United States District Court, N.D. Illinois, Eastern Division
R&B RECEIVABLES MANAGEMENT, CORP., d/b/a R&B SOLUTIONS, Plaintiff,
UNITED STATES DEPARTMENT OF HEALTH AND HUMAN SERVICES, GIAN JOHNSON, Acting Director of The Assister Programs Division of the Consumer Support Group, JULIA DREIER, as an individual, and JOHN DOES 1-5, Defendants.
MEMORANDUM OPINION AND ORDER
MATTHEW F. KENNELLY United States District Judge
Receivables Management Corp. (R&B) alleges that former
Department of Health and Human Services (HHS) employee Julia
Dreier wrongfully denied R&B grant funds as part of the
Navigator Program under the Affordable Care Act (ACA).
R&B sued HHS and Dreier. HHS moved to dismiss
R&B's claims on multiple grounds. The Court granted
the motion in part but declined to dismiss R&B's
claims against Julia Dreier in her individual capacity.
R&B Receivables Mgmt. Corp. v. U.S. Dep't of
Health and Human Servs., No. 15 C 8109, 2016 WL 5341811
(N.D. Ill. Sept. 23, 2016).
has now moved to dismiss R&B's claims against her
under Fed R. Civ. P. 12(b)(2) and Fed R. Civ. P. 12(b)(6),
arguing that this Court lacks personal jurisdiction over her
and that R&B has failed to state a claim. The Court
dismisses the claims against Dreier because it lacks personal
jurisdiction over her.
Court takes the facts from R&B's complaint,
Dreier's reply, and an affidavit by Dreier. On a motion
to dismiss for lack of personal jurisdiction, the Court takes
the allegations and factual disputes in the light most
favorable to plaintiff. Sprint Spectrum L.P. v. City of
Carmel, 361 F.3d 998, 1001 (7th Cir. 2004)
applied for a healthcare navigator grant as part of a program
offered under the ACA through the HHS Center for Medicare and
Medicaid Services (CMS). R&B received a grant for the
years 2013-2014 to operate as a navigator in Wisconsin. The
navigator program in Wisconsin requires businesses to
disclose whether they have declared bankruptcy. R&B filed
for Chapter 11 bankruptcy reorganization in 2012, due to
changes in the law that negatively affected its business in
student loans. R&B states that it disclosed its
bankruptcy status to the necessary parties in Wisconsin and
also notified HHS/CMS. R&B contends that CMS responded
that it had no issue with R&B's bankruptcy status as
long as it could still be licensed as a navigator in
states that it successfully fulfilled its role as a navigator
in Wisconsin. It applied for another grant for the years
2014-2015. R&B states that it was still in Chapter 11
bankruptcy reorganization at the time it applied but that the
ACA navigator grant application did not ask any questions
related to bankruptcy. CMS awarded R&B grants to conduct
navigator duties in four states: Illinois, Iowa, Indiana, and
contends that an article published in North Carolina reported
that R&B's bankruptcy was pending and criticized CMS
for awarding R&B a grant instead of a prior grant
recipient based in North Carolina. After this article was
published, CMS and Dreier contacted R&B to ask about its
bankruptcy status. R&B states that it supplied Dreier
with documents for its court-approved bankruptcy
reorganization and proof that it was no longer under court
supervision after successfully completing the reorganization.
R&B contends that Dreier responded with a letter stating
that R&B violated conditions of its grant award when it
failed to report its bankruptcy status. R&B responded to
Dreier's letter, advising that she was mistaken about the
timing of the bankruptcy and that the company had already
successfully completed the reorganization by the time it
applied for a grant. R&B contends that Dreier responded
that any further correspondence should be sent to a general
email address. This was her last communication with R&B.
currently resides in Minnesota and no longer works for the
federal government. At the time of R&B's grant
revocation, she lived in Washington, D.C. and was working in
CMS's Maryland office. Dreier states that she never
visited Illinois in connection with work. As the director for
the navigator grant program, she oversaw 104 entities in 34
alleges that by improperly revoking its navigator grant
Dreier violated R&B's constitutional right to due
process. It has sued suing her in her individual capacity
under Bivens v. Six Unknown Named Agents of Federal
Bureau of Narcotics, 403 U.S.
(1971). Dreier argues that this Court lacks personal
jurisdiction over her and in the alternative that R&B has
failed to state a claim upon which relief can be granted.
considering a motion to dismiss under Fed. R. Civ. P
12(b)(2), the plaintiff has the burden to show that personal
jurisdiction over the defendant is proper. Tamburo v.
Dworkin, 601 F.3d 693, 700 (7th Cir. 2010). When the
Court rules on a motion to dismiss for lack of personal
jurisdiction based on written materials, the plaintiff needs
only to make out a prima facie case. N. Grain Mktg., LLC
v. Greving, 743 F.3d 487, 491 (7th Cir. 2014). Factual
disputes are resolved in the plaintiff's favor.
Id. (citing Purdue Res. Found v.
Sanofi-Synthelabo, S.A., 338 F.3d 773, 782 (7th Cir.
district court may exercise jurisdiction over a defendant as
long as she is subject to jurisdiction in the state in which
the district court is located. Fed.R.Civ.P. 4(k)(1)(A). A
court in Illinois may exercise personal jurisdiction over a
defendant on any basis allowed under the Illinois
Constitution and the Constitution of the United States.
N. Grain Mktg., LLC, 743 F.3d at 492 (citing 735
Ill. Comp. Stat. 5/2-209(c)). Illinois' long arm statute
extends to the constitutional limits; therefore, the due
process clause of the Fourteenth Amendment ...