Filed: Mar. 01, 2002
Latest Update: Feb. 21, 2020
Summary: F I L E D United States Court of Appeals Tenth Circuit UNITED STATES COURT OF APPEALS MAR 1 2002 FOR THE TENTH CIRCUIT PATRICK FISHER Clerk FINANCIAL INSTRUMENTS GROUP, LTD., Plaintiff-Appellee, No. 01-1205 v. (D.C. No. 99-K-1071) (D. Colo.) NANCY NGAR CHING LEUNG, Defendant-Appellant, and NL TRADING; NEW AGE INTERNATIONAL, INC.; P.K. TRADING; SECURED INVESTMENTS, Defendants. ORDER AND JUDGMENT * Before LUCERO , PORFILIO , and ANDERSON , Circuit Judges. * The case is unanimously ordered submitte
Summary: F I L E D United States Court of Appeals Tenth Circuit UNITED STATES COURT OF APPEALS MAR 1 2002 FOR THE TENTH CIRCUIT PATRICK FISHER Clerk FINANCIAL INSTRUMENTS GROUP, LTD., Plaintiff-Appellee, No. 01-1205 v. (D.C. No. 99-K-1071) (D. Colo.) NANCY NGAR CHING LEUNG, Defendant-Appellant, and NL TRADING; NEW AGE INTERNATIONAL, INC.; P.K. TRADING; SECURED INVESTMENTS, Defendants. ORDER AND JUDGMENT * Before LUCERO , PORFILIO , and ANDERSON , Circuit Judges. * The case is unanimously ordered submitted..
More
F I L E D
United States Court of Appeals
Tenth Circuit
UNITED STATES COURT OF APPEALS
MAR 1 2002
FOR THE TENTH CIRCUIT
PATRICK FISHER
Clerk
FINANCIAL INSTRUMENTS
GROUP, LTD.,
Plaintiff-Appellee,
No. 01-1205
v. (D.C. No. 99-K-1071)
(D. Colo.)
NANCY NGAR CHING LEUNG,
Defendant-Appellant,
and
NL TRADING; NEW AGE
INTERNATIONAL, INC.;
P.K. TRADING; SECURED
INVESTMENTS,
Defendants.
ORDER AND JUDGMENT *
Before LUCERO , PORFILIO , and ANDERSON , Circuit Judges.
*
The case is unanimously ordered submitted without oral argument pursuant
to Fed. R. App. P. 34(a)(2) and 10th Cir. R. 34.1(G). This order and judgment is
not binding precedent, except under the doctrines of law of the case, res judicata,
and collateral estoppel. The Court generally disfavors the citation of orders and
judgments; nevertheless, an order and judgment may be cited under the terms and
conditions of 10th Cir. R. 36.3.
Defendant Nancy Ngar Ching Leung, appearing pro se, 1
appeals the district
court’s entry of default judgment against her in favor of plaintiff, Financial
Instruments Group, Ltd. (“FIG”). FIG, a Colorado corporation in bankruptcy,
filed suit against Leung seeking recovery, pursuant to 11 U.S.C. §§ 547(b) and
548, of preferential transfers and fraudulent conveyances totaling $484,621.65
that she received from FIG within one year prior to its bankruptcy filing. Leung
contends that the district court abused its discretion in denying her request for
dismissal based on her claim of defective service, in denying her motion for
change of venue, and in granting default judgment against her for failure to
1
Leung constantly refers to herself throughout her opening brief and her
pleadings as “the Non-Attorney, Non-Lawyer, Pro Se, Defendant,” and contends
in part that the district court erred in not relaxing the pleading standards because
of her pro se status. ( E.g. , Appellant’s Br. at 2.) Yet, Leung’s pleadings before
this court and the district court demonstrate an obvious legal sophistication, a
complete familiarity with the rules of civil procedure, and an excellent command
of the English language. This is particularly striking because in a motion seeking
to avoid an appearance before the district court, Leung claimed a limited ability to
use the English language. As the district court pointed out, “[i]f this defendant is
limited in her use of English, someone else is writing [her pleadings] for her. If
she is writing [her pleadings] for herself, then quite clearly she is not limited in
her ability to use the English language.” (Appellee’s App. at 170.) The district
court expressed concern that an attorney was ghostwriting Leung’s pleadings,
allowing her to misrepresent her status as a pro se defendant in order to obtain
more leeway as an unrepresented party. ( Id. at 170–71.) See also Haines v.
Kerner ,
404 U.S. 519, 520 (1972) (calling for liberal construction of pro
se pleadings).
We have carefully reviewed all of Leung’s pleadings in this litigation.
While we cannot reach any definitive conclusion, we share the district court’s
concern.
-2-
comply with court orders. Because we conclude the district court did not abuse
its discretion, we affirm.
I
FIG filed its complaint in the federal district of Colorado on June 8, 1999.
FIG sent Leung, a resident of Illinois, a notice of the lawsuit in July 1999, but
she refused service of the complaint by mail and did not provide FIG with her
current address. At the same time as it filed its complaint against Leung, FIG
commenced litigation against more than 200 other defendants in connection with
its bankruptcy proceedings, which it claimed resulted in some delays in
effectuating service. FIG was unable to effectuate personal service on Leung
until October 16, 1999, eight days more than the 120-day time period set out in
Fed. R. Civ. P. 4(m). 2
Rule 4(m) provides that if service of process “is not made upon a defendant
within 120 days after the filing of the complaint, the court, upon motion or on its
own initiative after notice to the plaintiff, shall dismiss the action without
prejudice.” Rule 4(m) further provides, however, that the court may extend the
time for service to be effected if the plaintiff shows “good cause” for the failure
2
We do not consider Leung’s claim that FIG failed to serve her on
October 16, 1999 because the summons was merely left in the bushes at her
residence. She did not present this argument to the district court, and we will not
consider issues raised for the first time on appeal. See Tele-Communications, Inc.
v. Comm’r , 104 F.3d 1229, 1232 (10th Cir. 1997).
-3-
to serve. “If good cause is shown, the plaintiff is entitled to a mandatory
extension of time.” Espinoza v. United States , 52 F.3d 838, 841 (10th Cir. 1995).
Moreover, the district court has the discretion to extend the time for service even
when the plaintiff has not shown good cause.
Id. at 840–41.
“Our scope of review applicable to this ‘good cause’ determination is
whether the court abused its discretion.” Hendry v. Schneider , 116 F.3d 446, 449
(10th Cir. 1997). “The trial court abuses its discretion in determining whether
there is ‘good cause’ if its decision is arbitrary, capricious, or whimsical.”
Id.
We conclude that Leung’s actual notice of the action and her efforts to avoid
service, coupled with the absence of any evidence that FIG was not diligent in its
attempts to locate Leung and effect service upon her, demonstrate good cause.
Therefore, the district court did not abuse its discretion in refusing to dismiss the
action for failure to effect timely service. See
id. & n.2 (holding that defendant’s
evasion of service constitutes good cause).
II
FIG brought this action in the federal district of Colorado, where it is
incorporated and where its bankruptcy proceedings are pending. Leung moved for
a change of venue, citing 28 U.S.C. § 1404(a), which authorizes the transfer of a
case to another district in which the case would be properly brought, for the
convenience of parties and witnesses or in the interests of justice. Her basis for
-4-
the request was the fact that, as a resident of Illinois who was not represented by
counsel, it would be inconvenient for her to travel to Colorado.
“In order to find error in the refusal to transfer under § 1404(a), it must
appear that there was a clear abuse of discretion by the trial judge.” Scheidt v.
Klein , 956 F.2d 963, 965 (10th Cir. 1992) (quotation and alterations omitted).
“Unless the balance is strongly in favor of the movant the plaintiff’s choice of
forum should rarely be disturbed.”
Id. (quotation and alteration omitted). The
“party moving to transfer a case pursuant to § 1404(a) bears the burden of
establishing that the existing forum is inconvenient.”
Id. (quotation omitted).
“Merely shifting the inconvenience from one side to the other, however,
obviously is not a permissible justification for a change of venue.”
Id. at 966.
Leung did not present any evidence other than her own inconvenience as a
reason for the requested change in venue. She claims that she should be given
preference as to the place of venue because she is not represented by counsel.
Even if we were not already skeptical of this factual assertion, see, supra, n.1, we
find no authority for giving preference to a defendant’s choice of venue merely
because of his or her pro se status. We conclude that the district court did not
abuse its discretion in denying Leung’s motion to transfer this action.
-5-
III
The district court entered a default judgment against Leung after she failed
to comply with numerous court orders. During the discovery stage of this
litigation, Leung failed to cooperate in the preparation of a court-ordered
stipulated scheduling and discovery order, failed to appear at a properly noticed
and court-ordered deposition, failed to appear at a court-ordered hearing relating
to a discovery motion that she had filed, and failed to timely respond to written
discovery.
After Leung failed to appear at the court-ordered hearing on her discovery
motion, the district court expressed its displeasure that Leung had failed to
comply with the court’s orders and outlined the basis for its belief that Leung was
misrepresenting her pro se status to the court. (Appellee’s App. at 170–71; see
also, supra, n.1 .) Stating on the record that, because of Leung’s delays, denials,
and refusals to recognize the jurisdiction of the court, it was no longer “going to
tolerate this kind of conduct from [Leung]” (Appellee’s App. at 171), the district
court instructed FIG that if there were “any further failures on the part of [Leung]
to comply with the orders of this Court, to move for the entry of default.” ( Id.) 3
3
Because Leung had failed to appear for the court hearing at which the
district court made these comments, the court ordered that a transcript of the
court’s rulings be sent to Leung by certified mail.
-6-
By pretrial order of September 14, 2000, the district court set December 18,
2000, as the trial date. On December 1, 2000, Leung sought a continuance of the
trial date, claiming she was seeking local counsel to represent her in the filing of
dispositive pretrial motions. The district court denied her motion because the
date for filing such motions had long since passed. However, Leung then
represented to FIG that she was selecting counsel to represent her at trial and FIG
stipulated to a motion to continue the trial. Having granted the motion, the
district court ordered Leung’s counsel to enter an appearance by January 18,
2001, and be ready for trial not later than March 18, 2001.
Counsel not having made an appearance of behalf of Leung by the court-
ordered deadline, the district court then set a hearing for the entry of default and
determination of damages pursuant to its earlier order that “[f]ailure to comply
fully with either of these conditions shall result in the entry of default.” ( Id. at
214.) Appellant filed a motion for reconsideration two days before the hearing
date. She claimed she had “inadvertently” failed to meet the court’s deadline, had
diligently attempted to secure local counsel, and was in the process of retaining
counsel in Illinois. (
Id. at 218–19.) Leung did not appear at the court-ordered
hearing for entry of default and determination of damages. The district court
-7-
denied her motion for reconsideration, entered default judgment against her, and
set damages at $481,621.65, based on admissions made by Leung in her
deposition.
The Federal Rules of Civil Procedure authorize default judgments against a
party who fails to obey a scheduling or pretrial order of the court. See
Fed. R. Civ. P. 16(f) and 37(b)(2)(C). We review the entry of default judgment
for abuse of discretion under the totality of the circumstances. M.E.N. Co. v.
Control Fluidics, Inc. , 834 F.2d 869, 872 (10th Cir. 1987). “Because a default
judgment is a harsh sanction, due process requires that ‘failure’ is a sufficient
ground only when it is the result of wilfullness, bad faith, or some fault of
petitioner rather than inability to comply.”
Id. (quotation and alteration omitted).
“We have defined a willful failure as ‘any intentional failure as distinguished
from involuntary noncompliance. No wrongful intent need be shown.’”
Id. at
872–73 (quoting In re Standard Metals Corp .,
817 F.2d 625, 628 (10th Cir. 1987).
Based on our careful review of the record, we are satisfied that Leung
wilfully and intentionally failed to comply with numerous scheduling and pretrial
orders of the district court and that she was aware of the possible consequences of
her failure to do so. We find no abuse of the district court’s discretion entering
default judgment against Leung.
-8-
We DENY Leung’s motion to strike FIG’s supplemental appendix. The
judgment is AFFIRMED .
ENTERED FOR THE COURT
Carlos F. Lucero
Circuit Judge
-9-
