Summary
The court denied GS Holistic’s motion for default judgment and granted the defendants’ motion to set aside the clerk’s entry of default. The court found that service of process on both defendants was not shown to be proper and allowed the plaintiff thirty additional days to effect service under Federal Rule of Civil Procedure 4(m), warning that the action could otherwise be dismissed without prejudice.
Topics
Practice areas
Questions Presented
- Whether service on a person at 4K Smoke Shop's business location who was not shown to be an authorized agent constituted proper service on the limited liability company.
- Whether leaving Khalid's summons at a location that was not his dwelling or usual place of abode constituted proper service on the individual defendant.
- Whether the clerk's entry of default should be set aside for lack of proper service.
- Whether plaintiff's motion for default judgment remained viable after the entry of default was set aside.
- Whether plaintiff should receive additional time to effect service under Federal Rule of Civil Procedure 4(m).
Holdings
- Service was not shown to be proper because the record did not establish that Ali Ali was an officer, managing or general agent, or other agent authorized to accept service for 4K Smoke Shop.
- Service was not shown to be proper because the summons was left at a location that the record did not establish was Khalid's dwelling or usual place of abode.
- The clerk's entry of default must be set aside because defendants were not properly served.
- Plaintiff's motion for default judgment was moot because a clerk's entry of default is a prerequisite to obtaining default judgment, and the entry of default was set aside.
- Plaintiff was allowed thirty days from entry of the order to serve defendants and provide proof of service, with dismissal under Rule 4(m) threatened if service was not completed.
Key quotations
“Due process requires proper service of process for a court to have jurisdiction to adjudicate the rights of the parties,” (Standard)
“Plaintiff shall have thirty days from the entry of this Order to serve the complaint and summonses upon the Defendants, or this action will be dismissed under Rule 4(m);” (Conclusion)
Factual background
GS Holistic alleged that 4K Smoke Shop and Mustafa Khalid infringed and counterfeited its trademarks and made a false designation of origin. The process server delivered the summons and complaint for 4K Smoke Shop to a person identified as "Ali Ali," whom the proof of service described as a manager; defendants submitted evidence that Ali Ali was merely a friend, was not an employee, and lacked authority to accept service. The process server allegedly left Khalid's summons at an unidentified residence with Khalid's brother, while Khalid submitted an affidavit stating that the location was not his dwelling or usual place of abode and that he was out of the country. Plaintiff did not respond to defendants' motion or otherwise support the sufficiency of service.
Procedural history
GS Holistic filed the complaint on December 31, 2024, and filed proofs of service for both defendants. The clerk entered default after plaintiff moved for entry of default. Defendants then opposed default judgment and moved to set aside the entry of default. The court granted defendants' motion, denied plaintiff's motion for default judgment as moot, and allowed plaintiff thirty additional days to effect service.
Remand instructions
No remand. Plaintiff must serve the complaint and summonses on defendants and provide proof of service within thirty days of entry of the order; otherwise the action may be dismissed under Rule 4(m).