Evasive maneuvers: How US courts sidestep the Hague Service Convention and effects on foreign defendants

Despite recent fluctuations in trade policy in the US, companies engaged in international shipping find US courts are increasingly familiar territory. But when a foreign shipping company is sued in the US, how that company is served with process can determine whether it even has a chance to defend itself.

Last year the US District Court for the Southern District of New York ruled that conducting discovery as required by the Hague Service Convention (“HSC”) is not necessary when the laws of the country where discovery requests require response do not explicitly prohibit non-HSC procedures, and where complying with the HSC “raises the prospect of substantial delay.” Skillz Platform Inc. v. Papaya Gaming, Ltd., 753 F.Supp.3d 347, 357 (S.D.N.Y. 2024).

The HSC was designed to streamline and standardize service of process across borders. Despite its incorporation into US law, US courts often find ways to bypass it. This exercise of judicial discretion can leave foreign defendants, and insurers, vulnerable to default judgments based on unorthodox or expedited service under the US Federal Rules of Civil Procedure (“FRCP”).

I. Why the Hague Service Convention Matters

The HSC governs service of judicial documents abroad when litigants’ home countries are party to the HSC. Many of the world’s maritime hubs, like Greece, the UK, and Singapore, are signatories. In theory, this provides a predictable process for serving parties involved in transnational disputes.

But litigation realities at US ports and courts often deviates from this framework. This is especially true when plaintiffs press for early jurisdiction or seizure of assets.

II. How US Courts Circumvent the Hague Service Convention

A. Rule 4(f)(3): Service by “Other Means”

FRCP 4(f)(3) permits courts to authorize alternative service on foreign defendants. Courts may allow:

• Service via email to shipping agents. See In re International Telemedia Associates, Inc., 245 B.R. 713, 720-21 (Bankr. N.D. Ga. 2000)
• Delivery of documents to US-based P&I club representatives. See Volkswagenwerk AG v. Schlunk, 486 U.S. 694, 707-08 (1988).
• Service on local counsel from prior litigation. See FMAC Loan Receivables v. Dagra, 228 F.R.D. 531, 536 (E.D. Va. 2005)

So long as the alternative method is “not prohibited” by the foreign country, many US judges will approve it even if the HSC procedures are available. See Rio Props., Inc. v. Rio Int’l Interlink, 284 F.3d 1007 (9th Cir. 2002).

B. Appearance Waivers

If a foreign defendant files an answer or responds to discovery without objecting to service, courts will typically find the issue waived. See PaineWebber Inc. v. Chase Manhattan Private Bank (Switzerland), 260 F.3d 453, 460-61 (5th Cir. 2001). This occurs even if HSC procedures were bypassed entirely. In a shipping context, vessel owners defending Rule B attachments or cargo damage suits may unknowingly waive their right to HSC procedures.

C. No “Service” Required

In Volkswagenwerk AG v. Schlunk, 486 U.S. 694 (1988) the US Supreme Court held that if US law does not require transmission of judicial documents abroad, the HSC does not apply. In cases involving vessel arrest or Rule C in rem proceedings, courts may adopt the logic of Schlunk, finding that personal service on a foreign owner is not even required if the arrest takes place in the US, and the notice requirements are satisfied.

III. Practical Consequences for Foreign Maritime Defendants

A. Default Risk

When claimants use alternative methods of service there is often a real risk the defendant will not find out in time to respond. This is especially problematic in Rule B attachment cases, where time is critical and courts may quickly enter default judgments. See Navalmar (U.K.) Ltd. V. Welspun Gujarat Stahl Rohren, Ltd., 485 F.Supp.2d 399, 408-411 (S.D.N.Y. 2007).

B. Eroded Predictability for P&I Clubs and Insurers

Foreign liability insurers, including P&I Clubs, often monitor US litigation but may not be timely advised when their members are served via alternative means, which can create coverage gaps and strategic blind spots.

C. Asset Seizure Without Notice

The ability to attach assets under Rule B combined with lax service requirements and the application of the Schlunk doctrine can lead to unjust enrichment for plaintiffs and logistical chaos for shipowners with tight sailing schedules. See Seawind Compania S.A. v. Crescent Line, Inc., 320 F.2d 580, 582 (2d. Cir. 1963).

IV. What Foreign Defendants Should Do

• Monitor US Dockets: Use AIS and court record systems to identify actions filed in US courts involving your fleet, cargo, or clients.
• Appoint US Counsel Early: Proactively retain counsel for pre-litigation monitoring even if service has not been made.
• Educate Local Agents and Counsel: Ensure commercial agents and P&I correspondents know to flag suspicious notices or service attempts.
• Designate an Agent for Service of Process: Designating an agent for service indicates that a specific entity or individual within the judicial district is the proper recipient of judicial documents on the foreign defendant’s behalf and avoids the risks associated with alternative service.

Conclusion

The HSC was designed to ensure transparency and fairness in cross-border litigation. But for maritime interests dragged into US courts, that protection may be more theoretical than real. Whether you are a shipowner in Piraeus, a charterer in Singapore, or an insurer in London, one cannot assume the Convention will shield them from US jurisdiction. Skillz Platform Inc. v. Papaya Gaming, Ltd. is one of the most recent iterations of a continuing trend for US courts to require litigants foreign and domestic to accept service and conduct discovery in the American style. When it comes to service, the tide is not always in your favor.