Judge: Colin Leis, Case: 23STCV29157, Date: 2024-09-23 Tentative Ruling
Case Number: 23STCV29157 Hearing Date: September 23, 2024 Dept: 74
Bespoke
Financial, Inc. vs Trus, LLC, et al.
Cross Defendant Lucky 13
Ventures, LLC’s Motion to Serve Defendant Trus LLC via Secretary of State.
BACKGROUND
This
is a cross claim filed by Defendant Lucky 13 Ventures LLC (Lucky) arising out
of the alleged breach of a settlement agreement rising from an alleged breach
of a settlement agreement between Plaintiff Bespoke Financial Inc., and
defendants Lucky, Trus LLC, (Trus), Ian Walters, and Does 1-10. Cross
Complainant moves for an order authorizing service of process on Trus by the
California Secretary of State.
LEGAL
STANDARD
Cross Complainant brings this motion under
Corporations Code section 17701.16(c), which provides:
If
an agent for service of process has resigned and has not been replaced or if
the designated agent cannot with reasonable diligence be found at the
address designated for personal delivery of the process, and it is shown by
affidavit to the satisfaction of the court that process against a
limited liability company or foreign limited liability company cannot be served
with reasonable diligence upon the designated agent by hand in the manner
provided in Section 415.10, subdivision (a) of Section 415.20, or subdivision
(a) of Section 415.30 of the Code of Civil Procedure, the court may make an
order that the service shall be made upon a domestic limited liability company
or upon a registered foreign limited liability company by delivering by hand to
the Secretary of State, or to any person employed in the Secretary of State's
office in the capacity of assistant or deputy, one copy of the process for each
defendant to be served, together with a copy of the order authorizing the
service. Service in this manner shall be deemed complete on the 10th day after
delivery of the process to the Secretary of State.
(Corp. Code § 17701.16(c) (emphasis added).)
DISCUSSION
1. Reasonable
Diligence in Personally Serving Defendant’s Designated Agent
Cross
Complainant has shown reasonable diligence in attempting to serve Trus’
designated agent. Code of Civil Procedure Section 415.10 provides “A summons
may be served by personal delivery of a copy of the summons and of the
complaint to the person to be served.” (Code Civ. Proc. § 415.10.) Section
416.10 further provides that summons on a corporation may be served “To the
person designated as agent for service of process. . .” (Code Civ. Proc. §
416.10.) Here, Cross Complainant attempted personal service on Trus’ registered
agent Adam Troy five times in late January of 2024. (Declaration of Wolfgang
Kovach ¶¶ 5-9; Mot. Ex. E.) While each attempt at service was made within
approximately one week, the attempts were at different times of day and ended only when the process server
was informed by a security guard the suite was vacant. (Kovach Decl. ¶ 10; Mot.
Ex. E.) Accordingly, Cross Complainant showed reasonable diligence in
effectuating personal service of Troy and Trus.
2.
Reasonable Diligence in Serving Defendant by
Substitution
Cross
Complainant has shown reasonable diligence in attempting to serve Trus by
substitution. Code of Civil Procedure Section 415.20 provides: “In lieu of
personal delivery of a copy of the summons and complaint to the person to be
served as specified in Section 416.10 . . . a summons may be served by
leaving a copy of the summons and complaint during usual office hours in his or
her office or, if no physical address is known, at his or her usual mailing
address . . . with the person who is apparently in charge thereof, and by
thereafter mailing a copy of the summons and complaint by first-class mail,
postage prepaid to the person to be served at the place where a copy of the
summons and complaint were left.” (Code Civ. Proc. § 415.20(a).) Here, at no
time in the five attempts at personal service was Cross Complainant’s process
server able to find an employee or officer at the address of Trus’ registered
agent. (Kovach Decl. ¶¶ 5-9; Mot. Ex. E.) Although Cross Complainant never
attempted to effectuate service at Troy’s mailing address as contemplated by §
415.20(a), this was not required as Troy had a physical address. Accordingly, Cross
Complainant showed reasonable diligence in effectuating substitute service of
Trus through its registered agent Troy.
3.
Reasonable Diligence in Serving Defendant by
Mail
Cross
Complainant has shown reasonable diligence in attempting to serve Trus by mail.
Code of Civil Procedure Section 415.30 provides: “A summons may be served by
mail as provided in this section. A copy of the summons and of the complaint
shall be mailed (by first-class mail or airmail, postage prepaid) to the person
to be served, together with two copies of the notice and acknowledgment
provided for in subdivision (b) and a return envelope, postage prepaid,
addressed to the sender.” (Code Civ. Proc. § 415.30(a).) Here, Cross
Complainant sent the requisite documents to Troy through first class mail on
February 14. (Kovach Decl. ¶ 11; Mot. Ex. D.) To date, Cross Complainant still
has not received an acknowledgement or receipt. (Kovach Decl. ¶ 12.)
Accordingly, Cross Complainant showed reasonable diligence in effectuating
service of Trus through mail to its registered agent Troy.
CONCLUSION
The
court GRANTS Cross Complainant’s motion to authorize service of process on Trus
by the California Secretary of State. Cross Complainant shall give notice.
///////////////////////////////////////////////
Plaintiff Bespoke Financial
Inc.’s Motion to Serve Defendant Trus LLC via Secretary of State.
BACKGROUND
This
is a claim by Plaintiff Bespoke Financial Inc. (Bespoke) arising from an alleged
breach of a settlement agreement by defendants Trus LLC, (Trus), Lucky 13
Ventures LLC, Ian Walters, and Does 1-10. Plaintiff moves for an order
authorizing service of process on Trus by the California Secretary of
State.
LEGAL
STANDARD
Plaintiff brings this motion under
Corporations Code section 17701.16(c), which provides:
If an agent for service of process has resigned and has
not been replaced or if the designated agent cannot with reasonable
diligence be found at the address designated for personal delivery of the
process, and it is shown by affidavit to the satisfaction of the court
that process against a limited liability company or foreign limited
liability company cannot be served with reasonable diligence upon the
designated agent by hand in the manner provided in Section 415.10, subdivision
(a) of Section 415.20, or subdivision (a) of Section 415.30 of the Code of
Civil Procedure, the court may make an order that the service shall be made
upon a domestic limited liability company or upon a registered foreign limited
liability company by delivering by hand to the Secretary of State, or to any
person employed in the Secretary of State's office in the capacity of assistant
or deputy, one copy of the process for each defendant to be served, together
with a copy of the order authorizing the service. Service in this manner shall
be deemed complete on the 10th day after delivery of the process to the
Secretary of State.
(Corp. Code § 17701.16(c) (emphasis added).)
DISCUSSION
1.
Reasonable Diligence in Personally Serving
Defendant’s Designated Agent
Plaintiff
has shown reasonable diligence in attempting to serve Trus’ designated agent. Code
of Civil Procedure Section 415.10 provides “A summons may be served by personal
delivery of a copy of the summons and of the complaint to the person to be
served.” (Code Civ. Proc. § 415.10.) Section 416.10 further provides that summons
on a corporation may be served “To the person designated as agent for service
of process. . .” (Code Civ. Proc. § 416.10.) Here, Plaintiffs attempted to
personally serve Trus’ registered agent Adam Troy four times between December
2023 and February of 2024. (Declaration of David Welch ¶¶ 4-7; Pl. Mot. Ex. E.)
These attempts were made across several months, at different times of day, and
at both the service address listed for Troy and the Business Address of Trus.
(Welch Decl. ¶¶ 4-7; Pl. Mot. Ex. E.) In each instance, the hired process
server reported that neither Troy nor any agents of Trus were present at the
addresses. Accordingly, Plaintiff showed reasonable diligence in effectuating
personal service of Troy and Trus.
2.
Reasonable Diligence in Serving Defendant by
Substitution
Plaintiff
has shown reasonable diligence in attempting to serve Trus by substitution.
Code of Civil Procedure Section 415.20 provides “In lieu of personal delivery of a copy of the
summons and complaint to the person to be served as specified in Section 416.10
. . . a summons may be served by leaving a copy of the summons and complaint
during usual office hours in his or her office or, if no physical address is
known, at his or her usual mailing address . . . with the person who is apparently in charge
thereof, and by thereafter mailing a copy of the summons and complaint by
first-class mail, postage prepaid to the person to be served at the place where
a copy of the summons and complaint were left.” (Code Civ. Proc. § 415.20(a).) Here,
at no time in the four attempts at personal service was Cross Complainant’s
process server able to find an employee or officer at the address of Trus’
registered agent. (Welch Decl. ¶¶ 4-7; Pl. Mot. Ex. E.) After attempting to
serve Troy four times, Plaintiff then attempted to serve Trus’ CEO, Marlon
Bills, six times from February to March of 2024. (Welch Decl. ¶¶ 9-11; Pl. Mot.
Ex. E.) These attempts at service were similarly spread across several times of
day and different locations and each process server reported that no one
connected to Trus could be found at the addresses listed in Trus’ filings. (Welch
Decl. ¶¶ 9-10; Pl. Mot. Ex. E.) Accordingly, Plaintiff showed reasonable
diligence in effectuating substitute service of Trus through its registered
agent Troy.
3.
Reasonable Diligence in Serving Defendant by
Mail
Plaintiff
has not shown reasonable diligence in attempting to serve Trus by mail. Code of Civil Procedure Section 415.30
provides: “A summons may be served by mail as provided in this section. A copy
of the summons and of the complaint shall be mailed (by first-class mail or
airmail, postage prepaid) to the person to be served, together with two copies
of the notice and acknowledgment provided for in subdivision (b) and a return
envelope, postage prepaid, addressed to the sender.” (Code Civ. Proc. §
415.30(a).) Here, Plaintiff sent the requisite documents by first class mail to
Ian Walters, a manager or member of Trus, in February of 2024 and has not yet
received acknowledgement and receipt. (Welch Decl. ¶¶11-12; Pl. Mot. Ex. F.)
However, Plaintiff has not provided proof of efforts to mail the requisite
documents to Troy, the registered agent, as contemplated by Section section
17701.16(c). Nor has Plaintiff provided evidence of efforts to find the current
or forwarding address for Troy, Walters, or any of the other officers or
directors of Trus. Accordingly, Plaintiff failed to exercise reasonable diligence
in attempting to serve Trus by mail.
CONCLUSION