United States District Court, N.D. Illinois, E.D.
January 7, 2005.
LM INSURANCE CORPORATION, Plaintiff,
SOURCE ONE GROUP, INC., Defendant.
The opinion of the court was delivered by: ELAINE E. BUCKLO, District Judge
MEMORANDUM OPINION AND ORDER
Plaintiff LM Insurance Corporation ("LM"), an Iowa corporation
having its principal place of business in Massachusetts, moves
for reconsideration of my order of August 18, 2004 dismissing
Counts VI, VII, and VIII of the complaint against defendant Brian
Bonar ("Bonar"), a citizen and resident of California, for lack
of personal jurisdiction. LM correctly states that a motion for
reconsideration will be entertained ". . . only where the court
has patently misunderstood a party . . . or has made an error not
of reasoning but of apprehension." Bank of Waunakee v. Rochester
Sales, Inc., 906 F.2d 1185, 1191 (7th Cir. 1990).
Where a court determines a motion to dismiss for want of
personal jurisdiction without holding an evidentiary hearing, all
factual disputes in the pleadings and affidavits must be resolved
in favor of the plaintiff. Purdue Research v. Sanobi Syntholabo,
S.A., 338 F.3d 773, 782 (7th Cir. 2003). The ultimate
question here, as I expressly recognized in issuing my August 18,
2004 order, is whether the plaintiff's papers establish a prima
facie case for the assertion of personal jurisdiction over Bonar.
I adhere to my determination that the plaintiff has failed to
meet that test. The case arises out of two contracts of insurance between LM or
its parent or affiliate, Liberty Mutual Insurance Company
("Liberty Mutual") and Source One Group, Inc. ("SOG"), a Delaware
corporation, and a guaranty allegedly made by Bonar of the
payment to Liberty Mutual by SOG of $829,342.50 owing in
connection with the contracts.*fn1 Bonar filed two
affidavits in support of his motion to dismiss. LM filed the
affidavit of Neil Johnson, an assistant vice president of
Liberty, in support of its opposition to the motion.
The Johnson affidavit's principal focus is on the fact that the
August 28, 2004 draft letter, signed by Bonar and containing his
purported guaranty of SOG's debt to plaintiff, refers to a July
25, 2003 letter setting forth an agreement between SOG and LM.
This reference, plaintiff insists, shows that Bonar in effect
submitted himself to the jurisdiction of Illinois courts and, by
extension, to this district court, because the July letter
establishes a number of contacts between SOG and Illinois. The
argument is unavailing. As I have already ruled, no matter what
SOG did to avail itself of Illinois law, Bonar was an individual
acting in a representative capacity and did nothing of the kind.
Plaintiff contends that this case is governed by the holding in
Hyatt Int'l Corp. v. Coco, 302 F.3d 707 (7th Cir. 2002).
There, Coco, a citizen and resident of Italy, approached Hyatt
with a possible deal for development of a hotel in Milan. He did
so on behalf of English and Italian entities of which he was a
director and employee. Coco negotiated directly with Hyatt's
Chicago office by mail and electronically and also visited
Hyatt's office. In the course of those dealings, Coco allegedly disclaimed any interest in a brokerage commission. When the
proposed transaction fell apart, Coco, in his individual capacity
filed suit against Hyatt in Italy for a brokerage commission.
Hyatt then sued Coco in this court for a declaratory judgment of
non-liability. Judge Grady of this court granted Coco's motion to
dismiss for want of personal jurisdiction. The court of appeals
reversed and remanded the case for further proceedings.
The case at bar is distinguishable. Here, there was a single
trip to Illinois by Bonar, and that was for the purpose of
negotiating with one of SOG's customers. When he negotiated with
the plaintiff on SOG's account, the party with whom he negotiated
was in a state other than Illinois and Bonar carried out the
negotiations by telephone and by mail from California. There was
no "set of dealings" between Bonar and the plaintiff in this
State sufficient to establish the Illinois nexus required for the
assertion of personal jurisdiction over Bonar. Compare, Hyatt,
supra, 302 F.3d at 717.
Plaintiff argues further that payment on the insurance
contracts (and, therefore, on the guaranty) was to be made in
Illinois, thus establishing sufficient Illinois contacts so as to
warrant assumption of jurisdiction over Bonar. The argument is
not well founded in law.
In Federal Rural Elec. Ins. V. Inland Power & Light,
18 F.3d 389, 395 (7th Cir. 1994), the court noted that, ". . . several
courts have held that making telephone calls and making payments
into the forum state are insufficient bases for jurisdiction."
The court went on to find the activities of the defendant in that
case ". . . too attenuated to provide a sufficient connection for
personal jurisdiction purposes." Id. For the foregoing reasons
and for the reasons stated in my August 18, 2004 opinion, I find
all of the matters raised by LM insufficient to meet Federal Due
Process requirements for the assertion of personal jurisdiction over Bonar. In view of this
holding, I do not address Bonar's alternative request that the
complaint be dismissed on grounds of improper venue.
The motion for reconsideration is denied.