Lugo-Vina v. Pueblo Intern., Inc., LUGO-VINA
Citation | 574 F.2d 41 |
Decision Date | 27 April 1978 |
Docket Number | LUGO-VINA,No. 77-1206 |
Parties | Russell A.et al., Plaintiffs, Appellees, v. PUEBLO INTERNATIONAL, INC., et al., Defendants, Appellants. |
Court | United States Courts of Appeals. United States Court of Appeals (1st Circuit) |
William L. Patton, Boston, Mass., with whom John M. Harrington, Jr., Ropes & Gray, David Rive Rivera, and Calderon, Rosa, Silva & Vargas, Hato Rey, P. R., were on brief, for defendants, appellants.
Ernesto Maldonado-Perez, San Juan, P. R., for plaintiffs, appellees.
Before COFFIN, Chief Judge, CAMPBELL, Circuit Judge, MOORE, Senior Circuit Judge. **
Plaintiff-appellee, Russell Lugo-Vina, a resident of Puerto Rico, was injured in a fall on the premises of a supermarket in Puerto Rico operated by defendant Pueblo International, Inc. (Pueblo). In this appeal, Pueblo challenges the size of the jury award and also maintains that the district court erred in finding diversity of citizenship. Because we decide that there was no diversity jurisdiction, we do not reach the issue of damages.
Plaintiff filed suit in October 1974 in the District of Puerto Rico. A few months earlier the district court had consolidated five other actions against Pueblo, sub nom. Agosto Alamo v. Pueblo International, Inc., for determination of the diversity jurisdiction question. In an opinion filed in June 1974, visiting Judge Dalton found that the Agosto Alamo plaintiffs had not established that Pueblo, a Delaware corporation, had its "principal place of business," see 28 U.S.C. § 1332(c), outside Puerto Rico. He therefore ordered the cases dismissed.
Relying on Judge Dalton's opinion, Chief Judge Toledo in March 1975 ordered plaintiff-Lugo-Vina's action dismissed. Shortly thereafter, Lugo-Vina moved to vacate the order of dismissal on grounds that visiting Judge Turk had agreed to reconsider Judge Dalton's order in Agosto Alamo. After Judge Turk vacated the Agosto Alamo dismissal, Judge Toledo vacated his dismissal in Lugo-Vina. A jury trial and this appeal followed.
The record also reveals that the Chairman of the Board's office was in New York City where "he looks over the shoulder (of each responsibility center) to the extent that every division reports to the chairman of the board." Mr. Vallecillo also stated without elaboration that the responsibility centers report to the Board and Executive Committee through the Chairman. He stated that the Chairman had moved his office to New York because Hills had been newly acquired and its operations could be better scrutinized from New York.
Remaining evidence established that both the President and Executive Vice President of Pueblo had their offices in Puerto Rico. Mr. Vallecillo also deposed that the "principal offices" of the corporation were there and that Pueblo kept all of its books in Puerto Rico.
On this record, Judge Turk found that Pueblo's principal place of business was New York. He based his finding on two grounds. He disregarded the formal separation between Pueblo and its wholly owned subsidiary, Hills Supermarkets, Inc. Viewing them as a single entity, Judge Turk reasoned that since the majority of supermarkets was in New York, Pueblo had its base of operations in New York. He also found:
With respect to the first basis for the district court's finding, it erred in ignoring the separate corporate identities of Hills and Pueblo. The evidence before the district court bearing on Hills' relationship to Pueblo differs in no material respect from that before the court in de Walker v. Pueblo International, Inc., 569 F.2d 1169 (1st Cir. 1978), where we held that it was error to look to the subsidiary's operations for purposes of determining where Pueblo's "principal place of business" was located. On the basis of Walker, therefore, we conclude that the district court erred insofar as its finding of diversity was based on the location of the Hills operations.
We also think that the district court was clearly erroneous...
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