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First Nonprofit Insurance Co. v. Neighbor To Family, Inc.

United States District Court, N.D. Georgia, Atlanta Division

March 12, 2015

FIRST NONPROFIT INSURANCE COMPANY, Plaintiff,
v.
NEIGHBOR TO FAMILY, INC., GEORGIA DEPARTMENT OF HUMAN SERVICES, GEORGIA DIVISION OF FAMILY AND CHILDREN SERVICES, and CAIN PEARSON, by and through his Next Friend, Ari Mathe, Defendants.

ORDER

RICHARD W. STORY, District Judge.

This case comes before the Court on Defendants Georgia Department of Human Services and Georgia Division of Family and Children Services' Motion to Dismiss [11] and Amended Motion to Dismiss [13]. After reviewing the record, the Court enters the following Order.

Background

Plaintiff First Nonprofit Insurance Company ("Plaintiff") brought this declaratory action on July 18, 2014 against the Georgia Department of Human Services ("DHS"), the Georgia Division of Family and Children Services ("DFCS"), Neighbor to Family, Inc. ("NTF"), and Cain Pearson, by and through his Next Friend, Ari Mathe. Plaintiff brought the action in order to adjudicate the rights and obligations of DHS, DFCS, and NTF under insurance policies issued to NTF related to a pending lawsuit in the State Court of DeKalb County, Georgia. (Compl., Dkt. [1].) Defendants DHS and DFCS filed their Motion to Dismiss [11] on August 25, 2014, alleging improper service, immunity under the Eleventh Amendment of the U.S. Constitution, and sovereign immunity under the Georgia Constitution. Defendants superseded that motion with an Amended Motion to Dismiss [13] on September 2, 2014. Therefore, the original Motion to Dismiss [11] is DENIED as moot.

Discussion

I. DFCS' Motion to Dismiss

As a threshold matter for DFCS, in their Amended Motion to Dismiss, Defendants argue that DFCS is not a proper defendant because it "is not a legal entity capable of being sued, but rather a division of DHS." (Am. Mot. Dismiss, Dkt. [13] at 3.) Under Georgia law, all county DFCS offices are "under the direction and supervision of the commissioner [of DHS], " O.C.G.A. § 49-4-3(b), and are therefore "instrumentalities of the State Department of Human [Services]." Bendiburg v. Dempsey , 707 F.Supp. 1318, 1331 (N.D.Ga. 1989), aff'd in part and rev'd in part on other grounds, 909 F.2d 463 (11th Cir. 1990) (finding that statutes governing DFCS "strongly suggest that the county departments are instrumentalities of the State Department of Human [Services] rather than separate county entities"). DFCS is thus not a separate legal entity from DHS because it is an instrumentality of DHS. See also Powell v. Dep't of Human Res. , 918 F.Supp. 1575, 1578-79 (S.D. Ga. 1996) (finding that DFCS was created by state law as a division of DHS). Naming both DHS and DFCS is therefore redundant, and DFCS should be dismissed from this action.

II. DHS' Motion to Dismiss

A. Insufficient Service of Process

Defendants move for dismissal from this action "due to lack of personal and subject matter jurisdiction." (Am. Mot. Dismiss, Dkt. [13] at 3.) The Court first addresses Defendants' argument that DHS was not properly served with process pursuant to Federal Rule of Civil Procedure ("Rule") 4. Defendants argue that Plaintiff never served the Commissioner of DHS as required under Georgia law.

Under Rule 4(m),

If a defendant is not served within 120 days after the complaint is filed, the court-on motion or on its own after notice to the plaintiff-must dismiss the action without prejudice against that defendant or order that service be made within a specified time. But if the plaintiff shows good cause for the failure, the court must extend the time for service for an appropriate period.

FED. R. CIV. P. 4(m).

Service of process on state agency defendants like DHS is governed by Rule 4(j)(2), which provides that plaintiffs must serve a state agency in one of two ways: "(A) delivering a copy of the summons and of the complaint to its chief executive officer; or (B) serving a copy of each in the manner prescribed by that state's law for serving a summons or like process on such a defendant." Id . Georgia law provides that state agencies must be served by delivering a copy of the complaint and summons to the agency's "chief executive officer or clerk thereof." O.C.G.A. § 9-11-4(e)(5). Under O.C.G.A. § 49-2-1, the DHS Commissioner is deemed the "chief administrative officer" of the agency. O.C.G.A. § 49-2-1(b). Furthermore, O.C.G.A. § 49-2-15 specifies that in suits against DHS, "it shall be the duty of the plaintiff to provide for service of notice of the pendency of such action by providing for service of a second original process, issued ...


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