Court Opinion

ID: 4574714
Source: CourtListenerOpinion
Date Created: 2020-10-08 20:00:25.16434+00
Date Added: 2024-06-11T08:47:22.042221
License: Public Domain

NOT FOR PUBLICATION                           FILED
                    UNITED STATES COURT OF APPEALS                        OCT 8 2020
                                                                      MOLLY C. DWYER, CLERK
                                                                       U.S. COURT OF APPEALS
                             FOR THE NINTH CIRCUIT

HERBALIFE INTERNATIONAL OF                      No.    19-56435
AMERICA, INC., a Nevada corporation;
HERBALIFE INTERNATIONAL, INC., a                D.C. No.
Nevada corporation,                             2:18-cv-06378-JFW-JC

                Plaintiffs-Appellees,
                                                MEMORANDUM*
 v.

HEALTHY1 INC., a New York corporation;
ALICE MARTINEZ, DBA Good Health, on
the website www.amazon.com and as
nutritionall88 on the website
www.ebay.com, DBA Wellness World,
bestvitaminusa, an individual,

                Defendants-Appellants,

and

DOES, 1-10,

                Defendant.

                   Appeal from the United States District Court
                      for the Central District of California
                    John F. Walter, District Judge, Presiding

      *
             This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
                           Submitted October 6, 2020**
                              Pasadena, California

Before: HURWITZ, BRESS, and BUMATAY, Circuit Judges.

      Herbalife International, Inc., and Herbalife International of America, Inc.

(collectively “Herbalife”), sued Alice Martinez and Healthy1, Inc. (collectively

“Defendants”), alleging that Defendants were selling Herbalife’s products on

Amazon and eBay without permission. Herbalife effectuated service of process and

neither defendant filed a responsive pleading within the requisite time, so the clerk

of court entered a default pursuant to Federal Rule of Civil Procedure 55(a). Shortly

after, Herbalife took discovery from Amazon and PayPal to prove up their damages.

Herbalife then filed a motion for entry of a default judgment.1 Herbalife’s motion

sought a permanent injunction and $8,419,400.75 in damages in the form of

disgorgement of Defendants’ profits, which were calculated based on the evidence

obtained from Amazon.

      On July 8, 2019, the district court granted the motion and entered a default

judgment. In November 2019, Defendants filed a motion to set aside the judgment

under Rule 60(b), arguing that neither Martinez nor Healthy1, Inc., were properly

      **
             The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).
1
  Herbalife served this motion on Defendants via mail, at the same address where
personal service of the complaint was effectuated, but Defendants did not respond.

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served. The district court denied that motion and Defendants appealed. Defendants

raise two contentions on appeal: (1) that the district court abused its discretion in

denying their motion to vacate for improper service; and (2) that the district court

erred in entering the default judgment. Because the first claim is without merit and

the second claim is both untimely and was not raised below, we affirm.

      A default judgment is void if the defendant “has not been made a party by

service of process.” Mason v. Genisco Tech. Corp., 960 F.2d 849, 851 (9th Cir.

1992). Martinez raises two arguments for why service was invalid: (1) that the

person Herbalife served was not actually her; and (2) even assuming the person

served was her, such service was legally deficient. “We review de novo whether

default judgment is void because of lack of personal jurisdiction due to insufficient

service of process,” but review the district court’s factual findings regarding

jurisdiction for clear error. S.E.C. v. Internet Sols. for Bus. Inc., 509 F.3d 1161, 1165

(9th Cir. 2007).

      First, while Martinez claims that this is a case of “mistaken identity,” a

mountain of evidence supports the district court’s finding that Martinez was served.

A licensed process server swore in an affidavit that he personally served Martinez

on August 8, 2018, at a residence on 192nd Street, Flushing, New York. The process

server identified Martinez by comparing her appearance to photographs downloaded

from Martinez’s Facebook page. An associate of the process server also took a

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picture of the woman at the 192nd Street address, and the district court determined

the photograph was of Martinez. Likewise, a corporate filing for an unrelated

company identifies Martinez as an officer and lists her address as the 192nd Street

residence. Vehicle registration documents show that Martinez owns a Toyota

minivan with the license plate “GPW9014,” which the process server noted and

photographed as being parked in the driveway of the 192nd Street residence at the

time of his service on Martinez. Finally, when the same process server later served

legal documents on Martinez in an unrelated case she admitted that she was

Martinez.

      Martinez does not directly dispute any of this evidence. Instead, she relies on

a barebones declaration denying receipt of service, claiming that she “did not reside”

at the 192nd Street address, did not have any “purpose” for being at that address, and

that she “would have likely been located at [her] residence” at the time of service.”

Notably, she does not declare where her residence was at the time, where she actually

was on August 8, 2018, or whether she was the person who answered the door as

alleged by the process server. Given this record, the district court’s finding that

Martinez was the woman served on August 8, 2018, was not “clearly erroneous”—

it was well justified.

      Second, Martinez argues that, even assuming these facts, service was legally

deficient because she did not physically take the documents. Martinez is mistaken.

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State law controls service of process. Fed. R. Civ. P. 4(e)(1). In New York, service

can be effectuated “by delivering the summons within the state to the person to be

served.” N.Y. C.P.L.R. § 308(1). Martinez’s contention that the relevant documents

were not delivered to her because she did not physically take them is incorrect under

New York caselaw. New York’s highest court has held that “under CPLR 308 (subd

1), delivery of a summons may be accomplished by leaving it in the ‘general vicinity’

of a person to be served who ‘resists’ service.” Bossuk v. Steinberg, 58 N.Y.2d 916,

918 (1983) (quoting McDonald v. Ames Supply Co., 22 N.Y.2d 111, 115 (1968)).

So “if the person to be served interposes a door between himself and the process

server, the latter may leave the summons outside the door, provided the person to be

served is made aware that he is doing so.” Id. Here, Martinez refused to open the

door to accept receipt of the documents from the process server. The process server

then wedged the documents into the wrought-iron screen door and affirmed that

Martinez saw him do this and knew that the materials left were for her. (Martinez

does not dispute this fact in her affidavit.) Accordingly, under New York law,

Martinez was properly served.

      And because service of a corporation can be effectuated through personal

service on any of its officers, Herbalife’s service of Martinez (the company’s

president) also constitutes valid service of Healthy1. See N.Y. C.P.L.R. § 311(a)(1)

(providing that personal service on a New York corporation can be accomplished by

                                         5
delivering the summons to an “officer, director, managing or general agent, or

cashier or assistant cashier” of the corporation).

      Finally, Martinez argues that the district court erroneously entered the default

judgment and miscalculated damages. Although a Rule 60 motion can extend the

time to file the notice of appeal, to do so the Rule 60 motion must itself be filed

within “28 days after the judgment is entered.” Fed. R. App. P. 4(a)(4)(A)(vi).

Martinez did not file her Rule 60 motion until November 4, 2019 (119 days after

judgment was entered on July 8, 2019), and she did not file her notice of appeal until

December 9, 2019. Accordingly, Martinez’s notice of appeal is untimely as to the

order entering default judgment. See Fed. R. App. P. 4(a)(1)(A) (in a civil case, the

notice of appeal must be filed “within 30 days after entry of the judgment or order

appealed from”). Because Herbalife properly invoked Rule 4(a)(4)’s mandatory

deadline, we must enforce it. See Hamer v. Neighborhood Hous. Servs., 138 S. Ct.
13, 17–18 (2017); Demaree v. Pederson, 887 F.3d 870, 876 (9th Cir. 2018) (Fed. R.

App. P. 4(a)(4) is a mandatory claim-processing rule under Hamer). Moreover,

Martinez in the district court did not challenge the amount of the default judgment,

and “[i]ssues not presented to the trial court cannot generally be raised for the first

time on appeal.” United States v. Flores–Payon, 942 F.2d 556, 558 (9th Cir. 1991).

      AFFIRMED.

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