITED STATES MAGISTRATE JUDGE