Ebersohl v. Bechtel Corporation et al

Filing 63

ORDER OF REMAND: This case is remanded to the Circuit Court of the Twentieth Judicial Circuit, St. Clair County, Illinois, for lack of federal subject matter jurisdiction based upon diversity of citizenship pursuant to 28 U.S.C. § 1332. Signed by Judge G. Patrick Murphy on 9/15/2010. (jhs)

E b e r s o h l v. Bechtel Corporation et al

D o c . 63

I N THE UNITED STATES DISTRICT COURT F O R THE SOUTHERN DISTRICT OF ILLINOIS G R E G O R Y EBERSOHL, P l a in t i f f , v s. B E C H T E L CORPORATION, et al., D e f e n d an t s . ) ) ) ) ) ) ) ) )

C I V I L NO. 09-1029-GPM

MEMORANDUM AND ORDER
M U R P H Y , District Judge: T his matter is before the Court sua sponte on the issue of federal subject matter jurisdiction. See Fo s te r v. Hill, 497 F.3d 695, 696-97 (7th Cir. 2007) ("It is the responsibility of a court to make an in dep en den t evaluation of whether subject matter jurisdiction exists in every case.");

J o h n s o n v. Wattenbarger, 361 F.3d 991, 992 (7th Cir. 2004) (a district court's "first duty in every su it" is "to determine the existence of subject-matter jurisdiction"); Hay v. Indiana State Bd. of Tax C o m m 'r s , 312 F.3d 876, 879 (7th Cir. 2002) (quoting Ruhrgas AG v. Marathon Oil Co., 526 U.S. 5 7 4 , 577 (1999)) ("Jurisdiction is the `power to declare law,' and without it the federal courts cannot proceed. Accordingly, not only may the federal courts police subject matter jurisdiction sua sponte, they must."). On August 16, 2010, the Court ordered counsel for Defendants Bechtel Power C o rp or a tio n ("Bechtel Power"), Prairie State Generating Company, LLC ("Prairie Generating"), Pra irie State Energy Campus Management, Inc. ("Prairie Energy"), and Becon Construction Company, I nc. ("Becon"), to submit to the Court affidavits establishing the citizenship of Bechtel Power, P ra irie Generating, Prairie Energy, and Becon for purposes of federal diversity jurisdiction. Counsel for Bechtel Power, Prairie Generating, Prairie Energy, and Becon now have submitted affidavits as

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Dockets.Justia.com

or der ed. After reviewing the affidavits, the Court concludes that federal subject matter jurisdiction does no t exist in this case. T his case was filed originally in the Circuit Court of the Twentieth Judicial Circuit, S t. Clair County, Illinois, and has been removed to this Court on the basis of federal diversity ju risdiction, the exercise of which requires generally, of course, that the parties to a case be of diverse sta te citizenship and that an amount in excess of $75,000, exclusive of interest and costs, be in con trov ersy. See 28 U.S.C. § 1332(a)(1); LM Ins. Corp. v. Spaulding Enters. Inc., 533 F.3d 542, 547 (7 th Cir. 2008). "For a case to be within the diversity jurisdiction of the federal courts, diversity must be `complete,' meaning that no plaintiff may be a citizen of the same state as any defendant." M c C r e a d y v. eBay, Inc., 453 F.3d 882, 891 (7th Cir. 2006) (quoting Fidelity & Deposit Co. of Md. v. C ity of Sheboygan Falls, 713 F.2d 1261, 1264 (7th Cir. 1983)). For purposes of federal diversity ju risdiction, the state citizenship of a natural person is determined by the state where the person is do m iciled, meaning the state where the person is physically present with the intent to remain there. See D e n lin g e r v. Brennan, 87 F.3d 214, 216 (7th Cir. 1996); Perry v. Pogemiller, 16 F.3d 138, 140 (7 th Cir. 1993). For diversity purposes, the citizenship of a corporation, including a non-profit corpora tion, is the state where the corporation is incorporated and the state where the corporation has its principal place of business, meaning the state where the corporation maintains its headquarters or " nerve center." See 28 U.S.C. § 1332(c)(1); Hertz Corp. v. Friend, 130 S. Ct. 1181, 1192-95 (2010); C C C Info. Servs., Inc. v. American Salvage Pool Ass'n, 230 F.3d 342, 346 (7th Cir. 2000); Wisconsin Kn ife Works v. National Metal Crafters, 781 F.2d 1280, 1282 (7th Cir. 1986); Nuclear Eng'g Co. v. S c o tt, 660 F.2d 241, 250 (7th Cir. 1981). Finally, a limited liability company ("LLC") has, for div ersity purposes, the state citizenship of each of the LLC's members. See Thomas v. Guardsmark,

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L L C , 487 F.3d 531, 534 (7th Cir. 2007); Intec USA, LLC v. Engle, 467 F.3d 1038, 1041 (7 th Cir. 2006); Cosgrove v. Bartolotta, 150 F.3d 729, 731 (7th Cir. 1998). T he affidavits filed by counsel for Bechtel Power, Prairie Generating, Prairie Energy, and Becon esta blish that Bechtel Power is a corporation incorporated under Nevada law with its principal place of bu siness in Maryland, so that Bechtel Power is a citizen of Nevada and Maryland for diversity purposes. T he affidavits reflect also that Becon is a corporation incorporated under Texas law with its principal pla ce of business in Texas and therefore is a Texas citizen for diversity purposes. Unfortunately, with respect to Prairie Generating, the affidavits aver only that Prairie Generating "is a Delaware Limited L ia bility Corporation whose principal place of business is Marissa, Illinois." Doc. 62-2 at 1. This is not sufficient to establish the citizenship of Prairie Generating for diversity purposes, because the citizenship of an LLC, as discussed, is determined by the citizenship of the LLC's members, not the state u nder the law of which an LLC is organized or the state where the LLC has its principal place of bu siness. Also, the affidavits reflect that Prairie Energy is a non-profit corporation incorporated under India na law with its principal place of business in Illinois, so that Prairie Energy is a citizen of Indiana a nd Illinois for diversity purposes. Because Plaintiff Gregory Ebersohl is a citizen of Illinois, diversity of citizenship is not complete. This case must be remanded to state court.1

1. The Court notes that Bechtel Power, Prairie Generating, Prairie Energy, and Becon were joined a s Defendants in this case by way of an amended complaint filed after the case was removed. However, the Court has no reason to suppose that Ebersohl has joined a non-diverse party simply to defeat federal ju risdictio n. See Schur v. L.A. Weight Loss Ctrs., Inc., 577 F.3d 752, 759 (7th Cir. 2009) (citing 28 U .S .C . § 1447(e)) (when a plaintiff seeks to join a diversity-defeating party after removal, in determ ining whether to allow amendment a court should consider: (1) the plaintiff's motive for seeking joinder, particularly whether the purpose is to defeat federal jurisdiction; (2) the timeliness of the request to amend; (3) whether the plaintiff will be significantly injured if joinder is not allowed; and (4 ) any other relevant equitable considerations). In any event, if Ebersohl voluntarily dismisses any div ersity-defea ting party from this case after remand, the case can be removed again. See Poulos v. N a a s Foods, Inc., 959 F.2d 69, 71 (7th Cir. 1992) (a plaintiff's voluntary dismissal of a non-diverse p a r ty makes a case removable to federal court). P a ge 3 of 4

T o conclude, this case is REM A N D E D to the Circuit Court of the Twentieth Judicial Circuit, S t . Clair County, Illinois, for lack of federal subject matter jurisdiction in diversity. The Clerk of C ou rt is directed to mail a copy of this Order to the clerk of the state court and to close the file of this case. I T IS SO ORDERED. D A T E D : September 15, 2010

/s/ G. Patrick Murphy G. PATRICK MURPHY United States District Judge

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