UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 09-1676
ALAN M. GRAYSON; AMG TRUST, The,
Plaintiffs - Appellees,
v.
CHARLES HSIN,
Defendant - Appellant,
and
CHARLES CATHCART; EVELYN CATHCART; YURIJ DEBEVC; SCOTT
CATHCART; SCOTT AND WHITNEY CATHCART FAMILY TRUST; DERIVIUM
CAPITAL USA INCORPORATED; VERIDIA SOLUTIONS LLC; SHENANDOAH
HOLDINGS LTD; VERISTEEL INCORPORATED; PTS INTERTECH
INCORPORATED; AQUILIUS INCORPORATED; OPTECH LIMITED; PAUL
ANTHONY JARVIS; NIGEL HARLEY WOOD; COLIN BOWEN; BANCROFT
VENTURES LTD; BANCROFT VENTURES UK LTD; SPENCER PARTNERS
LTD; ISLE OF MAN ASSURANCE LTD; DMITRY BOURIAK; VISION
INTERNATIONAL PEOPLE GROUP PL; TOTAL ECLIPSE INTERNATIONAL
LTD; BRYAN JEEVES; ALEXANDER JEEVES; KRISTINA PHELAN; JEEVES
GROUP, The; JEEVES HOLDINGS LTD; JAVELIN LTD; LEXADMIN TRUST
REG; ST VINCENT TRUST COMPANY LTD; ST VINCENT TRUST SEVICE
LTD; WINWARD ISLES TRUST COMPANY LTD; SELBOURNE TRUST
COMPANY LTD; PELICAN TRUST COMPANY LTD; JEEVES GROUP ASIA
LTD; WACHOVIA SECURITIES INCORPORATED; JOHN DOES −10; 1
JEEVES COMPANY LTD; ORANGEBURG METAL TREATMENT CO LLC;
METARIZON LLC, f/k/a Metarrizon Solutions Incorporated;
RANDOLPH ANDERSON; JONATHAN SANDIFER; PATRICK KELLEY; ROBERT
BRADENBURG; NIGEL THOMAS TEBAY; JOANNA OVERFIELD BODELL,
Defendants,
KEVIN CAMPBELL,
Party−in−Interest.
Appeal from the United States District Court for the District of
South Carolina, at Charleston. David C. Norton, Chief District
Judge. (2:07-cv-00593-DCN)
Argued: September 23, 2010 Decided: January 14, 2011
Before NIEMEYER and KEENAN, Circuit Judges, and Jerome B.
FRIEDMAN, United States District Judge for the Eastern District
of Virginia, sitting by designation.
Affirmed by unpublished per curiam opinion.
ARGUED: Steven Soulios, RUTA & SOULIOS LLP, New York, New York,
for Appellant. Alisa Joy Roberts, KUBLI & ASSOCIATES, PC,
Vienna, Virginia, for Appellees. ON BRIEF: F. Truett Nettles,
II, THE NETTLES LAW OFFICE, LLC, Charleston, South Carolina, for
Appellant.
Unpublished opinions are not binding precedent in this circuit.
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PER CURIAM:
Charles Hsin, one of the defendants in this case in which
Alan M. Grayson and The AMG Trust claim damages from an alleged
fraudulent stock loan scheme, seeks to set aside a multi-million
dollar default judgment entered against him. He contends that
he was never properly served and that the judgment, in any
event, is void for lack of subject matter jurisdiction because
the plaintiff lacks standing to bring the fraud claims. In
addition, Hsin contends that the district court violated Federal
Rule of Civil Procedure 54(b) in certifying the default judgment
as a final judgment before liability of all of the other
defendants involved in the scheme was determined; that the
amount of the default judgment was manifestly unjust; and that
the district court erred in failing to hold a hearing on
damages.
As to subject matter jurisdiction, Hsin bases his argument
on the fact that a parallel action making the same allegations
has been filed by the trustee in the bankruptcy of Derivium
Capital, LLC, a firm involved in the scheme. We conclude,
however, that Hsin’s argument relates to the doctrine of
prudential standing, not Article III standing. Accordingly, we
do not consider the merits of this argument in deciding whether
to set aside the default judgment. See Lujan v. Defenders of
Wildlife, 504 U.S. 555, 560-61 (1992) (stating that the
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requirements for Article III standing are injury in fact,
causation, and redressability).
As to Hsin’s claim that he was not properly served in this
case, we affirm for the reasons given by the district court.
The district court found that Hsin was served in accordance with
New York leave-and-mail procedure. See N.Y. Civ. Practice Law &
Rule § 308(2); Fed. R. Civ. P. 4(e)(1) (allowing service per
state rules). First, it found that, in accordance with Rule
4(e)(1) and New York Civil Practice Law and Rule § 308(2), the
plaintiffs mailed the summons and complaint to Hsin at his last
known residence address at 99 Campbell Avenue, Williston Park,
New York, on June 19, 2007, via first-class mail. Hsin’s own
affidavit states that he last lived at 99 Campbell Avenue.
Moreover, the plaintiffs demonstrated that after a diligent
search, they were unable to uncover any other address for his
residence.
Second, the district court found, again in accordance with
Rule 4(e)(1) and New York Civil Practice Law and Rule § 308(2),
that the plaintiffs served Hsin at his place of business by
delivering a copy of the summons to Nicole Ingrahm, a person
there of suitable age and discretion. The record shows that
Hsin was the founder and CEO of First Federal Group of
Companies, Inc., which was the parent of several other
companies, including First Federal Capstone Ventures, LLC. The
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plaintiffs obtained the address for First Federal Group from its
website, which gave 515 Madison Avenue, 21st Floor, New York,
New York 10022, as the company’s address. When a professional
process server went to 515 Madison Avenue, the building’s
directory indicated that the 21st floor was occupied by First
Federal Capstone, a subsidiary of First Federal Group. The
process server went to the office on the 21st floor and there
spoke with Nicole Ingrahm, who told the process server that Hsin
had an office there. She also told the process server that “she
believed that Mr. Hsin had just left for a trip to Hong Kong,
China, and she did not know when he would return.” That
information was corroborated by a telephone conversation that
the process server had had earlier that day with Hsin. As the
process server related it, after calling Hsin on a listed
telephone number, “I personally spoke with a man with an Asian
accent who identified himself as Charles Hsin. Mr. Hsin
informed me that he was at the airport and was about to fly to
Hong Kong, China. Mr. Hsin asked me to send my delivery to Hong
Kong.” After receiving the information about Hsin from Ingrahm,
the process server handed the summons and complaint to Ingrahm,
who the process server observed was a person of suitable age and
discretion.
For these reasons, we reject Hsin’s claim that he was not
properly served. We decline to consider Hsin’s other arguments,
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which he did not raise in the district court and which, in any
case, go to the merits of the defaulted claims.
Accordingly, we affirm the district court’s order, dated
May 12, 2009, denying Hsin’s motion to set aside the default
judgment, and we affirm the final judgment entered June 9, 2009.
AFFIRMED
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