In the case of Campbell v. Acme Installations Inc., highlighted in the April 2019 Illinois Bar Journal authored by Eric J. Muñoz, general jurisdiction for nonresident defendants is clarified.
In the Campbell case, the plaintiff brought a lawsuit against General Electric and other companies resulting from his alleged exposure to GE-manufactured industrial furnaces located at a Chicago steel company where he worked from 1964 to 1965. At the time of the filing of the lawsuit, GE was based in New York, and its principal place of business was in Massachusetts.
GE had been licensed to conduct business in Illinois since 1897. GE employed some 3,000 employees at 30 facilities that it owned, leased, or operated throughout Illinois. It also had six business units located in the state. GE’s annual sales from its Illinois operations “exceeded $1 billion, with a claimed economic impact in Illinois of $4.8 billion.”
GE had a registered agent for service of process in Illinois throughout the years. “Ten years ago, these would be the kind of jurisdiction-rich facts that would have given any plaintiff confidence in defeating a motion to dismiss filed by a nonresident defendant on the basis that a court in Illinois lacked general jurisdiction over the defendant.”
In a U.S. Supreme Court case, Daimler AG v. Bauman, 571 U.S. 117, 137-138 (2014), the Supreme Court rejected general jurisdiction over the German carmaker Daimler in California’s state court. Citing the Daimler case, the Campbell court stated that “general jurisdiction does not automatically arise in every State in which a corporation engages in substantial, continuous, and systematic course of business.” Rather, under the current legal order, the determination of whether a corporate defendant is amenable to general jurisdiction requires that its “affiliations with the forum state . . . be so continuous and systemic as to render it essentially at home in the forum State.”
What is meant by “being at home” for general jurisdiction purposes are its state of incorporation and its principal place of business, although, in “exceptional” cases, a corporation may be “at home” elsewhere. A footnote in the Muñoz article refers to the case of Perkins v. Benguet Consolidated Mining Co., 342 U.S. 437 (1952), in which the Supreme Court upheld that a Philippines-based corporation, Benguet, was amenable to general jurisdiction in Ohio because, due to the exigencies of World War II, the company was forced to temporarily remove its president out of the Philippines to Ohio where he kept an office, maintained the company’s files, and oversaw the company’s activities. Daimler, 571 U.S. at 129-30 and n19.
The takeaway from this article and these recent cases is that general jurisdiction in Illinois for nonresident defendants has been limited. In the Illinois Supreme Court case of Aspen American Insurance Co. v. Interstate Warehousing Inc. 2017 IL 121281, the Illinois Supreme Court dismissed a negligence lawsuit and breach of contract case against an Indiana-based warehouse operator for damages arising out of a collapsed roof at one of the defendant’s warehouses in Michigan.
In the Aspen American Insurance Co. case, Daimler was said to have “raised the bar” for general jurisdiction and made it “incredibly difficult” to establish general jurisdiction over a defendant in a forum other than its place of incorporation or principal place of business. The Aspen court rejected general jurisdiction over the Indiana company in an Illinois state court even though the corporate defendant had both continuously operated a warehouse in Joliet, Ill., and had been registered to do business in Illinois since 1988. The court concluded that the defendant was not “at home” in Illinois – meaning Illinois was neither the defendant’s state of incorporation, its principal place of business, nor a “surrogate home” so as to meet the “exceptional circumstances” qualification – the Illinois Supreme Court followed in Daimler and rejected general jurisdiction over this defendant.
The bottom line for Illinois practitioners is that this recent caselaw has made it clear that nonresident corporate defendants being sued in Illinois courts, despite having sizable economic business interests in the state, are consistently being found non-amenable to general jurisdiction under the Daimler due-process analysis.
In summary, it appears that if a corporate defendant is not headquartered in Illinois, or does not have its principal place of business located in the state, a court here will probably not allow a nonresident defendant to be sued in this jurisdiction. In other words, the nonresident defendant was not “at home” in Illinois. At the present time, the basis of Daimler and the Illinois Supreme Court case cited above, doing business in or having systemic and continuous contact with Illinois is no longer enough to sustain general jurisdiction over a nonresident corporate defendant who is neither headquartered nor incorporated in Illinois.
Kreisman Law Offices has been handling complex commercial litigation cases, wrongful death lawsuits, traumatic brain injury cases and catastrophic injury lawsuits for individuals, families and loved ones who have been injured, harmed or killed by the carelessness or negligence of another for more than 40 years in and around Chicago, Cook County and its surrounding areas, including Brookfield, Oak Lawn, River Grove, Bellwood, Melrose Park, Crestwood, Alsip, Arlington Heights, Orland Park, Chicago (North Lawndale, Garfield Park, Humboldt Park, West Town, West Loop, Chinatown, Bronzeville, Oakland, Hyde Park, Wrigleyville, Uptown, Pulaski Park, Sauganash, Edgebrook, Norwood Park, Edison Park), Mount Prospect, Palatine, Palos Hills, Hickory Hills and Worth, Ill.
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