Commercial Litigation and Arbitration

Who Bears the Burden of Proof as to Service When It Is Challenged after a Default Judgment Has Been Entered? — Circuit Split

McGehee v. Diversified Global Servs., LLC, 2017 U.S. Dist. LEXIS 38810 (D. Tenn. Mar. 17, 2017) (R&R):

Authority is split as to who bears the burden of proof when service is challenged after default judgment has been entered. It is well-settled that the plaintiff bears the burden to establish that service [*9]  was proper when it is challenged through a Rule 12(b)(5) motion to dismiss for insufficient service of process. Metro. Alloys Corp. v. State Metals Indus., Inc., 416 F. Supp. 2d 561, 563 (E.D. Mich. 2006); Shires v. Magnavox Co., 74 F.R.D. 373, 377 (E.D. Tenn. 1977). This allocation flows from the general presumption that a plaintiff "must carry throughout the litigation the burden of showing that he is properly in the court." McNutt v. General Motors Acceptance Corp. of Indiana, Inc., 298 U.S. 178, 189 (1936).

Some courts have found that this presumption remains and that the burden stays with the plaintiff no matter the stage at which service is challenged. Oldfield v. Pueblo De Bahia Lora, S.A., 558 F.3d 1210, 1217 (11th Cir. 2009) ("It goes without saying that, where the defendant challenges the court's exercise of jurisdiction over its person, the plaintiff bears the ultimate burden of establishing that personal jurisdiction is present . . . This standard applies whether the issue is raised by way of a motion to dismiss under Federal Rule of Civil Procedure 12(b)(2) or a motion to set aside a judgment under Rule 60(b)(4)."); see also, Morris v. B.C. Olympiakos, SFP, 721 F. Supp. 2d 546, 554-57 (S.D. Tex. 2010) (citing Rockwell International Corp. v. KND Corp., 83 F.R.D. 556 (N.D. Tex. 1979)); Donnely v. Copeland Intra Lenses, Inc., 87 F.R.D. 80, 85 (E.D.N.Y.1980); DiCesare-Englar Productions, Inc. v. Mainman, Ltd., 81 F.R.D. 703, 705 (W.D.Pa.1979). Other courts, however, follow a contrary rule: "If the defendant, after receiving notice, chooses to let the case go to a default judgment, the defendant must then shoulder the burden of proof when the defendant decides to contest jurisdiction in a postjudgment rule 60(b)(4) motion." Bally Exp. Corp. v. Balicar, Ltd., 804 F.2d 398, 401 (7th Cir. 1986); see also "R" Best Produce, Inc. v. DiSapio, 540 F.3d 115, 126 (2d Cir. 2008); S.E.C. v. Internet Sols. for Bus. Inc., 509 F.3d 1161, 1163 (9th Cir. 2007); Hazen Research, Inc. v. Omega Minerals, Inc., 497 F.2d 151, 154 (5th Cir. 1974).

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