Ninth Circuit Determines That in a Federal Action, Rule 3 Governs, and a Federal Court Need Not Borrow the States Time Period for Service of Process

Per S.J. v. Issaquah School District No. 411, 470 F.3d 1288 (9th Cir. Dec. 11, 2006):

This appeal presents the question whether, in an action arising under federal law where there is no federal statute of limitations, a federal court borrows the state's time period for service of process as well as for filing suit. . . . We have previously held that Rule 3 of the Federal Rules of Civil Procedure controls when an action which arises under federal law is "commenced" for purposes of tolling the statute of limitations borrowed from state law. Sain v. City of Bend, 309 F.3d 1134, 1136 (9th Cir.2002). It follows that federal procedural rules thereafter govern the action, at least when there is a federal rule to apply. Here there is, because Rule 4(m) of the Federal Rules of Civil Procedure provides a time limit for service of process (120 days). Accordingly, we hold that a federal court borrowing a state's time period for filing suit brought under federal law should not also borrow the state's time limits for serving the complaint. As S.J.'s IDEA action was timely commenced for purposes of tolling the borrowed statute of limitations when it was filed within 30 days, we reverse.

Congress had not provided a federal statute of limitations governing IDEA claims at the time this action commenced. For this reason, courts considering such claims must borrow the most closely analogous state statute of limitations so long as it does not undermine the policies of the IDEA. See Livingston Sch. Dist. Nos. 4 & 1 v. Keenan, 82 F.3d 912, 915 (9th Cir.1996). . . . Applying Keenan, the district court in this case borrowed the thirty-day statute of limitations for judicial review of agency orders in the WAPA. No one disputes that choice. . . .

As we explained in Sain, 309 F.3d at 1137-38, the Supreme Court held in Walker v. Armco Steel Corp., 446 U.S. 740 (1980), and West v. Conrail, 481 U.S. 35 (1987), that when an action is commenced for purposes of the statute of limitations differs depending upon whether the action is based on state or federal law. Walker indicated that in a diversity case, even though Rule 3 governs the date from which timing requirements of the Federal Rules of Civil Procedure are measured, federal courts borrow state service rules that are integral to the statute of limitations in order to determine when the action is commenced for purposes of tolling the statute of limitations. However, West indicated that when the underlying cause of action is based on federal law and it is necessary to borrow a limitations period from another federal statute, the action is not barred if it has been commenced in compliance with Rule 3 within the borrowed limitations period regardless of the borrowed statute's service requirements. We took the next step in Sain, holding that the rule from West, where the borrowed statute was federal, also applies when the statute of limitations is borrowed from state law. . . .

In sum, Sain held that Rule 3 governs the commencement of federal causes of action using borrowed state statutes of limitations. This means there is no gap to fill and no basis for resorting to state law to determine when the action is commenced. As S.J.'s action was commenced under Rule 3 within the thirty-day period of limitations when he filed his complaint in federal district court, the corollary is that Rule 4 controls service of process. So holding aligns us with the Seventh Circuit's reasoning in Gray v. Lacke, 885 F.2d 399, 409-10 (7th Cir.1989). . . . Therefore, we hold that a federal court borrowing a state's time period for filing suit brought under federal law should not also borrow the state's time limits for serving the complaint. S.J. timely commenced his IDEA action by filing his complaint on September 13, 2004. As the district court borrowed the state's time limit for service as well, we reverse.