689 F. App'x 12
2d Cir.2017Background
- Mary Middleton obtained a default judgment against Green Cycle Housing, LLC and Tal Etshtien in the Southern District of Iowa; that judgment was later registered in the Southern District of New York on January 29, 2015.
- Defendants moved in the Southern District of New York under Fed. R. Civ. P. 60(b)(4) to vacate the registered default judgment as void for lack of jurisdiction.
- Defendants conceded that service in the Iowa action was properly made but disputed that they had actual notice of the lawsuit before entry of default.
- The district court (S.D.N.Y.) denied the Rule 60(b)(4) motion; defendants appealed to the Second Circuit.
- The Second Circuit reviewed the denial de novo to determine whether the Iowa court lacked jurisdiction or otherwise violated due process.
- The court analyzed Iowa’s long‑arm framework and the record facts and concluded that the Iowa court properly exercised specific personal jurisdiction over defendants.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the default judgment is void for lack of personal jurisdiction under Rule 60(b)(4) | Middleton argued Iowa had specific jurisdiction over defendants based on their contacts and the relationship between defendants, the forum, and the litigation | Green Cycle and Etshtien argued they lacked actual notice and that the Iowa court therefore lacked jurisdiction, rendering the judgment void | Held: The Second Circuit affirmed; personal jurisdiction in Iowa was proper and the Rule 60(b)(4) motion was correctly denied |
| Who bears burden to prove/defeat jurisdiction when service conceded but actual notice denied | Middleton treated burden as on defendants only after default, and in any event argued record supports jurisdiction | Defendants contended that conceding service does not place on them the burden to disprove jurisdiction because they deny actual notice | Held: Court assumed plaintiff bore burden but found plaintiff satisfied it; did not resolve burden-shifting question definitively |
| Whether Iowa’s long‑arm statute permits exercise of jurisdiction consistent with due process | Middleton argued Iowa’s long‑arm reaches the full extent of due process and defendants’ contacts met minimum contacts tests | Defendants contended their contacts were insufficient for specific jurisdiction (contracts alone insufficient) | Held: Court agreed Iowa’s long‑arm reaches full constitutional limits and defendants’ contacts satisfied specific jurisdiction under Iowa precedent |
| Whether district court’s factual findings were clearly erroneous | Middleton relied on district court findings supporting jurisdiction | Defendants argued factual findings (e.g., notice, contacts) were erroneous | Held: No clear error in district court’s factual findings; appellate court affirms |
Key Cases Cited
- Burda Media, Inc. v. Viertel, 417 F.3d 292 (2d Cir. 2005) (denial of Rule 60(b)(4) reviewed de novo because a void judgment requires vacatur)
- Luckett v. Bure, 290 F.3d 493 (2d Cir. 2002) (factual findings in Rule 60(b)(4) context reviewed for clear error)
- Grace v. Bank Leumi Tr. Co., 443 F.3d 180 (2d Cir. 2006) (definition of when a judgment is void under Rule 60(b)(4))
- "R" Best Produce, Inc. v. DiSapio, 540 F.3d 115 (2d Cir. 2008) (ordinary allocation of burden to prove personal jurisdiction when defendant appears and contests jurisdiction)
- Hammond v. Fla. Asset Fin. Corp., 695 N.W.2d 1 (Iowa 2005) (Iowa long‑arm statute extends to the limits of due process)
- Meyers v. Kallestead, 476 N.W.2d 65 (Iowa 1991) (focus of specific jurisdiction is relationship among defendant, forum, and litigation)
- Ostrem v. Prideco Secure Loan Fund, LP, 841 N.W.2d 882 (Iowa 2014) (modern two‑part specific jurisdiction test: purposeful direction/activities and whether claims arise from those activities)