Durukan America, LLC v. Rain Trading, Inc.

787 F.3d 1161, 91 Fed. R. Serv. 3d 1697, 2015 U.S. App. LEXIS 9240, 2015 WL 3485884
CourtCourt of Appeals for the Seventh Circuit
DecidedJune 3, 2015
Docket14-3016
StatusPublished
Cited by28 cases

This text of 787 F.3d 1161 (Durukan America, LLC v. Rain Trading, Inc.) is published on Counsel Stack Legal Research, covering Court of Appeals for the Seventh Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Durukan America, LLC v. Rain Trading, Inc., 787 F.3d 1161, 91 Fed. R. Serv. 3d 1697, 2015 U.S. App. LEXIS 9240, 2015 WL 3485884 (7th Cir. 2015).

Opinion

HAMILTON, Circuit Judge.

Plaintiff Durukan America, a Texas candy company, sued Rain Trading, an Illinois wholesaler, and its president Yavuz Can-bulat for breach of contract and deceptive practices. To prove service, Durukan filed with the court two affidavits from a process server. After a month passed without an answer from the defendants, the district court entered a default judgment for Durukan. Almost a year later the defendants moved to vacate the default judgment, submitting an affidavit and records to show that they were never served. Without holding a hearing to address the dueling affidavits, the district court denied the motion to vacate. Because the district court should have held a hearing to resolve the factual conflict in the affidavits, we reverse and remand.

Durukan sued Rain Trading and Canbulat for, according to the complaint, refusing to pay for about $86,000 worth of candy and gum. Durukan filed an affidavit of service for each defendant. The process server attested that he served Canbulat “[b]y leaving a copy with the named party, Yavuz Burak Canb[u]lat personally on April 2, 2013,” a Tuesday, at 4:05 p.m. at 3033 Malmo Drive in Arlington Heights, Illinois. This is the corporation’s registered address. The corporation was served, according to the second affidavit, “by leaving a copy with Yavuz Burak Canbulat, Authorized Person” on the same date and time and at the same location. The process server identified the person he served as male, Caucasian, and approximately 36 years old. The affidavits were signed and notarized.

The defendants did not respond to the complaint. The district court entered a default judgment in favor of Durukan for $88,365.77. Two months later the court issued a summons to garnish Canbulat’s wages. Durukan filed another affidavit of service in which the process server stated that he served the summons on Rain Trading “by leaving a copy with Adam Ozturk, Sales Department and Authorized Person on July 25, 2013,” at 2:10 p.m. at the same Arlington Heights address. The defendants did not respond to the garnishment summons.

Ten months later the defendants moved to reopen the case. They swore that they had learned of the suit only because an officer of the Cook County Sheriffs Department had just arrested Canbulat for failing to appear at a .state court proceeding to discover his assets. Eleven days after that arrest, the defendants moved to set aside the default judgment under Federal Rule of Civil Procedure 60(b)(4). Canbulat attached to the motion a two-page affidavit stating that Durukan’s affidavits of service were “false and erroneous” and that neither defendant “was *1163 served ... at the time and place therein stated [in the Affidavits of Service] or at any time or place.” Canbulat continued: “After reviewing both 'affidavits of the process server, I checked the records and verified that at the said date and time, I was employed with and working at Abb-vie,” a company located 25 miles (a half-hour drive) from the address identified in the affidavits of service. Canbulat added: “My work hours did not permit me to leave before 5:00 PM, as I was a salaried employee, and in fact I did not leave before 5:00 PM CST on the day in question.”

Desiring more information, the district court denied the motion without prejudice. The defendants renewed their motion and attached two documents to corroborate Canbulat’s affidavit: (1) a description of Canbulat’s job at Abbvie, including that he worked full-time, Monday through Friday, from 8:00 a.m. to 5:00 p.m.; and (2) an email exchange with a supervisor regarding Canbulat’s request 'not to work on April 11, 2013 (more than a week after the process server says he served Canbulat). The employer had produced these documents in response to plaintiff Durukan’s subpoena seeking records of the days and hours worked by Canbulat in the entire month of April 2013. There was no similar request for the day of the supposed service, April 2nd. The defendants argued in their motion that this evidence, combined with Canbulat’s affidavit, showed that it would have been impossible to serve either defendant as claimed because Canbulat was working at Abbvie on April 2, 2013, at 4:05 p.m. Because neither defendant was served, the defendants continued, the district court lacked personal jurisdiction and the default judgment is void.

Without holding a hearing, the district court denied the defendants’ renewed motion to vacate the default judgment. The court discounted Canbulat’s affidavit as “self-serving.” It then explained that the employment records do “not rebut the evidence of proper service” because they “in no way reflect that on April 2, 2013 at 4:05 p.m. Canbulat was somewhere other than as reflected by the process server.”

In general we review the denial of a Rule 60(b) motion for abuse of discretion, but the review is more searching when personal jurisdiction or service of process is being challenged for the first time. See Philos Techs., Inc. v. Philos & D, Inc., 645 F.3d 851, 854 (7th Cir.2011); Relational, LLC v. Hodges, 627 F.3d 668, 671 (7th Cir.2010); Homer v. Jones-Bey, 415 F.3d 748, 753 (7th Cir.2005). “[I]f the district court lacked personal jurisdiction over the defendant at the time it entered the default judgment, the judgment is void, and it is a per se abuse of discretion to deny a motion to vacate that judgment.” Relational, 627 F.3d at 671 (citations omitted); see Philos, 645 F.3d at 855; State St. Bank v. Inversiones Errazuriz, 374 F.3d 158, 178 (2d Cir.2004).

A process server’s affidavit identifying the recipient and when and where service occurred is “prima facie evidence of valid service which can be overcome only by strong and convincing evidence.” O'Brien v. R.J. O’Brien & Assocs. Inc., 998 F.2d 1394, 1398 (7th Cir.1993) (internal quotation marks and citations omitted); Relational, 627 F.3d at 672; Homer, 415 F.3d at 752. The affidavits of service that named the recipient as Mr. Canbulat and placed service on April 2, 2013, at 4:05 p.m. at Rain Trading’s registered place of business established a prima facie showing. But Durukan is wrong when it asserts on appeal that its prima facie showing entitled it to have any dispute with its affidavits resolved in favor of jurisdiction. The affidavit of the party asserting personal jurisdiction is presumed true only until it is disputed. Once disputed, the party assert *1164 ing personal jurisdiction — in this case Durukan — must prove what it has alleged. Hyatt Int’l Corp. v. Coco, 302 F.3d 707, 713 (7th Cir.2002); see Philos, 645 F.3d at 859.

The defendants have presented sufficient evidence to dispute the presumption of sérviee.

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787 F.3d 1161, 91 Fed. R. Serv. 3d 1697, 2015 U.S. App. LEXIS 9240, 2015 WL 3485884, Counsel Stack Legal Research, https://law.counselstack.com/opinion/durukan-america-llc-v-rain-trading-inc-ca7-2015.