## Facts

- National Development Company (NDC), wholly owned by the Republic of the Philippines, entered a joint-venture relationship with Triad Holding Corporation and related entities controlled by Adnan Khashoggi.
- NDC alleged that, upon dissolution of the venture, approximately $3.5 million owed to NDC was diverted by Khashoggi and Triad.
- NDC filed suit in the Southern District of New York to compel arbitration under a written arbitration clause.
- On December 22, 1986, NDC attempted substituted service on Khashoggi by leaving the summons and complaint with his maid at his apartment in the Olympic Tower in New York City.
- Khashoggi was an international businessman with multiple residences, including a compound in Saudi Arabia; he claimed Saudi Arabia was his “true” home.
- Khashoggi did not appear, and the district court entered a default judgment compelling arbitration.
- An ICC arbitral tribunal later found Triad was Khashoggi’s alter ego and held Triad and Khashoggi jointly and severally liable to NDC for more than $3.4 million plus costs, interest, and attorneys’ fees.
- When NDC sought to confirm and enforce the award in federal court, Khashoggi moved under Federal Rule of Civil Procedure 60(b)(4) to vacate the earlier default judgment as void for lack of personal jurisdiction, contending that the Olympic Tower apartment was not his “dwelling house or usual place of abode” under Rule 4.

## Issues

1. Whether substituted service at Khashoggi’s New York apartment by leaving process with his maid satisfied Federal Rule of Civil Procedure 4(d)(1) (now Rule 4(e)(2)(B)).
2. Whether an individual with multiple residences may have more than one “dwelling house or usual place of abode” for purposes of Rule 4.
3. Whether, if service complied with Rule 4, the default judgment compelling arbitration was void for lack of personal jurisdiction under Rule 60(b)(4).

## Decision

- The Second Circuit affirmed the denial of Khashoggi’s Rule 60(b)(4) motion.
- The court held that Rule 4’s “dwelling house or usual place of abode” is not limited to a single primary residence; a defendant may have multiple qualifying abodes.
- The Olympic Tower apartment qualified as Khashoggi’s “dwelling house or usual place of abode” based on indicia of permanence and use, including ownership, substantial remodeling, and employment of a live-in maid, and evidence that Khashoggi stayed there when in New York and was residing there at the relevant time.
- Because service complied with Rule 4, the district court had personal jurisdiction, and the default judgment was not void.

## Legal Principles

- For substituted service under Federal Rule of Civil Procedure 4(e)(2)(B), an individual may have more than one “dwelling house or usual place of abode.”
- A location may qualify as a “dwelling house or usual place of abode” when it has sufficient permanence and regular use as a place where the defendant lives, even if the defendant spends substantial time elsewhere.
- Due process requires a method of service reasonably calculated to provide notice; compliance with Rule 4 at a qualifying abode can satisfy that standard.
- Actual notice may be relevant but does not, by itself, cure defective service; the method of service must satisfy Rule 4.
- A default judgment is void under Rule 60(b)(4) only if the court lacked personal jurisdiction; valid service defeats a jurisdictional voidness challenge.

## Conclusion

The Second Circuit held that substituted service on Khashoggi at his New York Olympic Tower apartment was valid because an individual may have multiple “usual places of abode” under Rule 4, and the apartment’s permanence and Khashoggi’s residential use supported personal jurisdiction, defeating his Rule 60(b)(4) attack on the default judgment.


Nat’l Dev. Co. v. Triad Holding Corp., 930 F.2d 253 (2d Cir. 1991)