Case Management and RMA credit & item return

Hello:

We have a situation where the associated RMA for a case (P17500) is not creating the PO when the last disposition for the RMA is = CRR, which the user is manually keying.  The item is marked obsolete at the ultimate receiving branch plant, but is not invoking an obsolete item error.  The PO is just not being created.  The CR is creating on the sales side.  Is this working as designed because of the obsolete stocking type at the receiving branch plant?  How should an obsolete item be treated in this regard?

Thanks in advance.