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Rio Properties, Inc. v. Rio International Interlink

United States Court of Appeals for the Ninth Circuit · 2002 · Civil Procedure

Civil ProcedureFRCP 4(f)(3)alternative serviceemail serviceforeign defendantdue process noticespecific jurisdictionCalder effects test

Facts

RIO, a Las Vegas hotel and casino operator, sued RII, a Costa Rican Internet sports-gambling business using the name "RIO" in its online operations and advertising. RIO tried to serve RII through a Florida address RII had listed for its domain registrations, but that location was only RII's courier, and RII's attorney declined to accept service; RIO's investigator also could not locate RII in Costa Rica. The district court therefore authorized service through mail to the courier and attorney and by email to the address RII used as its preferred contact. RII also advertised in Las Vegas radio and in print publications circulated in Nevada, and later failed to comply with discovery orders, leading to default judgment.

Issue

Whether the district court properly authorized service on a foreign business entity by email and regular mail under Rule 4(f)(3), whether Nevada could exercise specific personal jurisdiction over RII, and whether default judgment and an award of attorneys' fees and costs were proper sanctions for RII's conduct.

Rule

Rule 4(f)(3) is an equal, independently available means of serving a foreign defendant; it is not a last resort and does not require prior exhaustion of Rule 4(f)(1) or 4(f)(2) methods. Service ordered under Rule 4(f)(3) must be directed by the court, not prohibited by international agreement, and reasonably calculated under the circumstances to give notice and an opportunity to respond. Specific personal jurisdiction exists where the defendant intentionally acts, expressly aims conduct at the forum, and causes harm the defendant knows is likely to be suffered there, the claim arises out of those forum-related activities, and jurisdiction is reasonable.

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One of 10 multiple-choice questions for this case. Pick an answer to see why.

Harborline Audio, a Seattle company, sues Solmar Streams, a Belize-based online music service, in federal court in Washington for trademark infringement. Before attempting service through letters rogatory or Belizean officials, Harborline moves for an order permitting service by courier to Solmar’s U.S. mail-forwarding address in Miami and by email to the customer-support address Solmar lists on its website as its preferred contact.

If no applicable international agreement prohibits those methods, which is the strongest argument that the district court may grant the motion?

Explanation. The majority held that Rule 4(f)(3) stands on equal footing with Rule 4(f)(1) and 4(f)(2). It is not a last resort, and a plaintiff need not first attempt every other possible method of foreign service. The rule’s textual limits are that the means be directed by the court and not prohibited by international agreement; due process must also be satisfied. (Derived from Rio Properties, Inc. v. Rio International Interlink (2002).)