Faur v. Sirius Intern. Ins. Corp., 04 C 7640.

• Decision Date: 25 April 2005
• Docket Number: No. 04 C 7640.,04 C 7640.
• Citation: 391 F.Supp.2d 650
• Parties: Violeta FAUR, Plaintiff, v. SIRIUS INTERNATIONAL INSURANCE CORPORATION, Akeso Care Management, Inc; f/k/a International Claim Managers, Inc, and International Medical Group Defendants.
• Court: U.S. District Court — Northern District of Illinois

391 F.Supp.2d 650

Violeta FAUR, Plaintiff, v. SIRIUS INTERNATIONAL INSURANCE CORPORATION, Akeso Care Management, Inc; f/k/a International Claim Managers, Inc, and International Medical Group Defendants.

No. 04 C 7640.

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

April 25, 2005.

COPYRIGHT MATERIAL OMITTED

COPYRIGHT MATERIAL OMITTED

Beau T. Greiman, Christopher Scott Griesmeyer, Levenfeld Pearlstein, Chicago, IL, for Plaintiff.

Robert J. Franco, II, Andrew Mueller, W. Grant Farrar, Bollinger, Ruberry and Garvey, Chicago, IL, for Defendants.

MEMORANDUM OPINION AND ORDER

PLUNKETT, Senior District Judge.

Violeta Faur ("Plaintiff") has filed a two-count complaint against Sirius International Corporation ("Sirius"), Akeso Care Management, Inc., f/k/a International Claim Managers, Inc. ("Akeso"), and International Medical Group ("IMG"), or collectively ("Defendants"), alleging breach of contract and violation of Illinois Insurance Code. Defendants have moved to dismiss Plaintiff's complaint pursuant to Fed.R.Civ.P. Rule 12(b)(2), 12(b)(3), and 12(b)(6) on the basis of improper jurisdiction, improper venue and failure to state a claim. Defendants alternatively request this Court transfer the matter because of improper venue under 28 U.S.C. § 1406(a). For the following reasons, Defendants' motion to dismiss pursuant to Rule 12(b)(2) and 12(b)(6) is denied. Defendants' motion to dismiss pursuant to Rule 12(b)(3) is denied. Defendant's motion to transfer pursuant to Rule 12(b)(3) is granted.

Facts

We accept, as we must, Plaintiff's alleged facts. Faur resides in Palatine, Illinois. Sirius's principal place of business is in Stockholm, Sweden, and Akeso and IMG's principal place of business is in Indianapolis, Indiana. The amount in controversy is over $180,000. Faur purchased a Health Insurance Global Medical Insurance Policy ("Policy") from Sirius, which became and remains effective as of March 30, 2001. (Pl.'s Compl. ¶ 8.) The Policy contains a forum selection clause that gives Marion County, Indiana exclusive jurisdiction for any court action relating to the Policy. (Id. at Ex. A.) On or about April 15, 2003, Faur was first diagnosed with leukemia and has since incurred charges for treatment totaling more that $180,000. (Id. at ¶ ¶ 11-13.) Under the Policy, Sirius must pay medical claims for the treatment of Faur's leukemia, but Sirius, through its agents Akeso and IMG, has denied all of Faur's leukemia claims, and she alleges this has breached the Policy. (Id. at ¶¶ 15-17.) Although Faur claims she has fulfilled her contractual obligations, she contends that Defendants have not and have caused Faur's damages. (Id. at ¶¶ 18,19.) She also asserts that, in violation of the Illinois Insurance Code, Defendants have unreasonably and vexatiously denied Faur's claims for benefits under the Policy and should therefore be responsible for $60,000 in attorney's fees. (Id. at ¶¶ 21, 27.)

Legal Standard

Under each rule that Defendants argue for dismissal, the Court will accept as true all well-pleaded factual allegations of the complaint, drawing all reasonable inferences in plaintiff's favor. Forseth v. Village of Sussex, 199 F.3d 363, 368 (7th Cir.2000).

Discussion

Defendants argue dismissal based on several different theories. We will address each in turn. Defendants begin by stating that Plaintiff's complaint should be dismissed pursuant to Rule 12(b)(2) for lack of jurisdiction. On a Rule 12(b)(2) motion to dismiss, a plaintiff must make a prima facie showing that jurisdiction over the defendant is proper. Nelson ex rel. Carson v. Park Indus., Inc., 717 F.2d 1120, 1123 (7th Cir.1983). Federal courts have diversity jurisdiction when the matter in controversy exceeds $75,000 and "is between citizens of different States and in which citizens or subjects of a foreign state are additional parties." 28 U.S.C. § 1332(a)(3). A federal court sitting in diversity has personal jurisdiction over a non-resident defendant if the forum state court would have jurisdiction over him. McIlwee v. ADM Indus., Inc., 17 F.3d 222, 223 (7th Cir.1994). The Illinois long-arm statute permits Illinois courts to exercise personal jurisdiction over defendants who, among other things, engage in the transaction of business within the state; contract to insure any person, property or risk located within this State; and "on any other basis ... permitted by the Illinois Constitution and the Constitution of the United States." 735 ILL. COMP. STAT. 5/2-209(a)(1), (a)(4), (c). In a case where personal jurisdiction is satisfied by the defendant's contacts with the forum state, the exercise of jurisdiction is constitutionally permissible if the defendant has "purposely avail[ed] itself of the privilege of conducting activities" in the forum state such that it "should reasonably anticipate being haled into court there." Burger King Corp. v. Rudzewicz, 471 U.S. 462, 474-75, 105 S.Ct. 2174, 85 L.Ed.2d 528 (1985) (internal quotation marks and citation omitted).

Here, Plaintiff is a citizen of Illinois and Defendants are citizens of Indiana and Sweden. The amount in controversy exceeds $180,000. Thus, diversity jurisdiction in this Court is established under 28 U.S.C. § 1332(a)(1). Furthermore, pursuant to the Illinois long arm statute, Plaintiff alleges Defendants' medical insurance contracts with Illinois residents establish the requisite conduct to invoke personal jurisdiction. Moreover, as alleged, Defendants regularly conduct business in Illinois and have therefore availed themselves to the benefits and protections of Illinois law. At this stage of the proceedings we must credit Plaintiff's version of the facts and, given those facts, determine whether defendant has sufficient contacts with Illinois to make it a proper venue for this suit. Taken as true, Plaintiff's allegations that Defendants have availed themselves of Illinois law by engaging in business and entering into insurance contracts with Illinois citizens prevent a dismissal based on lack of personal jurisdiction. Plaintiff has made a prima facie showing that jurisdiction is proper; thus, Defendants' 12(b)(2) motion is denied.

Next, Defendants argue that Plaintiff's complaint should be dismissed pursuant to Rule 12(b)(6). In such a motion, no claim will be dismissed unless "it is clear that no relief could be granted under any set of facts that could be proved consistent with the allegations." Hishon v. King & Spalding, 467 U.S. 69, 73, 104 S.Ct. 2229, 81 L.Ed.2d 59 (1984). It is a minority view that Rule 12(b)(6) is the proper motion when considering the dismissal of a claim because of a forum selection clause. Frietsch v. Refco. Inc., 56 F.3d 825, 830 (7th Cir.1995)(referring to Lambert v. Kysar, 983 F.2d 1110, 1112 n. 1 (1st Cir.1993)). More often, forum selection clauses are treated with a Rule 12(b)(3) motion to dismiss. Id. Nevertheless, we will examine the claim under Rule 12(b)(6).

Here, Defendant states that because Plaintiff expressly agreed to litigate all disputes in Indiana, she cannot state a claim upon which relief may be granted. (Def's Mot. to Dismiss at 4.) Plaintiff's claim is for breach of contract and in Illinois to state such a claim, a plaintiff must allege: (1) the existence of a contract between the plaintiff and the defendant; (2) plaintiff's full performance of his duties under the contract; (3) defendant's breach, and (4) plaintiff's damages as a result of the breach. Elson v. State Farm Fire & Cas. Co., 295 Ill.App.3d 1, 6, 229 Ill.Dec. 334, 691 N.E.2d 807 (1998)(citing Nielsen v. United Servs. Auto. Ass'n, 244 Ill.App.3d 658, 662, 183 Ill.Dec. 874, 612 N.E.2d 526 (1993)). A plaintiff must allege facts sufficient to show that the contract terms have been breached. Id. It is important to note that "the general principles governing the interpretation of insurance contracts do not differ from those controlling in other contracts." Id.

Here, Faur does allege facts upon which there is a viable complaint. She sufficiently alleges that there was a valid medical insurance contract, that she performed her duties under the contract by paying the scheduled premiums, that Defendants breached the contract by denying her medical claims, and that there were damages in the form of medical bills. Taken in a light most favorable to Plaintiff, Faur has established that relief may be granted. Therefore, Defendants' Rule 12(b)(6) motion to dismiss is also denied.

In this 12(b)(6) argument, Defendants further state that Plaintiff has waived subject matter jurisdiction and has not met the venue requirements to be in this Court, and accordingly Rule 12(b)(6) compels dismissal. (Def's Mot. to Dismiss at 7.) The venue discussion will be addressed in the Rule 12(b)(3) context below. However, Defendants should be reminded that subject matter jurisdiction may not be waived. A defendant may waive venue or personal jurisdiction, but subject matter jurisdiction is not waivable. Moore v. Olson, 368 F.3d 757, 758 (7th Cir.2004). Therefore, Defendants' contention that these two factors compel a Rule 12(b)(6) dismissal is also rejected.

Defendants' final argument to dismiss the complaint pursuant to a Rule 12(b)(3) motion to dismiss, or in the alternative to transfer, for lack of proper venue under 28 U.S.C. § 1406(a) requires a more lengthy discussion. Defendants argue dismissal because the forum selection clause in the contract must supersede any other statutory venue. Section 1406 provides: "The district court of a district in which is filed a case laying venue in the wrong division or district shall dismiss, or if it be in the interest of justice, transfer such case to any district or division in which it could have been brought." 28 U.S.C. § 1406(a). To overcome a § 1406 dismissal, proper venue must be established. In a diversity case, venue is appropriate in: "(1) a judicial district where any defendant resides, if all defendants reside in the same State, (2) a...