Las Vegas Sun

August 27, 2014

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Supreme Court: Those pursuing civil suits in Nevada must mail notice to nonresidents

The Nevada Supreme Court ruled today that nonresidents sued in a Nevada court must be sent the summons and complaint to complete legal service of the civil complaint.

The court said publication alone of the suit in a Nevada newspaper is not adequate to notify nonresidents.

The ruling came in a case involving a civil suit by Alex Loeb, a shareholder in a company called Universal Travel Group, a firm registered with the Secretary of State’s Office in Nevada but with all officers in China. The officers are accused of mishandling the firm, which caused the New York Stock Exchange to halt trading in the stock in 2011.

Loeb accuses the officers of fraud and other unlawful conduct.

Reno attorney David O’Mara, representing Loeb, argued in his brief to the court that Nevada judicial rules do not require the transmittal of documents abroad. The notice can be accomplished by publication in a Nevada newspaper. He also said the company had already been served in Nevada with the complaint.

“Officers and directors of a Nevada corporation should not be permitted to shield themselves from service simply because they are residents of another country,” he wrote in his brief.

The Supreme Court said, however: “A party residing outside the United States whose address is known must be served according to the terms of the Hague Convention.”

The Hague Convention is an international treaty organization that establishes procedures to be used in suing nonresidents. The convention includes more than 70 countries, including the United States.

O’Mara argued unsuccessfully that Nevada rules should prevail over the procedures set by the Hague Convention.

The court, in a decision written by Justice James Hardesty, said Loeb knew the addresses of the officials in China. It said that, under the Nevada rules, “if the defendant’s address is known, the party serving process must both complete publication and mail the documents to the defendant’s address.”

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