Bridgeview Health Care Center, Ltd. v. State Farm Fire and Casualty Company 2014 IL 116389


Appellate citation: 2013 IL App (1st) 121920.


            JUSTICE BURKE delivered the judgment of the court, with opinion.


      Chief Justice Garman and Justices Freeman, Thomas, Kilbride, Karmeier, and Theis concurred in the judgment and opinion.


            A hearing aid business which is a sole proprietorship owned by an Illinois resident is located in Terre Haute, Indiana. The office of State Farm Fire and Casualty Company in West Lafayette, Indiana, issued a comprehensive general liability policy to that owner at the Indiana business address. Later, the Illinois corporation of Bridgeview Health Care Center, Ltd., the named plaintiff here, complained of unsolicited faxes sent by the hearing aid business, and of alleged statutory violations, as well as damages incurred through loss of toner and ink.

            An action to determine whether the State Farm policy provided coverage against these claims was initiated in the circuit court of Cook County in 2010. Bridgeview sought a declaration that State Farm had a duty to defend and indemnify the insured under the advertising injury and property damage provisions of the policy, while State Farm sought a declaration of noncoverage. Although State Farm acknowleged that Illinois law provided coverage, it also argued that there was a conflict with Indiana law and that a conflict-of-laws analysis should be undertaken. This would reach to the issue of which state had the most significant contacts with the dispute, and State Farm argued that the most significant contacts were with Indiana. State Farm conceded that there were no Indiana state court cases on the coverage issue, but argued that two unreported federal district court decisions from the Southern District of Indiana had “predicted” that the Indiana Supreme Court would find no coverage and that this circumstance justified finding a conflict. Relying on a 2011 decision of the Illinois appellate court, the circuit court held that such a “prediction” does not demonstrate a conflict, and that there was no need to reach the issue of significant contacts.

            In this decision, the Illinois Supreme Court affirmed the circuit court and reversed the appellate court, which had reached a contrary conclusion. The supreme court said that such federal district court decisions, in and of themselves, cannot establish a conflict between the law of different states, since a “predictive” judgment is not, in fact, state law. State Farm failed to meet its burden of demonstrating a conflict.