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GOLDBERG v. MILLER

January 17, 1995

ISADORE GOLDBERG d/b/a ASSURED LIFETIME BENEFITS, Plaintiff,
v.
PHILIP MILLER, NANCY MILLER and LIFETIME OPTIONS, INC., Defendants.



The opinion of the court was delivered by: ELAINE E. BUCKLO

 Isadore Goldberg d/b/a Assured Lifetime Benefits ("Assured") filed an amended complaint against Lifetime Options, Inc. ("LOI"), Philip Miller and Nancy Miller ("Mr. Miller" and "Ms. Miller" and collectively, the "Millers") on August 30, 1994. Jurisdiction is based on diversity of citizenship. 28 U.S.C. § 1332. Assured alleges tortious interference with contractual relations against LOI and breach of contract against the Millers.

 LOI has filed a motion to dismiss Assured's amended complaint for lack of personal jurisdiction, improper venue, and failure to state a claim upon which relief can be granted. The Millers have moved to dismiss Assured's amended complaint for lack of personal jurisdiction and failure to state a claim upon which relief can be granted. For the reasons stated below, defendants' motions to dismiss are granted.

 Background

 Assured, an Illinois citizen, is a viatical settlement company which purchases at a discount from face value existing life insurance policies from individuals facing life threatening or catastrophic illnesses. LOI, a Maryland corporation having its administrative offices in Arlington, Virginia, is also such a company. Mr. Miller is a California citizen who has been diagnosed HIV positive. Ms. Miller is a California citizen who has been married to Mr. Miller since August 8, 1981.

 In March 1993, a broker named Francis Welcome ("Mr. Welcome") who works for or did business as Lifestyle Resources Corporation ("Lifestyle") *fn1" telephoned Mr. Miller in California. Mr. Welcome told Mr. Miller that he was aware of Mr. Miller's medical condition and that he was in a position to negotiate a transfer and assignment of Mr. Miller's life insurance policy, for value, with a viatical settlement company. Mr. Welcome's contact was not solicited by Mr. Miller. At some point, Mr. Welcome informed Mr. Miller that a viatical settlement company in Illinois named Assured was interested in purchasing Mr. Miller's life insurance policy.

 Assured, Mr. Miller and Mr. Welcome then negotiated the sale to Assured of Mr. Miller's life insurance policy. According to uncontradicted statements in Mr. Miller's affidavit, nearly all contact made with Assured was through Mr. Welcome and all communication with Mr. Miller took place in California. *fn2" Mr. Miller Aff., P 14. Ms. Miller did not participate in the negotiations and never had any direct contact with Assured. She occasionally spoke to Mr. Welcome regarding the necessity of her signing certain documents.

 In June 1993, the parties reached agreement. Mr. Miller executed in San Diego County, California a Purchase Agreement and Absolute Assignment assigning all rights and title under his life insurance policy to Assured. Mr. Miller also executed in San Diego county the Insured Certification, an Irrevocable Power of Attorney in favor of Milton Heching and an Authorization to Release Policy Information. Ms. Miller executed in San Diego county a Purchase Agreement, an Absolute Assignment and Insured Certification. Assured then paid the Millers $ 200,000 and Lifestyle $ 17,000.

 Assured alleges in its amended complaint that after it paid these sums, LOI learned of Assured's contract with the Millers, that it offered the Millers more money than they had received from Assured in return for the life insurance policy that the Millers had already transferred to Assured, and that Mr. Miller and LOI sent letters and made phone calls to Assured requesting Assured to rescind its agreement with the Millers. Ultimately, Assured agreed to reassign the policy proceeds and cancel the power of attorney in return for the amount of money it paid to the Millers and an additional amount to cover its costs. Assured claims that it reserved its right to proceed against Mr. Miller.

 Discussion

 A federal district court in Illinois has personal jurisdiction over a party involved in a diversity action only if Illinois courts would have personal jurisdiction. Michael J. Neuman & Associates, Limited v. Florabelle Flowers, Incorporated, 15 F.3d 721, 724 (7th Cir. 1994). The burden of proving jurisdiction over a nonresident defendant rests with the plaintiff. 5A Wright and Miller, FEDERAL PRACTICE AND PROCEDURE, § 1351 at 248 (1990).

 A. LOI

 1. Illinois Long-Arm Statute: Section 2-209(a)(2)

 The Illinois long-arm statute gives an Illinois court jurisdiction over a cause of action arising from a person's "commission of a tortious act within this State." 735 ILCS § 5/2-209(a)(2). Assured claims that this Court has jurisdiction over LOI under this section of the long-arm statute due to LOI's alleged tortious interference with Assured's contract with the Millers.

 The acts that form the basis of tortious interference with contractual relations, i.e., defendant's intentional and malicious inducement of a breach of contract, must be directed at parties other than the plaintiff. Kraft Chemical Company v. Illinois Bell Telephone Co., 240 Ill. App. 3d 192, 181 Ill. Dec. 170, 608 N.E.2d 243, 247 (1st Dist. 1992). Assured does not allege that any of LOI's conduct directed at the Millers occurred in Illinois. In addition, LOI's affidavit attached to its motion to dismiss states:

 
5. That none of the communications between the Defendants herein took place in ...

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