Melevitis v. Expedia Group, Inc

2021 IL App (1st) 200820-U

• Court: Appellate Court of Illinois
• Decided: December 20, 2021
• Docket: 1-20-0820
• Status: Unpublished

Opinion

2021 IL App (1st) 200820-U FIRST DISTRICT, FIRST DIVISION December 20, 2021

No. 1-20-0820

NOTICE: This order was filed under Supreme Court Rule 23 and is not precedent except in limited circumstances allowed under Rule 23(e)(1). _____________________________________________________________________________

IN THE APPELLATE COURT OF ILLINOIS FIRST JUDICIAL DISTRICT _____________________________________________________________________________

ANDREA MALEVITIS, ) Appeal from the ) Circuit Court of Plaintiff-Appellant, ) Cook County, Illinois. v. ) ) No. 19 M6 8136 EXPEDIA GROUP, INC., and HOME AWAY, ) INC., ) Honorable ) Carrie E. Hamilton, Defendants-Appellees. ) Judge Presiding _____________________________________________________________________________

JUSTICE COGHLAN delivered the judgment of the court. Presiding Justice Hyman and Justice Walker concurred in the judgment.

ORDER

¶1 Held: Dismissal of plaintiff’s first amended complaint is affirmed where plaintiff failed to make a prima facie showing that Illinois has personal jurisdiction over the nonresident corporate defendants.

¶2 Plaintiff-appellant Andrea Malevitis sued defendants-appellees Expedia Group, Inc.

(Expedia) and Home Away, Inc. (Home Away) 1 (collectively referred to as defendants) for

several claims arising from a vacation rental agreement. Malevitis appeals the circuit court’s

1 Plaintiff’s notice of appeal names defendants as Expedia Group, Inc. and Home Away, Inc. Defendants asserted in the lower court that the correct entity names are HomeAway.com, Inc. (HomeAway) and Expedia, Inc. We will refer to defendants as they appear in the notice of appeal. No. 1-20-0820

dismissal of her first amended complaint based on lack of personal jurisdiction over defendants.

For the following reasons, we affirm.

¶3 BACKGROUND

¶4 Malevitis, an Illinois resident, entered into an online rental agreement to rent Kenneth

Moore’s 2 residential property in Scottsdale, Arizona from September 19 to September 25, 2018.

The property was listed on Home Away’s website, VRBO.com, which had photographs and a

written description of Moore’s property.

¶5 On September 19, 2018, Malevitis and her family arrived at Moore’s residence and

discovered “a hole in the roof large enough to allow a substantial amount of water to form and

gather upon the kitchen and dining area floors” and “visible dirt and grime present, indicating

that the rental home was not cleaned and habitable.” The front driveway was different than the

one shown in photographs on the website and the swimming pool and spa area “was in reality

not the same pool depicted in the photographs as the pool was rundown, ill-maintained and

neglected.”

¶6 When Malevitis confronted Moore about the defects, he “became combative, belligerent,

mentally unstable and ignorant with [Malevitis] and her family” and accused them of breaking

into his home. Malevitis asked Moore again about the problems with the residence and his

“promise to pay in cash the overcharged amount of $300.00” that Malevitis had already paid.

Moore became even more hostile, “engaging in additional threatening, belligerent, ignorant,

[and] menacing” conduct. Malevitis found other rental accommodations at a “substantial and

additional expense[].”

2 Moore is not a party to this appeal. -2- No. 1-20-0820

¶7 On July 15, 2019, Malevitis sued Moore and Home Away for breach of contract,

fraudulent concealment, intentional and negligent infliction of emotional distress, and violation

of the Illinois Consumer Fraud and Deceptive Business Practices Act (815 ILCS 501/1 (West

2018)). Malevitis amended her complaint, adding Expedia as a defendant. Expedia was not

involved in Malevitis’ booking, but Home Away is a “wholly-owned subsidiary of Expedia.”

Malevitis alleged that Moore, Expedia, and Home Away were all parties to the rental agreement

that she “executed in Cook County, Illinois.” She further asserted that Illinois had personal

jurisdiction over defendants because they “have in the past and presently conduct business” in

Illinois and they “operate a vacation rental business where [they] rent homes from around the

United States to residents of the State of Illinois.”

¶8 Expedia and Home Away moved to dismiss Malevitis’ first amended complaint under

735 ILCS 5/2-301(a) (West 2018) for lack of personal jurisdiction. 3 Defendants argued that

Illinois does not have general jurisdiction over defendants because “[n]either is incorporated

under the laws of this State nor maintains its principal place of business here.” They also asserted

that Illinois lacked specific personal jurisdiction because “the allegations arise solely out of an

incident arising at a Scottsdale, Arizona home.”

¶9 In support of their motion, defendants filed a declaration of Lee Huberman, Home

Away’s senior product manager. Huberman clarified that Home Away “operate[s] an online

forum that allows property owners and managers, referred to as ‘Members,’ to list their

properties for short-term rentals and connect with individuals who are seeking to rent a house or

3 Defendants alternatively moved to compel arbitration, but the circuit court did not rule on that motion. -3- No. 1-20-0820

apartment when visiting a city, referred to as ‘Travelers.’ ” Home Away does not own or operate

any properties and “is not a party to rental transactions.”

¶ 10 Malevitis sought an extension of time to respond to defendants’ motion to dismiss until

“the completion of discovery on the issue of personal jurisdiction in Illinois.” Defendants

objected to the motion and asked for a protective order prohibiting Malevitis’ “improper

jurisdictional discovery” served “[w]ithout leave to do so.” The circuit court denied Malevitis’

motion for an extension “and to conduct discovery,” granted defendants’ motion for a protective

order, and gave Malevitis 28 days to respond to defendants’ motion to dismiss.

¶ 11 The circuit court ultimately granted defendant’s motion to dismiss, finding that the court

lacked general jurisdiction over defendants because “[n]either defendant was incorporated in the

State of Illinois nor maintains its principle[sic] place of business in Illinois” and “there is no

evidence that either defendant engages in substantial, continuous and systematic course of

business in Illinois.” Relying on National Gun Victims Action Council v. Schecter, 2016 IL App

(1st) 152694, ¶ 23, the court also found that Illinois did not have specific jurisdiction over

defendants because they did not initiate contact with Malevitis, “[n]othing about the transaction

at issue was required to take place in Illinois,” and performance was to take place in Arizona.

¶ 12 ANALYSIS

¶ 13 “The plaintiff has the burden of establishing a prima facie basis to exercise personal

jurisdiction over a nonresident defendant.” Aspen American Insurance Co. v. Interstate

Warehousing, Inc., 2017 IL 121281, ¶ 12. In ruling on a motion to dismiss for lack of personal

jurisdiction, “the court shall consider all matters apparent from the papers on file in the case,

affidavits submitted by any party, and any evidence adduced upon contested issues of fact.” 735

ILCS 5/2-301(b) (West 2018). “Any unrebutted allegations must be accepted as true [citation],

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but any conflicts in the supporting documentation must be resolved in the plaintiff’s favor.”

Zamora v. Lewis, 2019 IL App (1st) 181642, ¶ 41. Where, as here, the circuit court determines a

jurisdictional question based on only documentary evidence, our review is de novo. Aspen

American Insurance Co., 2017 IL 121281, ¶ 12 (citing Russell v. SNFA, 2013 IL 113909, ¶ 28).

¶ 14 State courts may “exercise personal jurisdiction over an out-of-state defendant if the

defendant has certain minimum contacts with [the State] such that the maintenance of the suit

does not offend the traditional notions of fair play and substantial justice.” (Internal quotation

marks omitted.) Daimler AG v. Bauman, 571 U.S. 117, 126 (2014). The “minimum contacts”

required for personal jurisdiction depends on whether the forum asserts general or specific

jurisdiction over a defendant. MacNeil v. Trambert, 401 Ill. App. 3d 1077, 1080 (2010).

Malevitis asserts that Illinois has both general and specific personal jurisdiction over defendants.

¶ 15 Initially, Malevitis argues that the circuit court erred in denying her discovery request

because she “request[ed] leave to seek information that is only in the custody of the Defendants

which would show *** their contacts with Illinois that would support general and specific

jurisdiction over them.” Illinois Supreme Court Rule 341(h)(7) (eff. Oct. 1, 2020) requires that

an appellant’s argument include “citation of the authorities and pages of the record relied on.”

Malevitis does not cite a single legal authority in support of this argument, and it is therefore

forfeited. See In re Marriage of Gabriel and Shamoun, 2020 IL App (1st) 182710, ¶ 74 (failing

to support an argument with citation to authorities forfeits review of an issue on appeal); see also

U.S. Bank v. Lindsey, 397 Ill. App. 3d 437, 459 (2009) (“A reviewing court is entitled to have the

issues clearly defined and supported by pertinent authority; it is not merely a repository into

which an appellant may ‘dump the burden of argument and research’ ***”).

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¶ 16 General Jurisdiction

¶ 17 General jurisdiction is “all-purpose,” and the plaintiff may pursue a claim against the

defendant even if defendant’s conduct that is being challenged occurred outside of the forum

state. Aspen American Insurance Co., 2017 IL 121281, ¶ 14. The standard for general

jurisdiction “is very high and requires a showing that the nonresident defendant carried on

systemic business activity in Illinois not casually or occasionally, but with a fair measure of

permanence and continuity.” (Internal quotation marks omitted.) Russell, 2013 IL 113909, ¶ 36.

¶ 18 Because “only a limited set of affiliations with a forum will render a defendant amenable

to all-purpose jurisdiction there,” a corporate defendant’s contacts with the forum state must be

“so ‘continuous and systematic’ as to render [it] essentially at home in the forum state.” Daimler,

517 U.S. at 137-139 (quoting Goodyear Dunlop Tires Operations, S.A. v. Brown, 564 U.S. 915,

924 (2011)). A corporation is “at home” in its state of incorporation and the state in which it has

its principal place of business. Id. at 137-38; see also Aspen American Insurance Co., 2017 IL

121281, ¶¶ 16-17. However, in “exceptional case[s],” a corporate defendant’s operations in a

state other than its state of incorporation or principal place of business might be “so substantial

and of such a nature as to render the corporation at home in that State.” Id. at 138, n. 19; see,

e.g., Perkins v. Benguet Consolidated Mining Co., 342 U.S. 437, 448-49 (1952) (finding general

jurisdiction over a Philippines corporation where its president “carried on *** a continuous and

systematic supervision of the necessarily limited wartime activities of the company” in Ohio).

¶ 19 Malevitis argues that Illinois has general jurisdiction over defendants because she “asked

the trial court to take judicial notice of the extraordinary media and internet presence Defendants

have throughout the United States, including the State of Illinois,” such as their “daily and

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repeated television ads, printed advertising materials” and “respective websites, which

continuously and systematically seek travel-related business” from Illinois residents.

¶ 20 However, general jurisdiction does not rest simply on whether a corporation’s “in-forum

contacts can be said to be in some sense ‘continuous and systematic.’ ” Daimler, 517 U.S. at 139.

Malevitis does not dispute that the defendants are not incorporated in Illinois and do not have

their principal places of business in Illinois. She also fails to show that this is an “exceptional

case” where defendants’ contacts with Illinois are “so substantial” as to render them at home in

Illinois. See e.g., Perkins, 342 U.S. at 448-49; see also Aspen American Insurance Co., 2017 IL

121281, ¶ 19 (quoting Monkton Insurance Services, Ltd. v. Ritter, 768 F.3d 429, 432 (5th Cir.

2014)) (noting that “under Daimler, it is ‘incredibly difficult to establish general jurisdiction in a

forum other than the place of incorporation or principal place of business’ ”). As such, Malevitis

has failed to make a prima facie showing that Illinois has general jurisdiction over defendants.

See Aspen American Insurance Co., 2017 IL 121281, ¶ 19 (no general jurisdiction over

nonresident defendant where plaintiff did not dispute that defendant was incorporated outside of

Illinois and the fact that defendant “does business” in Illinois through a warehouse did not render

defendant “at home”); Campbell v. Acme Insulations, Inc., 2018 IL App (1st) 173051, ¶ 15 (court

did not have general jurisdiction over nonresident defendant where Illinois was not the state of

incorporation or principal place of business and its business in Illinois was a “relatively small

portion of its total operations”).

¶ 21 Specific Jurisdiction

¶ 22 For specific personal jurisdiction, “a defendant’s general connections with the forum are

not enough.” Bristol-Myers Squibb Co. v. Superior Court of California, San Francisco County,

137 S. Ct. 1773, 1781 (2017). Rather, “the defendant’s suit-related conduct must create a

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substantial connection with the forum state.” Walden v. Viore, 571 U.S. 277, 284 (2014). To

establish this “substantial connection,” the plaintiff must show that (1) “the defendant

purposefully directed its activities at the forum state” and (2) “the cause of action arose out of or

relates to the defendant’s contacts with the forum state.” Russell, 2013 IL 113909, ¶ 40 (citing

Burger King Corp. v. Rudzewicz, 471 U.S. 462, 472 (1985)). “[T]he relationship must arise out

of contacts that the ‘defendant himself’ creates with the forum State,” rather than contacts

between the plaintiff (or third parties) and the forum State. (Emphasis in original.) Walden, 571

U.S. at 284 (quoting Burger King Corp., 471 U.S. at 475).

¶ 23 Malevitis maintains that defendants “are also subject to specific jurisdiction in that the

Defendants’ litigated-related conduct created a substantial connection with the State of Illinois.” 4

¶ 24 The only apparent “contact” defendants had with Illinois that is related to Malevitis’

cause of action is through their website. Defendants’ website is a “forum” for individuals to

advertise their properties and for travelers to find properties for short-term rentals, but Malevitis

does not allege, and the record does not show, that defendants target travelers from Illinois or

direct any conduct toward Illinois specifically. Compare Wiggen v. Wiggen, 2011 IL App (2d)

100982, ¶ 38 (defendant’s website insufficient to assert personal jurisdiction where there was “no

evidence that the website specifically solicits customers in Illinois”) with Innovative Garage

Door Co., 2012 IL App (2d) 120117, ¶ 25 (specific personal jurisdiction over defendant that

arranged business transactions “between the Illinois business and what were primarily Illinois

4 Malevitis also argues that “Defendants[sic] own Terms and Conditions allowed and caused them to be subjected to personal jurisdiction in Illinois” because they provide that arbitration may be conducted in person in the state where the plaintiff lives and plaintiff “can file a small claims complaint without any reference to jurisdiction.” However, Malevitis raises this argument for the first time on appeal, and it is therefore forfeited. Mabry v. Boler, 2012 IL App (1st) 111464, ¶ 15 (“Generally, arguments not raised before the circuit court are forfeited and cannot be raised for the first time on appeal”). -8- No. 1-20-0820

consumers” and where the agreement with the plaintiff “clearly establishe[d] a significant

relationship between [defendant] and Illinois).

¶ 25 Additionally, the relevant conduct giving rise to the cause of action occurred in Arizona,

and Malevitis has not shown an “affiliatio[n] between the forum and the underlying

controversy.” (Internal quotation marks omitted.) Goodyear Dunlop Tires Operations, S.A., 564

U.S at 919; see also uBid v. GoDaddy Group, Inc., 623 F.3d 421, 431(7th Cir. 2010) (noting that

without showing defendant had “constitutionally sufficient contacts with the forum” and that

defendant’s contacts were related to the lawsuit, “the mere fact that the defendant allegedly

caused harm by conducting business or advertising over the Internet is not adequate to establish

jurisdiction in the plaintiff’s chosen forum state”).

¶ 26 Malevitis relies on Ford Motor Co. v. Montana Judicial District Court, 141 S. Ct. 1017

(2021) to argue that Illinois has specific jurisdiction over defendants. In Ford Motor Co., the

Supreme Court held that Montana and Minnesota had specific jurisdiction over Ford for lawsuits

related to two separate accidents in those states that involved Ford vehicles. Id. at 1022. In doing

so, the Court rejected Ford’s argument that specific jurisdiction could only attach in a state where

Ford sold or manufactured and designed the vehicle in question, noting that specific jurisdiction

is not a “causation-only approach.” Id. at 1026. Rather, specific jurisdiction “demands that the

suit ‘arise out of or relate to the defendant’s contacts with the forum.’ ” (Emphasis in original.)

Id.

¶ 27 However, Ford purposefully availed itself of the privileges of conducting business in both

states and “systematically served a market in Montana and Minnesota for the very vehicles that

the plaintiffs allege malfunctioned and injured them in those States.” Id. at 1026-1028. Whereas

here, there is no evidence that defendants purposefully directed any conduct toward Illinois or its

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residents, and the alleged injury did not occur in Illinois. We therefore find that Malevitis has not

made a prima facie showing that Illinois has specific personal jurisdiction over defendants.

¶ 28 CONCLUSION

¶ 29 For the foregoing reasons, the circuit court’s order dismissing Malevitis’ first amended

complaint is affirmed.

¶ 30 Affirmed.

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