district, as well a provision for nationwide service of process},
but neither of those provisions serves as a substitute for the
constitutional requirement that defendants may only be obliged to
defend themselves in the federal courts of states where they have
established minimum contacts. Int’l Shoe Co. v. Washington, 326
U.S. 310, 316 (1945) (holding that the Due Process clause permits
the exercise of personal jurisdiction only where the defendant’s
contacts with the forum state are close enough that “traditional
notions of fair play and substantial justice” are not offended);
Trs. of the Hotel Employees and Rest. Employees Int’l Union Welfare
Pension Fund v. Amivest Corp., 733 F. Supp. 1180, 1183 (N.D. Ill.
1990) (Aspen, J.) (finding that the district court had personal
jurisdiction over an ERISA defendant because the defendant’s
business dealings in Illinois were extensive enough to meet the
standard of Int’l Shoe).

There are two types of personal jurisdiction: specific and
general. Helicopteros Nacionales de Colombia, S.A. v. Hall, 466
U.S. 408, 414-15. When a non-resident has substantial or
“continuous and systematic” contacts with the forum state, the

court may exercise general jurisdiction over the defendant, even

1 29 U.S.C. § 1132(e) (2) states: “When an action under this
title is brought in a district court of the United States, it may
be brought in the district where the plan is administered, where
the breach took place, or where a defendant resides or may be
found, and process may be served in any other district where a
defendant resides or may be found.”

4



jurisdiction in this case. Taking the well-pleaded facts in the
complaint as true, Mrs. Boxdorfer knowingly entered into the
subrogation agreement with Lapham on her husband’s behalf. She made
misrepresentations to Lapham over the telephone, informing them
that she and her husband did not intend to hire an attorney, and
that they would notify Lapham before doing so. According to the
complaint, she knowingly accepted a payment of money which,
pursuant to the contract she signed, belonged to Lapham, thus
causing a tort to occur in Illinois. While the question is a close
one, I find that this is sufficient to bring Mrs. Boxdorfer within
the jurisdiction of this court. Heritage House, 906 F.2d at 276.
The motion to transfer, however, does not present a close
question. Mrs. Boxdorfer makes a compelling argument for the
transfer of this case to the Eastern District of Missouri. “For the
convenience of parties and witnesses, in the interest of justice,
a district court may transfer any civil action to any other
district or division where it might have been brought.” 29 U.S.C.
§ 1404, Factors a court should consider when deciding whether to

transfer include:

plaintiff's initial choice of forum; the relative ease of
access to the sources of proof; the availability of compulsory
process for the attendance of unwilling witnesses and the cost
of obtaining the attendance of witnesses; the situs of
material events; and convenience of the parties, specifically
their respective residencies and abilities to bear the expense
of trial in a particular forum.



Ill. Aug. 9, 1995) (Nordberg, J.) (holding that a California lawyer
who had represented an Illinois resident fifteen years earlier, but
had no ongoing contact with the state, was not subject to general
jurisdiction in Illinois).

Nor does specific jurisdiction attach in this case. In their
response to Devereaux’s motion to dismiss, Lapham alleges that

Devereaux committed torts in Illinois when it made
misrepresentations to Lapham on the telephone and instructed its
clients to do the same. However, even if such telephone calls would
be sufficient to establish specific jurisdiction over Devereaux (an
arguable point), these allegations do not appear in the complaint,
and a brief in opposition to a motion to dismiss may not amend the
complaint. Perkins v. Silverstein, 939 F.2d 463, 470 (7th Cir.
1991). The only communication by Devereaux mentioned in the
complaint is a letter acknowledging receipt of some documents which
had been sent by Lapham. This is not “purposeful availment” of the
privilege of conducting business in Illinois, and Devereaux should
not have anticipated that it could be haled into an Illinois court
for sending such a letter.

The only case Lapham cites in support of its argument that
Devereaux has sufficient contact with Illinois to meet the Int’l
Shoe standard is Heritage House Rests., Inc., v. Cont’l Funding

Group, 906 F.2d 276 (7th Cir. 1990). Heritage House provides no

guidance as to defendant Devereaux; the foreign defendant in



for causes of action unrelated to the defendant’s activities within
the state. Id. If the non-resident’s contacts with the state are
limited, the court may invoke specific jurisdiction, which applies
only to causes of action related to the defendant’s activities
within the state. Id. Specific jurisdiction is applicable in cases
where a defendant has purposefully availed himself of the privilege
of conducting activities in the state and where he should
reasonably anticipate being haled into court there. RAR, Inc. v.
Turner Diesel, Ltd., 107 F.3d 1272, 1277 (7th Cir. 1997). “To give
a concrete example, an out-of-state party’s contract with an in-
state party is alone not enough to establish the requisite minimum
contacts.” Id.

Devereaux’s contacts with Illinois cannot be considered
systematic and continuous. According to its answers to
interrogatories, over the past three years, Devereaux, a Missouri
law firm, has represented “less than five” clients who are
residents of Illinois, two of them criminal defendants whose
proceedings were resolved two years prior to the filing of this
lawsuit. It has no Illinois office, Illinois employees, or Illinois
agents. There is no evidence that, other than the two resolved
criminal cases, the firm conducted any business in Illinois for the
clients who were Illinois residents. Such sporadic contacts are not
sufficient to establish general jurisdiction. See Pendleton v.

Germino, No. 95-C2350, 1995 U.S. Dist. LEXIS 11739, at *12 (N.D.



Eastern District of Missouri would not change the outcome; the
Eighth Circuit has explicitly adopted the reasoning of Central
States. Witt v. Allstate Ins. Co., 50 F.3d 536 (8th Cir. 1995).
Therefore, Federal’s motion to dismiss Count IV is GrRaNTED.

Iv.

Finally, defendants Gina Boxdorfer and Edwards move to dismiss
for lack of personal jurisdiction or to transfer to the Eastern
District of Missouri. I grant the motion to dismiss as to Edwards,
but deny it as to Mrs. Boxdorfer. I grant the motion to transfer as
to Mrs. Boxdorfer.

Edwards and Mrs. Boxdorfer adopt the arguments made by
Devereaux in support of its motion to dismiss for lack of personal
jurisdiction. Lapham has not alleged any facts suggesting that
Edwards is subject to the personal jurisdiction of this court.
According to the complaint, Edwards is a Delaware corporation with
its principal place of business in Missouri. Nothing in the
complaint or the brief in opposition to the motion to dismiss
suggests any relationship between Edwards and the state of
Illinois, except that it is allegedly holding funds which
rightfully belong to an Illinois corporation. This is not a basis
for the exercise of personal jurisdiction. The motion to dismiss is
GRANTED as to defendant Edwards.

Mrs. Boxdorfer, on the other hand, has had enough contact with

Illinois parties to justify the exercise of specific personal



1 tMinate Oper Foun (06/97)

AN | United States District Court, Northern District of Illinois

vege Maplorae Judge Elaine E. Bucklo “han Assigned dude

CASE NUMBER 03 C 3282 DATE 10/7/2003
CASE Lapham-Hickey Steel Corp. vs. A.G. Edwards Trust Company, et al.
TITLE

[In the following box (a) indicate the party filing the motion, ¢.g,, plaintiff, defendant, 3rd party plaintiff, and (b) state briefly the nature
of the motion being presented.]

MOTION:

DOCKET ENTRY:

(1) oO Filed motion of [ use listing in “Motion” box above.]

2) Oo Brief in support of motion due.

GB) Oo Answer brief to motion due___. Reply to answer briefdue___.

(4) im Ruling/Hearingon___setfor_ att

(5) oO Status hearing[held/continued to] {set for/re-set for]on__set for__—_att

(6) a Pretrial conference[held/continued to] [set for/re-set for}on__—setfor__—s at
() Q Trial[set for/re-set for]on____at

(8) a (Bench/Jury trial] [Hearing] held/continuedto__at

(9) Oo This case is dismissed [with/without] prejudice and without costs[by/agreement/pursuant to]

QCOFRCP4(m) C)Local Rule 41.1 CIFRCP41(a)(1) O FRCP41(a)(2).

do [Other docket entry] The motions to dismiss by defendants Devereaux, Federal, and Edwards are
granted. The motion to dismiss as to Mrs. Boxdorfer is denied. Mrs. Boxdorfer’s motion to transfer the
case to the Eastern District of Missouri is granted. Plaintiff having agreed to drop Lason from the suit,
this case as to Mrs. Boxdorfer is transferred to the United States District Court in the Eastern District of
Missouri.

(1) [For further detail see order attached to the original minute order.]
No notices required, advised in open court.

No notices required.

o | Notices mailed by judge’s staff.

Notified counsel by telephone.

Docketing to mail notices.

Y | Mail AO 450 form. 4ynoo
Copy to judge/magistrate judge. ) ‘e
2335 Hdl L- 19
courtroom 150 e9
MPI Hem SH i E

L4G3, ~  Datestime received in ; _
central Clerk’s Office mailing deputy initials



Georgouses v. NaTec Res. Inc., 963 F. Supp. 728, 730 (N.D. Ill.
1997) (Gettleman, J.).

With the exception of the plaintiff's choice of forum, all
factors are either neutral or weigh in favor of transfer. The
sources of proof are primarily located in Missouri; while the
witnesses the parties intend to call are not expected to be
unwilling, virtually all of them are in the St. Louis area,
inducing Mr. Boxdorfer, an essential witness who is quadriplegic
and can only travel at great expense and inconvenience; all of the
material events took place in Missouri; finally, the only remaining
defendant, Mrs. Boxdorfer, is a private citizen charged with the
care of her profoundly disabled husband and their minor children,
while the plaintiff is a corporation with extensive Missouri
contacts, including the plant where Mr. Boxdorfer was employed
prior to the accident. Transfer would serve the convenience of the
parties as well as the interest of justice. The motion to transfer

this case to the Eastern District of Missouri is GRANTED

Bore 2 Burkle

Elaine E. Bucklo
United States District Judge

Dated: October 7, 2003

10



Heritage House purposefully solicited the business of the Illinois
plaintiff, the parties entered into an oral contract, and the
defendant subsequently provided investment advice to the plaintiff
via telephone for over a year. In contrast, there was never any
business relationship between Lapham and Devereaux or any
solicitation to that end.

Devereaux is not subject to the general or specific personal
jurisdiction of this court. Therefore, Devereaux’s motion to
dismiss is GRANTED.

IIl.

Count IV of the complaint alleges a claim against Federal for
subrogation. Federal moves for transfer to the Eastern District of
Missouri or dismissal for failure to state a claim on which relief
may be granted. I grant the motion and dismiss the count against
Federal.

In Ctr. States, Southeast and Southwest Areas Pension Fund v.
State Farm Mut. Auto. Ins. Co., 17 F.3d 1081, 1084 (7th Cir. 1994),
the Seventh Circuit held on very similar facts that an insurance
company which is not a party to a subrogation agreement has no duty
to uphold it. If a covered individual violates a subrogation
agreement by accepting a settlement from an insurer, the aggrieved
employer’s remedy is to pursue the covered individual for breach of
contract; neither ERISA nor the subrogation agreement provide any

remedy against the insurer. Id. Transferring the case to the



Devereaux, seeking recovery under a number of theories of the funds
it paid to cover Mr. Boxdorfer’s medical expenses. Lapham agreed to
drop Lason from the suit, so Counts III and IV, which named only
Lason, are no longer before me. The remaining defendants have
separately moved to dismiss the case or, in the alternative, for
transfer to the Eastern District of Missouri. - °

This court has jurisdiction over the case pursuant to the
federal diversity statute, 28 U.S.C. § 1332. I grant the motion to
dismiss as to Devereaux, Federal, and Edwards, but deny it as to
Mrs. Boxdorfer, and grant Mrs. Boxdorfer’s motion to transfer the
case to the Eastern District of Missouri.

II.

The three counts which name Devereaux are Count II, seeking
equitable relief under 29 U.S.C. § 1132(a) (3), Count V, alleging
tortious interference, and Count VI, alleging conversion. Devereaux
moves to dismiss on the ground that this court cannot exercise
personal jurisdiction over Devereaux. I grant the motion.

The plaintiff bears the burden of establishing that the court
has personal jurisdiction over each defendant. Ctr. States,
Southeast and Southwest Areas Pension Fund v. Reimer Express World

Corp., 230 F.3d 934, 939 (7th Cir. 2000). The statute named in

Count II includes a venue provision which permits venue in this



Benefits Agreement which stated that Mr. Boxdorfer was obligated to
reimburse the plan for covered medical expenses paid on his behalf
out of any recovery in connection with the accident, and which
assigned to Lapham any such cause of action.

In early 2002, Mr. Boxdorfer retained defendant Devereaux,
Stokes, & Nolan, P.C. (“Devereaux”), a Missouri law firm, to
represent him in connection with his injuries. On March 13, 2002,
Devereaux filed a civil personal injury action against Mr. Jones
and Lason in Missouri state court, seeking recovery of damages
sustained by Sylvan Boxdorfer as a result of Mr. Jones’ and Lason’s
negligence. Mr. Jones’ and Lason’s legal counsel in that action was
retained by defendant Federal Insurance Company (“Federal”), an
Indiana corporation. Unbeknownst to Lapham, Mr. Boxdorfer reached
a settlement with Jones and Lason which provided for the payment of
$2,500,000 to the Sylvan A. Boxdorfer Special Needs Trust, of which
Mrs. Boxdorfer and defendant A.G. Edwards Trust Company
(“Edwards”), a Delaware corporation, are co-trustees, and
$1,500,000 individually to Mrs. Boxdorfer. Federal paid the
settlement on behalf of Mr. Jones and Lason, its insured. The
Devereaux Law Firm received an unspecified amount of attorneys’
fees from the settlement proceeds. On November 21, 2002, Devereaux
notified Lapham of the settlement.

On May 16, 2003, Lapham filed the present seven-count

complaint against Lason, Edwards, Mrs. Boxdorfer, Federal, and



IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION

LAPHAM-HICKEY STEEL CORP.,
Plaintiff,

v.
No. 03 C 3282
A.G. EDWARDS TRUST COMPANY FSB, a
Delaware corporation, as co-trustee of
the SYLVAN A. BOXDORFER SPECIAL NEEDS
TRUST; GINA BOXDORFER, as co-trustee of
the SYLVAN A. BOXDORFER SPECIAL NEEDS
TRUST; LASON SYSTEMS, INC., a Delaware
corporation; FEDERAL INSURANCE COMPANY,
an Indiana corporation; and DEVEREAUX
STOKES & NOLAN, P.C., a Missouri
professional corporation,

gar

yuh
ot

Defendants.

MEMORANDUM OPINION AND ORDER
I.

Plaintiff Lapham-Hickey Steel Corporation (“Lapham”), an
Illinois corporation, employed Sylvan Boxdorfer, a resident of St.
Louis, Missouri. On September 25, 2001, Mr. Boxdorfer was involved
in a car accident which rendered him quadriplegic. The other
vehicle involved was being driven by Leroy Jones, an employee of
Lason Systems, Inc. (“Lason”), a Delaware corporation. Pursuant to
its Employee Group Health Care Plan (the “Plan”), Lapham paid Mr.
Boxdorfer $776,256.45 in covered medical expenses in connection
with the injuries which resulted from the accident. In mid-October,
2001, defendant Gina Boxdorfer, acting on behalf of her

incapacitated husband, signed a Subrogation and Assignment of