Kostal v. PINKUS DERMATOPATHOLOGY LAB.

• Decision Date: 15 April 2005
• Docket Number: No. 1-04-1447.,1-04-1447.
• Citation: 827 N.E.2d 1031,357 Ill. App.3d 381,293 Ill.Dec. 150
• Parties: Dawn G. KOSTAL, Plaintiff-Appellee, v. PINKUS DERMATOPATHOLOGY LABORATORY, P.C., a Michigan Corporation; David A. Mehregan; and Darius R. Mehregan, Defendants-Appellants.
• Court: United States Appellate Court of Illinois

827 N.E.2d 1031

357 Ill. App.3d 381

293 Ill.Dec. 150

Dawn G. KOSTAL, Plaintiff-Appellee, v. PINKUS DERMATOPATHOLOGY LABORATORY, P.C., a Michigan Corporation; David A. Mehregan; and Darius R. Mehregan, Defendants-Appellants.

No. 1-04-1447.

Appellate Court of Illinois, First District, Fifth Division.

April 15, 2005.

Lowis & Gellen, Chicago (Mark J. Smith, Joan M. Kubalanza and Jenny Ostrom Blake, of counsel), for Appellants.

Cisar & Mrofka, Ltd., Oak Brook (Thomas J. Cisar, Robert J. Mrofka and Kenneth G. Miller, of counsel), for Appellee.

Justice GALLAGHER delivered the opinion of the court:

Defendants, Pinkus Dermatopathology Laboratory, P.C. (Pinkus), David A. Mehregan, M.D., and Darius R. Mehregan, M.D. (collectively, defendants), appeal from an order of the circuit court of Cook County denying their motion to quash service of summons and to dismiss plaintiff Dawn G. Kostal's fourth amended complaint for lack of personal jurisdiction. We affirm and remand.

BACKGROUND

In December 2001, plaintiff, an Illinois resident, visited her physician in Illinois. During that visit, her physician obtained tissue samples and sent them to Pinkus for analysis. Pinkus, a Michigan corporation, is a pathology laboratory that is operated on a national basis. Defendants provide expert diagnostic analysis by mail. Defendants processed and analyzed plaintiff's tissue samples in Michigan, drafted reports in Michigan and sent allegedly inaccurate reports to plaintiff's physician in Illinois.

Plaintiff filed a medical negligence action alleging that, as a result of defendants' negligence, her care and treatment were delayed, requiring extensive medical procedures, and causing her severe and permanent physical injury, pain and suffering, disability, disfigurement and the loss of a normal life.¹ Defendants filed a special appearance to quash service of summons and to dismiss plaintiff's fourth amended complaint for lack of personal jurisdiction.² The trial court denied defendants' motion. Defendants now appeal pursuant to Supreme Court Rule 306(a)(3) (155 Ill.2d R. 306(a)(3)).

ANALYSIS

The sole issue on appeal is whether the State of Illinois can assert jurisdiction over the nonresident defendants. Plaintiff bears the burden of establishing a valid basis for asserting jurisdiction over defendants. Morecambe Maritime, Inc. v. National Bank of Greece, S.A., 354 Ill.App.3d 707, 710, 290 Ill.Dec. 468, 821 N.E.2d 780, 784 (2004) ("Plaintiff bears the burden of establishing a prima facie case for the assertion of personal jurisdiction over defendant; however, uncontradicted evidence may overcome the prima facie case and defeat jurisdiction").

The standard of review is de novo when a trial court determines jurisdiction solely on the basis of documentary evidence. Morecambe Maritime, Inc. v. National Bank of Greece, S.A., 354 Ill.App.3d at 710, 290 Ill.Dec. 468, 821 N.E.2d at 784; Zazove v. Pelikan, Inc., 326 Ill.App.3d 798, 802, 260 Ill.Dec. 412, 761 N.E.2d 256, 259 (2001). In the instant case, the trial court heard no courtroom testimony with respect to the issue of personal jurisdiction. Therefore, our review is de novo.

As in other de novo reviews, it is the trial court's judgment that is before us on review, not the trial court's reasoning. See, e.g., City of Chicago v. Holland, 206 Ill.2d 480, 491-92, 276 Ill.Dec. 887, 795 N.E.2d 240, 247-48 (2003) (summary judgment); Pryweller v. Cohen, 282 Ill.App.3d 899, 907, 218 Ill.Dec. 312, 668 N.E.2d 1144, 1149 (1996) (motion to dismiss); Makowski v. City of Naperville, 249 Ill.App.3d 110, 115, 187 Ill.Dec. 530, 617 N.E.2d 1251, 1255 (1993) (summary judgment). Thus, our function is to determine whether the trial court's decision was correct, regardless of the reasoning or the grounds for that decision. Holland, 206 Ill.2d at 492, 276 Ill.Dec. 887, 795 N.E.2d at 247-48. If the judgment is correct, we may affirm it on any ground present in the record. Holland, 206 Ill.2d at 492, 276 Ill.Dec. 887, 795 N.E.2d at 247-48; Pryweller v. Cohen, 282 Ill.App.3d at 907, 218 Ill.Dec. 312, 668 N.E.2d at 1149.

Illinois' Long-Arm Statute

The parties agree that whether Illinois can exercise jurisdiction over defendants rests on the applicability of Illinois' long-arm statute. 735 ILCS 5/2-209 (West 2002). Illinois' long-arm statute provides several bases for jurisdiction over a non-resident defendant and provides, in relevant part, as follows:

"(a) Any person, whether or not a citizen or resident of this State, who in person or through an agent does any of the acts hereinafter enumerated, thereby submits such person, and, if an individual, his or her personal representative, to the jurisdiction of the courts of this State as to any cause of action arising from the doing of any of such acts:

(1) The transaction of any business within this State;

(2) The commission of a tortious act within this State;

* * *

(7) The making or performance of any contract or promise substantially connected with this State;

* * *

(b) A court may exercise jurisdiction in any action arising within or without this State against any person who:

* * *

(4) Is a natural person or corporation doing business within this State.

(c) A court may also exercise jurisdiction on any other basis now or hereafter permitted by the Illinois Constitution and the Constitution of the United States." 735 ILCS 5/2-209 (West 2002).

Before the trial court, plaintiff's counsel conceded that plaintiff's bases for the court's asserting personal jurisdiction over defendants were subsections (a)(1) and (a)(2). The trial court expressly based its decision on these two subsections. In addition, the trial court relied on Weiden v. Benveniste, 298 Ill.App.3d 531, 232 Ill.Dec. 704, 699 N.E.2d 151 (1998), which in turn relied on subsection (c) of Illinois' long-arm statute. Thus, the trial court also impliedly based its decision on subsection (c). Now, on appeal, plaintiff has relied on subsections (a)(1), (a)(2), and (c), and has additionally raised subsection (b)(4) of Illinois' long-arm statute as bases for jurisdiction. Defendants contend that Illinois' assertion of jurisdiction over them is improper under any of these subsections of Illinois' long-arm statute.

We shall first briefly address plaintiff's new argument that jurisdiction over defendants is permissible pursuant to section 2-209(b)(4) of the long-arm statute. 735 ILCS 5/2-209(b)(4) (West 2002). Section 2-209(b)(4) of Illinois' long-arm statute allows Illinois to exercise jurisdiction over a nonresident defendant who is "doing business within" Illinois. Jurisdiction based upon a party's "doing business" in Illinois was recognized by Illinois courts before it was codified as section 2-209(b)(4). Hendry v. Ornda Health Corp., 318 Ill.App.3d 851, 853, 252 Ill.Dec. 208, 742 N.E.2d 746, 748 (2000), citing Gaidar v. Tippecanoe Distribution Service, Inc., 299 Ill.App.3d 1034, 1041, 234 Ill.Dec. 150, 702 N.E.2d 316, 320 (1998).

There is a distinction between the "doing business" theory now codified in subsection (b)(4) of Illinois' long-arm statute and the "transaction of business" theory under section (a)(1) of the statute. Under the "doing business" theory, a corporation becomes subject to the state's jurisdiction if the corporation "engages in a continuous and systematic course of business in the State," even if the subject lawsuit has no relationship to that business. Kadala v. Cunard Lines, Ltd., 226 Ill.App.3d 302, 314, 168 Ill.Dec. 402, 589 N.E.2d 802, 810 (1992). The "doing business" standard is quite high but once satisfied, a corporation is considered a resident of Illinois and may be sued on any cause of action, regardless of whether it arose out of the corporation's contacts with the state. Haubner v. Abercrombie & Kent International, Inc., 351 Ill.App.3d 112, 119, 285 Ill.Dec. 884, 812 N.E.2d 704, 711 (2004). This is known as general jurisdiction. Forrester v. Seven Seventeen HB St. Louis Redevelopment Corp., 336 Ill.App.3d 572, 271 Ill.Dec. 280, 784 N.E.2d 834 (2002). Alternatively, under the "transaction of business" theory, the state has jurisdiction "if the corporation transacts any business within the State and a cause of action arises from that transaction." (Emphasis added.) Kadala v. Cunard Lines, Ltd., 226 Ill.App.3d at 314, 168 Ill.Dec. 402, 589 N.E.2d at 810. Such jurisdiction is specific. See, e.g., Bombliss v. Cornelsen, 355 Ill.App.3d 1107, 291 Ill.Dec. 925, 824 N.E.2d 1175 (2005) ("Specific jurisdiction refers to jurisdiction over a defendant in a suit arising out of or related to the defendant's contacts with the forum").

As noted, plaintiff's counsel conceded below that plaintiff was not contending that Illinois could assert general jurisdiction over defendants and that this case involved specific jurisdiction. Thus, the trial court decided that Illinois could exercise specific jurisdiction over defendants. Because we agree with the trial court that there are minimum contacts in this case sufficient to support jurisdiction, we see no need to further discuss plaintiff's newly raised argument that defendants' affidavits and admissions demonstrate that they are "doing business" in Illinois. Likewise, we need not address defendants' contentions that the facts set forth in their affidavits overcome plaintiff's prima facie basis for asserting jurisdiction. The statements in defendants' affidavits relate to their lack of physical presence and are relevant only to the issue of whether defendants are "doing business" in Illinois, which would subject them to general jurisdiction. In any event, the instant cause of action is for medical negligence which allegedly arose from, and is specifically related to, defendants' contacts with Illinois. Thus, a specific jurisdiction analysis applies.

Defendants, citing the 1996 case of International Business Machines Corp. v. Martin Property & Casualty Insurance Agency, Inc., 281 Ill.App.3d 854, 217 Ill. Dec. 197, 666 N.E.2d 866 (1996)...