Acuity, A Mutual Insurance Company v. Swan et al

Filing 17

ORDER denying 12 Motion to Dismiss Case for Lack of Jurisdiction; denying 14 Motion to Strike. Signed by Judge David R. Herndon on 10/4/2016. (dsw)

UNITED STATES DISTRICT COURT FOR THE
SOUTHERN DISTRICT OF ILLINOIS
ACUITY, A Mutual Insurance Company,
Plaintiffs,
v.
JAMES SWAN and
HARDIN READY MIX, INC,
Defendants.

No. 16-cv-865-DRH

ORDER
HERNDON, District Judge:
This matter is before the Court on the defendant’s (Hardin Ready Mix, Inc.)
motion to dismiss this diversity action for lack of subject matter jurisdiction (Doc.
12) and the plaintiff’s motion to strike the same as untimely (Doc. 14). The Court
first addresses the motion to strike.
Defendant was served on August 18, 2016 (Doc. 7). Plaintiff contends,
pursuant to Rule 12(a)(1), defendant had until September 8, 2016 to answer or
otherwise respond to the plaintiff’s complaint. Accordingly, the plaintiff argues, the
motion to dismiss for lack of subject matter jurisdiction should be denied as
untimely. The plaintiff’s argument is without merit. It is well established that a
litigant may raise a court’s lack of subject-matter jurisdiction at any time. See, e.g.,

Craig v. Ontario Corp., 543 F.3d 872, 875 (7th Cir. 2008) (“[S]ubject-matter

jurisdiction is so central to the district court's power to issue any orders whatsoever
that it may be inquired into at any time, with or without a motion, by any party or by
the court itself.”). Accordingly, the motion to strike is DENIED.
With regard to the motion to dismiss for lack of subject matter jurisdiction,
defendant argues that complete diversity is lacking because the plaintiff and both
defendants are citizens of the State of Illinois. 1 The record indicates, and the
parties seem to agree, that both defendants are citizens of the State of Illinois. See
Doc. 1 ¶ 2 (“Defendant, Hardin Ready Mix, Inc. (“Hardin”) is an Illinois corporation
with its principal place of business located in Hardin, Illinois.”); Doc. 1 ¶ 3
(“Defendant, James Swan (“Swan”), is a citizen of Illinois.”); Doc. 12 (arguing both
defendants are citizens of the State of Illinois).
The dispute here relates to the citizenship of plaintiff Acuity. Defendant
contends the plaintiff is a citizen of the State of Illinois because it is a company
doing business in the State of Illinois. Acuity contends that it is a citizen of
Wisconsin because it is a Wisconsin corporation with its principal place of business
in Wisconsin.
A corporation, which plaintiff claims to be, can be a citizen in up to two
states-the state where it is incorporated and the state where its principal place of
business is located. See 28 U.S.C. § 1332(c)(1); Pastor v. State Farm Mut. Auto. Ins.
Co., 487 F.3d 1042, 1047 (7th Cir.2007) (“a corporation is a citizen of two states
1

Actually, in one paragraph of its briefing, defendant alleges that defendant James Swan is a
“resident” of the State of Illinois. It is well established that residency is not the same as citizenship.
Camico Mut. Ins. Co. v. Citizens Bank, 474 F.3d 989, 992 (7th Cir.2007). However, the complaint
alleges that James Swan is a citizen of the State of Illinois. The complaint’s allegation as to Swan’s
citizenship is sufficient.

(though they may coincide): the state in which the corporation is incorporated and
the state in which its principal place of business is located”).
Here, according to the complaint and Acuity’s responsive pleading, Acuity is
incorporated in the State of Wisconsin and its principal place of business (or “nerve
center”) is in in the State of Wisconsin. Defendant’s motion does not contest that
Acuity is a Wisconsin corporation with its principal place of business in Wisconsin.
Rather, defendant maintains that because Acuity does business in the State of
Illinois it is a citizen of the State of Illinois. However, being licensed or authorized to
do business in a state does not necessarily make a corporation a citizen of that
state. Instead, as noted above, besides the state of incorporation, a corporation is
only a citizen of the state in which it has its principal place of business (or its “nerve
center”), 2 not every state in which it does business. See Wojan v. Gen. Motors

Corp., 851 F.2d 969, 974 (7th Cir.1988) (stating that party's allegation that
corporation was “‘licensed’ or ‘authorized’ to do business in a state does not
necessarily make [it] a citizen of that state because besides the state of
incorporation, a corporation is only a citizen of the state in which it has its principal
place of business ... not every state in which it does business”).
In the instant case, the record reflects that Acuity is a citizen of the State of

2

The phrase “principal place of business” in § 1332(c)(1) “refers to the place where the
corporation's high level officers direct, control, and coordinate the corporation's activities.” Hertz
Corp. v. Friend, 559 U.S. 77, 80 (2010). “[I]n practice it should normally be the place where the
corporation maintains its headquarters. ...” Id. at 93.

Wisconsin and that both defendants are citizens of the State of Illinois. Accordingly
the motion to dismiss for lack of subject matter jurisdiction is DENIED.
IT IS SO ORDERED.
Signed this 4th day of October, 2016.

Digitally signed by
Judge David R. Herndon
Date: 2016.10.04
15:46:45 -05'00'
United States District Judge