Community Merchant Services, Inc. v. Jonas

CourtAppellate Court of Illinois
DecidedDecember 23, 2004
Docket4-04-0343 Rel
StatusPublished

This text of Community Merchant Services, Inc. v. Jonas (Community Merchant Services, Inc. v. Jonas) is published on Counsel Stack Legal Research, covering Appellate Court of Illinois primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Community Merchant Services, Inc. v. Jonas, (Ill. Ct. App. 2004).

Opinion

NO. 4-04-0343

IN THE APPELLATE COURT

OF ILLINOIS

FOURTH DISTRICT

COMMUNITY MERCHANT SERVICES, INC., an Illinois Corporation,

         Plaintiff-Appellant and                 Cross-Appellee,

         v.

SAMUEL K. JONAS, Individually; CASH RESOURCES, INC., a Colorado Corporation; and MEDIACHOICETV.COM, INC., a Colorado Corporation Doing Business as CONVENIENTV.COM,

         Defendants-Appellees and                Cross-Appellants.

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Appeal from

Circuit Court of

McLean County

No. 02L15

Honorable

Kevin P. Fitzgerald,

Judge Presiding.

_________________________________________________________________

JUSTICE MYERSCOUGH delivered the opinion of the court:

In January 2002, in McLean County, Illinois, plaintiff, Community Merchant Services, Inc. (Community), filed a complaint against defendants, Samuel K. Jonas, individually, Cash Resources, Inc. (Cash Resources), and MediachoiceTV.com, Inc., doing business as ConvenienTV.com (CTV).  Community's complaint alleged breach of contract and alter-ego claims.  An amended complaint filed in August 2002 further alleged breach of fiduciary duty, fraudulent inducement, conversion, and fraud.  

Defendants filed motions to dismiss based on lack of personal jurisdiction and the doctrine of forum non conveniens .    The trial court found personal jurisdiction existed over all defendants but concluded the complaint should nevertheless be dismissed on forum non conveniens grounds.  

Community appeals, arguing the trial court abused its discretion in dismissing its complaint pursuant to the doctrine of forum non conveniens .  Defendants cross-appeal, contending the court abused its discretion in finding personal jurisdiction over defendants Jonas and Cash Resources.  We affirm in part and reverse in part.  

I. BACKGROUND

Community is an Illinois corporation with its principal place of business in Bloomington, Illinois.  It is an independent service operator in the automated teller machine (ATM) industry and places ATMs throughout Illinois.  Community developed and owns the Kahuna Media Network (Kahuna), a business also in the ATM industry.

MediachoiceTV.com is a Colorado corporation doing business as CTV.  CTV is in the business of providing digital media and advertising services utilized in connection with point-of-sale advertising.  Cash Resources is also a Colorado corporation and is in the business of providing data processing and other services for ATMs.  Jonas is the president and majority shareholder of CTV and was the president and sole shareholder of Cash Resources until the sale of its assets in August 2002 to an entity known as eFunds, Inc.

In October 2000, Community and CTV began discussing the potential sale of Kahuna by Community to CTV.  As a result of these discussions, three documents were drafted and signed by the parties.  First, in October 2000, a disclosure agreement was entered into and signed by Community and defendant Jonas in his capacity as president of both CTV and Cash Resources.  Second, in December 2000, a temporary letter agreement, sometimes referred to by the parties as a letter of intent, was entered into and signed by the parties.  Finally, in April 2001, an addendum was signed by the parties and added to the letter agreement.  The addendum was to serve as the parties' binding agreement.  None of the agreements contained a choice-of-forum provision.

Paragraph seven of the addendum incorporated a breakup provision, providing for reimbursement to CTV in the event of impossibility of performance due to "catastrophic circumstances beyond remedy or repair."  CTV claims it eventually attempted to  invoke the breakup provision, contending "catastrophic circumstances" had occurred.  

In January 2002, Community brought suit in McLean County, Illinois, against CTV, Jonas, and Cash Resources, alleging defendants defaulted on their agreement to purchase Kahuna.  Community specifically alleged a breach-of-contract claim against CTV and single alter-ego claims against both Jonas and Cash Resources.  In August 2002, an amended complaint was filed.  The amended complaint further alleged breach-of-fiduciary-duty, fraud, and conversion claims against Jonas and a fraudulent-inducement claim against both Jonas and Cash Resources.  

In February 2002, 17 days after Community filed its original complaint, CTV filed suit against Community in Arapahoe County, Colorado.  CTV, in part, sought a declaratory judgment concerning the existence of a "catastrophic circumstance beyond remedy or repair," entitling it to invoke paragraph seven of the addendum.  Community filed motions to quash service and to dismiss the Colorado complaint based upon lack of jurisdiction and forum non conveniens .  Community's motions were denied.  The Colorado court, however, stayed the action pending a final disposition in the Illinois suit.  

In March 2002, in the Illinois suit, CTV filed a general appearance and a motion to dismiss based upon forum non conveniens .  In the same month, defendants Jonas and Cash Resources filed special and limited appearances and motions to quash service due to lack of personal jurisdiction.  Jonas and Cash Resources contended they were Colorado residents with an absence of Illinois contacts and an absence of actions undertaken on their behalf in connection with the current dispute.

In July 2003, Jonas traveled to Bloomington, Illinois, and was personally served with process.  His stated reason for coming to Illinois was to assist his counsel in preparing for, and taking the deposition of Frank Lunn, the president of Community.  After leaving Bloomington, Jonas traveled to Chicago for the deposition of nonparty witness Andrew Yonke, again stating his purpose was to provide factual assistance to counsel.  Jonas also moved to quash this service as improper.  

In December 2003, the trial court denied the jurisdictional motions of Jonas and Cash Resources.  The court initially found personal jurisdiction over Jonas pursuant to him having been personally served in Illinois.  See 735 ILCS 5/2-209(b)(1) (West 2002).  The court next found two sources of personal jurisdiction with respect to Cash Resources.  The court first found Cash Resources was generally doing business in Illinois (735 ILCS 5/2-209(b)(4) (West 2002)) and then concluded that the present cause of action arose out of Cash Resources's transactions of business within Illinois (735 ILCS 5/2-209(a)(1) (West 2002)).

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Bluebook (online)
Community Merchant Services, Inc. v. Jonas, Counsel Stack Legal Research, https://law.counselstack.com/opinion/community-merchant-services-inc-v-jonas-illappct-2004.