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Ferguson v. Bill Berger Associations

December 08, 1998


The opinion of the court was delivered by: Presiding Justice Gordon

Appeal from the Circuit Court of Cook County.

Honorable Dorothy Kinnaird, Judge Presiding.

In this permissive interlocutory appeal taken pursuant to Supreme Court Rule 306 (155 Ill. 2d R. 306), defendant, Bill Berger Associates, Inc., appeals from the denial of its motion to dismiss the complaint of plaintiff Eva Dreikurs Ferguson. In that complaint, which was filed by Ferguson individually and as executor of the estate of Sadie E. Dreikurs, the plaintiff sought a declaration canceling the literary agency relationship between the defendants, Bill Berger *fn1 and Bill Berger and Associates, Inc., and the plaintiff's deceased father, Rudolf, and her deceased mother, Sadie. She also sought an accounting of royalty and commission transactions received by the defendants in connection with that relationship. Defendant, Bill Berger Associates, Inc. (hereinafter referred to as "defendant"), a corporation with its principal place of business in New York, moved to dismiss plaintiff's action contending that the action violated the forum selection provision of a contract entered into between the plaintiff's father and a German publisher. The defendant alternatively contended that the complaint should be dismissed on the grounds of forum non conveniens. The trial court denied the defendant's motion; and the defendant's petition for leave to appeal to this court was granted pursuant to Supreme Court Rule 306. For the reasons discussed below, we affirm the denial of the defendant's motion to dismiss on the grounds of forum non conveniens. We also find that we are without jurisdiction to hear defendant's appeal from the portion of the order denying dismissal on the grounds of forum selection.


The pleadings and affidavits of the parties alleged the following facts. The plaintiff is the daughter of deceased author Doctor Rudolf Dreikurs, owner of certain copyrights in connection with books he authored or co-authored. Upon Rudolf's death, the ownership rights to those copyrights passed to plaintiff's mother, Sadie E. Dreikurs, and upon her death temporarily passed to plaintiff as executor of Sadie's estate. (Upon the closure of that estate, the plaintiff will succeed to all ownership rights in the copyrights.) The pleadings alleged that Rudolf entered into a literary agency relationship with the defendant in 1963 and also at that time executed a publication contract between Meredith Press, a division of Meredith Publishing Company, and himself for the publication of "Children: The Challenge", a book he co-authored. *fn2 The complaint also alleged that in 1964 Rudolf executed an agreement with a German publisher, Ernst Klett Verlag, for the German language rights pertaining to that book. (The defendant alleged that it had prepared these contracts for the parties' signatures.) Each of these agreements, which were attached to plaintiff's complaint and defendant's motion to dismiss, set forth defendant's status as Rudolf's agent and authorized the defendant to collect and receive monies due Rudolf and to otherwise act on Rudolf's behalf. The German agreement, unlike the Meredith Press agreement, contained forum selection and choice of law clauses, respectively requiring that all disputes be settled by "defendant's competent home courts, or at claimant's election by arbitration in Zurich, Switzerland" and that the terms of the agreement be governed and interpreted according to the laws of the State of New York.

The plaintiff's complaint alleged that no independent written contracts were executed between Rudolf, Sadie or Eva and the defendant authorizing the defendant to collect royalties and to retain a portion thereof, to make payments to other representatives out of the royalty payments received, or to enter into publishing agreements or addenda to those agreements on their behalf. The plaintiff sought a declaration that, pursuant to the common law and to the Durable Power of Attorney Law (755 ILCS 45/2-1 et seq. (West 1996)), any authority of the defendant to represent the Dreikurs' copyright interests, pursuant to any agency agreement or power of attorney, terminated by operation of law as of the date of Sadie's death on February 26, 1996. *fn3 The plaintiff sought a further declaration that the defendant was not authorized to permit Paul & Peter Fritz, AG (unidentified in the complaint) to execute an addendum to the German contract on June 6, 1996.

In its motion to dismiss, the defendant alleged that the gravamen of the plaintiff's complaint arose from execution of an addendum to the German agreement concerning the right to sell Rudolf's book in quality paperback volume form. The defendant alleged that the addendum was executed by Paul & Peter Fritz, AG, the successor to Linder AG, defendant's foreign subagent. (The 1964 German Agreement authorized Linder AG, "acting on behalf of Bill Berger Assoc.," to act as Rudolf's agent with respect to collecting money due under the terms of the agreement and to act on Rudolf's behalf.) The defendant cited to the forum selection provision of the original German agreement and the requirement that the dispute be resolved in the defendant's home court, namely, the New York court. The defendant alternatively argued that the dispute should be dismissed on the basis of forum non conveniens. In this argument, which was supported by the affidavit of William Berger and by a letter written by Peter S. Fritz of Paul & Peter Fritz AG, the defendant contended that trial in New York would be more convenient and would better serve the ends of Justice. The defendant argued that such a Conclusion was warranted by a consideration of the location of the parties and witnesses, the location of the documents, the relative difference in the economic burdens imposed upon the parties by the choice of the forum state, the place of execution and performance of the contract, the choice of law provision in the German agreement, and the public interest factor of burdening Illinois courts with a matter having no "meaningful connection" to Illinois.

In his affidavit attached to defendant's motion to dismiss, William Berger, president and sole shareholder of the defendant corporation, averred that he was a New York resident and that the defendant was a New York corporation with its principal place of business being in New York. He stated that he was 74 years of age, legally blind, and unable to travel without assistance. He further averred that he never travelled to Illinois to transact literary agency business; that he did not contact Rudolf Dreikurs in Illinois to offer him literary representation; and that Berger Associates did not solicit business in Illinois. He stated that the contract between Rudolf and Meredith Press relative to "Children: The Challenge" was negotiated from the office of Berger Associates in New York; that the contract was last signed by the publisher's agent in New York and was to be performed in New York; and that Meredith Press' assignee, Penguin USA, is headquartered in New York. Berger averred that the contract between Rudolf and the German publisher Ernst Klett Verlag was negotiated from the office of Berger Associates in New York and from the office of Berger's subagent, Linder AG (now known as Paul & Peter Fritz AG), in Switzerland. He stated that all royalties were paid to and collected by Berger Associates in New York and that payments to Doctor Dreikurs and his heirs were made from New York. He also stated that, to the best of his knowledge, all of the files and persons involved with the publishing contract, other than the foreign edition, were New York residents. He further stated that all of the publishing industry and literary agency experts that he would retain to render opinion testimony resided in New York.

Also attached to defendant's motion as an exhibit was a letter from Peter S. Fritz of Paul & Peter Fritz AG. In the letter, Fritz stated that Linder AG underwent a name change in 1984 to Paul & Peter Fritz AG and that the German publisher Ernst Klett Verlag underwent a name change to Klett-Cotta Verlag. He stated that neither entity operated offices in Illinois and that each of their principal contacts in the United States were with agents and publishers in New York. Fritz also stated that travel to Illinois in connection with the lawsuit would be very costly and inconvenient whereas travel to New York could be connected with other business matters to offset travel costs.

In response, the plaintiff moved to strike the letter exhibit because it was unverified, unsworn and not in affidavit form as required by Supreme Court Rule 187 (155 Ill. 2d R. 187). The plaintiff also argued that the defendant could not rely on the forum selection provision of the German agreement because the defendant was not a party to that contract. The plaintiff further argued that the gravamen of her complaint was not the execution of the addendum to the German agreement but, rather, defendant's agency status and the termination of that status by operation of law upon the death of Sadie Dreikurs. The plaintiff contended that her complaint also cited the Meredith Press contract, which did not have a forum selection clause, and the Illinois Durable Powers of Attorney Act (775 ILCS 45/2-1 et seq. (West 1996)). With respect to the defendant's forum non conveniens contention, the plaintiff argued that Illinois was her home forum; that deference should be given to her choice of forum; and that either party would have to bear the burden of out-of-state litigation, including the costs of document production and witness travel. The plaintiff further contended that her action only would require the testimony of plaintiff and William Berger and that the inconvenience to William Berger was not sufficient to justify the dismissal of the Illinois action.

The trial court denied defendant's motion to dismiss finding that the Illinois court could easily determine the key issue in the case which dealt with the relationship between Rudolf Dreikurs and the defendant and the alleged termination of that relationship. The court found that the defendant could obtain evidence from William Berger by way of an evidence deposition if necessary. The court also rejected defendant's forum selection contention finding that the forum selection provision was only present in the German agreement and that that agreement did not create the agency relationship between Rudolf Dreikurs and the defendant.

The defendant appeals contending that the trial court abused its discretion in denying the motion to dismiss on the basis of violation of the forum selection clause and on the basis of forum non conveniens.


I. Forum ...

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