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Intelligent Payments, LLC v. Revprotect, Inc.

United States District Court, D. Utah, Central Division

May 8, 2017

INTELLIGENT PAYMENTS, LLC, Plaintiff,
v.
REVPROTECT, INC. aka REVPROTECT, LLC; JASON TAYLOR; JANA TAYLOR; and DOES 1-10, Defendants.

          MEMORANDUM DECISION AND ORDER

          DALE A. KIMBALL United States District Judge.

         This matter is before the court on Defendant RevProtect, Inc.'s, Motion to Quash Service and on Defendant Jana Taylor's Motion to Dismiss. A hearing on the motions was held on April 25, 2017. At the hearing, Plaintiff Intelligent Payments, LLC, was represented by Grant Sumsion. Defendants RevProtect, Inc., and Jana Taylor were represented by Mark Shurtleff. Before the hearing, the court carefully considered the memoranda and other materials submitted by the parties. Since taking the matter under advisement, the court has further considered the law and facts relating to the matter. Now being fully advised, the court renders the following Memorandum Decision and Order.

         BACKGROUND

         On June 10, 2015, Plaintiff Intelligent Payments, LLC, filed a Complaint against Defendants Jason Taylor, Jana Taylor, and RevProtect, LLC. Pursuant to an order from Magistrate Judge Dustin Pead, on June 17, 2016, Plaintiff filed an Amended Complaint against Jason Taylor, Jana Taylor, and RevProtect, Inc., a.k.a. RevProtect, LLC. The Amended Complaint alleges the following causes of action against all Defendants: breach of an Independent Sales Organization (“ISO”) agreement that was signed by Jason Taylor on behalf of RevProtect, LLC; express contractual indemnity based on the same agreement; fraud; civil conspiracy; violations of the Racketeering Influenced Corrupt Organizations (“RICO”) Act; a pattern of unlawful activities; and negligent misrepresentation.

         On September 20, 2016, Magistrate Judge Pead entered a Default Certificate against Defendant Jason Taylor based on his failure to plead or otherwise defend. In a Scheduling Conference before Magistrate Judge Pead held on September 29, 2016, the court discussed outstanding issues related to service on Defendants Jana Taylor, RevProtect, LLC, and RevProtect, Inc., and the court granted Plaintiff's request for additional time to serve those Defendants.

         On or about October 8, 2016, Plaintiff served the Summons and Amended Complaint on Defendant Jana Taylor personally and on Defendant RevProtect, Inc., by leaving a copy with Defendant Jason Taylor. On January 10, 2017, Plaintiff filed proof of service on Defendants Jana Taylor and RevProtect, Inc. In response to an Order to Show Cause, Defendants Jana Taylor and RevProtect, Inc., filed a Motion to Quash Service as to RevProtect and to Dismiss as to Jana Taylor. Plaintiff filed an opposition to the motions, but Defendants did not file a reply.

         DISCUSSION

         MOTION TO QUASH SERVICE

         When a defendant challenges the sufficiency of process pursuant to Federal Rules of Civil Procedure 12(b)(4) and (5), the “plaintiff bears the burden to make a prima facie case that he has satisfied statutory and due process requirements so as to permit the Court to exercise personal jurisdiction over defendants.” Fisher v. Lynch, 531 F.Supp.2d 1253, 1260 (D. Kan. 2008). Service against a corporation is effective if a copy of the summons and complaint are delivered to any agent “authorized by appointment or by law to receive service of process” on behalf of the corporation. Fed.R.Civ.P. 4(h)(1)(B).

         Defendants argue both that the summons for RevProtect was defective and that service on RevProtect was improper. First, Defendants argue that, pursuant to Federal Rule of Civil Procedure 4, a summons must “be directed to the defendant, ” which, in the case of a corporation, requires it to be directed to “an officer, a managing or general agent or to any other agent authorized by appointment or law to receive service of process” for the defendant. Fed.R.Civ.P. 4(a)(1)(B), (h)(1)(B). Defendants argue that, because the summons was directed to “REVPROTECT, INC. aka REVPROTECT, LLC, ” the summons was defective on its face and should be quashed.

         Defendants first argument is based on a misreading of Rule 4. Defendants correctly state that Rule 4 requires a summons to be “directed to the defendant.” Fed.R.Civ.P. 4(a)(1)(B). However, Defendants incorrectly conclude that, because Rule 4 requires a corporation to be served by “delivering a copy of the summons and of the complaint to an officer, a managing or general agent, or any other agent authorized by appointment or by law to receive service of process, ” Fed.R.Civ.P. 4(h)(1)(B), that the summons must be directed to one of those individuals. In this case, the court concludes that Plaintiff correctly directed the summons to the corporate defendant, so the summons was not defective on its face.

         Defendants next argue that service on RevProtect was improper because Plaintiff attempted service on Jason Taylor, who Defendants argue is not a member, manager, or authorized agent of RevProtect. According to Defendants, service should have been made on Jana Taylor, who is the sole member and registered agent of RevProtect identified by the State of Utah Corporation Division. Therefore, Defendants argue that Plaintiff's attempted service on RevProtect should be quashed because Plaintiff failed to serve RevProtect by any proper, authorized method. On the other hand, Plaintiff argues that it properly served RevProtect, Inc., an apparently defunct corporation, by serving Jason Taylor, who is still designated with the Utah Department of Corporations and Commercial Code as the registered agent for RevProtect, Inc. Plaintiff argues that its service was proper because, pursuant to Federal Rule of Civil Procedure 17(b)(2), the capacity of a corporation to be sued is determined by “the law under which it was organized, ” and Utah provides for service on the registered agent of a dissolved corporation. Utah Code Ann. § 16-10a-1409.

         The differences between the positions of the parties seem to be significantly related to the existence of, and confusion between, multiple, similarly named organizations. The parties seem to agree that RevProtect, Inc., is a now-defunct organization, which still has Jason Taylor listed as its registered agent. RevProtect, LLC, is a non-existent entity that appears to be mentioned in some contracts relevant to this case. Rev Protect, LLC, is a distinct organization from RevProtect, Inc., which has Jana Taylor as its sole member and registered agent. With that understanding, Defendants appear to be arguing that Plaintiff has failed to properly serve Rev Protect, LLC, while Plaintiff is arguing that it properly served RevProtect, Inc.

         The court concludes that Plaintiff did properly serve RevProtect, Inc., which is the entity that is currently named as a Defendant in this case. Because Plaintiff properly served the named Defendant, Defendant's argument that the attempted service should be quashed as improper lacks merit. However, the court notes that if Plaintiff intends to pursue claims against ...


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