Court Opinion

ID: 3211673
Source: CourtListenerOpinion
Date Created: 2016-06-09 20:00:52.388748+00
Date Added: 2024-06-11T12:35:01.847575
License: Public Domain

FILED
                           NOT FOR PUBLICATION
                                                                             JUN 09 2016
                    UNITED STATES COURT OF APPEALS                       MOLLY C. DWYER, CLERK
                                                                          U.S. COURT OF APPEALS

                            FOR THE NINTH CIRCUIT

FEDERAL TRADE COMMISSION,                        No. 14-56582

              Plaintiff - Appellee,              D.C. No. 8:13-cv-00919-DOC-
                                                 RNB
 v.

BUSINESS TEAM, LLC, a Nevada                     MEMORANDUM*
limited liability company; AMIR
MONTAZERAN,

              Defendants - Appellants.

                    Appeal from the United States District Court
                       for the Central District of California
                     David O. Carter, District Judge, Presiding

                             Submitted June 6, 2016**
                               Pasadena, California

Before: GOULD, MELLOY***, and HURWITZ, Circuit Judges.

        *
             This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
        **
             The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).
        ***
            The Honorable Michael J. Melloy, Senior Circuit Judge for the U.S.
Court of Appeals for the Eighth Circuit, sitting by designation.
      Business Team, LLC and Amir Montazeran (“Amir”) appeal the district

court’s denial of their motions to set aside default judgments entered against them

in an action by the Federal Trade Commission (FTC) seeking to enforce Section

5(a) of the FTC Act, which prohibits unfair or deceptive commercial practices. We

affirm.

1.    The district court did not err in denying Amir’s motion to set aside entry of

default on the ground that he was never properly served with the FTC’s summons.

Under Fed. R. Civ. P. 4(e), an individual may be served following the law of the

state where the district court is located or where service is made. Under California

law, a person can be served by leaving the summons and a copy of the complaint at

the person’s usual mailing address in the presence of someone apparently in charge

of the mailing address, and thereafter mailing a copy of the summons and

complaint to that address. Cal Civ. Proc. Code § 415.20(b). The FTC employed

this method at Amir’s mailing address in Irvine, after numerous unsuccessful

attempts at personal service that showed reasonable diligence on the part of the

FTC. The FTC thus complied with section 415.20(b) and, therefore, with Fed. R.

Civ. P. 4(e). Amir challenged service on the ground that he had subleased his

Irvine apartment one month before the FTC’s first attempt to deliver the summons

                                         -2-
and complaint. But this allegation does not invalidate service because the Irvine

apartment was still Amir’s usual mailing address.

2.    The district court did not err in denying Business Team’s motion to set aside

entry of default. Business team contends that its owner Mohammad Montazeran

(“Mohammad”), Amir’s father, suffered a heart attack in February 2014 that left

him unable to hire counsel until late April 2014. But this allegation is inconsistent

with the district court’s finding that Mohammad was likely not central to Business

Team’s operation, given his status as a dependent on Amir’s tax returns, as well as

Business Team’s eventual defense of the lawsuit, even while Mohammad was

hospitalized in Iran following the heart attack. Also, the FTC served Business

Team on January 15, 2014, several weeks before Mohammad claimed to have been

hospitalized. There was no abuse of discretion in the district court’s decision not

to set aside entry of default against Business Team.

3.    The district court also did not err in declining to set aside the default

judgments against Amir and Business Team. It correctly weighed the factors from

Eitel v. McCool, 782 F.2d 1470, 1471–72 (9th Cir. 1986), including the likely

prejudice to the FTC, the merits of the FTC’s claims, the material facts at issue,

whether the default was excusable, and the general policy favoring decisions on the

merits.

                                          -3-
AFFIRMED.

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