Tag: Civil Procedure

This post was also written by Lisa Kim.

Just a few weeks ago Legal Bytes updated its reporting (which has been going on since 2009) noting that the U.S. District Court for the Southern District of New York in Fortunato v. Chase Bank USA (S. D.N.Y June 7, 2012) declined to permit a plaintiff to effect service of process on a defendant via Facebook (see, Service of Process by Facebook? Not Just Yet!). However, it seems that legislators and courts alike are opening up to the idea of allowing service through social media where it would be reasonably likely for the defendant to receive actual notice. In the fast-paced world of digital technology and social media, the courts are indeed moving just a wee bit faster (do they have a choice?).

Last month, Rep. Jeff Leach, R-Plano, introduced a Texas bill (H.B. 1989) that would allow courts to approve the use of substituted service of process through a social media website. Specifically, this law would allow the court to prescribe substituted service through a social media website if: “(1) the defendant maintains a social media page on that website; (2) the profile on the social media page is the profile of the defendant; (3) the defendant regularly accesses the social media page account; and (4) the defendant could reasonably be expected to receive actual notice if the electronic communication were sent to the defendant’s account.”

Similarly, last week, in FTC v. PCCare247 Inc., S.D.N.Y, the U.S. District Court for the Southern District of New York granted the Federal Trade Commission (FTC) permission to effect service of process (although not the summons and complaint) via Facebook and email upon five defendants based in India.

In the PCCare247 case, the FTC alleged that the defendants operated a scheme, largely out of call centers located in India, that tricked American consumers into spending money to fix non-existent problems with their computers. FTC served the defendants through the Indian Central Authority as required by the Hague Convention and also sent the summons and complaint to the defendants via email, Federal Express, and personal service via a process server. Although the Indian Central Authority (after more than five months) still had not responded to the FTC confirming that defendants had been served, the defendants received notice through the process server.

The request for service of process via Facebook and email came into play later when the FTC requested permission to serve additional documents on the defendants. The court granted the motion, holding that service via email and Facebook are not prohibited by the Convention or any other known international agreement. In addition, the court held that service via email and Facebook comports with due process as the FTC demonstrated the likelihood service via email and/or Facebook would reach the defendants. The court cited the fact that email addresses for service were used for various tasks in the alleged scheme to defraud consumers and defendants had used some of the emails to email the court.

The common thread between the Texas Bill and PCCare247 appears to be the high likelihood that service through these electronic means would give actual notice to the defendant. Indeed, in distinguishing Fortunato, the PCCare247 court specifically noted the FTC provided the court with “ample reason for confidence that the Facebook accounts identified are actually operated by defendants.” The Facebook accounts had been registered with email addresses known to be the email addresses of the defendants; the defendants listed their job titles at the defendant company as professional activities on their Facebook accounts and two of the defendants were shown to be “friends” with a third defendant.

The evolution of judicial precedent and thinking in this area will not only be interesting to watch but may also transform the manner in which the law, the courts and judicial systems around the globe confront and attempt to deal with legal professional and ethical issues (see generally, Friends on Facebook – Hold Them Close, Get Held in Contempt of Court!) Social media and technology, wired and wireless, continues to challenge every industry and profession and neither the law nor the legal profession are immune. Don’t hesitate to contact Keri Bruce, Lisa Kim if you want to know more about these issues, and, of course, you are always free to contact me, Joseph I. Rosenbaum, or any of the attorneys at Rimon with whom you regularly work. We would be happy to help.

Back in 2009 (yes, 2009), Legal Bytes reported that the British High Court agreed to allow the service of a court order to an individual through Twitter (see, British High Court is for the Birds? Actually, for Twitter!). In that same article, we noted an Australian Supreme Court Judge allowed service of legal papers through Facebook. Increasingly, U.S. courts are confronting similar questions.

New York law, for example, has an enumerated set of mechanisms by which one can effect service of process. But the law also notes that if the enumerated methods are impracticable, service can be made “in such manner as the court, upon motion without notice, directs." In other words, if you are trying to sue someone in New York and none of the traditional methods works, you can petition the court and request some other method, and, assuming the court agrees, that will be effective to constitute service of process. But the standards remain high for the use of social media and other technology-enabled mechanisms. Witness the recent decision by the U.S. District Court for the Southern District of New York, in Fortunato v. Chase Bank USA (11 Civ. 6608), which in June of last year, denied the bank’s petition to allow service of process using Facebook.

The case started when Lorri J. Fortunato (Lorri) sued Chase, alleging that another person fraudulently opened a Chase credit card account in her name and incurred debts without her knowledge or authorization. When the debt went unpaid, Chase initiated collection proceedings against Lorri. In 2009, Chase obtained a default judgment and in 2010 began proceedings to garnish her wages – a process by which Chase eventually collected the full amount of the default judgment. But Lorri claimed she never lived at the address at which Chase attempted to serve her notice of the action and, during the course of the lawsuit, Chase discovered that Nicole Fortunato (Nicole), the plaintiff’s estranged daughter, had opened the account in her mother’s name, listed her address in the account application, and made the charges – the amount Chase ultimately received from garnishing Lorri’s wages.

Chase requested, and was granted permission, to bring Nicole into the case as a third-party defendant, but despite hiring an investigator to locate her, Chase was unable to determine exactly where Nicole lived. The investigator did, however, find a Facebook profile that was believed to be hers, and so Chase petitioned the court to allow it to effect service of process on Nicole in a number of ways, among which were service through Facebook and a message to the email address listed on the profile page.

Although the court did conclude that Nicole’s pattern of "providing fictional or out of date addresses” made service of process upon Nicole using traditional methods impracticable, the court went on to reason that Chase had not been able to assert "any facts" that could substantiate, among other things, that the Facebook profile was actually that of the Nicole Fortunato in this particular case. The court noted anyone can create "a Facebook profile using real, fake, or incomplete information," so how could they be sure it was the person they intended to serve! Feel free to read the Court’s Memorandum Opinion & Order (PDF) yourself.

The lesson from this and other cases so far: Whatever method of service of process is requested, one must be able to substantiate, with some degree of certainty, that the person intended to be served is likely to receive the summons and complaint and, thus, be apprised of the pendency of legal proceedings involving that person. Social media and technology, wired and wireless, is turning the legal world upside down. If you want to remain upright or need to know more, feel free to contact me, Joseph I. Rosenbaum, or any of the attorneys at Rimon with whom you regularly work.