Bilek v. Fed. Ins. Co.

CHRISTOPHER BILEK, individually and on behalf of others similarly situated, Plaintiff, v. FEDERAL INSURANCE COMPANY, HEALTH INSURANCE INNOVATIONS, INC, and DOES 1-10, Defendants.

19 C 8389

UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF ILLINOIS EASTERN DIVISION

July 13, 2020

MEMORANDUM OPINION

CHARLES P. KOCORAS, District Judge:

Before the Court is Defendant Health Insurance Innovations's ("HII") motion to dismiss Plaintiff Christopher Bilek's ("Bilek") Complaint for lack of personal jurisdiction under Federal Rule of Civil Procedure 12(b)(2) and motion to dismiss for failure to state a claim under Federal Rule of Civil Procedure 12(b)(6), and Defendant Federal Insurance Company's ("FIC") motion to dismiss for failure to state a claim under Rule 12(b)(6). For the following reasons, the Court will grant the motions.

BACKGROUND

For purposes of this motion, the Court accepts as true the following facts from the complaint. Alam v. Miller Brewing Co., 709 F.3d 662, 665-66 (7th Cir. 2013). All reasonable inferences are drawn in Bilek's favor. League of Women Voters of Chicago v. City of Chicago, 757 F.3d 722, 724 (7th Cir. 2014).

Plaintiff Bilek is an Illinois citizen residing in Cook County. Defendant FIC is an Indiana corporation with a principal place of business in Indianapolis, Indiana. FIC is a member of the Chubb family of companies. Defendant HII is a Delaware corporation with a principal place of business in Tampa, Florida.

On September 20, 2019, Bilek received an unsolicited call on his cell phone. The call played a prerecorded message selling health insurance and instructed Bilek to "press 1" to be connected with a live representative. Bilek followed the prompt and the live representative offered Bilek a health insurance policy for $171 per month, plus a $99 one-time fee. Bilek says the health insurance was underwritten by Chubb and facilitated by HII.

On September 26, 2019, Bilek again received an unsolicited phone call on his cell phone, this time from a different phone number. The call again played the same prerecorded message and instructed Bilek to "press 1" for a live representative. Bilek again followed the prompt and was given a quote for Chubb health insurance. Bilek says that the calls used a prerecorded or artificial voice because of "awkward pacing and intonation" that differed from the live representative.

Bilek alleges that the calls were made by an unnamed third-party telemarketer, but that HII knowingly participated in the calls "by pairing the telemarketer with the quote for Chubb insurance through its online portal." HII also provided real-timequoting information and emailed quotes to call recipients during the calls, though Bilek does not allege he received an email.

Bilek says the "Chubb" insurance referred to by the telemarketers was FIC. Bilek alleges that it is the practice of the telemarketers used by HII and FIC to change caller IDs so that recipients cannot tell who is calling.

Bilek alleges that HII and FIC used an automatic telephone dialing system ("autodialer"), with the capacity to dial a large amount of phone numbers in a short period of time without the need for human intervention. In other words, a human did not dial Bilek's phone number when the calls were placed.

Based on these facts, Bilek filed this complaint on behalf of himself and a purported class on December 21, 2019, alleging violations of the Telephone Consumer Protection Act, 47 U.S.C. § 227 ("TCPA"), and the Illinois Automatic Telephone Dialers Act, 815 ILCS § 305/1 et seq. ("IATDA"). Bilek seeks to hold HII and FIC directly and vicariously liable because the third-party callers were agents of HII and FIC. On February 13, 2020, HII moved to dismiss Bilek's complaint under Rule 12(b)(2) and (6). On the same day, FIC moved to dismiss Bilek's complaint under Rule 12(b)(6).

LEGAL STANDARD

Rule 12(b)(2) allows a court to dismiss a claim for lack of personal jurisdiction over the defendant. Fed. R. Civ. P. 12(b)(2). A complaint need not include facts alleging personal jurisdiction. But once the defendant moves to dismiss the complaintunder this Rule, the plaintiff must demonstrate that personal jurisdiction exists. Purdue Research Found. v. Sanofi-Synthelabo, S.A., 338 F.3d 773, 782 (7th Cir. 2003). If the court rules on the motion without a hearing, the plaintiff need only establish a "prima facie case of personal jurisdiction." Id. (quoting Hyatt Int'l Corp. v. Coco, 302 F.3d 707, 713 (7th Cir. 2002)).

The court reads the entire complaint liberally and draws every inference in the plaintiff's favor. Cent. States, Se. & Sw. Areas Pension Fund v. Phencorp Reins. Co., 440 F.3d 870, 878 (7th Cir. 2006) (quoting Textor v. Bd. of Regents of N. Ill. Univ., 711 F.2d 1387, 1393 (7th Cir. 1993)) (internal quotation marks omitted). The court may also consider affidavits from both parties when determining whether a plaintiff has met its burden. Felland v. Clifton, 682 F.3d 665, 672 (7th Cir. 2012). When the defendant challenges, by declaration, a fact alleged in the plaintiff's complaint, the plaintiff has an obligation to go beyond the pleadings and submit affirmative evidence supporting the exercise of jurisdiction. Purdue Research Found., 338 F.3d at 783. While affidavits trump the pleadings in this context, all facts disputed in the affidavits will be resolved in the plaintiff's favor. See id. at 782. Unrefuted facts in defendant's affidavits, however, will be taken as true. GCIU-Employer Ret. Fund, 565 F.3d 1018, 1023 (7th Cir. 2009).

A motion to dismiss under Federal Rule of Civil Procedure 12(b)(6) "tests the sufficiency of the complaint, not the merits of the case." McReynolds v. Merrill Lynch & Co., 694 F.3d 873, 878 (7th Cir. 2012). The allegations in the complaint must setforth a "short and plain statement of the claim showing that the pleader is entitled to relief." Fed. R. Civ. P. 8(a)(2). A plaintiff need not provide detailed factual allegations, but it must provide enough factual support to raise its right to relief above a speculative level. Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007).

A claim must be facially plausible, meaning that the pleadings must "allow . . . the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). The claim must be described "in sufficient detail to give the defendant 'fair notice of what the . . . claim is and the grounds upon which it rests.'" E.E.O.C. v. Concentra Health Servs., Inc., 496 F.3d 773, 776 (7th Cir. 2007) (quoting Twombly, 550 U.S. at 555). "[T]hreadbare recitals of the elements of a cause of action, supported by mere conclusory statements," are insufficient to withstand a 12(b)(6) motion to dismiss. Iqbal, 556 U.S. at 678.

DISCUSSION

HII urges the court to dismiss Bilek's complaint because the Court lacks personal jurisdiction over it and because Bilek fails to allege that it is directly or vicariously liable for the alleged TCPA and IATDA violations. Similarly, FIC argues that Bilek fails to allege that it is directly or vicariously liable for the statutory violations. We address each argument in turn.

I. Personal Jurisdiction

As a preliminary matter, HII argues that the Court does not have personal jurisdiction over it to certify a nationwide class because potential non-resident classmembers cannot establish HII's contacts with Illinois. However, the Seventh Circuit recently held, "the named representatives must be able to demonstrate either general or specific personal jurisdiction, but the unnamed class members are not required to do so." Mussat v. IQVIA, Inc., 953 F.3d 441, 447 (7th Cir. 2020). Accordingly, we only address whether Bilek has established that the Court has personal jurisdiction over HII.

A federal court sitting in Illinois may exercise jurisdiction over a defendant only if authorized to do so by both Illinois law and the United States Constitution. bE2 LLC v. Ivanov, 642 F.3d 555, 558 (7th Cir. 2011). The Seventh Circuit has explained that there is "no operative difference between the limits imposed by the Illinois Constitution and the federal limitations on personal jurisdiction." Hyatt Int'l Corp. v. Coco, 302 F.3d 707, 715 (2003)). Illinois law permits a court to exercise personal jurisdiction over a non-resident using its long-arm statute. Labtest Int'l v. Ctr. Testing Int'l Corp., 766 F. Supp. 2d 854, 858 (N.D. Ill. 2011) (citing 735 ILCS §5/2-209). That statute requires nothing more than the standard for federal due process: that the defendant have sufficient contacts with the forum state "such that the maintenance of the suit does not offend traditional notions of fair play and substantial justice." Brook v. McCormley, 873 F.3d 549, 552 (7th Cir. 2017) (quoting Int'l Shoe Co. v. Washington, 326 U.S. 310, 316 (1945)). A defendant's contacts with the forum state must not be fortuitous. Hyatt Int'l Corp., 302 F.3d at 715-16. Rather, a defendant must have purposely established those contacts such that it could "reasonably anticipate being haled into court" there. Burger King Corp. v. Rudzewicz, 471 U.S. 462, 474 (1985).

Two types of personal jurisdiction exist: general or specific. Daimler AG v. Bauman, 571 U.S. 117, 122 (2014). General jurisdiction exists when the party's contacts with the forum state "are so constant and pervasive as to render [it] essentially at home" there. Id. Specific jurisdiction grows out of "the relationship among the defendant, the forum, and the litigation." Walden v. Fiore, 571 U.S. 277, 284 (2014).

Bilek does not challenge HII's argument that the Court does not have general jurisdiction over it. Accordingly, the argument is waived. United States v. Holm, 326 F.3d 872 (7th Cir. 2003) ("It is not the obligation of this court to research and construct the legal arguments open to parties," and "perfunctory and undeveloped arguments" are waived.); Rose v. United States, 929 F. Supp. 305, 309 (N.D. Ill. 1996) (stating th...