Appeal from the United States District Court for the Northern District of Illinois, Eastern Division. No. 95 C 2963 James F. Holderman, Judge.
Before POSNER, Chief Judge, and ESCHBACH and EVANS, Circuit Judges.
Raymond Panaras was terminated from his position as a regional manager at Liquid Carbonic Industries Corporation (LCI), following more than 25 years of continuous employment. In what is becoming a familiar cry among older displaced workers in this period of corporate "down-sizing," he says that he was terminated on account of his age. LCI and its parent corporation and codefendant, CBI Industries, Inc., attribute the termination to a legitimate reduction in work force unrelated to Panaras' age.
After filing a charge of discrimination with the EEOC and receiving a right to sue letter, Panaras filed his complaint in district court on May 17, 1995--well within the requirement that a complaint alleging age discrimination be filed within 90 days after issuance of the letter. 29 U.S.C. sec. 626(e). Unfortunately for Panaras, the case never got off the ground. The district court granted a defense motion to dismiss it for failure to accomplish proper service of the summons and complaint on the defendants.
This appeal requires that we examine the time period allowed for service of process under Rule 4 of the Federal Rules of Civil Procedure. Prior to amendment in 1993, the federal rules, namely former Rule 4(j), *fn1 required that district courts dismiss cases without prejudice if service was not made within 120 days of the filing of the complaint, unless a plaintiff showed good cause for the delinquency. On December 1, 1993, amended and renumbered Rule 4(m) went into effect, providing:
If service of the summons and complaint 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 as to that defendant or direct that service be effected within a specified time; provided that if the plaintiff shows good cause for the failure, the court shall extend the time for service for an appropriate period.
With the new rule in mind, we review the facts regarding Panaras' attempt to obtain service on the defendants.
On May 17, 1995, the day he filed his complaint (about halfway through the 90-day right-to-sue period), Panaras says he attempted to serve the summons and complaint by hand-delivering copies to each defendant in care of their registered agent, C T Corporation Systems. A member of plaintiff's counsel's office, however, who was responsible for the service, could not recall if he actually delivered the summons and complaint. As a courtesy, however, copies of the summons and complaint were served on counsel who was known by plaintiff's counsel to be representing both defendants.
On June 14, 1995, defendants filed their answer, which contained affirmative defenses. They did not, however, serve the pleading on Panaras until July 21, 1995. As one of their affirmative defenses, the defendants said "insufficiency of process and/or insufficiency of service of process." During discovery, in response to Panaras' interrogatories, the defendants stated that the factual premise of the "service" affirmative defense "is that process was never issued for Defendant CBI Industries, Incorporated and that neither Defendant was properly served . . . ."
Apparently, plaintiff's counsel was satisfied (this may have been wishful thinking) that process had been properly served on both CBI and LCI. Panaras contends that his counsel did not inquire further regarding proof of service because the defendants participated in scheduling conferences and responded to his discovery requests. Counsel tells us he believed the defendants were served and were simply objecting to some technical defect due to numerous changes in the corporate structure of one or both of defendants and their affiliated companies.
On September 18, 1995, 124 days after the filing of the complaint, the defendants moved to dismiss it for failure to serve them within 120 days. Not until service of that motion and an accompanying memorandum of law did Panaras learn of the specific details of the defective service. Defendants alleged that a summons never issued to CBI; neither CBI nor LCI was ever served; and the only attempt at service was the courtesy delivery of a single summons, directed only to LCI, to defendants' counsel's office.
On November 6, the parties appeared in the district court on the defendants' motion to quash the belated service of a new summons. The court granted the motion to quash and also granted defendants' motion to dismiss the suit without prejudice, concluding "[t]here has not been a sufficient good cause showing for the failure to serve within the 120 days." The court went on to note that Panaras was now free to attempt to obtain proper service by filing a new complaint. In the court's view, there was no statute of limitations problem, because "[t]he statute of limitations, as far as [the court] can tell at this point without having reviewed it precisely, has not run." But then Panaras' counsel informed the court of his view that dismissal without prejudice would effectively be with prejudice because the 90-day filing period had expired. *fn2 Counsel also stated his view that the new rule could give him relief without a showing of good cause. The record is not altogether clear on ...