Chinese e-commerce sellers seek to nullify thousands of US default judgments obtained via email after Seventh Circuit deemed such service invalid

Executive summary: Chinese e-commerce sellers filed a class action seeking to void thousands of US default judgments that were entered after email service, which the Seventh Circuit has previously held invalid. The outcome could affect the enforceability of US judgments against foreign defendants, expose US creditors to risk of judgment vacatur, and increase litigation costs for cross-border disputes.

Who is involved: Cross-border Counselor LLP representing Ningbo-based cross-border e-commerce sellers (plaintiffs), unnamed US judgment creditors (defendants), and the Seventh Circuit precedent on email service.

Likely next: The court will consider the Rule 60(d)(1) motion; if granted, judgments may be vacated and defendants may seek restitution, with a possible appeal.

On September 9, 2026, a group of Ningbo-based cross-border e-commerce sellers filed a bilateral class action in the Northern District of Illinois under Rule 60(d)(1) requesting the vacatur of thousands of 'Schedule A' default judgments that were entered after service of process by email. The plaintiffs rely on a recent Seventh Circuit precedent that held email service of process to be invalid for such judgments. If successful, the action could trigger restitution of amounts collected from the defendants and affect the enforceability of US judgments against foreign parties.

What's next — scenarios

Legal Precedent Validation (Base Case) (55%)

Large-scale clawback of funds held in escrow or seized by US authorities, creating liquidity volatility for cross-border logistics and fintech partners.

Court grants motion to vacate a representative sample of judgments
Judge issues ruling on Rule 60(d)(1) application in Illinois

Judicial Pushback (Downside) (25%)

Increased legal costs for US rights holders as they must pivot to more expensive, traditional service methods to secure foreign assets.

Seventh Circuit denies the motion to vacate
District Court upholds validity of email service under 'extraordinary circumstances' exception

Systemic Enforcement Collapse (Tail Risk) (20%)

Massive de-risking by US-based IP enforcers, leading to a significant drop in total settlement volume from Chinese e-commerce sellers.

Class action certification granted for all Ningbo-based sellers
Multilateral restitution order issued by Northern District of Illinois

What to watch

Northern District of Illinois ruling on the Ningbo class action motion (Q4 2026)
Seventh Circuit supplementary briefing schedule (Next 60 days)
Federal court rulings on 'Schedule A' asset freezes involving email service (Next 90 days)

Timeline

2026-09-10 — Cross-border Counselor LLP: Chinese E-Commerce Sellers File Class Action Seeking to Void Thousands of "Schedule A" Default Judgments Entered After Email Service the Seventh Circuit Has Held Invalid (PR Newswire)

Analysis — what this means

Sectors affected

Cross-border e-commerce (China-based sellers)
US judgment enforcement and debt collection
Legal services specializing in cross-border litigation

Regulatory implications

May affect the application of Federal Rule of Civil Procedure 60(d)(1) for voiding judgments based on improper service
Could influence judicial standards for email service of process in federal courts

Key entities

Sources

Cross-border Counselor LLP: Chinese E-Commerce Sellers File Class Action Seeking to Void Thousands of "Schedule A" Default Judgments Entered After Email Service the Seventh Circuit Has Held Invalid — PR Newswire

Related cases

Browse the full archive →