Moreover, the Court cannot exercise personal jurisdiction over defendant, even ifit has actual notice
of the suit, unless “the procedural requirement of service of summons [is] satisfied.” Omni Capital

Intern., Lid. v. Rudolf Wolff & Co.. Ltd., 484 U.S. 97, 104 (1987). Thus, neither defendant’s failure

to waive service or its awareness of this suit is a substitute for proper service.

Plaintiff's failure to effect service within 120 days after the filing of the complaint is grounds
for dismissal of the suit. FED. R. Civ. P. 4(m), The Court is not required to dismiss, however, and
declines to do so in this instance. See Panaras v. Liquid Carbonic Indus. Corp, 94 F.3d 338, 340 (7"
Cir. 1996) (“[T]he court may, in its discretion, either dismiss the action without prejudice or direct
that service be effected within a specified time,” even if no cause is shown for the service failure).
Because the 120-day period has recently lapsed and it appears that plaintiff will ultimatcly be able
to effect proper service, the Court exercises its discretion to extend by forty-five days plaintifl’s time

for service. Accordingly, defendant’s motion to dismiss for lack of timely service is denied.

Motion to Transfer Venue’

Defendant also asks the Court to transfer this case to the District of Maryland pursuant to 28
U.S.C. § (“section”) 1406, which authorizes the transfer of cases that are filed in the wrong venue.
Venue for a diversity suit, like this one, is proper in:

(1) ajudicial district where any defendant resides, if all defendants reside in the same
State, (2) a judicial district in which a substantial part of the events or omissions
giving rise to the claim occurred, or a substantial part of property that is the subject
of the action is situated, or (3) a judicial district in which any defendant is subject to

? According to the Supreme Court, we can consider this motion, even though defendant has
not been served. Sce Goldlawr, Inc. v. Hciman, 369 U.S. 463, 466 (1962) (“The language of section
1406(a) is amply broad enough to authorize the transfer of cases... whether the court in which it
was filed had personal jurisdiction over the defendants or not.”’)

4


(here].” Burger King, 471 U.S. at 474, 476 (internal quotation marks and citation omitted); see

Heritage House Restaurants, Inc. v. Continental Funding Group. Inc., 906 F.2d 276, 284 (7 Cir.

1990) (Non-resident defendant that provided financial services to resident-corporation plaintiff for
more than one year was subject to the jurisdiction of the Iilinois courts because defendant had
“knowingly .. . reached out to... and created a continuing relationship” with Ulinois resident),
Because a corporation is deemed to reside in any state that can exercise personal jurisdiction
over it, defendant is a resident of Uinois. 28 U.S.C. § 1391(c). Consequently, venue is proper in
this district because defendant resides here and is subject to personal jurisdiction here, the first and
third options in the venue statute. 28 U.S.C, § 1391(a)(L), (3)? Accordingly, defendant’s motion

to transfer this case to the District of Maryland is denied.

*Venue is also proper in this district because “a substantial part of the events or omissions
giving rise to the claim” — the formation of the contracts and plaintiff's performance — occurred
here, the second option in the venue statute. 28 U.S.C. § 1391(a)(2).



process.” Mp. R. Civ. P., Dist. CT., R. 3-124. Plaintiff has not shouldered its burden of proving that

defendant was served in accordance with any of these methods. Aetna Bus. Credit, Inc. v. Universal

Decor & Interior Design, Inc., 635 F.2d 434, 435 (5 Cir. 1981) (“When service of proccss is
challenged, the party on whose behalf it is made bears the burden of establishing its validity.”).
The only evidence plaintiff offers on service is the affidavit of ils process server. That
document says that Malkanthi Renuka, administrative assistant, was handed a copy of the summons
and complaint at 101 Lake Forest Boulevard, Suite 302, Gaithersburg, Maryland on April 1, 2003.
(Aff. Service.) Ms, Renuka was not found in Illinois, so service was not effected pursuant to Illinois
law. Service was also not effected pursuant to Maryland law as plaintiff has not shown that it made
a good faith attempt to serve one of defendant’s officers before serving Ms. Renuka, or that Ms.
Renuka is expressly or impliedly authorized to accept service of process for defendant.' Similarly,
plaintiff has not shown that Ms. Renuka is authorized by appointment or law to receive process for
defendant, as required by Rule 4(h). Thus, plaintiff has not shown that it properly served defendant.
Plaintiff argues that any defect in service should be excused because defendant received a
waiver of service but refused to execute it and, in any event, it has actual notice of the suit. Neither
circumstance cures defective service. As Judge Coat observed: “A plaintiff’s obligation to attempt
service does not end when a defendant fails to waive service. Rather, the onus is on the plaintiff to
effect service in another way, [though] the defendant could be required to bear the costs of effecting

that service.” DeBartola v. Plano Molding Co., 2002 WL 1759811, at *2 (N.D. Ill. July 20, 2002).

*Citing to the process server’s affidavit, plaintiff says that Ms. Renuka was the only person
in defendant’s office on the day she was served and that she told the process server she was
authorized to accept process. (See Pl.’s Am. Reply at 4.) In reality, however, the process server's
affidavit says nothing more than that Ms. Renuka was served.

3


personal jurisdiction at the time the action is commenced, if there is no district in
which the action may otherwise be brought.

28 U.S.C. § 1391(a). Defendant contends that the Northern District of Illinois does not mect any of
ihe venue criteria.

For venue purposcs, a corporation is deemed to reside in any district in which it is subject
to personal jurisdiction at the time the action is filed. 28 U.S.C. § 1391(c), Defendant is subject to
personal jurisdiction in this district if the Illinois courts could exercise jurisdiction over it. FED. R.
Civ. P. 4(k)(1)(A). The [linois fong-arm statute permits INinois courts to exercise jurisdiction over
a non-resident defendant if doing so is consistent with federal constitutional standards. 735 ILL.
Comp. STAT, 5/2-209(c), In a case like this, which arises out of 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 (1985) (internal quotation marks and citation omitted), Plaintiff, who bears the

burden of proving proper venue, see Grantham v, Challenge-Cook Bros. Inc., 420 F.2d 1182, 1184

(7th Cit. 1970), has proffered evidence that suggests defendant is subject to the jurisdiction of the
Tlinois courts.

Plaintiff alleges that defendant entcred into a series of contracts with it for the purchase of
milk powder from March 1999 through November 2002, (First Am. Compl. {| 7-8.) The contracts
were apparently identical, calling for the purchase of dry milk powder and payment net sixty days
from the date of each invoice. (Id. § 7.) Plaintiff aggregated the balances due on each order and, by
the end of July 2002, defendant owed plaintiff $484,253.49 on the contracts, (Id., Ex. 1.) According

to plaintiff's president, plaintiff accepted defendant’s orders in Iinois, plaintiff negotiated for the

5


Conclusion
For all of the reasons stated above, defendant’s motion to dismiss for lack of proper service
is denied. Plaintiif is given forty-five days from the date of this Memorandum Opinion and Order
to serve defendant in accordance with the Federal Rules. Defendant’s motion {o transfer for
improper venue is also denied.

ENTER:

UNITED STATES DISTRICT JUDGE

DATED: 2F 2008.



Bee

‘Minute Order Form (06°97)

United States District Court, Northern District of MWlinois

‘Name of Assigned Judge ? Sitting Judge if Other
or Magistrate Judge Paul E. Plunkett than Assigned Judge
CASE NUMBER 03 C 1168 DATE 7/28/2003
CASE Carlyn Dairy Products Inc. vs. First Intemtl’ Inc.
JITLE
[In the following box {a) indicate the party filing the motion, ¢.g,, plaintill, defendant, 3rd party plaintiff, and (b) state briefly the nature
MOTION: of the motion being presented,]
DOCKET ENTRY:
qa) qa Filed motion of [ use listing in “Motion” box above.]
(2) my Brief in support of motion duc
Q) a Answer brief to motion due. . Reply to answer briefdue_
(4) Oo Ruling/learingon__setfor__at
(5) va) Status hearing[held/continued to] [set for/re-set for}on__—=—ssetfor_ at.
(6) o Pretrial conferencefheld/continued to] [set for/re-set for]on____set for, at.
(1) a Trial(set for/re-set forjon__— at.
(8) a (Bencl/Jury trial] [Hearing] held/continuedto ss at_
(9) go This case is dismissed (with/without] prejudice and without costs[by/agreement/pursuant to]
OrRCPA(m) OO Local Rule 41.1 CIFRCP41(a\(1) OO FRCP41(a)(2),

qo) of [Other docket entry) ENTER MEMORANDUM OPINION AND ORDER: Defendant's motion

to dismiss for lack of proper service is denied. Plaintiff is given forty-five days from the date of this

Memorandum Opinion and Order to serve defendant in accordance with the Federal Rules. Defendant's

motion to transfer for improper venue is also denied. Status hearing set for 8/13/03 at 9:30a.m.
gi) ol (For further detail sce order attached to the original minute order,]

No notices required, advised in open court.

No notices required. umber of notices

rfaales

Notices mailed by judge's staff.

‘Notified counsel by telephone,

vo | Docketing to mail notices.

Mail AO 450 form, RVAO2 Isirein es

Y | Copy w judge/magistrate judge.

done majtod novice
courtroom,

depaty's
initials

TBK

Date/time received in
central Clerk's Office

mailing deputy initials



purchase of the products necded to fill the orders in Illinois, defendant sent payments on the purchase
orders to Ilinois and the unpaid invoices on which the suit is based were prepared in and transm ited
from Ilinois. (P1.’s Am. Reply, Ex. 1, McAuliffe Aff. 47.)

Defendant says those contacts are insufficient to vest jurisdiction, and therefore, residency,
in Illinois because they do not exist. Though defendant admits itonce had a contractual relationship
with plaintiff, it says it was not a party to the contracts underlying this suit. (Se¢ Def.’s Reply Supp.
Mot. Transfer Venue, Att. A, Abdalla Aff. { 10.) Thus, defendant says, it never sent the contested
orders to Minois, received the contested invoices from, or sent payments on them to, IMinois, or took
any other action in connection with these contracts that would confer jurisdiction on the courts of
this State.

At this stage of the proceedings, however, we cannot resolve factual disputes. Tnstead, we
must credit plaintiff's version of the facts and, given those facts, determine whether defendant has
sufficient contacts with Jllinois to make it a proper venuc for this suit. Cf. RAR, Jne. v. Tumer

RAK, ne. Yieer

Diesel, Ltd., 107 F.3d 1272, 1275 (7TM Cir, 1997) (On motion to dismiss for lack of personal

jurisdiction, “(plaintiff] is entitled to have any conflicts in the affidavits resolved in its favor.”).
Given the evidence plaintiff has offered, we conclude that it does. According to plaintiff,
the parties had an ongoing business relationship that lasted for more than three years. Pursuant to
that relationship, defendant transmitted a series of orders to plaintiff, which were received, accepted
and acted upon in Ilinois. Defendant sent periodic payments to Illinois and the invoices it allegedly
failed to pay were prepared in and transmitted from Illinois. That evidence suggests that defendant
is amenable to jurisdiction in this State because it “created continuing obligations” between itself

and a resident of this State, conduct that should have caused it “[to] anticipate being haled into court


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

DOCKETEN

CARLYN DAIRY PRODUCTS, INC., ,
MUL 2 9 2upy

Plaintiff,

No, 03 C 1168
Paul FE. Plunkett, Senior Judge

¥.

FIRST INTERNATIONAL, INC.,

Defendant.

MEMORANDUM OPINION AND ORDER

Carlyn Dairy Products, Inc. has sued First International, Inc. for breach of contract.
Defendant has filed a Federal Rule of Civil Procedure (“Rule”) 12(b)(5) motion to dismiss for
insufficiency of process and, in the alternative, a motion to transfer venue. For the reasons set forth

below, both motions are denied.

Facts

Plaintiff is an Illinois corporation with its principal place of business in Mundclein, Tlinois.
(First Am. Compl. 4 1.) Defendant is a Maryland corporation with its principal place of business in
Gaithersburg, Maryland. (1d, 2.)

From March 1999 through November 2002, defendant entered into a series of contracts with

plaintiff for the purchase of dry milk powder. (Id, §{[ 7-8.) Throughout that period, defendant sent

o\


purchase orders to plaintiff and plaintiff accepted the orders, purchased the necessary milk powder
to fill them and shipped it to defendant’s specified destination. (Id, { 8.)

In 2002, defendant started falling behind on its payments and by December 2002 it was
making no payments at all. (Id. 10; id., Ex 1.) Defendant currently owes plaintiff $444,202.79.
(id, 10.)

Plaintiff filed this suit on February 18, 2003. In March 2003, plaintiff mailed a copy of the
complaint and a request for waiver of service to defendant’s president. (Pl.’s Am. Reply, Ex. 1,
McAuliffe Aff. 4 3.) The waiver of service was not retumed, Consequently, on April 2, 2003,
plaintiff had a process server deliver a copy of the summons and complaint to defendant’s office.
(Aff. Service.)

Detendant contends that it has not been properly served and that, in any event, this Court is

not a proper venue for this suit.

Discussion

Motion to Dismiss

The Federal Rules permit plaintiff to effect service on defendant pursuant to Minois law,
Maryland law or “by delivering a copy of the summons and. . . complaint to an officer, managing
or general agent, or to any other agent authorized by appointment or by law to receive service of
process.” Frp, R. Civ, P. 4(e)(1), (h)(1). Ulinois law permits corporations to be served through
agents found in this State. 735 ILL. Comp. STAT. 5/2-204, Maryland law permits corporations to be
served through various officers or “if'a good faith attempt to serve [those officers] has failed, service

may be made by serving . . . [any] person expressly or impliedly authorized to receive service of