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O'Brien v. R.J. O'Brien & Assocs., Inc. - 998 F.2d 1394 (7th Cir. 1993)


A signed return of service constitutes prima facie evidence of valid service which can be overcome only by strong and convincing evidence. Absent evidence to the contrary, a district court does not abuse its discretion by concluding that a defendant has in fact been served with process as stated in a sworn statement of a return of service.


Mark O’Brien (O’Brien) maintained an investment account with Sage, an introducing broker, who purchased silver options for him through R.J. O'Brien & Associates, Inc. (RJO). O'Brien filed suit against RJO, alleging that RJO fraudulently executed the silver option transactions in violation of the Commodities Futures Trading Act, resulting in the loss of approximately $20,000 from his investment account with Sage. O’Brien served process on RJO personally but failed to file its return of service until he moved for default 17 months later. A default was then entered when RJO was unable to explain its failure to respond to O’Brien complaint. RJO's motion to vacate the default was denied, and a default judgment entered. Damages were awarded in an amount proved by O’Brien's affidavit when RJO failed to submit any evidence with regard to damages. RJO then moved to set-aside the default judgment and dismiss the case for lack of personal jurisdiction due to alleged defects in the summons. The motion to dismiss was also denied. RJO appealed. 


Did the district court abuse its discretion in entering the default judgment?




The court held that the district court did not abuse its discretion, under Fed. R. Civ. P. 55(a) and 60(b), in entering and refusing to vacate the default or the default judgment. O’Brien's failure to file the return of service did not affect the validity of service or RJO’s obligation to timely respond. Any lack of personal jurisdiction was waived because the defects in the summons were challenged in RJO's first motion, as required by Fed. R. Civ. P. 12(h)(1).

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