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Spake v. UFG Specialty Insurance Co.

United States District Court, D. Colorado

February 6, 2018



          PHILIP A. BRIMMER United States District Judge.

         The Court takes up this matter sua sponte on the notice of removal [Docket No. 1] filed by “UF Specialty Insurance Company.”[1] Defendant states that the Court has subject matter jurisdiction over this lawsuit pursuant to 28 U.S.C. § 1332(a). Docket No. 1 at 2.

         In every case and at every stage of the proceeding, a federal court must satisfy itself as to its own jurisdiction, even if doing so requires sua sponte action. Citizens Concerned for Separation of Church & State v. City & County of Denver, 628 F.2d 1289, 1297 (10th Cir. 1980). Absent an assurance that jurisdiction exists, a court may not proceed in a case. See Cunningham v. BHP Petroleum Great Britain PLC, 427 F.3d 1238, 1245 (10th Cir. 2005). Courts are well-advised to raise the issue of jurisdiction on their own, regardless of parties' apparent acquiescence. First, it is the Court's duty to do so. Tuck v. United Servs. Auto. Ass'n, 859 F.2d 842, 844 (10th Cir. 1988). Second, regarding subject matter jurisdiction, “the consent of the parties is irrelevant, principles of estoppel do not apply, and a party does not waive the requirement by failing to challenge jurisdiction.” Ins. Corp. of Ireland v. Compagnie des Bauxites de Guinee, 456 U.S. 694, 702 (1982) (internal citations omitted). Finally, delay in addressing the issue only compounds the problem if it turns out that, despite much time and expense having been dedicated to a case, a lack of jurisdiction causes it to be dismissed or remanded regardless of the stage it has reached. See U.S. Fire Ins. Co. v. Pinkard Constr. Co., No. 09-cv-00491-PAB-MJW, 2009 WL 2338116, at *3 (D. Colo. July 28, 2009).

         It is well established that “[t]he party invoking federal jurisdiction bears the burden of establishing such jurisdiction as a threshold matter.” Radil v. Sanborn W. Camps, Inc., 384 F.3d 1220, 1224 (10th Cir. 2004). Defendant invokes 28 U.S.C. § 1332(a) as the basis for this Court's diversity jurisdiction. Docket No. 1 at 2. Section 1332(a)(1) states: “The district courts shall have original jurisdiction of all civil actions where the matter in controversy exceeds the sum or value of $75, 000, exclusive of interest and costs, and is between [] citizens of different States.” The facts as presently averred, however, do not provide sufficient information regarding the citizenship of plaintiff and defendant.

         The notice of removal states that plaintiff is a “resident of the City of Northglenn and State of Colorado.” Docket No. 1 at 2. However, domicile, not residency, is determinative of citizenship. Whitelock v. Leatherman, 460 F.2d 507, 514 (10th Cir. 1972) (“[A]llegations of mere ‘residence' may not be equated with ‘citizenship' for the purposes of establishing diversity.”); see also Mississippi Band of Choctaw Indians v. Holyfield, 490 U.S. 30, 48 (1989) (“‘Domicile' is not necessarily synonymous with ‘residence, ' and one can reside in one place but be domiciled in another.” (citations omitted)).

         Moreover, defendant's allegations regarding its own citizenship are deficient.[2]Defendant states that it is a “corporate resident of the city of Cedar Rapids, State of Iowa, with a corporate address at 118 2nd Ave SE, Cedar Rapids, IA 52401.” Docket No. 1 at 2 (citing Docket No. 1-3). For diversity purposes, “a corporation shall be deemed to be a citizen of every State and foreign state by which it has been incorporated and of the State or foreign state where it has its principal place of business.” 28 U.S.C. § 1332(c)(1); see Carden v. Arkoma Assocs., 494 U.S. 185, 196 (1990).[3] A corporation's “principal place of business” is “the place where a corporation's officers direct, control, and coordinate the corporation's activities.” Hertz Corp. v. Friend, 559 U.S. 77, 92-93 (2010). A corporation's principal place of business is not necessarily the same as its corporate address or even its headquarters. Id. at 93. Defendant fails to identify its form of business organization, its state of incorporation, and its principal place of business. Docket No. 1 at 2.

         Because defendant has not sufficiently alleged the citizenship of the parties, the Court is unable to determine whether it has subject matter jurisdiction over plaintiff's claim. See United States ex rel. General Rock & Sand Corp. v. Chuska Dev. Corp., 55 F.3d 1491, 1495 (10th Cir. 1995) (“The party seeking the exercise of jurisdiction in his favor must allege in his pleading the facts essential to show jurisdiction.”) (citations and internal quotation marks omitted). Therefore, it is ORDERED that, on or before 5:00 p.m. on February 19, 2018, defendant UFG Specialty Insurance Company shall show cause why this case should not be dismissed due to the Court's lack of subject matter jurisdiction.



[1] UF Specialty Insurance Company claims that it is incorrectly named in the complaint as UFG Specialty Insurance Company. Docket No. 1 at 1. For simplicity, the Court refers to the party seeking removal as “defendant.”

[2] Defendant claims that plaintiff's policy was issued by United Fire & Casualty. Docket No. 1-3 at 1, ¶ 3. United Fire & Casualty is not a named party. Moreover, to the extent that defendant claims that United Fire & Casualty is a proper party, defendant's allegations of United Fire & Casualty's citizenship are similarly deficient.

[3] These considerations do not apply if defendant was not formed as a corporation. See Carden, 494 U.S. at 195 (“[W]e reject the contention that to determine, for diversity purposes, the citizenship of an artificial entity, the court may consult the ...

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