Peninsula Asset Mgmt v. Hankook Tire Co.,

Filing 920071213

Opinion

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RECOMMENDED FOR FULL-TEXT PUBLICATION Pursuant to Sixth Circuit Rule 206 File Name: 07a0477p.06 UNITED STATES COURT OF APPEALS FOR THE SIXTH CIRCUIT _________________ PENINSULA ASSET MANAGEMENT (CAYMAN) LTD.; X KAREN CHONGAH HAN; NO JOON PARK, Plaintiffs-Appellants, No. 07-3028 > v. , HANKOOK TIRE CO., LTD.; YANG-RAE CHO, Defendants-Appellees. N Appeal from the United States District Court for the Northern District of Ohio at Akron. No. 04-01153--David D. Dowd, Jr., District Judge. Argued: November 28, 2007 Decided and Filed: December 13, 2007 Before: MARTIN, SILER, and ROGERS, Circuit Judges. _________________ COUNSEL ARGUED: Bruce E. Bagelman, LAW OFFICES OF BRUCE E. BAGELMAN, Dallas, Texas, for Appellants. Jeffry H. Ray, RAY, VALDEZ, McCHRISTIAN & JEANS, El Paso, Texas, for Appellees. ON BRIEF: Bruce E. Bagelman, LAW OFFICES OF BRUCE E. BAGELMAN, Dallas, Texas, Tailim Song, TAILIM SONG LAW FIRM, Dallas, Texas, for Appellants. Jeffry H. Ray, Karen L. Landinger, RAY, VALDEZ, McCHRISTIAN & JEANS, El Paso, Texas, Douglas N. Godshall, Robert L. Tucker, HANNA, CAMPBELL & POWELL, Akron, Ohio, for Appellees. _________________ OPINION _________________ ROGERS, Circuit Judge. Plaintiffs, including a Grand Cayman Islands corporation, sued a South Korean corporation and a natural citizen of South Korea on breach of contract and fraud claims. Plaintiffs brought their suit in the United States District Court for the Northern District of Ohio on the basis of diversity jurisdiction under 28 U.S.C. 1332(a)(2). The district court granted summary judgment in favor of the defendants on all claims, and the plaintiffs appealed to this court. Because there are alien corporations on both sides of the controversy, this case lacks the complete diversity required for a federal court to exercise diversity jurisdiction under 1332(a)(2). See Ruhrgas AG v. Marathon Oil Co., 526 U.S. 574, 580 n.2 (1999); Creaciones Con Idea, S.A. de C.V. v. Mashreqbank PSC, 232 F.3d 79, 82 (2d Cir. 2000); Impuls I.D. Internacional, S.L. v. Psion- 1 No. 07-3028 Peninsula Asset Mgmt., et al. v. Hankook Tire Co., et al. Page 2 Teklogix, Inc., 234 F. Supp. 2d 1267, 1272-74 (S.D. Fla. 2002). Contrary to the defendants' argument, it makes no difference whether the plaintiff Grand Cayman Islands corporation has its principal place of business in the United States. It is well established that, under 1332(a)(2), "even if a corporation organized under the laws of a foreign nation maintains its principal place of business in a State, and is considered a citizen of that State, diversity is nonetheless defeated if another alien party is present on the other side of the litigation." Creaciones Con Idea, 232 F.3d at 82 (quoting Int'l Shipping Co., S.A. v. Hydra Offshore, Inc., 875 F.2d 388, 391 (2d Cir. 1989)). The jurisdiction in this case cannot, moreover, be predicated on 1332(a)(3) even though that section has been interpreted as not requiring complete diversity. See, e.g., Dresser Indus., Inc. v. Underwriters at Lloyd's of London, 106 F.3d 494, 498-99 (3d Cir. 1997). That section is inapplicable here because there is not a United States citizen on each side of the dispute. Therefore, the only applicable section is 1332(a)(2), which requires complete diversity. Because complete diversity is lacking in this case, we reverse the judgment of the district court and remand the case for consideration of the need to dismiss for lack of subject matter jurisdiction.

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