Opinion

1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA 10 11 BETA PHONESAVANH SAVATDY, an Case No.: 26cv2465-GPC(DEB) individual, 12 ORDER FOLLOWING ORDER TO Plaintiff, 13 SHOW CAUSE HEARING v. 14 NEWREZ, LLC, a Delaware limited 15 liability company, dba SHELLPOINT 16 MORTGAGE SERVICING; BANK OF AMERICA, N.A., fka COUNTRYWIDE 17 HOME LOANS, INC., dba AMERICA'S 18 WHOLESALE LENER and DOES 1 through 25, inclusive, 19 Defendants. 20 21 On August 6, 2026, the Court issued an order to show cause why the case should 22 not be dismissed for failing to serve under Federal Rule of Civil Procedure (“Rule”) 4(m) 23 and for failing to prosecute under S.D. Local Civ. Rule 41.1(a). (Dkt. No. 6.) A hearing 24 was held on August 21, 2026. (Dkt. No. 9.) 25 On June 25, 2025, Plaintiff Beta Phonesavanh Savatdy (“Plaintiff”) filed a 26 complaint against NewRez, LLC (“NewRez”) and other individual and corporate 27 28 1 defendants in San Diego Superior Court. (Dkt. No. 1-2 at 3. ) On February 18, 2026, 2 Plaintiff filed an amended complaint (“FAC”) against NewRez, LLC and Bank of 3 America, N.A. alleging claims under the Fair Debt Collection Practices Act. (Id. at 6.) 4 On April 17, 2026, the case was removed to this Court. (Dkt. No. 1, Not. of Removal.) 5 The notice of removal states that Defendant NewRez was served with the first amended 6 complaint on March 20, 2026. (Dkt. No. 1, Not. of Removal ¶ 2.) Plaintiff admits that 7 Bank of America has not been served. (Dkt. No. 8, Shemwell Decl. ¶ 16.) The last 8 docket activity was an order to substitute defense counsel on May 5, 2026. 9 On August 17, 2026, in response to the OSC, Plaintiff’s counsel filed a declaration 10 stating that he has been communicating with NewRez’ counsel about the merits of the 11 case and they have exchanged multiple settlement proposals with the most recent on 12 August 14, 2026.2 (Dkt. No. 8, Shemwell Decl. ¶¶ 7, 9-13.) However, counsel have not 13 explained the failure to comply with the Rules. 14 The Rules govern the procedure in all civil actions in federal district court. Fed. R. 15 Civ. P. 1. They provide specific, required deadlines for service of the summons and 16 complaint and when and how a defendant must respond to the complaint. See Fed. R. 17 Civ. P. 4, 12. Deadlines in the Rules are not automatically paused while parties engage in 18 settlement discussions. In fact, the Rules provide a procedure if a party seeks to extend 19 time. See Fed. R. Civ. P. 6(b); 4(m). 20 Rule 4(m) provides that a defendant must be served within 90 days after a 21 complaint is filed. Fed. R. Civ. P. 4(m). A defendant must also serve a responsive 22 23 24 1 Page numbers are based on the CM/ECF pagination. 25 2 Both parties also filed a joint status report pursuant to Rule 26(f) laying out proposed pretrial and discovery-related deadlines. (Dkt. No. 7.) However, Rule 26(f) joint status report is not appropriate at 26 this time since a Rule 26(f) conference is held after an answer has been filed and an early neutral evaluation conference with the Magistrate Judge. See Zappia v. World Sav. Bank FSB, Civil No. 27 14cv1428–WQH (DHB), 2015 WL 1608921, at *2 (S.D. Cal. Apr. 10, 2015) (“In this district, the Rule 26(f) conference is typically held after an Answer has been filed and after an Early Neutral Evaluation 28 1 || pleading within 21 days after being served with the summons and complaint. Fed. R. 2 P. 12(a)(1). 3 Here, Plaintiff has not timely served Bank of America and Defendant has failed to 4 || timely respond to the FAC. At the hearing, Plaintiff's counsel stated he will serve Bank 5 ||of America by Monday, August 24, 2026 and defense counsel indicated that he intends to 6 || file a motion to dismiss if the case does not settle. After discussing the issues with the 7 || parties at the hearing, the Court ORDERED the following at the hearing: 8 1. Plaintiff is granted leave to serve Defendant Bank of America, N.A. no later 9 than Monday, August 24, 2026. 10 2. The parties are directed to contact Magistrate Judge Butcher’s chambers to set 11 up a status conference to discuss settlement. In the event the case does not 12 settle, Defendant is granted to leave to file a responsive pleading within 30 days 13 of status conference. 14 IT IS SO ORDERED. 15 Dated: August 25, 2026 16 Hon. athe Cae 17 United States District Judge 18 19 20 21 22 23 24 25 26 27 28