Democratic National Committee v. The Russian Federation et al

Filing 151

MOTION to Serve Defendant Aras Agalarov by Alternate Means. Document filed by Democratic National Committee.(Sellers, Joseph)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
------------------------------------- X
DEMOCRATIC NATIONAL COMMITTEE,
Plaintiff,

Civil Action No. 1:18-cv-03501 (JGK)

v.
THE RUSSIAN FEDERATION et al.,
Defendants.
------------------------------------- X

MOTION TO SERVE DEFENDANT ARAS AGALAROV BY ALTERNATE MEANS

TABLE OF CONTENTS
I.

BACKGROUND ................................................................................................................ 1

II.

SERVICE ATTEMPTS ...................................................................................................... 2

III.

LEGAL STANDARD ......................................................................................................... 3

IV.

ANALYSIS ......................................................................................................................... 4

V.

CONCLUSION ................................................................................................................... 6

i

TABLE OF AUTHORITIES
Page(s)
CASES
Advanced Aerofoil Techs., AG v. Todaro,
2012 WL 299959 (S.D.N.Y. Jan. 31, 2012) ..............................................................................3
AMTO, LLC v. Bedford Asset Mgmt., LLC,
No. 14-CV-9913, 2015 WL 3457452 (S.D.N.Y. June 1, 2015) ................................................5
Arista Records LLC v. Media Servs. LLC,
No. 06 CIV. 15319(NRB), 2008 WL 563470 (S.D.N.Y. Feb. 25, 2008) ..................................5
Bidonthecity.com LLC v. Halverston Holdings Ltd.,
No. 12 CIV. 9258 (ALC) (MHD), 2014 WL 1331046 (S.D.N.Y. Mar. 31,
2014) ..........................................................................................................................................5
Dama S.P.A. v. Does,
No. 15-CV-4528 (VM), 2015 WL 10846737 (S.D.N.Y. June 15, 2015) ..................................5
Elsevier, Inc. v. Siew Yee Chew,
287 F. Supp. 3d 374 (S.D.N.Y. 2018)....................................................................................3, 4
Kuklachev v. Gelfman,
No. 08-CV-2214 (CPS), 2008 WL 5068860 (E.D.N.Y. Nov. 24, 2008) ...................................5
Microsoft Corp. v. Does,
No. 12-CV-1335 SJ RLM, 2012 WL 5497946 (E.D.N.Y. Nov. 13, 2012) ...............................4
Mullane v. Cent. Hanover Bank & Trust Co.,
339 U.S. 306 (1950) ...................................................................................................................4
Philip Morris USA Inc. v. Veles Ltd.,
No. 06 CV 2988 GBD, 2007 WL 725412 (S.D.N.Y. Mar. 12, 2007) .......................................4
Rio Props., Inc v. Rio Int’l Interlink,
284 F.3d 1007 (9th Cir. 2002) ...................................................................................................4
Sec. & Exch. Comm’n v. Anticevic,
2009 WL 361739 (S.D.N.Y. Feb. 13, 2009) ..............................................................................3
Sulzer Mixpac AG v. Medenstar Indus. Co.,
312 F.R.D. 329 (S.D.N.Y. 2015) ...............................................................................................6
OTHER AUTHORITIES
Federal Rule of Civil Procedure Rule 4(f) ...................................................................................3, 4
i

Fed. R. Civ. P. (4)(h)........................................................................................................................3
Sean Stewart-Muniz, Azerbaijani billionaire picks up Palazzo pad for $11M ...............................2

ii

Plaintiff DNC (“Plaintiff” or “the DNC”) respectfully requests permission to serve the
summons, Complaint, Electronic Case Filing Rules & Instructions, and Individual Practices of
Judge John G. Koeltl (the “service packet”) on Defendant Aras Agalarov by sending the
Complaint: (a) via email and first class mail to Scott Balber1, Aras Agalarov’s attorney in other
matters; and (b) via email to the email address associated with Aras Agalarov’s real estate firm.
I.

BACKGROUND

Defendant Aras Agalarov is an Azeri-born Russian oligarch and the president of Crocus
Group, a Moscow-based real estate development firm.2 The website for Crocus Group contains a
webpage titled “Our Leaders,” and features two biographies: one of Aras Agalarov, and one of
his son, Emin Agalarov.3 The website does not contain any other biographies or names of staff or
employees. See supra note 3. The website also contains a webpage titled “Contacts.” Id. That
page lists a Moscow mailing address for Crocus Group, and the email address
[e-mail].4 No other contact information is provided for Crocus Group or for Aras or
Emin Agalarov. See supra note 4.
Plaintiff has not located a mailing address for Aras Agalarov in Russia or in Azerbaijan.
Declaration of Julia Horwitz (“Horwitz Decl.”) ¶ 2. However, according to local Florida real

Mr. Balber also represents Aras Agalarov’s son, Emin Agalarov, in this litigation.
Plaintiff’s counsel has already sent Mr. Balber a copy of the Complaint and of the July 19, 2018
status report in connection with his representation of Emin Agalarov. In addition, Plaintiff’s
counsel has communicated extensively with Mr. Balber regarding the sufficiency of service on
Emin Agalarov (most recently on July 23, 2018). Based on those communications, Plaintiff
believes that Mr. Balber is in a position to contact the Agalarovs and give them information
about this case.
1

2

Crocus Group, http://www.crocusgroup.com (last visited July 19, 2018)

3

Our Leaders, Crocus Group, http://www.crocusgroup.com/crocus/management/ (last
visited July 19, 2018)
4

Contact us, Crocus Group, http://www.crocusgroup.com/crocus/contacts/ (last visited
July 19, 2018). The web page also includes a Russian phone number: [phone].
1

estate reports, Aras Agalarov purchased a luxury condominium on Fisher Island in Miami Beach,
Florida, in April 2016.5 This Florida address is the only United States address associated with
Mr. Agalarov that Plaintiff has located, despite Plaintiff’s diligent efforts to search databases,
dockets, and news reports for alternate addresses. Horwitz Decl. ¶ 2. Because Aras Agalarov has
only been present at that address twice in the past two years, as explained in greater detail below,
Plaintiff believes that Aras Agalarov resides abroad, likely in Moscow where Crocus Group is
based. See id. ¶ 3.
II.

SERVICE ATTEMPTS

On April 30, 2018, Plaintiff’s counsel called Scott Balber, who confirmed that he
represents both Aras Agalarov and his son in other matters. Declaration of Geoffrey A. Graber
(“Graber Decl.”) ¶ 2. Mr. Balber said that he was not authorized to accept service on behalf of
Aras Agalarov, and when Plaintiff’s counsel asked if Mr. Balber could identify anyone else who
might be authorized to accept service for Aras Agalarov or his son, Mr. Balber instructed Plaintiff’s
counsel to consult “the Federal Rules.” Id. ¶ 3.
Without Mr. Balber’s guidance, Plaintiff consulted publicly available real estate reports,
which suggested that Aras Agalarov purchased a luxury condominium in Florida. Horwitz Decl.
¶ 4. Plaintiff therefore mailed Aras Agalarov a service waiver at the Florida address on May 2,
2018. Id. ¶ 5. When Plaintiff did not receive a response to the waiver by the deadline, Plaintiff
hired a process server to attempt personal service at the Florida address. Id. On June 15, 2018,
the process server knocked on the door of the condominium and received no answer. See Affidavit

5

Russian billionaire buys Fisher Island condo for $10.7M, Sun Sentinel (Apr. 13, 2016,
4:03 PM), http://www.sun-sentinel.com/local/miami-dade/sfl-fisher-island-condo-10-7m20160413-story.html; Sean Stewart-Muniz, Azerbaijani billionaire picks up Palazzo pad for
$11M, The Real Deal: Miami (Apr. 13, 2016, 12:45 PM),
https://therealdeal.com/miami/2016/04/13/azerbaijani-billionaire-picks-up-palazzo-pad-for-11m/.
2

of Due Diligence, attached as Exhibit A. He then spoke to a security guard who informed him that
the Agalarov family has only been present at that residence twice in the last two years. Id. The
process server has provided a notarized “affidavit of due diligence,” explaining his attempt to serve
Aras Agalarov. Id.
Plaintiff’s counsel searched real estate reports and other publicly available sources for other
addresses where Aras Agalarov might reside, but the search was fruitless. Horwitz Decl. ¶ 6.
III.

LEGAL STANDARD

Federal Rule of Civil Procedure Rule 4(f) establishes three mechanisms for service of an
individual abroad: 1) “by any internationally agreed means of service that is reasonably calculated
to give notice, such as those provided by the Hague Convention,” Fed. R. Civ. P. (4)(f)(1); 2) if
there is no internationally agreed means, then by following the law of the country where the
defendant is located, following directions given by an official in the foreign country where the
defendant is located, hand delivering a copy of the summons and complaint to the defendant
(unless the defendant is an organization), or mailing the summons and complaint with a request
for a signed receipt, Fed. R. Civ. P. (4)(f)(2), (4)(h)(2); or 3) by “other means not prohibited by
international agreement, as the court orders,” Fed. R. Civ. P. (4)(f)(3).
There is “no hierarchy” among these three means of service: a plaintiff need not attempt
service under Rule 4(f)(1) or Rule 4(f)(2) before the court authorizes service on an international
defendant under Rule 4(f)(3). Elsevier, Inc. v. Siew Yee Chew, 287 F. Supp. 3d 374, 377–78
(S.D.N.Y. 2018) (quoting Advanced Aerofoil Techs., AG v. Todaro, 2012 WL 299959, at *1
(S.D.N.Y. Jan. 31, 2012)); see also Sec. & Exch. Comm’n v. Anticevic, 2009 WL 361739, at *3
(S.D.N.Y. Feb. 13, 2009). However, in an exercise of their discretion, some courts have required
parties seeking permission to serve a defendant under Rule 4(f)(3) to show: (1) “that the plaintiff
has reasonably attempted to effectuate service on the defendant” by itself; and (2) that “the
3

circumstances are such that the court’s intervention is necessary.” Elsevier, Inc., 287 F. Supp. 3d
at 378 (collecting cases).
When a court exercises its authority under Rule 4(f)(3), it may authorize any means of
service that is “reasonably calculated, under all circumstances to apprise interested parties of the
pendency of the action and afford them an opportunity to present their objections” and comports
with international law. Rio Props., Inc v. Rio Int’l Interlink, 284 F.3d 1007, 1014, 1016 (9th Cir.
2002) (quoting Mullane v. Cent. Hanover Bank & Trust Co., 339 U.S. 306, 314 (1950)); Elsevier,
Inc., 287 F. Supp. 3d at 379–80 (citing Rio with approval); Microsoft Corp. v. Does, No. 12-CV1335 SJ RLM, 2012 WL 5497946, at *2 (E.D.N.Y. Nov. 13, 2012) (same); Philip Morris USA
Inc. v. Veles Ltd., No. 06 CV 2988 GBD, 2007 WL 725412, at *2 (S.D.N.Y. Mar. 12, 2007) (same).
IV.

ANALYSIS

Because Plaintiff has only been able to locate the mailing address and email address for
Mr. Agalarov’s place of business in Moscow, the Court can and should exercise its authority under
Rule 4(f)(3) to authorize service on Mr. Agalarov: a) via email and first class mail to Scott Balber,
Aras Agalarov’s attorney in other matters; and b) via email to the email address associated with
Aras Agalarov’s real estate firm. Plaintiff has satisfied the two threshold conditions that some
district courts impose on parties seeking a court order under Rule 4(f)(3). Elsevier, Inc., 287 F.
Supp. 3d at 378. First, as explained above, Plaintiff “reasonably attempted to effectuate service
on the defendant” without assistance from the Court: Plaintiff attempted personal service at the
only known mailing address associated with Mr. Agalarov, and searched carefully for other
potential mailing addresses without success. See id. Second, because Plaintiff has not been able
to locate any other mailing address or email address associated with Mr. Agalarov, it would be
difficult if not impossible to serve him without the Court’s permission to serve him through the
Crocus Group email address. See id.; see also Dama S.P.A. v. Does, No. 15-CV-4528 (VM), 2015
4

WL 10846737, at *2 (S.D.N.Y. June 15, 2015) (authorizing email service under Rule 4(f)(3) where
the defendant had a “functioning email address,” but “otherwise remained anonymous”).
Serving Mr. Agalarov without Court intervention would also be difficult, if not impossible,
because Plaintiff cannot use the Hague Convention service of process procedures: Crocus Group
is located in Russia, which does not participate in the Hague Convention service of process
procedures with respect to the United States. AMTO, LLC v. Bedford Asset Mgmt., LLC, No. 14CV-9913, 2015 WL 3457452, at *4 (S.D.N.Y. June 1, 2015) (“Accordingly, because there is no
reason to believe that service would be effective if a plaintiff were required to serve a defendant
based in Russia in accordance with the Hague Convention procedures, substituted service pursuant
to Rule 4(f)(3) is appropriate.”) (internal quotations omitted); see also Arista Records LLC v.
Media Servs. LLC, No. 06 CIV. 15319(NRB), 2008 WL 563470, at *2 (S.D.N.Y. Feb. 25, 2008)
(same). Moreover, Plaintiff is prevented from serving the service packet by mail to Crocus
Group’s mailing address because Russia has formally objected to service of process by mail. See
Kuklachev v. Gelfman, No. 08-CV-2214 (CPS), 2008 WL 5068860, at *2 (E.D.N.Y. Nov. 24,
2008).6
In light of Russia’s refusal to accept service by mail, the means of service best
“calculated, under all circumstances to apprise” Mr. Agalarov of the lawsuit and “afford [him] an

As courts in this District have recognized, “The Russian Federation is a signatory to the
Hague Convention, but objects to all methods of service in Article 10, including ‘the freedom to
send judicial documents, by postal channels, directly to persons abroad.’” Bidonthecity.com LLC
v. Halverston Holdings Ltd., No. 12 CIV. 9258 (ALC) (MHD), 2014 WL 1331046, at *9 (S.D.N.Y.
Mar. 31, 2014) (quoting Hague Service Convention art. 10(a)). Courts have further found that
Russia’s reliance on Article 10 of the Hague Convention to object to service of process by postal
mail is not inconsistent with its refusal to participate in the Hague Convention’s service of process
procedures. See Kuklachev, 2008 WL 5068860 at *2. Thus, although Russia refuses to accept
service through the Hague Convention’s service of process procedures, that “does not change the
fact that Russia does not agree to service by mail.” Id. at *2 n.2. See also Bidonthecity.com LLC,
2014 WL 1331046, at *9.
6

5

opportunity to present [his] objections,” without violating international agreements, is: a) via
email and first class mail to Scott Balber, Aras Agalarov’s attorney in other matters; and (b) via
email to the email address associated with Aras Agalarov’s real estate firm.
As the Court recognized in granting Plaintiff’s motion to serve Defendant Paul J. Manafort
Jr. by first class mail and email to his criminal defense attorneys, as well as by first class mail to
the detention center where he is awaiting trial, serving documents on an attorney who is
representing a defendant in another matter is a reliable means of effecting service. Memo Endorsed
Order, ECF No. 140. Moreover, Crocus Group’s email address is likely to reach Mr. Agalarov, as
he holds himself out as the president and only one of two named officers of Crocus Group. See
supra note 3. Since no other employees or staff are mentioned anywhere on the website, and since
no individual email addresses are provided for either of the two officers listed on the website, any
email that is transmitted to the general Crocus Group account is likely to be delivered or forwarded
to the Crocus Group president. See Sulzer Mixpac AG v. Medenstar Indus. Co., 312 F.R.D. 329,
332 (S.D.N.Y. 2015) (holding that service via email was reasonably calculated to inform the
defendant of the litigation because the defendant conducted some business over email, and it was
therefore likely that the defendant would read the email serving the complaint).
V.

CONCLUSION

For the foregoing reasons, Plaintiff respectfully requests authorization to serve Aras
Agalarov by sending the Complaint via email and first class mail to Scott Balber, Aras
Agalarov’s attorney in other matters; and via email to the email address associated with Aras
Agalarov’s real estate firm.

6

Dated: July 24, 2018

Respectfully submitted,

/s/ Joseph M. Sellers
Joseph M. Sellers (admitted Pro Hac Vice)
Geoffrey A. Graber (admitted Pro Hac Vice)
Julia A. Horwitz (admitted Pro Hac Vice)
Alison S. Deich (Pro Hac Vice pending)
Cohen Milstein Sellers & Toll PLLC
1100 New York Ave. NW ● Fifth Floor
Washington, DC 20005
[phone]

Michael Eisenkraft (#6974)
Cohen Milstein Sellers & Toll PLLC
88 Pine St. ● 14th Floor
New York, NY 10005
[phone]

Attorneys for Plaintiff

7

CERTIFICATE OF SERVICE
I hereby certify that on July 24, 2018, I electronically filed the foregoing motion with the
Clerk of the Court using ECF, which in turn sent notice to all counsel of record who have
appeared in this action. I also certify that I caused a copy of the foregoing motion to be filed in
the office of the Clerk of the Court for transmittal to pro se parties in this action.
I further certify that I also served the foregoing motion to the parties set forth below as
indicated:
BY E-MAIL: I caused a true and correct copy of the foregoing motion to be served by
electronic transmission to each of the following parties shown through email:
Scott Balber
Herbert Smith Freehills New York LLP
450 Lexington Avenue
New York, NY 10017
[e-mail]

Counsel for Emin Agalarov

Jay R. Nanavati
Kostelanetz & Fink LLP
601 New Jersey Avenue NW
Suite 620
Washington, DC 20001
[e-mail]

Counsel for Paul Manafort, Jr.

Thomas E. Zehnle
Law Office of Thomas E. Zehnle
601 New Jersey Avenue NW
Suite 620
Washington, DC 20001
[phone]
[e-mail]
Alan S. Futerfas
The Law Offices of Alan S. Futerfas
565 Fifth Ave., 7th Floor
New York, NY 10017
[e-mail]

Counsel for Donald J. Trump, Jr.

BY U.S. MAIL: I am readily familiar with the firm’s practice of collection and
processing correspondence for mailing. Under that practice it would be deposited with the U.S.
Postal Service on that same day with postage thereon fully prepaid at Washington, D.C. in the
ordinary course of business.
Richard W. Gates, III
206 Virginia Avenue
Richmond, VA 23226

Service of Process Address for Richard W.
Gates, III

George Papadopoulos
4926 N. Fairfield Avenue
Chicago, IL 60625

Service of Process Address for George
Papadopoulos

Dated:

July 24, 2018

/s/ Julia A. Horwitz
Julia A. Horwitz

CERTIFICATE OF LENGTH
I hereby certify that this document is less than 7,000 words.

Dated:

July 24, 2018

/s/ Julia A. Horwitz
Julia A. Horwitz