United States District Court, S.D. Illinois
June 3, 2005.
LUCILLE RUTZ, individually and on behalf of all others similarly situated, Plaintiff,
BARNES-JEWISH HOSPITAL and BJC HEALTH SYSTEMS, INC., Defendants.
The opinion of the court was delivered by: MICHAEL J. REAGAN, District Judge
MEMORANDUM AND ORDER
Before the Court is Defendant's, BJC Health System's, Special
and Limited Entry of Appearance of Defendant BJC Health System
for the Purpose of Contesting Personal Jurisdiction over BJC
Health System and Motion to Dismiss for Lack of Personal
Jurisdiction (Doc. 9), filed October 26, 2004. Defendant moves
the Court, pursuant to Federal Rule of Civil Procedure
12(b)(2), to dismiss Plaintiff's Second Amended Complaint as it
pertains to Defendant BJC Health System for lack of personal
jurisdiction. This matter is fully briefed and ready for
On August 6, 2003, Plaintiff, Lucille Rutz ("Rutz"), filed a
Petition for Declaratory Judgment and to Adjudicate Liens against
United Healthcare,*fn1 Washington University School of
Medicine and Barnes-Jewish Hospital in the Circuit Court of
Madison County, State of Illinois. The basis for the Petition was
to adjudicate various liens in relation to injuries suffered in
an automobile accident on September 21, 2001. On January 29, 2004, Rutz was
granted leave to file First Amended Complaint, which added
allegations against Defendant Barnes-Jewish Hospital and asserted
class action claims for violation of the Illinois Consumer Fraud
Act, 815 ILCS 505-1, et seq., and for unjust enrichment.
On August 12, 2004, Rutz was granted leave to file
Second Amended Complaint. In Count I, Rutz seeks declaratory judgment to
adjudicate liens against all Defendants. Count II is an unjust
enrichment claims against Barnes-Jewish Hospital. In Count III,
Rutz asserts a claim against Defendant Barnes-Jewish Hospital for
violation of the Illinois Consumer Fraud Act. In Count IV, Rutz
asserts a claim against Defendant BJC Health Systems ("BJC") for
violation of the Illinois Consumer Fraud Act. Count V is an
unjust enrichment claim against BJC.
Defendant BJC moves the Court to dismiss Rutz's Second Amended
Petition as to BJC for lack of personal jurisdiction. In support
of said Motion, BJC states that 1) Rutz has failed to allege
sufficient facts which would subject BJC to the jurisdiction of
the Illinois courts; 2) Rutz's Second Amended Complaint does not
contain legally sufficient factual allegations that BJC is "doing
business" in the State of Illinois to subject itself to the
Illinois courts; 3) the exercise of personal jurisdiction over
BJC offends federal and state guarantees of due process; and 4)
the Court lacks personal jurisdiction over the federal question
Rutz responds as follows: 1) there is no requirement that she
allege jurisdictional facts under either federal or Illinois law;
2) BJC is "doing business" in Illinois; and 3) if the Court
determines that evidence that BJC is subject to this Court's
jurisdiction is insufficient, Rutz requests limited discovery on
jurisdictional issues. Rutz submits pictures of Alton Memorial
Hospital in Madison County, Illinois, with the BJC logo beneath
the Hospital name. Rutz seeks to proceed under this Court's "general" rather than "specific" jurisdiction,
stating that, because BJC is doing significant business in
Illinois, it is subject to this Court's general jurisdiction.
BJC replies that Rutz's references to signage are insufficient
to confer personal jurisdiction over BJC. BJC again argues that
Rutz has failed to plead sufficient facts to establish personal
jurisdiction. Specifically, BJC asserts that Alton Memorial
Hospital is separately incorporated and that using the activities
of a subsidiary corporation as a basis for personal jurisdiction
over the parent corporation violates due process. In the
alternative, BJC seeks limited discovery on the jurisdictional
issues and an evidentiary hearing where Rutz would be required to
establish jurisdiction by a preponderance of the evidence.
FEDERAL RULE OF CIVIL PROCEDURE 12(b)(2) authorizes dismissal
based on lack of personal jurisdiction. Rutz's October, 2004,
Second Amended Complaint does not include facts alleging personal
jurisdiction, nor is that required in a Complaint. Steel
Warehouse of Wisconsin, Inc. v. Leach, 154 F.3d 712, 715
(7thp> Cir. 1998). Once a defendant moves to dismiss a
Complaint for lack of personal jurisdiction, however, plaintiff
bears the burden of demonstrating the existence of personal
jurisdiction. Purdue Research Foundation v. Sanofi-Synthelabo,
S.A. , 338 F.3d 773, 787 (7thp> Cir. 2003) (citing Central
States, S.E. & S.W. Areas Pension Fund v. Reimer Express World
Corp., 230 F.3d 934, 939 (7thp> Cir. 2000).
Assuming no evidentiary hearing is held on this issue, (i.e.,
if the district court resolves the dismissal motion based on the
parties' written submissions), the plaintiff need only "[make]
out a prima facie case of personal jurisdiction" to avoid Rule
12(b)(2) dismissal. Purdue, 338 F.3d at 783 (citing Hyatt
Int'l Corp. v. Coco, 302 F.3d 707, 713 (7thp> Cir. 2002);
see also Nelson by Carson v. Park Industries, Inc., 717 F.2d 1120, 1123
(7thp> Cir. 1983); Celozzi v. Boot, ___ F.3d ___, 2000 WL
1141568, *2 (7thp> Cir. 2000). In evaluating whether the
Plaintiff has made this prima facie showing, the Court resolves
in the plaintiff's favor all disputes concerning relevant facts
presented in the record. Purdue, 338 F.3d at 782 (citing
Nelson, 717 F.2d at 1123 and RAR, Inc., v. Turner Diesel,
Ltd., 107 F.3d 1272, 1275 (7thp> Cir. 1997) (Plaintiff "is
entitled to have any conflicts in the affidavits resolved in
[her] favor."). The Court may consider affidavits submitted by
both parties, but the Court must accept as true all well-pleaded
facts and resolve in favor of Plaintiff Rutz all factual disputes
in the pleadings and affidavits.
Personal jurisdiction involves a multi-layered, sometimes
complex, analysis. Clearly, where a federal district court
exercises diversity jurisdiction, personal jurisdiction lies
"only if a court of the state in which it sits would have such
jurisdiction." RAR, 107 F.3d at 1275. Because the Court
denied Rutz's motion to remand based on federal question
jurisdiction and did not resolve the question of whether the
Court also enjoys diversity jurisdiction, the Court will consider
this matter under the federal question statute,
28 U.S.C. § 1331.
Simply stated, to exert personal jurisdiction over Defendant
BJC in this matter, the Court must find two propositions to be
true: 1) that BJC is amenable to service of process and 2) that
haling BJC into court in Illinois accords with due process
principles, i.e., does not offend "traditional notions of fair
play and substantial justice" embodied in the Due Process Clause
of the United States Constitution. Int'l Shoe Co. v.
Washington, 326 U.S. 310, 316 (1945).
Having carefully examined the record before it, and resolving
in Rutz's favor "all disputes concerning relevant facts presented
in the record," the Court answers both of these questions in the
affirmative. First, BJC is amenable to service of process here. BJC is a
Missouri corporation with its principal place of business in that
state. Whether a non-resident defendant is amenable to process
depends on whether it "could be subjected to the jurisdiction of
a court of general jurisdiction in the state in which the
district is located." FED. R. CIV. P. 4(k)(1)(A). An Illinois
trial court may exercise jurisdiction over such non-resident
defendants based upon (a) the fact that the corporation has been
found to be "doing business" in Illinois or (b) compliance with
the requirements of the long-arm statute, section 2-209(a)(1) of
the Code of Civil Procedure. 735 ILCS 5/2-209(a)(1), (b)(4).
Rutz asserts that BJC is subject to this Court's general
jurisdiction which, unlike specific jurisdiction, allows a
defendant to be sued in the forum regardless of the subject
matter of the litigation. Purdue, 338 F.3d at 787 (citation
omitted). Citing Alderson v. Southern Co.,
321 Ill.App. 3d 832, 747 N.E.2d 926 (1st Dist. 2001), Rutz states that BJC's
permanent and systematic in-state business activities constitute
"doing business" in Illinois such that this Court can exercise
jurisdiction even if Rutz's cause of action has no connection
with any of BJC's in-state activities.
Rutz submits six photographs of BJC signage in Madison County,
three of which are permanent signs at Alton Memorial Hospital.
Rutz's Exhibits 1-5. A fourth sign, described by Rutz as
"semipermanent," identifies "BJC Health System Design and
Construction Department." Rutz's Exhibit 6. Rutz asserts that
this fourth sign implies that BJC has additional permanent ties
through its construction activities in Illinois. Rutz states that
BJC seeks the benefits of the Illinois market for its healthcare
services and, thus, could have anticipated being brought into
BJC argues that its business activity in Illinois does not meet
the requirements of the statute because its activities are not
"intentional, substantial, and continuous with a fair measure of permanence and continuity."
There is a well-worn maxim that one cannot have one's cake and
eat it. It appears that this is precisely what BJC would like to
achieve. BJC wants the benefit of name recognition in Illinois,
the imprimatur of the BJC name, and the concomitant flow of
Illinois patients and healthcare dollars into its system without
the burden of being haled into the State's courts. The logo on
Alton Memorial Hospital reads "BJC Health System," but, when a
lawsuit is filed by an Illinois citizen, BJC falls back upon its
position that its affiliate hospitals are separately incorporated
such that their relationship with BJC should be disregarded. The
Court has evidence before it that BJC Health Systems and
Barnes-Jewish Hospital are separately incorporated (Defendant's
Exhibits A, B), but BJC has offered no evidence in the form of an
affidavit or other sworn testimony that would lead the Court to
decide that its relationship with its affiliate hospitals should
be disregarded. BJC has not refuted Rutz's prima facie evidence
by offering an affidavit regarding its business activities in
Illinois. While the burden of proof rests with Rutz, any factual
conflicts must be resolved in her favor, and, at this stage, the
issue of jurisdiction need not be proven by a preponderance of
the evidence. Purdue Research, 338 F.3d at 781-83.
BJC seeks to benefit from the Illinois market for its
healthcare services, and, by so doing, it has "purposefully
availed itself of the privilege of conducting business in the
state and could have anticipated being brought into its courts."
Halim v. Great Gatsby's Auction Gallery, Inc., 2004 U.S. Dist.
LEXIS 3411 (N.D.Ill. 2004). In arguing that Hendry v. Ornda
Health Corp., Inc., 318 Ill.App.3d 851, 742 N.E.2d 746
(Ill.App.2nd Dist. 2000) supports its position, BJC states that
"the business activity of the non-resident corporation [must] be
intentional, substantial and continuous with a fair measure of
permanence and continuity and not occasional, casual,
inadvertent, trivial or sporadic." It appears beyond doubt to this Court that
the activities of BJC fall into the former category rather than
the latter. For these reasons, the Court concludes that BJC is
amenable to service of process in Illinois.
Furthermore, haling BJC into Court in Illinois comports with
due process principles. The Due Process Clause of the
Fourteenth Amendment to the United States Constitution limits when a state
may assert personal jurisdiction over a non-resident individual
or corporation. RAR, 107 F.3d at 1277.
As stated above, the non-resident defendant must have "certain
minimum contacts with [the state] such that maintenance of the
suit does not offend `traditional notions of fair play and
substantial justice.'" Id. (quoting Int'l Shoe,
326 U.S. at 316). What this means in a given case depends on whether the
state asserts "general" or "specific" jurisdiction.
If a defendant has continuous and systematic business contacts
with the forum state, the court may exercise personal
jurisdiction over the defendant even in cases that do not arise
out of, and are not related to, the defendant's forum contacts.
Hyatt, 302 F.3d at 713. In such situations, the state is said
to exercise general jurisdiction over the defendant.
Helicopteros Nacionales De Colombia, S.A. v. Hall,
466 U.S. 408, 414 (1984). If, on the other hand, the plaintiff's cause of
action arises out of the defendant's forum-related activities,
the state is said to exercise specific jurisdiction over the
The question the Court must ask is whether Rutz has made a
prima facie showing that BJC has "purposefully availed" itself of
the privilege of conducting activities in the forum state such
that it should reasonably anticipate being haled into court here.
World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 297
(1980); Burger King Corp. v. Rudzewicz, 471 U.S. 462,
474-475 (1985). Rutz argues that BJC has substantial, continuous and
permanent business activities in Madison County, Illinois and
submits photographs to support the assertion.
Upon careful consideration of the parties' submissions, the
Court finds that Rutz has made a prima facie showing that BJC has
purposefully availed itself of the privilege of conducting
activities in Illinois such that BJC could reasonably anticipate
being haled into court in Illinois. Accordingly, maintenance of
the instant suit comports with due process principles.
For all these reasons, the Court concludes that dismissal is
not merited based on a lack of personal jurisdiction.
Accordingly, the Court DENIES Defendant's, BJC Health
System's, Motion to Dismiss for Lack of Personal Jurisdiction
IT IS SO ORDERED.