Mccarthy V Datax Ltd

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Automated Summary

Key Facts

Plaintiff Michelle McCarthy requested entry of clerk's default against defendant Strategic Solutions Services (Arrow Mountain Funding) after proper service via a judicial bailiff in Canada under the Hague Convention on March 27, 2025. The court granted the default but also approved a stay of the deadline to apply for default judgment until the case and any appeals are resolved. Service was confirmed valid under Fed. R. Civ. P. 4(f)(1) due to the Hague Convention's authorization of personal service by a huissier/bailiff.

Issues

  • The court determined that service of process on Strategic Solutions Services in Canada via a judicial bailiff, as authorized by the Hague Convention, was proper under Federal Rule of Civil Procedure 4(f)(1).
  • The court granted a stay of the deadline to apply for default judgment against Strategic Solutions Services until the matter and any appeals are resolved, citing the risk of inconsistent judgments in RICO cases involving joint and several liability.

Holdings

  • The court granted the plaintiff's request to enter clerk's default against Strategic Solutions Services after confirming proper service via a judicial bailiff under the Hague Convention. The service was executed on March 27, 2025, on an officer of the defendant, satisfying the requirements of Federal Rule of Civil Procedure 4(f)(1).
  • The court also granted a stay of the deadline to apply for default judgment against Strategic Solutions Services until the resolution of the case and any potential appeals. This decision was based on the risk of inconsistent judgments in multi-defendant RICO cases, where joint and several liability may apply, as noted in precedents like United States v. Philip Morris USA and Vick v. Wong.

Remedies

  • The court also granted a stay of the deadline to apply for default judgment against Strategic Solutions Services until the resolution of this matter and any appeals to avoid inconsistent judgments.
  • The court granted the plaintiff's request for entry of clerk's default against Strategic Solutions Services, as the defendant failed to plead or defend after proper service under the Hague Convention. The Clerk is directed to enter the default.

Legal Principles

The court applied Federal Rule of Civil Procedure 4(f)(1) to confirm proper service of process via the Hague Convention on a Canadian defendant. It also relied on Rule 55(a) to justify entry of clerk's default for failure to defend. Additionally, Rule 54(b) was cited to address withholding final judgment in multi-defendant actions to avoid inconsistent rulings, particularly in RICO cases with joint and several liability.

Precedent Name

  • Zurich Am. Ins. Co. v. Ednic Trading Corp.
  • Auto-Owners Ins. Co. v. Bailey
  • Tekno Prods., Inc. v. Glove Trends, Inc.
  • Northfield Ins. Co. v. Browning Timber & Saw Mill, LLC
  • N. Pointe Ins. Co. v. Glob. Roofing & Sheet Metal, Inc.
  • Vick v. Wong
  • United States v. Philip Morris USA

Cited Statute

  • Federal Rules of Civil Procedure
  • Hague Convention on the Service Abroad of Judicial and Extrajudicial Documents

Judge Name

Amanda Arnold Sansone

Passage Text

  • In a lawsuit involving multiple parties, 'the court may direct entry of a final judgment as to one or more, but fewer than all, claims or parties only if the court expressly determines that there is no just reason for delay.' Fed. R. Civ. P. 54(b). However, the preferred practice in multi-defendant actions where only some defendants are in default is to withhold granting a default judgment against those defendants until there is an adjudication on the merits as to the non-defaulted defendants. N. Pointe Ins. Co. v. Glob. Roofing and Sheet Metal, Inc., No. 6:12-cv-476-Orl-31TBS, 2012 WL 5378826, at *4 (M.D. Fla. Sept. 4, 2012) (internal quotation marks and citations omitted). Courts take this approach to avoid inconsistent judgments.
  • Because RICO claims often result in joint and several liability, a default judgment in a RICO case may result in inconsistent judgments. See United States v. Philip Morris USA, 316 F. Supp. 2d 19, 27 (D.D.C. 2025); see also Vick v. Wong, 263 F.R.D. 325, 332 (E.D. Va. 2009) (explaining that, when multiple defendants are jointly and severally liable, an inconsistent judgment might result if one defendant successfully defended on the merits while default judgment was entered against another defendant). Accordingly, for the reasons stated above, Ms. McCarthy's request for entry of clerk's default (Doc. 41) is GRANTED. The Clerk is DIRECTED to enter default against Strategic Solutions Services. Further, Ms. McCarthy's request for a stay of the deadline to apply for default judgment against Strategic Solutions Services until this matter and any appeals are resolved (Doc. 41) is GRANTED.
  • Federal Rule of Civil Procedure 4(f)(1) permits serving an individual in a foreign country 'by any intentionally agreed means of service... such as those authorized by the Hague Convention on the Service Abroad of Judicial and Extrajudicial Documents.' Fed. R. Civ. P. 4(f)(1). The United States and Canada are signatories to the HagueConvention. 'There is no dispute that the Hague Convention authorizes personal service by a huissier/bailiff[.]' Tekno Prods., Inc. v. Glove Trends, Inc., et al., No. CV 19-91 (SDW)(LDW), 2019 WL 4228685, at *3 (D.N.J. July 26, 2019), report and recommendation adopted, No. 19-91 (SDW)(LDW), 2019 WL 4220901 (D.N.J. Sept. 5, 2019). A judicial bailiff served a copy of the summons and complaint on an officer of Strategic Solutions Services on March 27, 2025. (Doc. 40). Accordingly, service is proper, and entry of clerk's default is warranted. Fed. R. Civ. P. 4(f)(1).