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Congdon v. Cheapcaribbean.Com, Inc.

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

November 3, 2017

BRIAN CONGDON, et al., Plaintiffs,
CHEAPCARBBEAN.COM, INC., et al., Defendants.



         Plaintiffs Brian Congdon and Lisa Congdon filed this suit against Defendants, Inc. (“”), Apple Vacations, LLC (“Apple Vacations”), Amstar DMC, S.A. (“Amstar”), and Apple Leisure Corporation in the Circuit Court of Cook County, Illinois, alleging negligence and other causes of action arising out of a motor vehicle accident that occurred while Plaintiffs were on vacation in Mexico. (Dkt. 1-1). After removing the case to federal court (Dkt. 1),, Apple Vacations, and Amstar moved to dismiss under Federal Rule of Civil Procedure 12(b)(2) for lack of personal jurisdiction. (Dkt. 12). Plaintiffs opposed dismissal and moved to remand the case to state court pursuant to 28 U.S.C. § 1447(c) for lack of federal diversity jurisdiction. (Dkt. 18). For the reasons stated below, the Court denies Plaintiff's motion for remand (Dkt. 18), grants Defendants' motion (Dkt. 12), and dismisses the case without prejudice for lack of personal jurisdiction.


         The following facts are based on the allegations in the complaint and the statements provided in the affidavits submitted by Defendants that controvert or supplement the Plaintiffs' allegations.

         According to the allegations in the complaint, on March 6, 2015, Plaintiffs Brian Congdon and Lisa Congdon, who are Iowa citizens, purchased an all-inclusive travel package to Mexico “through a telephone representative of” See (Dkt. 1-1 at ¶¶ 1-2, 7). The package included airfare, ground transportation from the Cancun airport to a resort, and a stay at the resort. Id. at ¶¶ 8-13. According to Plaintiffs, in the telephone call in which they booked their trip, they were told that they were purchasing a vacation package from Defendant Apple Vacations and that they would be greeted by Apple Vacations representatives in Mexico. Later, Plaintiffs were given “written instructions” that upon arrival, they would be greeted by representatives of Defendant Amstar DMC, S.A. Id. at ¶¶ 11-12. When Plaintiffs arrived in Mexico on June 10, 2015, they were indeed greeted by individuals who Plaintiffs identified as representatives of all three companies:, Apple Vacations, and Amstar. Id. at ¶ 27. Shortly before midnight, Plaintiffs boarded a vehicle operated by an Amstar employee, who Plaintiffs allege drove negligently in inclement weather and crashed the vehicle into a building, injuring Plaintiffs. Id. at ¶¶ 28-34. Plaintiffs allege that the Amstar employee who drove the vehicle was also an agent of the three other named defendants. Id. at 29.

         Plaintiffs filed a complaint alleging negligence, agency, and common law fraud in Illinois state court against Defendants for both the negligent driving of the vehicle and also for the representations that Defendants would provide Plaintiffs with “reliable and safe ground transportation.” Id. at ¶¶ 297-302. Plaintiffs allege that all four named Defendants are “doing business in all 50 states, including Cook County, Illinois” because they either “engaged in the business of selling all-inclusive travel packages via the internet and telephone sales” or “advertis[ed] destination management services and [sold] such services via the internet and telephone sales in all 50 states.” Id. at ¶¶ 3-6.
 is a Delaware corporation with its primary place of business in Addison Texas. See (Dkt. 12-1 at 7) (Affidavit of S. Dumaine). Apple Vacations is a Delaware limited liability company, whose sole member is ALG Integrated Holdings, Corp.-a Delaware corporation with its principal place of business in Pennsylvania. See (Dkt. 1 at ¶ 11); see also (Dkt. 12-1 at 10) (Declaration of W. Hopping). In addition, Apple Vacations is “registered with the Illinois Secretary of State.” (Dkt. 1-1 at ¶ 4). Amstar is incorporated in the British Virgin Islands with its principal place of business in the Dominican Republic. See (Dkt. 12-1 at 2) (Declaration of E. Rybicki). According to its president, Amstar “does no business in Illinois.” Id. Finally, Plaintiffs allege that, Apple Vacations, and Amstar are all operating subsidiaries of Apple Leisure Corporation, and that Defendants constitute an “integrated travel company doing business in all 50 states.” (Dkt. 1-1 at ¶¶ 9-10). Plaintiffs allege that Apple Leisure Corporation is a Delaware corporation headquartered in Pennsylvania. Id. at ¶ 5. However, documents submitted with Defendants' filings indicate that Apple Leisure Corporation, although it previously had existed under Delaware law, entered void status as of March 1, 2000. See (Dkt. 1-1 at 22); see also (Dkt. 25-1) (Declaration of R. Campobasso & Ex. A). Despite this fact, Plaintiffs appear to have served the registered agent provided by the Delaware Secretary of State for Apple Leisure Corporation. See (Dkt. 1-1 at 13-14).

         Apple Vacations and removed the action to this Court pursuant to 28 U.S.C. § 1441 on the basis of diversity jurisdiction, 28 U.S.C. § 1332.[1] Shortly thereafter, Apple Vacations,, and Amstar moved to dismiss the complaint pursuant to Federal Rule of Civil Procedure 12(b)(2) for lack of personal jurisdiction, Rule 12(b)(3) for improper venue, and Rule 12(b)(5) for improper service on Amstar. (Dkt. 12). Before responding to Defendants' motion, Plaintiff moved to remand the case. (Dkt. 18).


         I. Plaintiffs' Motion to Remand

         A. Legal Standard

         “The federal removal statute permits a defendant to remove a civil action from state court when a district court has original jurisdiction over the action.” Micrometl Corp. v. Tranzact Techs., Inc., 656 F.3d 467, 470 (7th Cir. 2011) (citing 28 U.S.C. § 1441(a)). The party invoking federal jurisdiction has the burden of establishing that it exists. See Schimmer v. Jaguar Cars, Inc., 384 F.3d 402, 404 (7th Cir. 2004) (a removing defendant must demonstrate “reasonable probability that subject-matter jurisdiction exists”). In deciding whether to remand a case, the Court assumes the truth of the factual allegations of the complaint unless they are contradicted by evidence (such as affidavits) submitted by the defendant. Deb v. Sirva, Inc., 832 F.3d 800, 808-09 (7th Cir. 2016). Further, a plaintiff's choice of forum is presumed valid, and the Court must resolve any doubts about jurisdiction in favor of remand. See, e.g., Schur v. L.A. Weight Loss Centers, Inc., 577 F.3d 752, 758 (7th Cir. 2009); Doe v. Allied-Signal, Inc., 985 F.2d 908, 911 (7th Cir. 1993) (“Courts should interpret the removal statute narrowly and presume that the plaintiff may choose his or her forum”); Schmude v. Sheahan, 198 F.Supp.2d 964, 966 (N.D. Ill. 2002) (“Generally, the removal statute is strictly construed, with an eye towards limiting federal jurisdiction”).

         B. Jurisdiction

         In this case, Defendants assert that the Court has jurisdiction based on diversity of citizenship. See 28 U.S.C. § 1332(a). In order for jurisdiction to be founded on diversity of citizenship, there must be complete diversity of citizenship-i.e., no plaintiff can be a citizen of the same state as any defendant. See LM Ins. Corp. v. Spaulding Enters. Inc., 533 F.3d 542, 546 n.1 (7th Cir. 2008) (citing Strawbridge v. Curtiss, 7 U.S. (3 Cranch) 267 (1806)). In addition to the citizenship requirement, the matter in controversy must exceed “the sum or value of $75, 000, exclusive of interest and costs.” 28 U.S.C. § 1332(a). Plaintiffs' motion to remand presents four arguments, only two of which are considered in detail below. These two arguments strike at the core of the Court's jurisdiction over this matter: that Defendants have not established either (1) complete diversity among the parties or (2) the amount in controversy.[2]

         1. Citizenship

         For the purpose of determining citizenship, a corporation is a citizen of “every State and foreign state by which it has been incorporated and of the State or foreign state where it has its principal place of business.” 28 U.S.C. § 1332(c)(1); see also Hertz Corp. v. Friend, 559 U.S. 77, 93 (2010) (the phrase “principal place of business” means the place where a corporation's officers direct, control, and coordinate the corporation's activities). A limited liability company is deemed to share the citizenship of ...

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