systematic” business contacts with the forum state. Hyatt Int'l Corp., 302 F.3d at 713. In
evaluating gencral jurisdiction, the court examines the defendant’s contacts with the forum slate

beyond those related to the pending lawsuit, Dehmlow v. Austin Fireworks, 963 F.2d 941, 947

n.6 (7" Cir, 1992).

Plaintiff argues that defendants have made continuous and systematic contacts with
Ulinois through their website. The exercise of personal jurisdiction is proper where a defendant
conducts business over the Internct with residents of the forum state through an active website.
David White Instruments, LLC v. TLZ, Inc., No. 02 C 7156, 2003 WI. 21148224, at *5 (N.D. Ill.
May 16, 2003); Aero Products Int'l, Inc. v. Intex Corp., 64 U.8.P.Q.2d 1772, 1776 (N.D. Tl.
2002). The exercise of personal jurisdiction may also be proper where a defendant maintains an
interactive websitc, in when a user can exchange information with the defendant's computer,
depending on the level of interactivity and commercial nature of the information exchange. Id.
The exercise of personal jurisdiction is nol proper where a defendant merely has posted
information on a passive website. Id.

Defendants’ website, “www.impactpads.com,” offers information about defendants’
products, but docs not allow users to purchase items through the website. The website allows
users to contact Impact by providing their name, telephone number, and e-mail address, but is not
otherwise intcractive. Although plaintiff argues in its brief that the website “is directed to Illinois
residents,” it offers no evidence that the website specifically targeted Illinois residents. The court
concludes that defendants’ website does not establish continuous and systematic contacts with
Illinois.

Plaintiff also argues that the exercise of general jurisdiction is proper because defendants



Plaintiff does not argue that venue would not be proper in either New Jersey or
Pennsylvania, but rather argues that a transfer to either venue would not serve the convenience of
the parties or promote the interests of justice. Factors relevant to (he convenience of the parties
and witnesses include: (1) the plaintiff's choice of forum, (2) the situs of material events; (3) the
relative case of access lo sources of proof; (4) the convenicncc of the witnesses; and (5) the

convenience to the parties of litigating in the respective fora. Allicd Van Lines, Inc. v. Aaron

Transler & Storage, Inc., 200 F. Supp. 2d 941, 946 (N.D. TIl. 2002). Iactors relevant to the
interest of justice include: (1) the speed at which the case will procecd to trial; (2) the court’s
familiarity with the applicable law; (3) the desirability of resolving controversies in each venue;
and (4) the relation of each community to the occurrence at issue. Td.

In support of its motion to transfer to the Eastern District of Pennsylvania, Monica argues
that the court should give little weight to plaintiff's choice of forum, because the design and
development of the prototype occurred in Pennsylvania, where Monica worked for plaintiff from
1993 through 2002. Although Monica asserts that the sources of proof would be easily
accessible in Pennsylvania, this assertion appears to be based on the fact that a number of
witnesses are located in nearby New Jersey; Monica does not indicate that any potential witness
(save himself) is located in Pennsylvania. Monica argues that plaintiff is a multi-million-dollar
company with vast resources, and is far better able to bear the burden of out-of-state litigation
than is Monica. Finally, Monica states that the Illinois Trade Secrets Act, the applicable law in
this case, is modeled alter the Uniform Trade Secrets Act, and requires an analysis similar to the
trade secrets analysis used be Pennsylvania courts.

For its part, Impact argues that New Jersey is the situs of material events, becanse the



2002 WL 1838130, at *4 (N.D. IU. Aug. 12, 2002); divine/Whittman-Hart, Inc. v. King, No. 02 C

2486, 2002 WL 1611585, at *4(N.D. Ul. July 22, 2002), This is because the location of the

tortious injury is critical to understanding where the tort occurred. Janmark, Inc., 132 F.3d al

1202,

Herc, plaintiff has alleged that defendants misappropriated plaintifi’s trade secrets, As
defendants were aware, plaintiff’s principal place of business is in [llmois, and thus the injury
would be felt most severcly in Illinois. Under the circumstances, il was foreseeable that
defendants would be required to answer {or such actions in Illinois.? Sce Digital Merch. Sys.
Inc. v. Oglesby, No. 98 C 8033, 1999 WL 1101769, at *3 (N.D. Hl. Nov. 30, 1999) (defendants’
knowledge that they were dealing with Illinois corporation at time of alleged tortious conduct
sufficient to satisfy minimum contacts). Moreover, Impact would have minimum contacts with
Illinois even under the morc restrictive interpretation of the effects doctrine that requires an
additional entry into the forum state, since Impact directed the mailing of an advertisement for its
product to an individual with the Chicago Bears, in Illinois. The court finds that defendants have
established minimum contacts with Illinois.

Having determined that minimum contacts exist, the court next must consider whether it
would offend traditional notions of fair play and substantial justice to exercise personal
jurisdiction over defendants in this casc. See Burger King Cotp., 471 U.S. at 477-78. No single
factor is dispositive to this inquiry, but the most important are the interests of the states involved

and the relative convenience of litigating there. See Kohler Co. v. Kohler Int'l, Lid., 196 F.

* Given this conclusion, the court need not consider Monica’s argument that the fiduciary
shicld doctrine precludes the court’s consideration of telephone calls he made to Illinois while he
was employed by plaintiff.

6



directly solicited an {linois resident through a written advertisement. However, this single act
does not establish continuous and systematic contacts with Illinois that would justify the court in
exercising general personal jurisdiction over defendants. The court concludes that general
personal jurisdiction does not exist in this case.
B. Specific Personal Jurisdiction

Specific personal jurisdiction exists where the suit arises out of, or is related to, the
defendant’s minimum contacts with the forum state. Hyatt Int’) Corp., 302 F.3d at 716, In this
inquiry, the court must first determine whether defendants “purposefully established ‘minimum
contacts’ in the forum State” such that they “should reasonably anticipate being haled into court”
in that slate. See Burger King Corp. v. Rudzewicz, 471 U.S. 462, 474 (1985); World-Wide

Volkswagen Corp. v. Woodson, 444 1.8, 286, 297 (1980).

Under the “effects doctrine,” personal jurisdiction over a nonresident defendant is proper
when the defendant’s intentional tortious actions aimed at the forum state cause harm to the
plaintiff in the forum state, and the defendant knows such harm is likely to be suffered. Sce
Calder y. Jones, 465 U.S. 783 (1984). The Seventh Circuit has interpreted the effects doctrine
broadly. Sec, e.g., Janmark, Inc. v. Reidy, 132 F.3d 1200, 1202 (7" Cir. 1997), Under the
Seventh Circuit interpretation, “the state in which the victim of a tort suffers the injury may

entertain a suit against the accused tor(feasor” even if all the other relevant conduct took place

outside fllinois.' See id.; Int'l Molding Mach. Co. v. St. Louis Conveyor Co., No, 01 C 8305,

' Although other circuits have criticized this broad application of the “cffects doctrine,”
sec, e.g., LM.O. Indus., Inc. v. Kiekert AG, 155 F.3d 254, 263-64 (3% Cir, 1998), and require
some additional “entry” into the forum state to support exercising personal jurisdiction therc, the
Seventh Circuit appears to make no such requirement.

5


When ruling on a motion to dismiss under Rule 12(b)(6), the court must consider

“whether relief is possible under any set of facts consistent with the allegations of the plaintiff's

complaint.” Pokuta v. Trans World Airlines, Inc., 191 F.3d 834, 839 (7 Cir, 1999). Under

illinois law, an employee owes a duty of loyalty to his employer. Dames & Moore y. Baxter &

Woodman. Inc., 21 F’. Supp. 2d 817, 823 (N.D. Ill. 1998) (citing ABC Trans Nat’l Transport, Inc.

v. Aeronautics Forwarders, Inc., 379 N.E.2d 1228, 1237 (Ill. App. Ct. 1978)). However, this

duty ends when the employment relationship ends. Id. (citing Prudential Ins. Co. v. Van Matre,
511 N.E.2d 740, 748 (ILL. App. Ct. 1987).

The complaint does not indicate when all of the alleged conduct at issuc occurred. Since
it is possible that at least some of the alleged activities occurred while Monica was employed by
plaintiff, the claim is not dismissed. Of course plaintiff will be unable to recover for any breach
of fiduciary duty based on Monica’s activities altcr he left plaintiff's employ, but that is a matter
to be resolved at a later stage of litigation.

IV. Motions to Transfer

Monica moves to transfer the case to the District Court for the Bastern District of
Pennsylvania, and Impact moves to transfer this case to the District Court for the District of New
Jersey. A district court may transfer a civil action to any other district where the case otherwise
might have been brought, “[flor he convenience of parties and witnesses, in the intcrest of

justice.” 28 US:

. § 1404(a). The party moving for transfer bears the burden of demonstrating
that, after considering the convenience of the parties, the convenience of the witnesses, and the
intcrest of justice, the transferee forum is clearly more convenient than the transferor forum.

Coffey v. Van Dom Iron Works, 796 F.2d 217, 219-20 (7" Cir, 1986).


. ”

Minute Order Hest (06/97)

United States District Court, Northern District of Illinois

ame ed i ing Judy

ve Magirate Judge George W. Lindberg “than haigned Judge

CASE NUMBER 03 C 3309 DATE 7/23/2003
CASE Riddell, Inc. vs. Theodore Monica, Jr.
TITLE

Tin the following box (a) indicate he party filiny the motion, e.g. plainti, defendant, Ard party plaintiff, and (b) state briefly the nature
of the motion being presented. |

MOTION:

DOCKET ENTRY:

ql) o Filed motion of | use listing in “Motion” box above.]

(2) Oo Brief in support of motion due

(3) og Answer brief to motion due____. Reply to answer brief due___.

(4) o Ruling/Hearingon___—_setfor___at__

(3) Oo Status hearing[held/continued to] {set for/re-set for] on____ set for at
(6) a Pretrial conference(held/continued to] [set for/re-set for]on__—_set for, __at__.__
{7) Oo Trial[set for/re-set for] on__at

(8) im} [Bench/Jury trial] [Hearing] held/continued to__at

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

OOPRCP4(m) OLocalRule 41.1 OFRCP4(ay(1) Cl FRCP41(a)(2).

(10) Ml [Otherdocketentry) Defendant Impact Protective Equipment’s motion to dismiss (5-1) and motion
to transfer (5-1) are denied. Defendant Theodore Monica’s motion to dismiss (4-1) and motion to
transfer (4-2) are denied, Enter memorandum opinion and order.

(1) [For further detail see order attached to the original minute order. |

v No notices required, advised in open court. Document

Number

o

tices required.
No no! quired ums of natiees

Natices mailed by judge's staff. UL 2 5 2003

Notified counsel by telephone. date duckied

Docketing to mail notices,
Mail AO 450 form, LYAOD LOM ESIT SA

Copy to judge/magistrate jude.

doce mailed wwe
courtroom

SLB deputy’s
initials

Date/time received in
central Clerk's Office. sg deputy iil



its witnesses will offer, and it appears from this summary that the listed witnesses’ testimony
would be significant. In addition to the witnesses listed by plaintiff, Impact lists nmeteen New
Jersey witnesses. Impact’s five remaining witnesses are located in Connecticut, North Carola,
New York, New Hampshire, and Pennsylvania. Monica lists ten of the same New Jersey
witnesses as Impact, along with the same North Carolina and New Hampshire witnesses. Neither
Impact nor Monica indicates the subject of these witnesses’ testimony, or whether they are
employed by Impact. Documents relating to Impact are located in New Jersey. Given that the
court is unable to evaluate the nature of defendants’ witnesses’ testimony or whether they would
testify voluntarily, this factor weighs against transfer.

Next, the court considers the convenience of the parties. According to a May 2003 article
in Intemet newsletter Consumer Mergers & Acquisitions Weekly, cited by defendants, plaintiff
has annual sales of $100 million. Plaintiff conducts business throughout the United States.
Although its principal place of business is in Illinois, plaintiff maintains offices in six other
states, including Pennsylvania, and in Canada. Impact was organized in June 2001, and thus far
has eamed no revenue. Impact maintains a single office, in New Jersey, and has four employees.
Monica resides in Pennsylvania; he has offered no evidence by way of affidavit as to his financial
circumstances. The court finds that this factor weighs in favor of transfer to either New Jersey or
Pennsylvania.

The court next examines the interest of justice. The parties have offered no evidence as
to the relative speeds at which the venues at issuc resolve cases, and therefore the court does not
consider that factor. The complaint alleges violations of Tllinois law, and a federal court in the

Northern District of [linois is more likely to be familiar with Tilinois law than a federal court in

11



alleged acts of misappropriation occurred there. Impact notes that most of its potential witnesses
are located in New Jersey, and that nonc is located in Illinois. Like Monica, Impact argues that
plaintiff is better able to alford the expenses of out-of-state litigation than is Impact. Impact
notes that although this action requires the application of Illinois law, New Jersey law provides
for similar actions, and thus a federal judge sitting in New Jerscy would be more than capable of
applying Tllinois law.

Normally, plaintiff's choice of forum is entitled to substantial weight, especially if the

chosen forum is the plaintifi’s home forum. Symons Corp. v. Southern Forming & Supply Tne.,

954 F. Supp. 184, 186 (N.D. TI. 1997). However, where the forum has no significant connection
to the plaintiff's claim, the plaintiff's chosen form may be entitled to less deference. Dum v.
Soo Line R. Co., 864 F. Supp. 64, 65 (N.D. Ill. 1994), Here, Ilinois is plaintiff's home forum,
and as the court has alrcady discussed, plaintiff's alleged injury occurred in plaintiff’s home
forum. In addition, according to plaintiff, defendants sent an advertisement directly to an Illinois
customer. Tl appears that the remaining events took place in Pennsylvania, New Jersey, and other
states. The court concludes that plaintiff's choice of forum is entitled to at least some deference.
The court next considers the rclative case of access to sources of proof and the
convenience of the witnesses, Since “[s]heer numbers alone...do not accurately gauge the full
extent of the witness convenience factor[,]...the Court must also consider the nature and quality
of their testimony and their availability by compulsory process.” Bally Mfg. Corp. v. Kane, 698
F. Supp. 734, 738 (N.D. Til. 1988). Plaintiff lists six Illinois witnesses, including two non-party
witnesses. Plaintiff's eight remaining potential witnesses are located in Missouri, Ohio, New

llampshire, Texas, Arizona, Florida, and Canada. Plaintiff summarizes the testimony it believes

10



Supp. 2d 690, 700 (N.D. Tl. 2002).

The court finds that its exercise of personal jurisdiction over these defendants does not
offend traditional notions of fair play and substantial justice. First, Illinois has a significant
interest in the adjudication of this case, since plaintiff is an [linois company, and, as discussed
above, defendants’ alleged tortious activity would have caused injury in Tllinois, Sce Int’l
Molding Mach, Co., 2002 WL 1838130, at *5 (Illinois has strong interest in adjudicating cases
arising from injuries occurring within its borders). Second, the burden on defendants of litigating
this case in Illinois, while perhaps significant, is nol so great as to amount to a deprivation of duc
process, given that Chicago is a major metropolitan area and transportation hub. See Bimberg v.

Milk St. Residential Assocs. Ltd,, No. 02 C 978, 02 C 3436, 2003 WL 151929, at *8 (N.D. Il.

Jan. 21, 2003) (holding that travel from Massachusetts to Illinois was not oppressive due to
modern advances in communication and transportation). Finally, the potential witnesses in the
case are largely split between Illinois and New Jersey, making it reasonable to resolve this case in
Illinois. Therefore, defendants’ motions to dismiss for lack of personal jurisdiction are denicd.

ILL = Monica’s Motion to Dismiss Count II

Count Li of the complaint alleges a claim of breach of fiduciary duty against Monica,
bused on allegations that Monica failed to tum over research and models of the prototype, applied
for a patent application for the prototype and failed to assign it to plaintiff, and presented the
prototype to plaintiff's competitors. Monica moves to dismiss Count TIT pursuant to Federal Rule
of Civil Procedure 12(b)(6) for failure to state a claim upon which relief can be granted, to the
extent that the claim is based on Monica’s conduct after he left plaintiff's employ in December

2002.



long-arm statute extends personal jurisdiction to the limit allowed under the Illinois Constitution
and the Constitution of the United States. 735 TLCS 5/2-209(c), RAR, Inc., 107 F.3d at 1276.

Thus, the court’s inquiry collapses into a state and federal constitutional inquiry. RAR, Inc., 107

F.3d at 1276.

Under the Illinois Constitution, jurisdiction is to be “‘asserted only when it is fair, just,
and reasonable to require a nonresident defendant to defend an action im Minois, considering the
quality and nature of the defendant’s acts which occur in Tllinois or which affect interests located
in Ilinois.”” Hyatt Int’ Corp. v. Coco, 302 F.3d 707, 715 (7" Cir. 2002) (quoting Rollins v.
Ellwood, 565 N.E.2d 1302, 1316 (Il, 1990)). Since there is little guidance available regarding
the reach of the Illinois Due Process Clause, court typically look to the Federal Due Process
Clause for guidance, See, e.g, id.; RAR, 107 F.3d at 1276-77. Thus, the court tums to the
federal constitutional limits on jurisdiction.

Under the United States Constitution, the Due Process Clause of the Fourteenth

Amendment limits a state court’s power to assert personal jurisdiction over a nonresident

defendant. RAR, Inc., 107 F.3d at 1277. A defendant must have “certain minimum contacts

[with the forum state] such that the maintenance of the suit does not offend ‘traditional notions of

a

fair play and substantial justicc.’” International Shoe Co. v. State of Washington, Office of

Unemployment Compensation and Placement, 326 U.S. 310, 316 (1945) (citation omitted),

Jurisdiction may be general or specific. Sec RAR, Inc., 107 F.3d at 1277. Here, plaintiff

contends that both general and specific jurisdiction exist.
A. General Personal Jurisdiction

General personal jurisdiction exists in cases in which a defendant has “continuous and



limited liability company that manufactures and sells sports equipment.

Monica left plaintiff's employ in December 2002. According to plaintiff, in early January
2003, Monica attended a convention in Louisiana as an employee of Impact. At that convention,
Monica presented a prototype sct of football protective pads that he had designed to the National
Football League, Canadian Football League, and various colleges. Plaintiff alleges that Monica
designed and developed this prototype while he was employed by plaintiff. Monica currently is a
Pennsylvania cilizen.

Tl. Personal Jurisdiction

On a motion to dismiss for lack of personal jurisdiction, the plaintiff bears the burden of

proving that personal jurisdiction exists. Central States, $.K. & §.W. Areas Pension Fund v.
Reimer Express World Comp., 230 I'.3d 934, 939 (7" Cir. 2000). In deciding a motion to dismiss

for lack of personal jurisdiction, the court may consider affidavits from the parties. Greenberg v.

Miami Children’s Hosp. Research Inst., Inc., 208 F. Supp. 2d 918, 922 (N.D. Ill. 2002) (citing
Kontos v. United States Dep’t of Labor, 826 F.2d 573, 576 (7" Cir. 1987)), The court must
resolve any factual disputes in the pleadings and affidavits in the plaintiff's favor, but takes as
{ruc any unrefuted facts contained in the defendant’s affidavits. Cont’| Cas. Co. v. Marsh, No. 01
C 0160, 2002 WL 31870531, at *2 (N.D. Ill. Dec. 23, 2002).

In a case based on diversity of citizenship, a federal district court sitting in Illinois has
personal jurisdiction over a nonresident defendant only if an Illinois court would have
jurisdiction. RAR, Inc. v, Turner Diesel, Ltd., 107 F.3d 1272, 1275 (7" Cir. 1997). An Illinois
court would have personal jurisdiction over a nonresident defendant only where it is permitted by

state statutory law, state constitutional law, and federal constitutional law. Id. at 1276. Tllinois’



IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOTS
EASTERN DIVISION DOCKETED

JUL 2 5 2003

RIDDELL, INC.,

Plaintiff,
03 © 3309
v.
Judge George W. Lindberg
THEODORE MONICA, JR. and

IMPACT PROTECTIVE EQUIPMENT, L.L.C.,

wee Se

Defendants.
MEMORANDUM OPINION AND ORDER

Defendants Theodore Monica, Jr. (“Monica”) and Impact Protective Equipment, L.L.C.
(“Impact”) have moved pursuant to Federa] Rule of Civil Procedure 12(b)(2) to dismiss
plaintiff's complaint for lack of personal jurisdiction. In addition, Monica moves to dismiss
Count TIT pursuant to Rule 12(b)(6). Alternatively, Impact moves to transfer this action to the
United States District Court for the District of New Jersey, and Monica moves to transfer the
action to the United States District Court for the Easter District of Pennsylvania. For the
reasons stated below, the motions are denied.

I. Background

Plaintiff is an Illinois corporation that manufactures and sells protective gear for football
players, In 1988, plaintiff bought United Sports Labs, a Texas corporation that designed and
manufactured shoulder pads for football players. Defendant Monica was an employee of United
Sports Labs, and became the gencral manager of the Riddell division that had been United Sports
Labs. In 1994, the division was moved to Pennsylvania.

Defendant Impact was formed in 2001 by Monica’s brother. Impact is a New Jersey



New Jersey or Pennsylvania. Finally, as the court discusses above, Illinois has a strong intcrest
in adjudicating a case that involves injurics to a business that operates in Illinois. The court finds
that the intcrest of justice weighs against transfer.

The court concludes that defendants have not met their burden of establishing that either
the District Court for the Eastern District of Pennsylvania or the District Court for the District of
New Jersey is clearly more convenient than the Northern District of Minois. Accordingly, the
motions to transfer arc denied.

ORDERED: Defendant Impact Protective Equipment’s motion to dismiss [5-1] and
motion to trans{er [5-2] are denied, Defendant Theodore Monica’s motion to dismiss [4-1] and

motion to transfer [4-2] arc denied.

ENTER:

Senior United States District Judge

pare. Wh 23 2009

12