Taylor et al v. State Farm Fire & Casualty Company

Filing 9

MEMORANDUM ORDER: State Farm will be permitted until 1/8/2010 to file an Amended Notice of Removal to clarify its citizenship. The court will review the document and, if it determines that State Farm has met its burden to establish removal jurisdiction, will set a scheduling conference in due course. Signed by Magistrate Judge Mark L Hornsby on 12/10/2009. (crt,Keifer, K)

UNITED STATES DISTRICT COURT W E S T ER N DISTRICT OF LOUISIANA S H R E V EP O R T DIVISION

F R A N K TAYLOR, ET AL VERSUS S T AT E FARM FIRE & C A S U A L TY CO.

C I V I L ACTION NO. 09-cv-1879 J U D G E HICKS MAGISTRATE JUDGE HORNSBY

M E M O R A N D U M ORDER Fran k and Donna Taylor filed suit in state court against State Farm Fire & Casualty C o . for losses and penalties allegedly due in connection with their claim for a fire loss at their resid enc e. State Farm removed the case based on an assertion of diversity jurisdiction. State Farm alleges in its Notice of Removal that the Taylors are "residents" of L o u i s i a n a. It is domicile rather than mere residency that decides citizenship for diversity p u r p o s e s , and "[i]t is well established that an allegation of residency does not satisfy the r e q u i re m e n t of an allegation of citizenship." Great Plains Trust Co. v. Morgan Stanley, 313 F . 3 d 305, 310 n. 2 (5th Cir. 2002). However, the Taylors alleged in their state court petition t h a t they are "residents and domiciliaries" of Louisiana, so the record is adequate in this respe ct. The notice also includes a letter from the Taylors' counsel stating that the amount a t issue exceeds $75,000. No amendment is necessary to address those points. State Farm alleges that it is "a foreign insurance company, with its headquarters in the State of Illinois." State Farm must file an Amended Notice of Removal to clarify its citizens hip. First, it should state with certainty whether it is a corporation or other form of

l e g a l entity or association. The assertion that it is a "company" is not sufficiently precise to a l l o w the court to determine which rules govern the determination of its citizenship. A s s u m i n g State Farm is a corporation, it must allege its citizenship in accordance with t h e applicable rules. A corporation is deemed to be a citizen of (1) the state in which it was i n c o r p o ra t e d and (2) the state where it has its principal place of business. 28 U.S.C. § 1332(c )(1). To establish diversity jurisdiction, a complaint must set forth "with specificity" a corporate party's state of incorporation and its principal place of business. "Where the p l a i n ti f f [or removing party] fails to state the place of incorporation or the principal place of b u s i n e s s of a corporate party, the pleadings are inadequate to establish diversity." Joiner v. D i a m o n d M Drilling Co., 677 F.2d 1035, 1039 (5th Cir. 1982). See also Getty Oil Corp. v. I n s u r a n ce Company of North America, 841 F.2d 1254, 1259 (5th Cir. 1988). State Farm's reference to having its "headquarters" in Illinois may have been an a tt em p t to assert its principal place of business, but such allegations should be made with more precision. It is possible for a corporation to have its business headquarters in one state y e t have its principal place of business, as determined under jurisprudential standards, in ano ther state. See Teal Energy USA, Inc. v. GT, Inc., 369 F.3d 873 (5th Cir. 2004). If State Farm is not a corporation, it must allege its citizenship in accordance with the r u l e s applicable to its legal nature. See, e.g., Burford v. State Line Gathering System, LLC, 2 0 0 9 WL 2487988 (W.D. La. 2009) (setting forth rules applicable to LLC's and other unincorp orated associations).

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State Farm will be permitted until January 8, 2010 to file an Amended Notice of R e m o v a l to clarify its citizenship. The court will review the document and, if it determines th a t State Farm has met its burden to establish removal jurisdiction, will set a scheduling c o n f e r e n c e in due course. T H U S DONE AND SIGNED in Shreveport, Louisiana, this 10th day of December, 2009.

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