Argued: April 29, 2015.
Appeal from the United States District Court for the Northern District of Illinois, Eastern Division. No. 1:13-cv-01322 -- Samuel Der-Yeghiayan, Judge.
For Durukan America, LLC, Plaintiff - Appellee: Oscar Trejo, Attorney, Atom Law Group, Chicago, IL.
For Rain Trading, Inc., Defendant - Appellant: Stephen K. Le Brocq, Attorney, Lane Legal Services, P.C., Chicago, IL.
For Yavuz B. Canbulat, Defendant - Appellant: Stephen K. Le Brocq, Attorney, Lane Legal Services, P.C., Chicago, IL.
Before BAUER, MANION, and HAMILTON, Circuit Judges.
Hamilton, Circuit Judge.
Plaintiff Durukan America, a Texas candy company, sued Rain Trading, an Illinois wholesaler, and its president Yavuz Canbulat 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 Sheriff's 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
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 Abbvie," 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 ...