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AS Engine Leasing, LLC v. Vision Airlines, Inc.

United States District Court, N.D. Illinois, Eastern Division

November 18, 2014

AS ENGINE LEASING, LLC, Plaintiff,
v.
VISION AIRLINES, INC., Defendant.

MEMORANDUM OPINION AND ORDER

JAMES F. HOLDERMAN, District Judge.

On February 27, 2014, plaintiff AS Engine Leasing, LLC ("AS Engine") filed an amended complaint alleging two counts of breach of contract against defendant Vision Airlines, Inc. ("Vision"). (Dkt. No. 22 ("Am. Compl.")) On May 2, 2014, Vision filed a motion to dismiss the complaint for lack of personal jurisdiction pursuant to Rule 12(b)(2) of the Federal Rules of Civil Procedure. (Dkt. No. 25.) For the reasons set forth below, the court grants Vision's motion.

BACKGROUND

This litigation arises out of a lease (the "Lease") between AS Engine and Vision for an aircraft engine, which AS Engine accuses Vision of breaching. AS Engine is a limited liability company organized under the laws of the state of Delaware. (Am. Compl. ¶ 2) The sole member of AS Engine is Aviation Sales, LLC, which is also organized under the laws of the state of Delaware. ( Id. ) The sole member of Aviation Sales, LLC is Victoria Ricks ("Ricks"), an individual who resides in Chicago, Illinois. ( Id. ) Vision is a corporation organized under the laws of the state of Nevada with its principal place of business in North Las Vegas, Nevada. (Dkt. No. 26, Ex. A ("Acor Aff.") ¶¶ 3, 4.) Vision is not registered to do business in Illinois and has no operations in Illinois. ( Id. ¶ 4.) Vision does not own any assets or property in Illinois, and it does not have any bank accounts in Illinois. ( Id. ¶ 12.)

In April 2013, David Meers, then the Senior Vice President of Vision, contacted BCI Aircraft Leasing, Inc. ("BCI") in an effort to lease two aircraft engines. (Dkt. No. 55, Ex. 1 ("Meers Decl.") ¶¶ 1, 4.) Meers' primary contact at BCI was Brian Hollnagel ("Hollnagel"). ( Id. ) On April 12, 2013, BCI presented Vision a "Proposal Letter" summarizing the terms and conditions for a lease of two engines. (Dkt. No. 55, Ex. 1, at 8-11.) Both Hollnagel and Meers executed the proposal. (Meers Decl.¶ 5.) In May 2013, however, BCI informed Meers that it was not interested following through with their proposed transaction, but suggested that Ricks may be interested in leasing engines to Vision. ( Id. ¶ 7.) Hollnagel informed Ricks, who is his wife, about the opportunity to lease an engine to Vision. (Ricks Decl. ¶ 3.) Ricks then created AS Engine, and it acquired the engine at issue in this case (the "Engine") to lease to Vision. ( Id. ¶¶ 5, 6.) Meers consequently negotiated the Lease with AS Engine. (Meers Decl. ¶ 7.)

Meers executed the Lease on behalf of Vision in Miami, Florida. (Accor Aff. ¶ 9.) On May 12, 2013, Ricks received a copy of the partially executed Lease while in Illinois. (Ricks Decl. ¶ 3.) Ricks executed the Lease and returned it to Vision. ( Id. ¶ 7.) Pursuant to the terms of the Lease, Vision paid a security deposit, rent, and maintenance reserves to Aviation Sales, LLC's bank account, which is located in Chicago, Illinois. ( Id. ¶ 8.)

Vision accepted delivery of the Engine at the Aviation Repair Technologies facility located in Blytheville, Arkansas. (Accor Aff. ¶ 12.) The Engine is currently located in Mexico City, Mexico. ( Id. ¶ 13.) AS Engine alleges that Vision has failed to make payments of rent and maintenance reserves when due. (Am. Compl. ¶¶ 46-55.) AS Engine further alleges that Vision has failed to return the Engine in accordance with the conditions set out in the Lease. (Am. Compl. ¶¶ 56-63.)

LEGAL STANDARDS

Rule 12(b)(2) provides for dismissal where a court lacks personal jurisdiction over a party. Fed.R.Civ.P. 12(b)(2). Once the defendant moves to dismiss a complaint under Rule 12(b)(2) for lack of personal jurisdiction, the plaintiff bears the burden of demonstrating the existence of jurisdiction. Purdue Research Found. v. Sanofi-Synthelabo, S.A., 338 F.3d 773, 782 (7th Cir. 2003). In ruling on a motion to dismiss, a court may consider matters outside of the pleadings. See id. When a court rules on personal jurisdiction based on the submission of written materials without holding an evidentiary hearing, the plaintiff is only required to make a prima facie case of personal jurisdiction. Id. (quoting Hyatt Int'l Corp. v. Coco, 302 F.3d 707, 713 (7th Cir. 2002)). If the defendant has submitted evidence in opposition to the implementation of jurisdiction, however, "the plaintiff must go beyond the pleadings and submit affirmative evidence supporting the exercise of jurisdiction." Id. at 782-83. In determining whether the prima facie standard has been satisfied, the court resolves any conflicts in affidavits or other supporting materials in the plaintiff's favor. Id. at 782 (quoting Nelson by Carson v. Park Indus., Inc., 717 F.2d 1120, 1123 (7th Cir. 1983)).

ANALYSIS

"A federal court sitting in diversity has personal jurisdiction only where a court of the state in which it sits would have such jurisdiction." Citadel Grp. Ltd. v. Wash. Reg'l Med. Ctr., 536 F.3d 757, 760 (7th Cir. 2008) (citing RAR, Inc. v. Turner Diesel, Ltd., 107 F.3d 1272, 1275 (7th Cir. 1997)) "An Illinois state court has personal jurisdiction when the Illinois long-arm statute, the Illinois state constitution and the due process clause of the federal constitution authorize it." Joy v. Hay Group, Inc., No. 02 C 4989, 2003 WL 22118930, at *3 (N.D. Ill. Sept. 11, 2003) (citing Cent. States, S.E. and S.W. Areas Pension Fund v. Reimer Express World Corp., 230 F.3d 934, 939 (7th Cir. 2000)).

The Illinois Long-Arm Statute permits personal jurisdiction on any basis permitted by the due process clauses of the Illinois and United States Constitutions. 735 Ill. Comp. Stat. 5/2-209(c). Although the Illinois Supreme Court has noted that the Illinois constitutional due process requirement is distinct from the federal requirement, see Rollins v. Ellwood, 565 N.E.2d 1302, 1316 (Ill. 1990), the Seventh Circuit has determined that because there is no operative difference between the Illinois and federal due process standards, a single due process analysis is sufficient. Illinois v. Hemi Grp. LLC, 622 F.3d 754, 757 (7th Cir. 2010).

Personal jurisdiction under the federal due process clause requires that "the defendants must 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.'" Hyatt Int'l Corp. v. Coco, 302 F.3d 707, 716 (7th Cir. 2002) (quoting International Shoe Co. v. Washington, 326 U.S. 310, 316 (1945) (citations omitted)). The United States Supreme Court has "framed the constitutional inquiry in terms of whether the defendant purposefully avails itself of the benefits and protections of conducting activities in the forum state." Mobile Anesthesiologists Chicago, LLC v. Anesthesia Assocs. of Houston Metroplex, P.A., 623 F.3d 440, 444 (7th Cir. 2010) (internal quotation marks omitted). To be subject to personal jurisdiction, "[t]he defendant's contacts must not be merely random, fortuitous, or attenuated; rather, the defendant's conduct and connection with the forum state' must be such that it should reasonably anticipate being haled into court there.'" Citadel, 536 F.3d at 61 (quoting Burger King Corp. v. Rudzewicz, 471 U.S. 462, 474-75 (1985)).

The United States Supreme Court recently confirmed its adherence to the distinction between "general jurisdiction" and "specific jurisdiction." See Daimler AG v. Bauman, 134 S.Ct. 746, 754-55 (2014). A foreign corporation is subject to general jurisdiction "only when the corporation's affiliations with the State in which suit is brought are so constant and pervasive as to render [it] essentially at home in the forum State." Id. at 751. To support an exercise of specific personal jurisdiction, the defendant's contacts with the forum state must "directly relate to the challenged conduct or transaction." Northern Grain Marketing, LLC v. Greving, 743 F.3d 487, 492 (7th Cir. 2014) (citing Logan Prod. v. Optibase, 103 F.3d 49, 52 (7th Cir. 1996). Here, AS Engine ...


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