Cook Associates v. Lexington United Corp

Brief Fact Summary.

Cook (Plaintiff) brought suit against Lexington United Corp. (Defendant), corporation with its principle place of business in Missouri, in Illinois, arguing that the court had personal jurisdiction over Defendant due to Defendant’s business conducted in the state.

Synopsis of Rule of Law.

The Illinois long-arm statute only allows a foreign corporation to be sued in Illinois based upon a single transaction of business in the state when the cause of action arises from the transaction.

Facts.

Plaintiff was an executive employment agency with offices in Chicago and Massachusetts. Defendant was a corporation with its principle place of business in Missouri. McIntosh operated the employment agency, and received a request from Runza, one of Defendant’s executives, for assistance in filling a position. The agreement between the two stated that Defendant would pay Plaintiff a fee if it hired one of Plaintiff’s referrals within two years of the referral. McIntosh sent Hoegemeir to fill the position. He was interviewed in Chicago and offered the position, but turned it down. At some point after this, McIntosh left Plaintiff and established her own employment agency. Runza contacted her again about a position and she again sent Hoegemeir. This time Hoegemeir accepted the offer. Plaintiff sued Defendant in Illinois state court to collect its fee. Defendant challenged the Illinois court’s personal jurisdiction, arguing that its only contact with Illinois was its annual participation in a trade show there. Plaintiff claimed that the original Hoegemeir interview in Chicago formed the basis for a finding that Defendant was doing business in Illinois and was therefore subject to process under the Illinois long-arm statute. The trial court found for Plaintiff and the appellate court reversed. Plaintiff appealed to the Illinois Supreme Court.

Issue.

Does the Illinois long-arm statute allow a foreign corporation to be sued in Illinois based upon a single transaction of business in the state when the cause of action does not arise from the transaction?

Held.

(Ward, J.) No. The Illinois long-arm statute only allows a foreign corporation to be sued in Illinois based upon a single transaction of business in the state when the cause of action arises from the transaction. Here, Hoegemeir rejected Defendant’s employment offer after the Chicago interview, so no contract was formed. Although Hoegemeir eventually accepted an employment offer from Defendant, that offer was very different from the one made after the Chicago interview. Therefore, the cause of action did not arise in Illinois and, under the long-arm statute, the court does not have personal jurisdiction over Defendant. Also, Defendant could not be said to be doing business in Illinois such that Illinois would have personal jurisdiction on that basis. Defendant’s appearance at the annual trade show was not sufficient to be considered doing business. Affirmed.

Discussion.

The Uniform Interstate and International Procedure Act is similar to the Illinois statute discussed in this case. There are some differences though as the UIIPA allows jurisdiction over out-of-state torts with in-state consequences, jurisdiction over a defendant who regularly solicits business within the state, and jurisdiction over persons contracting to supply services within the state. The Illinois statute does not allow jurisdiction in these circumstances.