Williams v. Phoenix Law PC

[7] UNITED STATES DISTRICT COURT [8] WESTERN DISTRICT OF WASHINGTON AT TACOMA [10] CURTIS WILLIAMS, CASE NO. 3:23-cv-05437-LK [11] Plaintiff, SECOND ORDER TO SHOW 12 v. CAUSE WHY THIS CASE SHOULD NOT BE DISMISSED 13 PHOENIX LAW, PC, 14 Defendant. [15] 16 This matter comes before the Court following Plaintiff Curtis Williams’ Response to the 17 Court’s August 15, 2023 Order to Show Cause. Dkt. Nos. 8–9. For the reasons discussed below, 18 Williams’ response is insufficient, and the Court provides him a final opportunity to show cause 19 why this case should not be dismissed. 20 I. BACKGROUND 21 Williams initiated this case against Defendant Phoenix Law, PC on May 12, 2023, seeking 22 to recover damages under federal and state law based on Phoenix Law’s alleged attempts to charge 23 him for credit repair services he did not sign up for. See generally Dkt. No. 1. On June 27, 2023, 24 Williams moved for entry of default following Phoenix Law’s failure to appear or defend in this 1 action. Dkt. No. 6. The next day, on June 28, 2023, the Court denied without prejudice Williams’ 2 motion for an entry of default. Dkt. No. 7. In particular, the Court questioned whether Williams 3 had effectuated service of the summons and complaint on Phoenix Law in accordance with Federal 4 Rule of Civil Procedure 4, and invited Williams to re-serve Phoenix Law. Id. at 1–4. 5 On August 15, 2023, after the 90-day time limit for service expired without further activity 6 in the case, the Court ordered Williams to show cause why this case should not be dismissed for 7 failure to prosecute in light of his failure to timely perfect service. Dkt. No. 8; see Fed. R. Civ. P. 8 4(m). 9 Williams responded to the Court’s Order on August 26, 2023, indicating that his counsel 10 has been monitoring collateral bankruptcy proceedings involving Phoenix Law “to divine as to 11 whether it was appropriate to take action in this case,” but that counsel ultimately decided against 12 doing so “[o]ut of an abundance of caution[.]” Dkt. No. 9 at 1–2. Specifically, Williams’ counsel 13 notes that there are ongoing proceedings in the United States Bankruptcy Court for the Central 14 District of California involving a “fraudulent transfer of assets investigation in the [b]ankruptcy of 15 Litigation Practice Group, PC,” and “an adversarial proceeding by the trustee of that bankruptcy, 16 Richard A. Marshack.” Id. at 1–2; see also Dkt. No. 1 at 5. However, counsel avers that an order 17 issued by the bankruptcy court on August 7, 2023 approved the sale of the Litigation Practice 18 Group’s assets to a third party, “including but not limited to the fraudulently transferred assets sold 19 to Phoenix Law[.]” Dkt. No. 9 at 2. According to counsel, this “order appears to strip any liability 20 incurred by Phoenix Law, resulting in the third party receiving ‘clean’ assets,” but counsel also 21 claims that “[t]he liability for its illegal conduct remains with Phoenix Law.” Id. 22 With respect to service, Williams asserts that he “intends to perfect service” on Phoenix 23 Law “pursuant to the requirements of Californi[]a law” and “will explain to [the] process server 24 that the name of the individual at the registered agent must also be recorded[.]” Id. Williams notes 1 that “the entity prescribed as the registered agent for [Phoenix Law] was served with a copy of the 2 summons and complaint in this matter” but adds, somewhat confusingly, that “the process server 3 omitted the inclusion of the complaint.” Id. In his response to the Court’s Order to Show Cause, 4 Williams further requests that he be permitted an additional 60 days to serve Phoenix Law. Id. 5 II. DISCUSSION 6 A. Legal Standard 7 As the Court explained in its August 15, 2023 Order, Plaintiffs have a general duty to 8 prosecute their claims, see Fid. Phila. Tr. Co. v. Pioche Mines Consol., Inc., 587 F.2d 27, 29 (9th 9 Cir. 1978), and they fail to fulfill this duty when they do not litigate their case, see, e.g., Spesock 10 v. U.S. Bank, NA, No. C18-0092-JLR, 2018 WL 5825439 , at *3 (W.D. Wash. Nov. 7, 2018); see 11 also Fed. R. Civ. P. 41(b) (permitting dismissal if a plaintiff fails to prosecute or to comply with 12 the federal rules or a court order). In addition, the Court noted that the Federal Rules of Civil 13 Procedure afford plaintiffs 90 days from the date the complaint is filed to effect service on a 14 defendant. Fed. R. Civ. P. 4(m). 15 If a defendant is not served within that time frame, the court “must dismiss the action 16 without prejudice against that defendant or order that service be made within a specified time.” Id. 17 However, Rule 4(m) “provides two avenues for relief.” Lemoge v. United States, 587 F.3d 1188 , 18 1198 (9th Cir. 2009). The first is mandatory under the plain language of the rule: “the district court 19 must extend time for service upon a showing of good cause.” Id. “The second is discretionary: if 20 good cause is not established, the district court may extend time for service upon a showing of 21 excusable neglect.” Id. To establish good cause, a plaintiff must establish, “at minimum, excusable 22 neglect.” Id. at 1198 n.3. The Court will also consider (1) whether Phoenix Law received actual 23 notice of the lawsuit; (2) whether Phoenix Law would suffer prejudice from an extension; and [24] 1 (c) whether Williams would be “severely prejudiced if his complaint were dismissed.” Id.; see also 2 Scott v. Sebelius, 379 F. App’x 603, 604 (9th Cir. 2010). 3 B. Williams Has Failed to Demonstrate Good Cause For His Failure to Timely Serve Phoenix Law [4] Williams filed this case over 100 days ago, Dkt. No. 1, and he has failed to demonstrate [5] good cause for why he could not effectuate service within the required 90 days, especially [6] considering that 60 days ago, this Court specifically pointed out the deficiencies in his prior [7] attempted service, Dkt. No. 7. Nor does his response to the Court’s August 15, 2023 Order to Show [8] Cause explain why he was unable to request an extension or stay over the past two months while [9] “monitoring” the collateral bankruptcy proceedings, how it was “cautiou[s]” to refrain from doing [10] so, or why he did not effectuate service between August 7, 2023 and now. Dkt. No. 9 at 2. Finally, [11] Williams’ request for an extension of the service deadline is procedurally improper; “requests for [12] affirmative relief must be made in a motion[.]” Sergeant v. Bank of Am., N.A., No. C17-5232 BHS, [13] 2018 WL 1427345 , at *1 n.2 (W.D. Wash. Mar. 22, 2018) (citing LCR 7(b)(1), 7(k)). [14] III. CONCLUSION [15] For the foregoing reasons, Williams is ORDERED to show good cause by September 5, [16] 2023 for his failure to timely serve Phoenix Law under Federal Rule of Civil Procedure 4(m). The [17] Court will dismiss this action without prejudice if Williams fails to timely show good cause. [19] Dated this 29th day of August, 2023. [20] A [21] Lauren King 22 United States District Judge