THE YOKOHAMA TRADING, INC., and TOM SEKIGAMI, individually, Plaintiff,
C&K AUTO IMPORTS, INC. & C&K AUTO IMPORTS SOUTH, INC., and DORON SAUER, Defendants.
MEMORANDUM OPINION AND ORDER
AMY J. ST. EVE, District Judge.
Plaintiffs The Yokohama Trading, Inc. and Tom Sekigami (collectively, "Plaintiffs") filed an eight-count Second Amended Complaint against Defendants C&K Auto Imports, Inc., C&K Auto Imports South, Inc., and Doron Sauer (collectively, "Defendants"). (R. 27, SAC.) In the Second Amended Complaint, Plaintiffs allege the following: Count I - Breach of Contract; Count II - Common Law Fraud; Count III - Fraudulent Misrepresentation against C&K; Count IV - Intentional Interference with Existing Contracts against C&K; Count V - Intentional Misrepresentation against C&K; Count VI - Negligence against C&K; Count VII - Conversion or in the Alternative Trespass to Chattel; and Count VIII - Rescission against C&K. Defendants move to dismiss Plaintiffs' Second Amended Complaint for lack of personal jurisdiction, improper venue, failure to join an indispensable party, or on forum non conveniens grounds. (R. 28, Mot.) For the following reasons, the Court dismisses Plaintiff's Second Amended Complaint for lack of personal jurisdiction without prejudice.
Defendants C&K Auto Imports and C&K Auto Imports South are New Jersey corporations organized under the laws of New Jersey. (R. 28-1, Sauer Cert. ¶ 1.) They are in the business of selling wholesale and retail vehicles. The principle place of business of each C&K corporation is in New Jersey. ( Id. ) C&K Auto Imports South has an operation in Florida as well. ( Id. ) Both C&K entities are not registered or licensed to do business in Illinois. ( Id. ¶ 3.) Neither corporation has ever had a facility located in Illinois. ( Id. ) Defendant Doron Sauer is the Chief Executive Officer of both C&K Auto Imports and C&K Auto Imports South. ( Id. ¶ 2.) Mr. Sauer lives in New Jersey and is a resident of New Jersey. ( Id. ¶ 2.) He is a licenced automobile dealer in both New Jersey and Florida. ( Id. ¶ 4.)
Plaintiff Tom Sekigami, the President and Owner of The Yokohama Trading Company, is a resident of the State of Illinois. (R. 32-1, Sek. Aff. ¶¶ 1-2.) The Yokohama Trading Company is located in Deer Park, Illinois and incorporated in Illinois. ( Id. ¶ 3; SAC ¶ 1.)
In December 2009, Mr. Sekigami discussed with Defendants, via email, the possibility of purchasing a 2008 Mercedes Benz CL 65 AMG (the "Vehicle"). In December 2009, the Vehicle was in Florida. ( Id. ¶ 9.) The parties disagree regarding who initiated the communication and how the negotiations regarding the purchase of the Vehicle progressed. According to Defendants, on or about mid-December 2009, Mr. Sekigami contacted Defendants in Florida via email to inquire about the availability of the Vehicle. ( Id. ¶ 6.) Specifically, Mr. Sekigami spoke with Joshua Sauer, Doron Sauer's son who works at Defendants' Florida facility. ( Id. ¶ 5.) In late December 2009, Mr. Sekigami contacted Defendants in Florida again and spoke with Doron Sauer. ( Id. ¶ 8.) Mr. Sekigami offered to purchase the Vehicle for $110, 000, but Doron Sauer rejected the offer. ( Id. ¶ 8.) According to Doron Sauer, Mr. Sekigami contacted Defendants in New Jersey at the end of December 2009 to further inquire about purchasing the Vehicle. ( Id. ¶ 10.) In January of 2010, the parties agreed on a purchase price of $120, 000 for the Vehicle. ( Id. )
According to Plaintiffs, on December 14, 2009, Joshua Sauer contacted Mr. Sekigami, in response to an email that Mr. Sekigami sent to Auto Trader, the host of the website www.autotrader.com ("AutoTrader.com"), which included an advertisement for the Vehicle. (Sek. Aff. ¶¶ 7-8.) Joshua Sauer's email conveyed to Mr. Sekigami that the Vehicle was available, had no damage, and was a perfect car with no blemishes. ( Id. ¶ 49.) Mr. Sekigami exchanged multiple additional emails with Joshua Sauer about possibly purchasing the Vehicle. ( Id. ¶¶ 9-15.) Joshua Sauer sent Mr. Sekigami a copy of the Car Fax report for the Vehicle which indicated the Vehicle had 18, 500 miles rather than 17, 000 as advertised in the Auto Trader advertisement. ( Id. ¶ 24.) When Mr. Sekigami advised Joshua Sauer about this discrepancy, Joshua Sauer informed Mr. Sekigami that the Vehicle was like new, with new tires and a recent oil change. ( Id. ¶ 26.) Mr. Sekigami agreed to purchase the Vehicle for $120, 000. ( Id. ¶ 34.) Mr. Sekigami asserts that he never had a conversation with Doron Sauer during December of 2009. ( Id. ¶ 28.)
The parties both state that Defendants prepared the Bill of Sale for the Vehicle in Florida on January 19, 2010 and sent it, via email, to Mr. Sekigami in Illinois. (Sek. Aff. ¶ 35; Sauer Cert. ¶ 10.) Mr. Sekigami executed the Bill of Sale in Illinois and returned it to Defendants in Florida. ( Id. ¶ 36.) Mr. Sekigami wired funds to Defendants in Florida from a bank in Illinois. ( Id. ¶ 39.) Mr. Sekigami instructed Defendants to send the title for the Vehicle to a company in Jamaica, New York. (Sauer Cert. ¶ 11.) Defendants never intended to and did not send the title for the Vehicle to Illinois. ( Id. ) Defendants prepared to send the vehicle to Tokyo, Japan via air freight from John F. Kennedy Airport, New York. ( Id. ¶ 12.) At no point did Defendants plan to deliver the Vehicle to Illinois. ( Id. )
After sending the funds to Defendants, Mr. Sekigami learned that the Vehicle was inoperable and required a major engine repair. (Sek. Aff. ¶¶ 40-41.) Defendants informed Mr. Sekigami that the Vehicle was no longer covered by the Mercedes Benz warranty. ( Id. ¶ 46.) Mr. Sekigami requested that Defendants return his money. ( Id. ¶ 51.) Defendants refused. ( Id. ) Plaintiffs filed their initial Complaint on May 7, 2012 seeking a refund of their money as well as interest, punitive damages, and attorney's fees.
On May 11, 2012, the Court dismissed Plaintiffs' Complaint sua sponte for failing to sufficiently plead diversity jurisdiction because Plaintiffs failed to allege the citizenship of each of the parties. (R. 4.) Plaintiffs failed, for example, to identify the citizenship of each member of the limited liability company parties, including Defendant Mercedes Benz USA LLC. ( Id. ) Plaintiffs filed an Amended Complaint on May 30, 2012. (R. 5.) The Court dismissed the Amended Complaint on May 31, 2012 because Plaintiffs once again failed sufficiently to plead complete diversity. (R. 6.) Plaintiffs filed their Second Amended Complaint on February 26, 2013, which no longer included Mercedes Benz USA LLC as a Defendant and which identified Plaintiff The Yokohama Trading as a corporation rather than a limited liability company.
I. Personal Jurisdiction
A. Legal Standard
Where, as here, a court's subject matter jurisdiction is based on diversity of citizenship, the court may exercise personal jurisdiction over a defendant only if personal jurisdiction would be proper in an Illinois court. See Hyatt Int'l Corp. v. Coco, 302 F.3d 707, 713 (7th Cir. 2002). "A state's exercise of personal jurisdiction is also subject to the demands of the Fourteenth Amendment's due process clause" and "[b]ecause Illinois permits personal jurisdiction if it would be authorized by either the Illinois Constitution or the United States Constitution, the state statutory and federal constitutional requirements merge." uBID, Inc. v. GoDaddy Grp., Inc., 623 F.3d 421, 425 (7th Cir. 2010). Looking to the federal constitutional requirements, it is well-established that the due process test for personal jurisdiction requires that a defendant have minimum contacts with the forum state "such that the maintenance of the suit does not offend traditional notions of fair play and substantial justice.'" Int'l Shoe Co. v. Wash., 326 U.S. 310, 316, 66 S.Ct. 154, 158, 90 L.Ed. 95 (1945) (citations omitted). "[I]t is essential in each case that there be some act by which the defendant purposefully avails itself of the privilege of conducting activities within the forum State, thus invoking the benefits and protections of its ...