Elite Integrated Medical, LLC et al v. New World Communicatons of Atlanta, Inc.
OPINION AND ORDER: Because Plaintiffs have not carried their burden to show by a preponderance of the evidence that diversity jurisdiction exists, Defendant's Motion to Dismiss 64 is GRANTED and this case is DISMISSED without prejudice for lack of jurisdiction. The Clerk is DIRECTED to close the case. Signed by Judge Amy Totenberg on 4/28/21. (rlb)
IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF GEORGIA
ELITE INTEGRATED MEDICAL,
LLC, f/k/a SUPERIOR HEALTHCARE
OF WOODSTOCK, LLC (d/b/a
SUPERIOR HEALTHCARE GROUP),
DR. ATLEE WAMPLER, IV, D.C.M.S.,
and FITE HEALTH AND WELLNESS
CENTER, LLC, f/k/a SUPERIOR
HEALTHCARE GROUP OHIO,
NEW WORLD COMMUNICATIONS
OF ATLANTA, INC., d/b/a FOX 5
CIVIL ACTION NO.
OPINION AND ORDER
In this case, Plaintiffs bring defamation claims against Defendant New
World Communications of Atlanta, Inc., (“NWCA”) for the actions of its television
station WAGA-TV FOX 5 Atlanta (“Fox 5 Atlanta”)1, for Fox 5 Atlanta’s publication
of allegedly false and defamatory statements about Plaintiffs during a series of
news reports between November and May of 2019. After jurisdictional discovery,
While Plaintiffs styled the case as being brought against NWCA “d/b/a” Fox 5 Atlanta, NWCA
explains that it “is not registered as a ‘D/B/A’ nor does it operate as a ‘D/B/A.’” (Motion to Dismiss
(“Mot.”), Doc 64 at n. 1). Rather, WAGA-TV Fox 5 Atlanta is the name of the broadcast station
operated by NWCA under its FCC license. (Deposition of Carolyn Forrest (“Forrest Dep.”) p.
209:13-14.) The Court notes that the Parties agree that “WAGA,” “Fox 5,” and “NWCA” all refer to
the same entity, the Defendant in this case. (Forrest Dep. p. 14:8-23.)
NWCA has filed anew its Motion to Dismiss for Lack of Subject Matter Jurisdiction
[Doc. 64], now before the Court. For the reasons below, the Court GRANTS
NWCA’s Motion [Doc. 64] and DISMISSES this case for lack of jurisdiction.
In November of 2019, Plaintiffs filed this action, alleging that NWCA
reported false and defamatory information about their regenerative medicine
practices and conduct in news coverage between May and November of that year.
(Complaint, Doc. 1.) Plaintiffs allege that NWCA produced broadcasts and
published articles conveying the message that Plaintiffs were participating in a
fraudulent and deceptive business scheme, including by misleading patients about
regenerative stem cell therapy treatment. (Id. ¶¶ 381, 433, 479, 511.) The 144-page,
540-paragraph Complaint alleges state-law claims for “defamacast,” libel,
attorneys’ fees, and punitive damages.
Shortly after this action was filed, Defendant NWCA filed an initial motion
to dismiss for lack of subject matter jurisdiction (Doc. 6), arguing that Plaintiffs’
asserted basis for federal jurisdiction was lacking. NWCA argued that there was
not complete diversity amongst the Parties because Defendant NWCA’s principal
place of business is in Georgia, not California. In December 2020, the Court
granted the Parties’ request to pursue jurisdictional discovery regarding the
diversity of citizenship issues raised by NWCA’s Motion. (Doc. 10.) Numerous
extensions of the discovery period were granted, and the Court denied without
prejudice Defendant’s Motion (Doc. 6), directing NWCA to refile the motion upon
conclusion of the discovery period. On November 30, 2020, NWCA did just that
and filed anew its Motion to Dismiss for Lack of Subject Matter Jurisdiction (Doc.
64). Plaintiffs then filed their Response (Doc. 72) and NWCA replied (Doc. 79).
The citizenship of each Plaintiff, though not included in the Complaint, is
not disputed by the Parties. According to the Parties’ Stipulation (Doc. 50),
Plaintiff Elite is a citizen of the state of Florida, as is Plaintiff Fite Health and
Wellness Center, LLC, f/k/a Superior Healthcare Group Ohio (“Fite”). 2 The
Complaint alleges, and Defendant agrees, that Dr. Atlee Wampler is a citizen of
Georgia. (Complaint, Doc. 1 ¶ 11.) As noted above, the crux of the dispute concerns
the citizenship of Defendant NWCA. While Plaintiffs allege that NWCA is a “foreign
According to the Stipulation, Elite’s sole member is a Florida Limited Liability Company. (Doc.
50 ¶ 1.) Similarly, Fite’s sole member is also a Florida Limited Liability Company. (Id. ¶ 2.) The
Court notes that the Complaint does not identify the citizenship of either Elite or Fite but only
states that Elite “is a domestic limited liability corporation organized and existing under the laws
of the state of Georgia” (Compl. ¶ 10) and that Fite “is a foreign limited liability corporation
organized and existing under the laws of the State of Ohio” (id. ¶ 12). For purposes of diversity
jurisdiction, limited liability companies and limited partnerships are citizens of any state of which
a member of the company or partnership is a citizen. Rolling Greens MHP, L.P. v. Comcast SCH
Holdings LLC, 374 F.3d 1020, 1022 (11th Cir. 2004); see also Carden v. Arkoma Assocs., 494 U.S.
185, 195-96 (1990). “To sufficiently allege the citizenships of these unincorporated business
entities, a party must list the citizenships of all the members of the limited liability company and
all the partners of the limited partnership.” Rolling Greens MHP, L.P., 374 F.3d at 1022
(emphasis added). And “[w]hen determining citizenship of the parties for diversity jurisdiction
purposes, a limited liability company (LLC) is a citizen of every state that any member is a citizen
of. And it is common for an LLC to be a member of another LLC. Consequently, citizenship of
LLCs often ends up looking like a factor tree that exponentially expands every time a member
turns out to be another LLC, thereby restarting the process of identifying the members of that
LLC.” Purchasing Power, LLC v. Bluestem Brands, Inc., 851 F.3d 1218, 1220 (11th Cir. 2017);
RES–GA Creekside Manor, LLC v. Star Home Builders, Inc., No. 10-cv-207-RWS, 2011 WL
6019904, at *3 (N.D. Ga. Dec. 2, 2011) (Story, J.) (quoting Multibank 2009–1 RES–ADC Venture,
LLC v. CRM Ventures, LLC, No. 10–cv–02001, 2010 WL 3632359, at *1 (D. Colo. Sept. 10, 2010)).
Here, the Complaint does not properly identify the citizenship of Elite or Fite, nor does the
Stipulation, as it does not identify the constituent entities of Elite and Fite or the citizenship of
those LLC’s members. For this separate reason, the Court cannot determine the citizenship of all
of the Plaintiffs and thus Plaintiffs have not carried their burden to show complete diversity.
corporation organized and existing under the laws of the State of Delaware with its
principal place of business being located in 10201 West Pico Boulevard, Los
Angeles, CA, 90035,” (Compl. ¶ 13), NWCA argues that its principal place of
business is in Atlanta, Georgia, thereby defeating diversity jurisdiction.
Federal Rule of Civil Procedure 12(b)(1) permits a party to move for
dismissal of a case if no subject matter jurisdiction exists. The motion may be
asserted on either facial or factual grounds. Carmichael v. Kellogg, Brown & Root
Svcs., Inc., 572 F.3d 1271, 1279 (11th Cir. 2009) (citations omitted). A facial attack
on a complaint “require[s] the court merely to look and see if [the] plaintiff has
sufficiently alleged a basis of subject matter jurisdiction, and the allegations in
[the] complaint are taken as true for the purpose of the motion.” Lawrence v.
Dunbar, 919 F.2d 1525, 1529 (11th Cir. 1990) (internal quotation omitted).
Alternatively, a factual attack “challenge[s] the existence of subject matter
jurisdiction in fact, irrespective of the pleadings, and matters outside the
pleadings, such as testimony and affidavits, are considered.” Id. In the instance of
a factual attack, because the court’s very power to hear the case is at issue, the court
is “free to weigh the evidence and satisfy itself as to the existence of its power to
hear the case.” Id. Accordingly, “no presumptive truthfulness attaches to the
plaintiff’s allegations, and the existence of disputed material facts will not preclude
the trial court from evaluating for itself the merits of jurisdictional claims.” Id.
Federal courts have diversity jurisdiction over civil actions where the
amount in controversy exceeds $75,000 and where the controversy is between
citizens of different states or between citizens of a state and citizens or subjects of
a foreign state. 28 U.S.C. § 1332. Diversity jurisdiction “applies only to cases in
which the citizenship of each plaintiff is diverse from the citizenship of each
defendant.” Caterpillar Inc. v. Lewis, 519 U.S. 61, 68 (1996); Triggs v. John Crump
Toyota, Inc., 154 F.3d 1284, 1287 (11th Cir 1998) (“[D]iversity jurisdiction requires
complete diversity, meaning that every plaintiff must be diverse from every
defendant.”); Strawbridge v. Curtiss, 7 U.S. 267 (1806). “The presence of [a]
nondiverse party automatically destroys original jurisdiction.” Wisconsin Dept. of
Corrections v. Schacht, 524 U.S. 381, 389 (1998).
Diversity jurisdiction is determined at the time of filing the complaint.
Thermoset Corp. v. Bldg. Materials Corp. of Am., 849 F.3d 1313, 1317 (11th Cir.
2017). “It is to be presumed that a cause lies outside [of the federal courts’] limited
jurisdiction, and the burden rests upon the party asserting jurisdiction” to
establish its existence by a preponderance of the evidence. Kokkonen v. Guardian
Life Ins. Co. of Am., 511 U.S. 375, 377 (1994); McCormick v. Aderholt, 293 F.3d
1254, 1257 (11th Cir. 2002) (“Further, the party invoking the court’s jurisdiction
bears the burden of proving, by a preponderance of the evidence, facts supporting
the existence of federal jurisdiction.”)
The dispute here concerns the citizenship of Defendant NWCA, and
specifically the location of NWCA’s principal place of business. 3 Plaintiffs argue
that NWCA’s principal place of business is in California, and thus diversity
jurisdiction exists; NWCA argues that its principal place of business is in Georgia,
and thus diversity jurisdiction is absent since one of the Plaintiffs, Dr. Wampler, is
undisputedly a citizen of Georgia.
For purposes of diversity jurisdiction, a corporation is a citizen of the state
in which it is incorporated and the state where it has its principal place of business.
28 U.S.C. § 1332(c). In Hertz v. Friend, after reviewing the divergent approaches
taken by the Courts of Appeals, the Supreme Court announced that the “nerve
center” test dictates the location of a corporation’s principal place of business. 559
U.S. 77, 92 (2010). The Court concluded that “‘principal place of business’ is best
read as referring to the place where a corporation’s officers direct, control, and
coordinate the corporation’s activities.” Id.
at 93. In practice, this “should
normally be the place where the corporation maintains its headquarters—provided
that the headquarters is the actual center of direction, control, and coordination,
i.e., the ‘nerve center,’ and not simply an office where the corporation holds its
board meetings.” Id. The nerve center is a single place and “[t]he public often
(though not always) considers it the corporation’s main place of business.” Id. As
the focus is on a particular place, courts should not attempt to measure “the total
The Parties agree that NWCA is a citizen of Delaware, as NWCA is incorporated in that state.
amount of business activities that the corporation conducts in a state overall as
compared to other states, as with the “general business activities test” some courts
used before Hertz. Id. at 93, 95 (noting that a corporation’s general business
activities may often lack a single principal place where these activities take place).
Ultimately, the nerve center points “in a single direction, toward the center of
overall direction, control, and coordination.” Id. at 95-96. (“The metaphor of a
corporate ‘brain,’ while not precise, suggests a single location.”)
Though the nerve center test is intended to be straightforward
“comparatively speaking” (id. at 95), the modern complexity of business structures
often renders this singular question a thorny one, for example, in cases of a parent
corporation and its subsidiary companies, as relevant here. It is, however, a “wellestablished rule that a parent corporation maintains separate citizenship from a
subsidiary unless it has exerted such an overwhelming level of control over the
subsidiary that the two companies do not retain separate corporate identities.”
Johnson v. SmithKline Beecham Corp., 724 F.3d 337, 351 (3d Cir. 2013) (citing
Quaker v. State Dyeing & Finishing Co. v. ITT Terryphone Corp., 461 F.2d 1140,
1142 (3d Cir. 1972)); see also, Taber Partners, I v. Merit Builders, Inc., 987 F.2d
57, 62-63 (1st Cir. 1993) (emphasizing that, “in determining a corporation’s
principal place of business, [the] inquiry must focus solely on the business
activities of the corporation whose principal place of business is at issue.”) Courts
should be hesitant to disregard “distinctions among the various corporate entities
that often comprise large business enterprises” such that the “brain” of every
related subsidiary corporation is that of the parent. SmithKline, 724 F.3d at 357, n.
23. See also, DeLuca v. Allstate New Jersey Ins. Co., 2011 WL 3794229 (D.N.J.
Aug. 25, 2011) (finding that subsidiary defendant’s principal place of business was
in New Jersey, not Illinois, although parent company was located in Illinois,
defendant subsidiary’s board of directions met in Illinois, and a number of
defendant’s officers worked in Illinois); Astra Oil Trading NV v. Petrobras
America, Inc., 2010 WL 3069793, at *8 (S.D. Tex. Aug. 4, 2010) (explaining that
where the corporate separation between a parent and subsidiary is real and
carefully maintained, the separate place of business of the subsidiary is recognized
in determining jurisdiction, even where parent company exerts some control;
finding that subsidiary’s business was directed from California, even though the
parent company made significant decisions from Europe).4
Here, under the test outlined in Hertz, Defendant argues that the “nerve
center” for NWCA is 1551 Briarcliff Road in Atlanta, Georgia because the Local
Officers in Atlanta “direct, coordinate, and control” NWCA’s business activities
almost exclusively. (Mot. at 6.) In support, NWCA argues that: (1) NWCA does not
conduct business in any state other than Georgia; (2) NWCA operates one station,
Fox 5 Atlanta, and broadcasts live from Atlanta 68 hours per week of local news
and programming responsive to the needs of the metro-Atlanta community; (3)
See also, EverNu Technology v. Rohm & Haas, 2010 WL 3419892, at *4 (E.D. Pa. Aug. 26, 2010)
(refusing to impute the parent company’s principal place of business in Michigan to subsidiary,
noting that “every subsidiary’s ‘nerve center’ would necessarily be the location of its parent” where
high-level review of the parent company is emphasized over the actual running of the business at
decisions regarding on-air and digital news content are made exclusively in
Atlanta; (4) NWCA owns the building in Atlanta that houses Fox 5’s news studios;
(5) operations, including budgets and finances, are managed from Atlanta; (6)
hiring decisions for NWCA are made in Atlanta; and (7) station policies,
procedures, and legal decisions are made in the Atlanta office, though NWCA
complies with corporate standards of its parent company, Fox Corporation. (Mot.
at 5, 13-14.)
In response, Plaintiffs argue that NWCA’s “nerve center” is in Los Angeles,
California because: (1) NWCA’s filings with the Secretary of State’s Offices in both
Georgia and Delaware list a principal business address in Los Angeles, California;
(2) 12 of 21 officers on a NWCA Officer List have addresses in California; and (3)
the CEO and CFO of NWCA are located in Los Angeles and that these officers
perform important functions. (Pl. Resp., Doc. 73 at 1-3.) Plaintiffs also challenge
that the five individuals identified by NWCA as “local officers” are in fact “officers”
of NWCA. (Id. at 6.)
The record before the Court reflects the following facts. Fox Corporation is
the owner and parent company over twenty-eight television stations across the
country, including NWCA. (Forrest Dep. p. 182:4-7; 178:23-179:2.) Fox
Corporation has designated its subsidiary Fox Television Stations, LLC as the
entity that provides oversight and collects certifications from the subsidiary
stations to ensure that Fox Corporation complies with federal law as a publicly
traded company. (Id. p. 85:11-19.) Thus, NWCA is an indirect subsidiary of Fox
Corporation. (Id. p. 181:6-11.)
NWCA has a three-member Board of Directors. The Board has appointed 21
officers. Most of these officers are attorneys and are located across the country: 12
have addresses in Los Angeles (though at three different locations)5, 6 in New York
City, two in Washington, D.C., and one in Atlanta, Georgia. (NWCA Officer List,
Doc. 64-2.) Of these 21 officers, NWCA’s CEO is Jack Abernathy, who has a Los
Angeles address, though he previously only had an office in New York before the
fall of 2018. (Forrest Dep. 184:10-12.) Jack Abernathy is also the CEO of Fox
Television Stations, LLC, the entity overseeing all subsidiary stations. (Forrest.
According to NWCA’s corporate representative, Carolyn Forrest, NWCA’s
21 officers are “Shared Service Officers” that provide “shared services” for every
subsidiary company of the parent company Fox that operates a TV station. (Forrest
Dep. p. 27:10-16) (“This exact list exists for every subsidiary company, so
that everyone on this list is able to perform services, upon request, for
every subsidiary company that operates a television station in the Fox
family.”) These “Shared Service Officers” provide expertise to subsidiary
companies in particular areas, such as regulatory FCC compliance (Forrest Dep.
114:9-16); human resources and payroll services (id. p. 46:18-47:14, 118:25-119:8),
5 Although 12 officers have addresses in Los Angeles, only three
are listed as having a work address
at 10201 West Pico Blvd., the site Plaintiffs contend is the NWCA’s principal place of business.
(NWCA Officer List, Doc. 64-2.)
or tax services (id. p. 99:8-16, 117:15-118:23). Some of these Shared Service Officers
provide no services to NWCA, for example, a labor relations specialist who deals
with stations that have unions, which NWCA does not. (Id. p. 27:18-25). In Ms.
Forrest’s over 26 years of experience as a member on the NWCA Officer List, there
has never been a meeting amongst these officers, or even a conference call to gather
the NWCA officers for NWCA business. (Id. p. 34:24-35:20, 36:18-21.) NWCA pays
significant amounts out of its own local budget for the services of these Shared
Service Officers. (Supplemental Declaration of William J. Schneider, Doc. 64-3 ¶¶
3-4, Doc. 68.) And though Mr. Abernathy is named CEO of NWCA, and, as the
Court understands, the other local subsidiary stations, he “does not get involved
and make decisions to run the business;” instead, he ensures that the stations are
fulfilling their legal obligations to the parent company and ensures that these
stations have necessary support services. (Forrest Dep. p. 111:14-25.)
Thus, as structured, these Shared Service Officers, including Mr. Abernathy,
do not direct, control, or coordinate the business of NWCA and only provide
oversight and ensure that NWCA and Fox’s other subsidiaries operate their
stations in compliance with the law. (Forrest Dep. p. 204:10-13.) Instead, these
Shared Service Officers have delegated the responsibility of directing,
coordinating, and controlling the business affairs of NWCA to a core group of five
Local Officers, who direct, control, coordinate, and manage NWCA from Atlanta.
(Id. p. 210:19-23.)
These Local Officers are William Schneider, Senior Vice President and
General Manager; Michael Holmes, Vice President of Finance; Jim Mannix, Vice
President of Sales; Scott Stuckey, Vice President of News; Rick Snyder, Vice
President of Creative Services; and Neil Mazur, Vice President of Engineering.
(Forrest Dep. p. 18:22-19:6.)6 The Local Officers were delegated these
responsibilities through their employment agreements. (Forrest Dep. p. 82:6-9;
138:18-20.) (Employment Agreements, Docs. 73-8, 73-9, 73-10, 73-11, 73-12, 7313) (noting, for example, that Mr. Schneider “shall serve as Vice President, General
NWCA’s (New World Communication of Atlanta) core business and raison
d’être is producing and broadcasting local news and programming for the metroAtlanta community through its news station Fox 5 Atlanta. NWCA holds a TV
Broadcast License exclusively for the operation of Fox 5 Atlanta, a station which
reports news and produces programming responsive to the needs of the metroAtlanta community. (Declaration of William J. Schneider (“Schneider Decl.”), Doc.
6-2 ¶ 6.) NWCA’s application filings with the FCC reflects that the “Community of
License/ Area to be Served” is Atlanta, GA. (Doc. 66-1, Ex. 16, p. 95.) Annual FCC
reports submitted by NWCA list a location of Atlanta, GA. (Id., Ex. 15, p. 65; Ex.
Plaintiffs emphatically contend that NWCA admitted in its discovery responses that the 21
officers direct, control, and coordinate NWCA’s activities. (Pl. Resp. at 2-3.) Indeed, NWCA’s
discovery responses indicate that officers appointed by the Board of Directors do control NWCA’s
activities, but as NWCA’s corporate representative testified, the local Atlanta officers are
appointed by the Board through the Board’s delegated authority (Forrest Dep. pp. 21:2-11; 80:282:12); thus, this response is not inconsistent with NWCA’s position that the local Atlanta officers
direct and control the Fox 5’s (and thus NWCA’s) business activities from Atlanta.
17, p. 102.) NWCA’s sole business location is at 1551 Briarcliff Road NE in Atlanta,
and NWCA does not conduct business in any state outside of Georgia. (Schneider
Decl. ¶¶ 3-4.)
The record further reflects that all activity attendant with running Fox 5
Atlanta’s broadcast station involves decisions made and authorized in Atlanta by
the Local Officers. All NWCA/ Fox 5 content is produced, broadcast, and directed
from NWCA’s sole location in Atlanta, Georgia. (Schneider Decl. ¶¶ 6-8.) The Local
Officers make all decisions about on-air and digital news content, for example, in
determining to produce a political recap show leading into election season or
deciding to pursue rights to preseason Atlanta Falcons games through negotiations
with Falcons management. (Schneider Decl. ¶ 8; Deposition of William J.
Schneider (“Schneider Dep.”), Doc. 67, pp. 42-46.)
Decisions regarding the allocation and spending of NWCA’s budget are
made locally. (Schneider Decl. ¶ 7.) Long-term budgets and financial objectives are
debated and developed over months and years in Atlanta by Mr. Schneider, Mr.
Holmes (VP of Finance) and department heads. (Schneider Dep. p. 117:8-118:9.) A
consolidated budget is ultimately submitted to CFO Mike Nelson for approval, but
he is not involved in the particulars of the budget development. (Id.) In addition,
hiring decisions are made locally. (Schneider Decl. ¶ 9.) The Local Officers also
“have the authority to make their own policies and procedures” to operate their
business, though they comply with corporate guidelines. (Forrest Dep. p. 49:1217.) The Local Officers are responsible for certifying that they have established
internal controls for financial reporting are in compliance with the law; the Local
Officers must attest to these certifications because they are “the only officers who
are directing and controlling what’s happening and … are in a position to certify
that there are internal controls and compliance with law.” (Forrest Dep. p. 85:2024.)
Other key technical and financial aspects of running the business are
controlled by the Local Officers in Atlanta. Leases and licenses for antenna and
tower sites are executed by Mr. Mazur, the VP of Engineering and Operations.
(Doc. 67-1 pp. 234, 264, 277, 281), as are licenses for video equipment (id. pp. 283,
285, 288, 290, 301). NWCA owns the real estate in Atlanta where Fox 5 develops
its content and pays significant business license and property taxes in Georgia. 7
Mr. Holmes, the VP of Finance, located in Atlanta, coordinates and signs off for
NWCA on these state tax documents. (See e.g., Doc. 67-1 pp. 28, 38, 40, 42, 43.)
Other official property agreements that NWCA enters into are executed locally by
Ms. Forrest. (See Joint Declaration of Easements, Doc. 67-1 pp. 359, 392, 401.)
In addition, NWCA/ Fox 5 Atlanta has been a defendant in approximately
ten lawsuits in the past decade, nine of which were in Georgia state courts and one,
involving an alleged violation of the Fair Labor Standards Act, was in federal court;
this complete list includes no cases in other states. (Complete List of Lawsuits, Doc.
65-2 p. 4-11; Forrest Dep. p. 151:22-25.) Ms. Forrest represented that any time a
See Business and Occupational Tax Documents for NWCA, Doc. 67-1, Ex. 9. See also Personal
Property Tax Statement, Doc. 67-1 p. 59-78.
litigant has used NWCA’s Atlanta address, NWCA has not denied that it is the
principal place of business for NWCA. (Forrest Dep. p. 187:7-9.)
The Nerve Center Test
Based on the thorough record before the Court as recounted above, Plaintiffs
have not carried their burden to establish that the nerve center of NWCA is 10201
West Pico Blvd., Los Angeles, California. Hertz, 559 U.S. at 96 (“The burden of
persuasion for establishing diversity jurisdiction, of course, remains on the party
asserting it …. When challenged on allegations of jurisdictional facts, the parties
must support their allegations by competent proof.”). Instead, the evidence leads
the Court to conclude that 1551 Briarcliff Road NE in Atlanta is NWCA’s nerve
center. As detailed thoroughly above, the core business activities attendant with
running NWCA’s news production and broadcasting business — what content will
be produced, by who, where, using what equipment and technology, and with what
budget — are
controlled, directed, and coordinated in Atlanta by the Local
Officers. In short, the “brain” of NWCA lives and breathes in Atlanta.
Plaintiffs’ arguments to the contrary rely on form over substance and are
insufficient to establish that NWCA’s principal place of business is Los Angeles.
First, Plaintiffs’ heavy reliance on filings with the Georgia and Delaware
Secretaries of State are not “sufficient proof to establish [NWCA’s] ‘nerve center.’”
Hertz, 559 U.S. at 97 (explaining that SEC form listing a corporation’s “principal
executive offices” is insufficient to show principal place of business, as such a
finding would “readily permit jurisdictional manipulation.”). See also, Wylie v.
Red Bull N. Am., Inc., 627 F. App'x 755, 758 (11th Cir. 2015) (holding that corporate
filing with Georgia Secretary of State listing “Principal Office Address” as in
California, and lists identifying CEO, CFO, and Secretary as sharing that California
address, does not establish that company’s principal place of business is in
California under the “nerve center” test); Sheets v. F. Hoffman-La Roche. Ltd.,
2018 WL 6428460, at *3 (N.D. Cal. Dec. 7, 2018) (finding that defendant’s primary
reliance on filings before the New Jersey Treasury Department and California
Secretary of State to establish principal place of business were unpersuasive in
light of the Supreme Court’s instruction in Hertz); In re Lorazepam & Clorazepate
Antitrust Litig., 900 F.Supp.2d 8, 18 (D.D.C. 2012) (finding that corporate annual
reports filed with Massachusetts Secretary of State listing principal office address
and addresses for corporation’s officers and directors were insufficient proof of
principal place of business).8
Similarly, Plaintiffs’ reliance on the addresses of the officers on the “List of
Officers” (Doc. 64-3) is also misplaced. While true that 12 of the 21 officers on the
Plaintiffs cite for support Motyl v. Franklin Templeton Co., LLC, 2014 WL 1413434 (S.D. Fla.
Apr. 11, 2014). The Motyl Plaintiffs sought a remand of the case to a Florida state court,
maintaining that various corporate filings indicated that Florida should be deemed the company's
actual operating headquarters. But the district court denied the remand motion, holding that the
defendant’s officers operated out of California and the bulk of defendant’s business activities
occurred in or were directed in California, not Florida, as the plaintiff had argued. The plaintiffs'
evidence consisted primarily of various corporate filings listing the defendant’s principal place of
business as in Florida. Id. at *3-4. Plaintiffs' similar primary reliance on corporate filings in the
instant case also cuts against Plaintiffs here where they have offered meager other substantive
evidence of California based "nerve center" activity. Here, the bulk of NWCA’s corporate activities
occur in Atlanta, at the direction of executives in Atlanta, rendering the Motyl case factually
inapposite and unhelpful to Plaintiffs’ position.
list are identified as having various California addresses (and only three at 10201
West Pico Blvd.), this is insufficient to show that NWCA “directs, controls, and
coordinates” the corporation’s activities from Los Angeles. Plaintiffs have not
provided specific evidence of ways in which these California-based officers,
including the Mr. Abernathy, direct, control, or coordinate the business of NWCA.
Nor have Plaintiffs provided any evidence to contradict NWCA’s evidence that core
business decisions are instead made by the local executives in Atlanta. Plaintiffs
argue that NWCA admits, through the testimony of its corporate representative,
that the Shared Service Officers such as Mr. Abernathy play important roles. (Pl.
Resp. at 4.) As detailed above, Ms. Forrest testified that Mr. Abernathy ensures
that all member stations are fulfilling their legal obligations to the parent company
and are supported in running their businesses but he “does not get involved and
make decisions to run the business.” (Forrest Dep. p. 111:15-23; 112:2-9.) Further,
Ms. Forrest testified that:
[H]e provides overall oversight, but he doesn’t participate in making
decisions about how each individual company that’s operating a
television station is fulfilling its responsibilities under FCC license to
serve the needs and interests of its community. He doesn’t have any
knowledge of the individual communities but for what he’s told by the
(Id.) Plaintiffs also rely on evidence that Mr. Schneider, Defendant’s Senior Vice
President and General Manager, sends monthly management reports to the CEO
(Pl. Resp. at 4.) Ms. Forrest testified that these reports are sent so that the CEO
“can learn what’s going on at the stations, because he’s not aware.” (Id. p. 83:25-
84:8) (further noting that Mr. Abernathy is the CEO of Fox Television Stations, the
company designed as providing oversight to ensure that subsidiary companies in
the Fox family comply with laws and follow their budget). This evidence thus does
not establish that core decision-making and control occurs at a central nerve center
in Los Angeles.
In arguing that the Court should look only to the addresses of the Shared
Service Officers, Plaintiffs oversimplify the nerve center test articulated by the
Supreme Court in Hertz. It is not simply the addresses of certain officers that are
relevant to the jurisdictional question; the crux of this inquiry asks where the
corporation’s activities are directed, controlled, and coordinated. See Johnson v.
SmithKline Beecham Corp., 724 F.3d 337, 356 n. 21 (3d Cir. 2013) (noting that
Hertz does not require a court to ignore evidence suggesting where activity is
actually controlled (there, by the board of directors) in favor of the location of
certain corporate officers, finding that principal place of business was Delaware,
although an array of tax and strategic support services were performed by officers
in London and Philadelphia).
Defendant NWCA points the Court to Moore v. Johnson & Johnson, 907
F.Supp.2d 646, 659-660 (E.D. Pa. 2012). In Moore, the defendant company (a
subsidiary company of Johnson & Johnson) argued that its principal place of
business was New Jersey, whereas the plaintiff argued that it was Pennsylvania. In
a thorough decision, the court held that the company’s principal place of business
was New Jersey, even though three principal officers – the President, Vice
President/ CFO, and Secretary — worked in Pennsylvania. Id. at 659. The Moore
Court determined, based on the record before it, that these higher-level officers did
not manage the relevant business of producing, distributing, and marketing
consumer brands, which was instead done by certain senior executives, only one
of whom was an officer of the company, operating in New Jersey. Id. at 659-660.
The court so concluded, even though the higher-level officers technically possessed
the authority under corporate by-laws to supervise all business activities. Id. at
659.9 See also, Arndt v. Johnson & Johnson, 2014 U.S. Dist. LEXIS 28629, at *18
(E.D. Pa. Mar. 5, 2014) (embracing Moore, supra, similarly finding that, although
some high-level corporate officers were located in Pennsylvania, these officers “do
not, in fact, direct, control, or coordinate” the company’s business as whole); In re
Lorazepam, 900 F.Supp.2d at 18 (“The listing of addresses, presumably in some
cases home addresses, offers little in the way of support for where the companies’
officers actually ‘direct’ and ‘coordinate’ corporate activity.”); Pool v. F. HoffmanLa Roche, Ltd., 386 F. Supp. 3d 1202, 1220 (N.D. Cal. 2019) (concluding that
defendant had not established that New Jersey was principal place of business even
though the majority of officers were located there, noting “sheer numbers are not
dispositive”); DeLuca, 2011 WL 3794229, supra, (finding that defendant had not
shown that Illinois was its principal place of business, even though Illinois was the
In Moore, the plaintiffs moved for reconsideration arguing that the Court erred in focusing on
the company’s day-to-day activities. The Moore Court held an evidentiary hearing and issued a
second decision reiterating its first conclusion, finding that the company’s principal place of
business was New Jersey. See Moore v. Johnson & Johnson, 2013 WL 5298573 (E.D. Pa. Sept. 20,
2013) (“Moore II”).
location of its parent company, the location where the defendant’s board of
directors met, and the location where a number of defendant’s officers worked;
instead determining that the defendant’s principal place of business was New
Jersey because defendant was a subsidiary company created specifically to address
New Jersey market and operated almost exclusively in New Jersey controlled by
New Jersey leadership). Here, the clear testimony shows that the “lawyers and
accountants” that give general legal or tax advice to Fox’s subsidiary companies
like NWCA, do not “control or coordinat[e] the station and frequently, they only
know a teeny bit about the station …. That person knows nothing more about the
news gathering or the engineering or anything else going on at the station.”
(Forrest Dep. p. 139:2-10.) Under the circumstances, substantive and real control
cannot be eschewed in the name of corporate formalities.
Plaintiffs criticize Moore and its reasoning. They point to cases in which
courts correctly explain that the jurisdictional analysis depends on more than the
location of the day-to-day activities of the corporation. See e.g., Cali v. Joe Ryan
Enterprises, Inc., 65 F.Supp.3d 1288 (M.D. Ala. 2014); Hoschar v. Appalachian
Power Co., 739 F.3d 163, 172 (4th Cir. 2014); Cent. W. Virginia Energy Co. v.
Mountain State Carbon, LLC, 636 F.3d 101, 105 (4th Cir. 2011); Celli v. Greenwich
Ins. Co., 2020 WL 4698509 (D. Mass. Aug. 13, 2020). While this principle is
indeed correct, Plaintiffs attempt to stretch the authority to an overly formalistic
reading. For example, Plaintiffs cite Cali, 65 F.Supp.3d 1288, supra, for the
proposition that courts should only evaluate officers’ functions and the location of
business activities in cases where equal number of officers exist in different states.
(Pl. Resp. at 9-10.) But Cali does not cabin the jurisdictional analysis so rigidly.
There, the court assessed a jurisdictional dispute involving a business with only
two primary officers, one in Georgia and one in Alabama, and nowhere did the
court articulate that a practical assessment of the functions of officers should only
be addressed under such circumstances. Moreover, in that case, the court, as here,
focused on “who is directing, controlling, and coordinating those operations.” And
as here, “the daily operations happen to occur at the same locale where those
operations are directed, controlled, and coordinated … the operations facility and
the nerve center collide.” Id. at 1294. (noting that defendant was not a corporation
with “far flung” and multiple business operations controlled from a separate,
central site; rather the operations occurred at a single location). Here, the Court
does not focus on the locus of the day-to-day activities or daily management, but
instead finds that the individuals making the significant corporate decisions and
directing NWCA’s policies and operations are directing NWCA from Atlanta.
Plaintiffs also cite Mountain State Carbon and Hoschar, supra, in support
of their position that day-to-day activities are “not relevant to the nerve center
test.” (Pl. Resp. at 11.) In Mountain State Carbon, the court concluded that if a
corporation’s day-to-day operations are managed in one state, while its officers
make significant corporate decisions and set policy in another, the principal place
of business is the latter. 636 F.3d at 106. The Hoschar Court reiterated that
determination in finding that while the defendant company’s day-to-day
operations were managed in West Virginia, its officers directed, controlled, and
coordinated the company’s activities from Ohio. 739 F.3d at 172-73.
To repeat, the key question demanded by the nerve center test asks where
decisionmakers control, coordinate, and direct the business of the company. And
while that remains the ultimate question, to determine its answer a court must
assess what type of business activities are being controlled, coordinated and
directed. SmithKline, 724 F.3d at n. 21 (explaining that to determine the actual
center of direction, control and coordination, “we first have to acknowledge the
nature of a corporation’s activities, as it is difficult to locate a corporation’s brain
without first identifying its body”). On the record before the Court, as described
above, the officers controlling, coordinating, and directing NWCA and its local
broadcasting business are the Atlanta officers. Unlike in Moutain State Carbon or
Hoschar, Plaintiffs here have not shown by a preponderance of the evidence that
any higher-titled officers are actually and substantively directing, controlling, and
coordinating the operations of NWCA, let alone from a central location at 10201
West Pico Blvd in California, as opposed to a location in New York or Washington,
the other listed officer locations.10
For this reason, Celli, 2020 WL 4698509 is also inapposite. There, the defendant argued that
a single alleged executive located in New York, who was an employee of a different subsidiary
company, controlled the defendant corporation. Id. at *3. The record showed that a majority of
the corporate officers operated out of Massachusetts, and that the company’s administrative
office, the location of books and records, and the location of board meetings was in Massachusetts.
Id. There was nothing in the record to dispute that the corporate officers in Massachusetts
exercised ultimate control over the company. Here, there is significant evidence that a core group
of decisionmakers exercise control over NWCA’s business from Atlanta. Plaintiffs also rely on
Tamiami Condo. Warehouse Plaza Ass'n, Inc. v. Markel Am. Ins. Co., 2019 WL 4854271, at *2
Plaintiffs’ next attack NWCA’s evidence that the Atlanta leaders are “Local
Officers” by arguing that these officers were not appointed through proper
corporate procedures. (Pl. Resp. at 5-6, 18-21.) None of the cases upon which
Plaintiffs rely to argue that the local Atlanta executives are not truly officers of
NWCA/ Fox 5 Atlanta involve a jurisdictional issue or analysis. Instead, these cases
involve questions of corporate liability concerning the fiduciary duties of
employees, or the scope of insurance coverage for employees, officers, and
directors for personal injury and negligence claims. (Pl. Resp. at 19-2111.) Further,
while Plaintiffs emphasize that the Atlanta leaders’ employment agreements are
with Fox Television Stations, LLC, those agreements clearly state that, for example
in the case of Mr. Schneider, “You shall serve as Vice President, General Manager,
WAGA.” (Doc. 73-8.) WAGA-TV are the call letters for the sole station NWCA
operates (Fox 5) under its FCC license. (Forrest Dep. p. 209:13-14.)12 NWCA’s
primary business involves holding the broadcast license for WAGA-TV Fox 5
Atlanta and operating Fox 5 Atlanta in accordance with that license to provide
programming responsive to the needs of the metro-Atlanta community. (Schneider
(S.D. Fla. Oct. 2, 2019), an entirely inapplicable case. There, the plaintiff, in arguing that
defendant’s principal place of business was in Florida, relied only on two pages from defendant’s
website indicating that it had a single office in Florida with 77 brokers, which was contradicted by
an abundance of evidence that defendant’s marketing, underwriting, claim handling, litigation,
and other significant activities were controlled and directed from Virginia.
11 Citing Select Portfolio Servicing, Inc. v. Evaluation Sols., L.L.C., 2006 WL 2691784, at *9 (M.D.
Fla. Sept. 20, 2006); Bruce v. Travelers Ins. Co., 266 F.2d 781, 784 (5th Cir. 1959); Guillory v,
Aetna Ins. Co., 415 F.2d 650, 653 (5th Cir. 1969); Lemmons v. Zurich Ins. Co., 403 F.2d 512, 514
(5th Cir. 1968); Paulsen v. Stifel, Nicolaus & Co., 2019 WL 2415213, at *4 (S.D.N.Y June 4, 2019),
12 As noted, the Parties agree that “WAGA,” “Fox 5,” and “NWCA” all refer to the same entity, the
Defendant in this case. (Forrest Dep. p. 14:8-23.)
Decl. ¶ 6.) Moreover, a review of the list of the 21 other individuals that Plaintiffs
agree are officers of NWCA indicates that all those individuals are employed by
either Fox Television Stations, LLC or Fox Corporation, not NWCA. (Doc. 66-1, p.
requirements for properly designating officers is not material to the empirical fact
question of where the nerve center of the corporate operations is located. Even if
the local executives — Mr. Schneider, Mr. Holmes, Mr. Mannix, Mr. Stuckey, Mr.
Snyder, and Mr. Mazur — are not, as Ms. Forrest testified, “officers” of NWCA, the
evidence shows that the core business activities of NWCA were being conducted
and directed by them and from Atlanta. See, Moore II, 2013 WL 5298573, at *7
(finding that non-officers directed, controlled and coordinated the operations of
the corporation, explaining that “[w]hen ‘the facts … suggest that [a] particular
corporation did not vest the relevant decision-making in its officers,’ those officers
do not comprise the corporation’s nerve center.”) (quoting SmithKline, 724 F.3d at
n. 21); see also, Volkert, Inc. v. Fin. Tech. Corp., 2019 WL 7576350, at *3 (M.D.
Tenn. Dec. 23, 2019), report and recommendation adopted, 2020 WL 134227
(M.D. Tenn. Jan. 13, 2020) (finding that defendant’s principal place of business
Plaintiffs also argue that the Local Officers are not officers because of a NWCA Board Resolution
from March 2019 resolves that all persons serving as officers prior to that date were thereby
removed and includes an updated list of the 21 official officers. (Doc. 73-5.) This resolution says
nothing about individuals who run Fox 5 Atlanta. It also does not show that the local Atlanta
executives were not delegated with decision-making authority through their employment
agreements or that they did not in fact control, coordinate, and direct the business of NWCA.
was Alabama, not Tennessee, where evidence showed that defendant’s business
was controlled from Alabama by a non-board member in contravention of by-laws
stating that defendant was to be managed by board of directors, and where
defendant was not authorized to transact business in Alabama).
As the above legal authority illustrates, the nerve center inquiry must focus
on the central location of control of the relevant company. The crux of the inquiry
asks what the evidence shows in terms of where the corporation’s operations are
directed and controlled. Corporations vary widely in terms of leadership structure
and the allocation of decision-making authority, and “a court’s nerve center
analysis need not woodenly focus on a corporation’s officers and can take stock of
corporate realities.” Moore II, 2013 WL 5298573, at *7. Under the facts here,
Plaintiffs have not carried their burden to show the existence of federal diversity
jurisdiction by a preponderance of the evidence. The Complaint does not allege and
Plaintiffs have not established the citizenship of the LLC Plaintiffs, Elite and Fite.
On top of that, Plaintiffs have not shown by a preponderance of the evidence that
NWCA’s principal place of business and nerve center is 10210 West Pico Blvd in
Los Angeles, California. Plaintiffs, like nearly all other plaintiffs who have sued
NWCA within the past decade (Doc. 65-2 p. 4-5), are of course free to pursue their
claims in the Georgia state courts.
Because Plaintiffs have not carried their burden to show by a preponderance
of the evidence that diversity jurisdiction exists, Defendant’s Motion to Dismiss
[Doc. 64] is GRANTED and this case is DISMISSED without prejudice for
lack of jurisdiction. The Clerk is DIRECTED to close the case.
IT IS SO ORDERED this 28th day of April, 2021.
Honorable Amy Totenberg
United States District Judge
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