Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-casd-3_07-cv-00370/USCOURTS-casd-3_07-cv-00370-4/pdf.json

Nature of Suit Code: 140
Nature of Suit: Negotiable Instruments
Cause of Action: 28:1345 Default of Promissory Note

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UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF CALIFORNIA

UNITED STATES OF AMERICA,

Plaintiff,

CASE NO. 07cv370-WQH-JMA

ORDER

vs.

DISTRIBUIDORA BATIZ CGH, S.A.

DE C.V.; et al.,

Defendants.

HAYES, Judge:

The matters before the Court are the Motion for Specially Authorized Service (ECF No.

93), and the Motion for Issuance of an Amended Summons (ECF No. 94).

BACKGROUND

On February 27, 2007, Plaintiff United States of America filed the Complaint against

Distribuidora Batiz, S.A. De C.V. (hereinafter “Distribuidora Batiz”), and Silvia Del Carmen

Batiz Esquer, Rodolfo Batiz Guillen, Raul Batiz Echavarria, Raul Guillermo Batiz Guillen,

Raul Guillermo Batiz Gamboa, Ricardo Batiz Gamboa, Olga Elena Batiz Esquer, Jorge

Guillermo Batiz Guillen, Jorge Guillermo Batiz Esquer, Gabriela Maria Batiz Gamboa, Angela

Maria Batiz Gamboa, Gerardo Batiz Esquer, Grupo Batiz CGH, S.A. de C.V., Greenver, S.A.

de C.V., Invernaderos La Pequena Joya, S.A. De C.V., and Pedro Batiz Guillen (collectively,

“Guarantor Defendants”). (ECF No. 1). The Complaint alleges that the United States,

through its agency, the Export-Import Bank of the United States, holds a promissory note on

Case 3:07-cv-00370-WQH-JMA Document 95 Filed 11/03/10 Page 1 of 8
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 Of the fourteen Defendants who are the subject of the May 12, 2009 Motion for

Default Judgment, Defendant Pedro Batiz Guillen is the only Defendant who did not file an

opposition to the Motion.

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which Distribuidora Batiz defaulted. The Complaint alleges that the Guarantor Defendants

unconditionally guarantied repayment of the full amount of Distribuidora Batiz’s indebtedness

on the note, but Defendants failed to pay the amount due. The Complaint seeks payment of

principal in the amount of $2,641,574.61, plus accrued interest.

Between approximately April 2008 and July 2008, Plaintiff attempted to serve seven

of the Defendants in Mexico pursuant to the Inter-American Convention on Letters Rogatory,

but the efforts were unsuccessful. (ECF No. 65-9, 65-10). For five of the Defendants, the

Mexican authorities stated that they could not locate the Defendants at the given addresses.

(ECF No. 65-9).

On November 7, 2008, the Court issued a Judgment against Defendant Raul Batiz

Echavarria pursuant to Federal Rule of Civil Procedure 54(b). (ECF No. 46). On December

5, 2008, the Court issued a Judgment against Defendant Rodolfo Batiz Guillen pursuant to

Rule 54(b). (ECF No. 51).

On May 12, 2009, based upon service of process at the San Diego, California offices

of Wilson Batiz LLC, “a Batiz family business,” the United States moved for default judgment

against the following fourteen defendants: Distribuidora Batiz; Grupo Batiz CGH, S.A. de

C.V.; Greenver, S.A. de C.V.; Invernaderos la Pequena Jolla, S.A. de C.V.; Pedro Batiz

Guillen; Silvia del Carmen Batiz Esquer; Raul Guillermo Batiz Guillen; Raul Guillermo Batiz

Gamboa; Olga Elena Batiz Esquer; Jorge Guillermo Batiz Guillen; Jorge Guillermo Batiz

Esquer; Gabriela Maria Batiz Gamboa; Angela Maria Batiz Gamboa; and Gerardo Batiz

Esquer. (ECF No. 59-2 at 5).

On May 22, 2009, thirteen of the fourteen Defendants who were the subject of the May

12, 2009 Motion for Default Judgment,1

 as well as Defendant Ricardo Batiz Gamboa (“Moving

Defendants”), through counsel Robert Ted Parker, filed an Opposition to Plaintiff’s Motion

for Default Judgment (ECF No. 60) and a Motion to Set Aside Clerk’s Default and Dismiss

Action as to Moving Defendants (ECF No. 61). The Moving Defendants contended that

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Plaintiff had failed to effectuate service against them, and therefore the action against them

should be dismissed pursuant to Federal Rule of Civil Procedure 12(b)(5). In support, the

Moving Defendants submitted a declaration from Defendant Jorge Guillermo Batiz Guillen

stating that “[e]ach of the Moving Defendants is of Mexican citizenship and domicile, and each

of them resides in Mexico.” (Jorge Guillermo Batiz Guillen Decl., ECF No. 61-3, ¶ 6). He

stated that “I first learned of the lawsuit when I received a copy of the letter [dated] February

26, 2009 that was signed by [Plaintiff’s counsel] and addressed to me and numerous other

members of the Batiz family at addresses which are not the residences or usual places of abode

or business of any of the Moving Defendants.” Id. ¶ 3.

On June 8, 2009, Plaintiff filed a Motion to Withdraw the Motion for Default Judgment

as to the Moving Defendants. (ECF No. 66). On June 9, 2009, Plaintiff filed a Motion for

Limited Early Discovery, seeking discovery “to obtain addresses it needs to effect

undisputedly proper service upon fourteen defendants and to move this litigation expeditiously

towards an adjudication on the merits.” (ECF No. 67-1 at 2). Plaintiff attached an email

exchange wherein attorney Parker refused to answer the following two questions posed by

Plaintiff’s counsel: “1) Will you provide me with addresses at which each of your 14 clients

may be served with process in this case? 2) Will you accept service of process on behalf of

your 14 clients?” (ECF No. 67-2 at 1).

On June 18, 2009, the Moving Defendants filed an opposition to the Motion for Limited

Early Discovery. (ECF No. 71). The Moving Defendants contended that any discovery taken

on the Moving Defendants prior to service would violate their right to Due Process.

On August 10, 2009, the Court issued an Order (1) granting the Motion to Withdraw

the Motion for Default Judgment as to the Moving Defendants; (2) granting the Motion to Set

Aside Clerk’s Default as to the Moving Defendants; (3) denying the Motion to Dismiss Action

as to the Moving Defendants; (4) denying without prejudice the Motion for Limited Early

Discovery; and (5) granting the Motion for Default Judgment as to Defendant Pedro Batiz

Guillen. (ECF No. 75). The Court stated that “there exists a reasonable prospect that service

may be obtained as to the Moving Defendants. Plaintiff may discover the Moving Defendants’

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Mexican addresses through discovery on the served Defendants or non-parties. Additionally,

Plaintiff may move for an order allowing service via Federal Rule of Civil Procedure

4(f)(3)....” Id. at 14 (citation omitted).

On October 14, 2009, the Magistrate Judge issued an Order granting Plaintiff’s motion

for limited early discovery seeking to take early discovery from non-party First National Bank

and Judgment Debtors Raul Batiz Echavarria, Pedro Batiz Guillen and Rodolfo Batiz Guillen

“to obtain information reasonably necessary to effect service of process upon the fourteen

Defendants who reside in Mexico and have not yet been served.” (ECF No. 78 at 1). On

December 16, 2009, the Magistrate Judge issued a Protective Order which had been agreed

upon by Plaintiff and the Judgment Debtors. (ECF Nos. 80, 81).

On July 22, 2010, the Court issued an Order stating:

The docket reflects that, since the Magistrate Judge authorized limited discovery

and issued the Protective Order, no proof of service has been filed as to any of

the Unserved Defendants and no proceedings have been taken against any

Unserved Defendant. ... It appearing to the Court that dismissal for want of

prosecution may be appropriate in this case, Plaintiff is hereby ORDERED TO

SHOW CAUSE as to why this case should not be dismissed without prejudice

for failure to prosecute as to the Unserved Defendants.

(ECF No. 90 at 2).

On August 20, 2010, Plaintiff filed a response to the Court’s July 22, 2010 Order; the

Motion for Specially Authorized Service; the Motion for Issuance of an Amended Summons;

and a certificate of service indicating that Defendant Olga Elena Batiz Esquer was served with

the Summons and Complaint pursuant to the Hague Convention on November 12, 2009. (ECF

Nos. 91-94). Plaintiff’s response outlined Plaintiff’s “tedious and time consuming” attempts

“to effect service in Mexico under the Hague Convention.” (ECF No. 92 at 5). “Because

service under the Hague Convention is the best way to ensure the international enforceability

of an eventual judgment, the United States respectfully requests that the Court permit a further

attempt to serve the defendants in Mexico.” Id. The Motion for Issuance of an Amended

Summons requests that the Court direct the Clerk to issue a revised summons to comply with

the Mexican Central Authority’s “newly disclosed additional requirements” that the summons

specify whether the twenty day period for answering the complaint is measured in calendar

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days or business days. Id. Because “the United States appreciates that there are practical

limitations on how long the Court can wait for a plaintiff to complete service,” id. at 6, Plaintiff

also filed the Motion for Specially Authorized Service which “requests that the Court enter an

order authorizing Rule 4(f)(3) service of the thirteen unserved defendants by delivering the

summons and complaint via certified mail to their attorney of record, Mr. Parker.” (ECF No.

93-1 at 10).

The Motion for Specially Authorized Service and Motion for Issuance of an Amended

Summons contain certificates of service indicating that Parker, counsel of record for the

thirteen unserved Defendants, and Jeffrey D. Cawdrey, counsel of record for the three

Judgment Debtors, each received electronic service of the pending motions. The docket

reflects that no opposition to either motion has been filed. 

DISCUSSION

Motion for Specially Authorized Service

Federal Rule of Civil Procedure 4(f) provides, in pertinent part: 

[S]ervice upon an individual ... may be effected in a place not within any judicial

district of the United States: 

(1) by any internationally agreed means reasonably calculated to give

notice, such as those means authorized by the Hague Convention ...; or ... 

(3) by other means not prohibited by international agreement as may be

directed by the court.

Fed. R. Civ. P. 4(f). Service under Rule 4(f)(3) must be (1) directed by the court; (2) not

prohibited by international agreement; and (3) comport with constitutional notions of due

process. See Rio Props., Inc. v. Rio Int’l Interlink, 284 F.3d 1007, 1014-16 (9th Cir. 2002).

To meet the due process requirement, “the method of service crafted by the district court must

be reasonably calculated, under all the circumstances, to apprise interested parties of the

pendency of the action and afford them an opportunity to present their objections.” Id. at

1016-17 (quotation omitted). “[A]s long as court-directed and not prohibited by an

international agreement, service of process ordered under Rule 4(f)(3) may be accomplished

in contravention of the laws of the foreign country.” Id. at 1014 (citation omitted). “[S]ervice

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of process under Rule 4(f)(3) is neither a last resort nor extraordinary relief. It is merely one

means among several which enables service of process on an international defendant.” Id. at

1015 (quotation omitted). In Rio Properties, the Court of Appeals for the Ninth Circuit held

that “when [plaintiff] presented the district court with its inability to serve an elusive

international defendant, striving to evade service of process, the district court properly

exercised its discretionary powers” to authorize service upon defendant’s attorney. Id. at 1016;

see also id at 1017 (“Service upon [defendant’s attorney] was ... appropriate because he had

been specifically consulted by [defendant] regarding this lawsuit. He knew of [defendant]’s

legal positions, and it seems clear that he was in contact with [defendant] in Costa Rica.

Accordingly, service to [defendant’s attorney] was ... reasonably calculated in these

circumstances to apprise [defendant] of the pendency of the present action.”). 

After review of the Motion and the record, the Court finds that Plaintiff has been

reasonably diligent in seeking to serve the thirteen unserved Defendants. The facts and

circumstances of this case warrant the Court’s intervention pursuant to Rule 4(f). Plaintiff has

demonstrated that service of the thirteen unserved Defendants by delivering the Summons and

Complaint via certified mail to Parker, their attorney of record, is not prohibited by

international agreement and is “reasonably calculated, under all the circumstances, to apprise

[Defendants] of the pendency of the action and afford them an opportunity to present their

objections.” Rio Props., 284 F.3d at 1016-17. The Motion for Specially Authorized Service

is granted.

Motion for Issuance of an Amended Summons

Currently, the Summons in this case states that the Defendant must file an answer to the

Complaint “within 20 days after service of this summons upon you, exclusive of the day of

service,” without specifying whether the twenty-day period is counted in business days or

calendar days. (ECF No. 2 at 1). “So that the United States may comply with the Mexican

authorities’ requirements and complete service of process in Mexico,” Plaintiff moves the

Court for an order requiring the Clerk to issue an amended summons to state, in pertinent part:

You are hereby summoned and required to file with the Clerk of this Court and

serve upon Plaintiff’s attorney, Kyle A. Forsyth, whose address is P.O. Box 875,

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 The thirteen unserved Defendants are: Distribuidora Batiz, S.A. de C.V.; Grupo Batiz

CGH, S.A. de C.V.; Greenver, S.A. de C.V.; Invernaderos la Pequena Jolla, S.A. de C.V., a/k/a

Invernaderos la Pequena Joya, S.A. de C.V.; Ricardo Batiz Gamboa; Silvia del Carmen Batiz

Esquer; Raul Guillermo Batiz Guillen; Raul Guillermo Batiz Gamboa; Jorge Guillermo Batiz

Guillen; Jorge Guillermo Batiz Esquer; Gabriela Maria Batiz Gamboa; Angela Maria Batiz

Gamboa; and Gerardo Batiz Esquer.

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Ben Franklin Station, Washington, DC 20044, an answer to the complaint which

is herewith served upon you, no later than the first business day occurring at

least 21 calendar days (including Saturdays, Sundays, and legal holidays) after

service of this summons upon you, exclusive of the day of service. If you fail

to do so, judgment by default will be taken against you for the relief demanded

in the complaint.

(ECF No. 94-1 at 2-3). The requested language reflects the 2009 amendment to Rule 12 that

provides twenty-one days for a defendant to answer a complaint. See Fed. R. Civ. P.

12(a)(1)(A)(i); see also Fed. R. Civ. P. 6(a)(1) (“When the period is stated in days or a longer

unit of time: (A) exclude the day of the event that triggers the period; (B) count every day,

including intermediate Saturdays, Sundays, and legal holidays; and (C) include the last day of

the period, but if the last day is a Saturday, Sunday, or legal holiday, the period continues to

run until the end of the next day that is not a Saturday, Sunday, or legal holiday.”).

Federal Rule of Civil Procedure 4(a) provides that “[t]he court may permit the summons

to be amended.” Fed. R. Civ. P. 4(a)(2). After review of the Motion and the record, the Court

concludes that, pursuant to Rule 4(a), the Motion for Issuance of an Amended Summons

should be granted.

CONCLUSION

IT IS HEREBY ORDERED that Plaintiff has shown cause why this action should not

be dismissed for failure to prosecute as to the unserved Defendants.

IT IS FURTHERED ORDERED that the Motion for Specially Authorized Service is

GRANTED. (ECF No. 93). Pursuant to Federal Rule of Civil Procedure 4(f)(3), Plaintiff is

authorized to serve the thirteen unserved Defendants via certified mail directed to their counsel

of record, Robert Ted Parker, at his office located at: Parker Law Firm, 7 Mira Loma, Orinda,

California 94563.2

//

//

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IT IS FURTHER ORDERED that the Motion for Issuance of an Amended Summons

is GRANTED. (ECF No. 94). Pursuant to Federal Rule of Civil Procedure 4(a)(2), the Clerk

of the Court shall issue an amended summons in the form requested in Exhibit B to the Motion

for Issuance of an Amended Summons, ECF No. 94-3 at 1.

No later than ninety (90) days from the date this Order is filed, Plaintiff shall file a

status report regarding Plaintiff’s efforts to serve the unserved Defendants.

DATED: November 3, 2010

WILLIAM Q. HAYES

United States District Judge

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