STANDARD OF REVIEW
In order for the court to exercise diversity jurisdiction over a case, the amount in controversy must exceed "the sum or value of $ 50,000, exclusive of interest and costs...." 28 U.S.C. § 1332(a). The amount in controversy requirement is met initially if the good faith allegations establish that the amount in dispute is more than $ 50,000. Loss v. Blankenship, 673 F.2d 942, 950 (7th Cir. 1982). The court is not bound to accept, however, the mere allegations in the plaintiff's complaint, ITT Commercial Finance Corp. v. Unlimited Automotive, Inc., 814 F. Supp. 664, 667 (N.D. Ill. 1992); Racich v. Mid Continent Builders Co., 755 F. Supp. 228, 229 (N.D. Ill. 1991), and the party seeking federal jurisdiction bears the burden of supporting its jurisdictional allegations by "competent proof." McNutt v. General Motors Acceptance Corp., 298 U.S. 178, 189, 56 S. Ct. 780, 785, 80 L. Ed. 1135 (1936); Grafon Corp. v. Hausermann, 602 F.2d 781, 783 (7th Cir. 1979). The plaintiff is allowed considerable latitude in supporting the allegations and must be given the benefit of any facts that could conceivably be proven. Racich, 755 F. Supp. at 229. Finally, in a diversity action, the court will not dismiss a case because of a jurisdictional amount deficiency unless it appears to a legal certainty that the plaintiff cannot meet the required amount in controversy. ITT Commercial Fin. v. Unlimited Auto., 814 F. Supp. 664, 667 (N.D. Ill. 1992).
In determining the amount in controversy, the amount demanded may be the aggregate of compensatory damages and punitive damages when both types are recoverable. Bell v. Preferred Life Assurance Soc. of Montgomery, 320 U.S. 238, 240, 88 L. Ed. 15, 64 S. Ct. 5 (1943); Sharp Electronics Corp. v. Copy Plus. Inc., 939 F.2d 513, 515 (7th Cir. 1991). For purposes of a Rule 12(b)(1) motion where compensatory damages alone do not satisfy the jurisdictional amount requirement under section 1332, the court must determine whether punitive damages are recoverable under the applicable state law; if they are found to be recoverable, then the court must determine whether the complaint satisfies the jurisdictional amount to a legal certainty. Sharpe, 939 F.2d at 515; Cadek v. Great Lakes Dragaway, Inc., 1994 U.S. Dist. LEXIS 11521, 1994 WL 449284, *2 (N.D. Ill. 1994).
The court recognizes that "when the issue of jurisdictional amount is intertwined with the merits of the case, 'courts should be careful not to decide the merits, under the guise of determining jurisdiction without the ordinary incident of trial.'" Loss, 673 F.2d at 950. When a claim for punitive damages, however, "comprises the bulk of the amount in controversy and may have been colorably asserted solely or primarily for the purpose of conferring jurisdiction, that claim should be given particularly close scrutiny." Cadek, 1994 U.S. Dist. LEXIS 11521, 1994 WL 449284, *2. Further, it is a question of law for the court, not for the jury, to decide whether a plaintiff has established that punitive damages are available. Racich, 755 F. Supp. 228, 229 (N.D. Ill. 1991) (citing AMPAT/Midwest, Inc. v. Illinois Tool Works. Inc., 896 F.2d 1035, 1043 (7th Cir. 1990)).
Because plaintiff seeks only $ 20,459.64 in commissions (i.e., compensatory damages) his jurisdictional claim is grounded on the additional $ 61,648.92 in exemplary damages sought under the Illinois Sales Representative Act 820 ILCS § 120/1 et. seg. (the "Act"). Therefore, the critical question before the court is whether insurance sales representatives fall within the protection of the Act in order to satisfy the jurisdictional amount required under 28 U.S.C. § 1332(a).
The Act provides for exemplary damages not to exceed three times the amount of commissions found to be owed to a "sales representative" from a "principal." 820 ILCS 120/3. Principals and sales representatives are defined as:
(3) "Principal" means a sole proprietorship, partnership, corporation or other business entity whether or not it has a permanent or fixed place of business in this State and which: