Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-casd-3_15-cv-02551/USCOURTS-casd-3_15-cv-02551-0/pdf.json

Nature of Suit Code: 890
Nature of Suit: Other Statutory Actions
Cause of Action: 15:1681 Fair Credit Reporting Act

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UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF CALIFORNIA

THERESA L. BLANKENSHIP,

Plaintiff,

v.

ACCOUNT RECOVERY 

SERVICE, INC.,

Defendant.

Case No.: 15-cv-2551-BTM-JLB

ORDER DISMISSING WITHOUT 

PREJUDICE DEFENDANT 

ACCOUNT RECOVERY SERVICE, 

INC., AND GRANTING LEAVE TO 

AMEND COMPLAINT

On January 5, 2017, Plaintiff filed a motion for default judgment against 

defendant Account Recovery Service, Inc., in which she asserted, in part, that 

Account Recovery Service, Inc. was in default in that it allegedly executed a waiver 

of service of the summons and complaint pursuant to Federal Rule of Civil 

Procedure 4(d)(1), but thereafter failed to file a responsive pleading. 

On the Court’s review of the waiver form referenced by Plaintiff, it determined 

that the waiver stated the party waiving service as “Kathryn Nix,”1 not Account 

Recovery Service, Inc., and that it was executed in Oxnard, California, whereas 

the complaint alleged that the primary corporate address of Account Recovery 

Service, Inc. was in Milwaukee. The Court thus found the waiver form insufficient 

to demonstrate the Court had acquired personal jurisdiction over Account 

Recovery Service, Inc. (ECF No. 59.) The Court accordingly denied Plaintiff’s 

 

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 The Court read the handwritten form as “Kathryn Dix,” but Plaintiff now indicates the handwriting actually says 

“Kathryn Nix.” 

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motion for judgment by default, and issued an Order to Show Cause (“OSC”) 

requiring Plaintiff to show good cause, in writing, why Account Recovery Service, 

Inc. should not be dismissed from the action based on Plaintiff’s failure to effect 

service, or obtain a valid waiver of service, within 90 days of filing the complaint, 

as required by Federal Rule of Civil Procedure 4(m). (ECF No. 59.)

Plaintiff has filed a timely response to the OSC. In essence, she contends 

that she served the correct person—Kathryn Nix, in Oxnard—but the wrong entity. 

She states her claim under the Fair Credit Reporting Act, 15 U.S.C. § 1681 is 

based on an allegedly wrongfully derogatory remark on her credit report entered 

by “Account Recovery Service,” with a P.O. Box in Oxnard. Pl.’s Resp. to OSC, 

Ex. 1. Her counsel’s research led him to conclude that “Account Recovery Service” 

meant Account Recovery Service, Inc., a corporation the California Secretary of 

State website identifies as a “forfeited” Wisconsin corporation with a principal 

address in Milwaukee, whose agent for service of process is C T Corporation 

System, located at 818 W. 7th Street in Los Angeles, California. Id. Ex. 2. 

Plaintiff’s counsel states he nevertheless sent the waiver of service packet to 

Kathryn Nix at a street address in Oxnard (“411 N A St in Oxnard, California”) 

based on an online search that apparently led him to website with the Oxnard 

mailing address. Id. at 2:17-23. 

Plaintiff’s counsel states he has now done additional research and has 

learned that the California Secretary of State website associates two corporations 

with the 411 N A St, Oxnard address: TriCounties Adjustment Bureau, Inc., and 

Accounts Adjustment Bureau. Id. Exs. 3, 4. Kathryn Nix is listed as the agent for 

service of process of both entities. Id. Plaintiff’s counsel indicates the new

information has led him to conclude that TriCounties Adjustment Bureau, Inc., 

doing business as Account Recovery Service, is the correct defendant—not 

Account Recovery Service, Inc., the Wisconsin corporation identified in the 

complaint. Id. at 3:24-4:1. Plaintiff’s counsel asks the Court to allow Plaintiff to 

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amend her complaint to name Tri Counties Adjustment Bureau, Inc. Id. at 4:1-5. 

Plaintiff’s burden in response to the OSC was to demonstrate good cause 

for the failure to effect service, or obtain a valid waiver of service, as to Account 

Recovery Service, Inc. within 90 days of filing this action. See Fed. R. Civ. P. 4(m). 

The “good cause” inquiry focuses on whether the Plaintiff has been diligent in 

attempting to effect service, and whether “some outside factor ... rather than 

inadvertence or negligence, prevented service....” Fed. R. Civ. P. 4, H.R. 7154—

Federal Rules of Civil Procedure Amendments Act of 1982 (“If the plaintiff has not 

been diligent, the court will dismiss the complaint for failure to serve within 120 

[now 90] days...”), Fed. R. Civ. P. 4, Adv. Comm. Notes to 1993 Am., Subdivision 

(m) (stating relief for failure to effect service within required time frame may be 

justified “if the defendant is evading service or conceals a defect in attempted 

service”); Mann v. Castiel, 681 F.3d 368, 374 (D.C. Cir. 2012) (quoting LeponeDempsey v. Carroll Cnty. Cm’rs, 476 F.3d 1277, 1281 (11th Cir. 2007)). “In making 

extension decisions under Rule 4(m) a district court may consider factors like a 

statute of limitations bar, prejudice to the defendant, actual notice of a lawsuit, and 

eventual service.” Efaw v. Williams, 473 F.3d 1038, 1041 (9th Cir. 2007) (internal 

quotation marks and citation omitted). If there is a showing of good cause, the 

district court must grant an extension of time for service under Rule 4(m), and if 

there is not, the court may dismiss the defendant without prejudice. Fed. R. Civ. 

P. 4(m); Efaw, 473 F.3d at 1041. 

The Court finds Plaintiff has not demonstrated good cause for the failure to 

effect service, or obtain a valid waiver of service, as to Account Recovery Service, 

Inc. At the outset, Plaintiff now disclaims the notion that Account Recovery 

Service, Inc. is a proper defendant in this action, which effectively moots the issue. 

To the extent Plaintiff’s counsel attempts to justify his delay in discovering the 

defect in service, the Court finds the response insufficient to provide such 

justification. This action was filed on November 12, 2015. (ECF No. 1.) At the 

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time Plaintiff’s counsel served the waiver form, he was operating under the belief 

that Account Recovery Service, Inc., a Wisconsin corporation, was the correct 

defendant. The California Secretary of State’s internet database shows CT 

Corporation is the agent for service of process for Account Recovery Service, Inc. 

Plaintiff’s counsel gives no indication this information was not available to him at 

the time he was attempting to effect service. A waiver of service of process, when 

served on a corporation, must be addressed “to an officer, a managing or general 

agent, or any other agent ... authorized by law.” Fed. R. Civ. P. 4(d)(1)(A)(ii). Yet 

rather than serve the waiver package on CT Corporation, Plaintiff’s counsel chose 

to send the waiver package to Kathryn Nix at an address in Oxnard, on the basis 

of an internet search (a search he now contends actually led him to a different 

entity). This additional information merely confirms that the waiver form did not 

create personal jurisdiction over Account Recovery Service, Inc., and fails to justify 

the delay in discovery of the defect. 

In reviewing Plaintiff’s OSC response, the Court found it necessary to 

consider whether it inadvertently acquired personal jurisdiction over Account 

Recovery Service, Inc., by the apparent participation of its counsel, Lloyd Dix, in a 

discovery conference early in the case. Plaintiff has submitted a copy of a 

February 22, 2016 email addressed to “efile_Bartick@casd.uscourts.gov,” the efile address for Magistrate Judge Bartick. Ex. 6. Attached to the email is a 

“Proposed Joint Discovery Plan Pursuant to F.R.C.P. 26(f)” prepared by Plaintiff’s 

counsel, which includes electronic signatures of counsel, including Lloyd Dix (“/s/ 

Lloyd Douglas Dix”) on behalf of Account Recovery Service, Inc. Ex. 6. The 

proposed plan states that a Rule 26(f) meeting was held telephonically on January 

27, 2016. Id. Although the proposed discovery plan was emailed to the magistrate 

judge, the electronic docket for this case shows that the document was never filed. 

Although Plaintiff does not contend Dix’s participation in the discovery 

conference and electronic signature to the proposed discovery plan resulted in a

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general appearance on behalf of Account Recovery Service, Inc., the Court has 

considered the issue sua sponte. “Defendants can waive the defect of lack of 

personal jurisdiction by appearing generally without first challenging the defect in 

a preliminary motion, or in a responsive pleading.” Jackson v. Hayakawa, 682 

F.2d 1344, 1347 (9th Cir. 1982). “An appearance ordinarily is an overt act by which 

the party comes into court and submits to the jurisdiction of the court..., an 

affirmative act involving knowledge of the suit and an intention to appear.” Benny 

v. Pipes, 799 F.2d 489, 492 (9th Cir. 1986). However, “‘[n]ot every act by a party 

that is addressed to the court or relates to the litigation will be deemed an 

appearance.’” Taylor v. Boston & Taunton Transp. Co., 720 F.2d 731, 733 (1st 

Cir. 1983) (quoting 10 Wright, Miller & Kane Federal Practice & Procedure § 2686 

(2d ed. 1983). “Informing the clerk of a change in address, Anderson v. Taylorcraft, 

Inc., 197 F. Supp. 872 (W.D. Pa. 1961), and requesting a delay in the entry of a 

default judgment, Rutland Transit Co. v. Chicago Tunnel Terminal Co., 233 F.2d 

655 (7th Cir. 1956), have been held insufficient to constitute an appearance.” Id.; 

see Benny, 799 F.2d at 493 (holding defendant prison guards’ three motions to 

extend time to respond to the complaint did not result in a general appearance).

The Court finds Dix’s participation in the telephonic discovery conference 

and signing of the proposed discovery plan did not result in a general appearance. 

Although the proposed discovery plan was emailed to the magistrate judge, it was 

never filed. S.D. Cal. Elect. Case Filing Admin. Policies & P., R. 2(a), 

https://www.casd.uscourts.gov/CMECF/Lists/Policies%20and%20Procedures/Att

achments/8/CASDPolicies_01-20-2017.pdf (“[e]-mailing a document to ... the 

assigned judge does not constitute ‘filing’ of the document”). Emailing the 

proposed discovery plan to the magistrate judge was thus akin to the contacts 

between counsel and courts that have been held not to result in a general 

appearance. Anderson, 197 F. Supp. at 874 (letter to the clerk regarding change 

in address); Taylor, 720 F.2d at 733 (holding there was no general appearance 

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where a docket entry indicated counsel contacted the court to state he would be 

filing an answer and motion to set aside default in two weeks); compare Vuitton v. 

Rags on Wheels, Civ. S-91-1294 EJG GGH 1992 U.S. Dist. LEXIS 20803, *3-4 

(E.D. Cal. 1992) (finding counsel made a general appearance where he signed a 

stipulation “that was later filed”). 

Also, Dix’s participation in the discovery conference and approval of the 

proposed discovery plan is consistent with an intent to preserve his client’s rights 

while investigating whether his client had been served (and it is now apparent that

there was no service on Account Recovery Service, Inc.). “[A]n appearance is 

always a matter of intention, and is not to be inferred....” Anderson, 197 F. Supp. 

at 874 (citation omitted). In Ayres v. Jacobs & Crumplier P.A., 99 F.3d 565, 568 

(3d Cir. 1996), defendants filed motions to dismiss challenging validity of service 

of process, and subsequently participated in discovery and attended scheduling 

conferences. Id. The Third Circuit held counsel’s conduct was merely “prudent” in 

light of their client’s potential liability and did not result in waiver of objections to 

personal jurisdiction. Id. Likewise, Dix’s participation in the discovery conference 

early in this case and shortly after the alleged service, combined with the lack of 

any subsequent responsive pleading, is at least consistent with the intent to 

preserve his client’s discovery rights while confirming whether Account Recovery 

Service, Inc. had been served. The Court therefore concludes no general 

appearance resulted, and it did not acquire personal jurisdiction over Account 

Recovery Service, Inc. 

Because Account Recovery Service, Inc. has not been served, far more than 

90 days have elapsed since the action was filed on November 12, 2015, and 

Plaintiff has not shown good cause for the delay, the Court will dismiss Account 

Recovery Service, Inc. from the action pursuant to Rule 4(m).

Plaintiff’s counsel indicates he now believes the complaint erroneously 

named Account Recovery Service, Inc., a Wisconsin corporation, and that the 

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correct defendant is actually Tri Counties Adjustment Bureau, Inc., doing business 

as Account Recovery Service. OSC Resp. at 3:24-36. The Court will grant Plaintiff 

the opportunity to amend the complaint to add the proposed new defendant. If

Plaintiff does amend, the newly named defendant must thereafter be served with 

process (or waive service) in accordance with Rule 4 as with any new defendant. 

For the foregoing reasons, defendant Account Recovery Service, Inc. is 

DISMISSED WITHOUT PREJUDICE from this action. The Court grants Plaintiff 

leave to amend the complaint to name the proposed new defendant identified in 

the response to the OSC. Plaintiff shall file the amended complaint by May 15, 

2017. 

IT IS SO ORDERED:

Dated: May 2, 2017

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