We have come a long way from personal in-person service of process to service over a social media platform to even service using a non-fungible token (NFT) sent to a blockchain address. The legal community needs to find ways to adapt to those who want to make themselves “virtually” impossible to serve and/or to those who want to hide their identity. For those who intentionally take advantage of operating “off the grid,” virtual communications cannot, when used as a “sword” to communicate and to engage in wrongdoing, be permitted to be used as a “shield” to claim service of process by such means is improper. The three recent decisions highlighted below from state and federal courts address creative uses of digital communication to serve process.
In LCX AG v. John Doe, Index No. 154644/2022 (Sup. Ct. N.Y. Co. June 2, 2022), notice of an order to show cause was permitted by embedding a hyperlink to the order hosted on a website through an NFT air dropped into the blockchain address of the defendant, who was seeking to conceal its identity and where defendant’s email address was not known. NFTs are digital assets that cannot be replicated or interchanged. Here, a cyberattack inflicted on a cryptocurrency exchange resulted in millions of dollars in digital assets being stolen from one of its wallets. The only identifying information the exchange had was a blockchain address to which the stolen asserts were transferred. The order to show cause sought to enjoin any use of cryptocurrency stored at that certain blockchain wallet address and directed the holder of the wallet to deny access to the address. Any such service, of course, would be subject to the defense that the actual defendant was not the one who clicked on the hyperlink embedded in the digital token.
