F & L DRUG CORP. v. American Central Insurance Co., Civ. No. 7644.

• Court: United States District Courts. 2nd Circuit. United States District Court (Connecticut)
• Writing for the Court: Gross, Hyde & Williams, by Robert E. Pritchard, Hartford, Conn., for defendant
• Citation: 200 F. Supp. 718
• Parties: F & L DRUG CORPORATION v. AMERICAN CENTRAL INSURANCE COMPANY.
• Decision Date: 15 December 1961
• Docket Number: Civ. No. 7644.

200 F. Supp. 718

F & L DRUG CORPORATION
v.
AMERICAN CENTRAL INSURANCE COMPANY.

Civ. No. 7644.

United States District Court D. Connecticut.

December 15, 1961.

200 F. Supp. 719

Schatz & Schatz, By Walter B. Schatz, Hartford, Conn., for plaintiff.

Gross, Hyde & Williams, by Robert E. Pritchard, Hartford, Conn., for defendant.

BLUMENFELD, District Judge.

The defendant caused this case to be removed from the state Superior Court for Hartford County by petition filed here January 29, 1959. A reading of the petition and the state court complaint filed with it discloses only that the plaintiff corporation is incorporated in and does business in Connecticut and that the defendant corporation is licensed under the laws of Missouri and is licensed and qualified to do business in Connecticut. Upon noting this state of the record when a motion relating to discovery matters was scheduled for hearing, the court indicated that the case would be remanded to the state court for lack of jurisdiction here.

The request of defendant for an opportunity to file a brief on the question of jurisdiction was granted and the defendant has now filed a motion for permission to amend its petition for removal. The removal petition purports to be based upon diversity of jurisdiction.

Under 28 U.S.C.A. § 1332(c)¹ which applies to actions begun after July 25, 1958 a corporation for diversity purposes "shall be deemed a citizen of any State

200 F. Supp. 720

by which it has been incorporated and of the State where it has its principal place of business." The petition does not allege either where the plaintiff corporation or the defendant corporation "has its principal place of business."

There has been no sufficient alllegation of the diversity of citizenship required by 28 U.S.C.A. § 1332(c). In the absence of facts in the record upon which diversity jurisdiction can rest, this court has no jurisdiction. Browne v. Hartford Fire Insurance Co. (D.C.N.D. Ill.E.D.1959), 168 F.Supp. 796, held that the failure to allege principal place of business in accord with the requirements of 28 U.S.C.A. § 1332(c), as amended in 1958, constituted a total failure to allege the required facts which would invest a federal court with jurisdiction. A like result has been reached in several other districts. Roseberry v. Fredell (D.C.E.D. Ky.1959), 174 F.Supp. 937; Washington-East Washington Joint Authority v. Roberts & Schaefer Co. (D.C.W.D.Pa.1960), 180 F.Supp. 15; Adams v. Ralph L. Smith Lumber Co. (D.C.N.D.Cal.N.D. 1960), 181 F.Supp. 729; Brandt v. Bay City Super Market (D.C.N.D.Cal.N.D. 1960), 182 F.Supp. 937; Gobet v. Intercontinental Hotels Corp. (D.C.P.R.1960), 184 F.Supp. 171. The same result would have been reached in Harris Trustee v. Standard Accident Insurance Co., 2 Cir., 1961, 297 F.2d 627, but for the existence of independent grounds of jurisdiction.

The defendant now seeks permission to amend its petition for removal by adding a further allegation setting forth the principal place of business of the defendant. 28 U.S.C.A. § 1446² requires the petition to be filed within the requisite twenty day period. Consequently, Browne v. Hartford Fire Insurance Co. (supra) would not allow an amendment after the expiration of the twenty days allowed for removal under 28 U.S.C.A. § 1446(b), holding this would not be curing mere defect but rather making an entirely new allegation.

Washington-East Washington Joint Authority v. Roberts & Schaefer Co. (supra) in holding that the defect could not be cured by amendment in its court quoted from the opinion in Jackson v. Allen, 132 U.S. 27, 34, 10 S.Ct. 9, 33 L.Ed. 249:

"It appears from the record that the citizenship of the parties at the commencement of the actions, as well as at the time the petitions for removal were filed, was not sufficiently shown, and that therefore the jurisdiction of the state court was never divested. Stevens v. Nichols, 130 U.S. 230, 9 S.Ct. 518 32 L.Ed. 914. This being so, the defect cannot be cured by amendment. Crehore v. Ohio & Mississippi Railroad Co., 131 U.S. 240, 9 S.Ct. 692 33 L.Ed. 144." 180 F.Supp. 16.

The defendant nevertheless argues that permission to amend should be granted under 28 U.S.C.A. § 1653 which reads:

"Amendment of pleadings to show jurisdiction. Defective allegations of jurisdiction may be amended, upon terms, in the trial or appellate courts. June 25, 1948, c. 646, 62 Stat. 944."

and cites the contra decisions of Firemen's Insurance Co. of Newark, N. J. v. Robbins Coal Co. (5 Cir., 1961), 288 F.2d

200 F. Supp. 721

349, and Park v. Hopkins (D.C.S.D.Ind. 1960), 179 F.Supp. 671

The decisions in both Park and Robbins in holding that a petition for removal might be amended rested upon the authority of Kinney v. Columbia Savings & Loan Ass'n, 191 U.S. 78, 24 S.Ct. 30, 48 L.Ed. 103 (1903). But Kinney v. Columbia (supra) did not go so far. It did allow amendment of mere technical defects in the allegations of a removal petition after a lapse of more than twenty days. Indeed that has been permitted in this district.³ The boundary adverted to by Kinney has been described in Southern Pacific Co. v. Stewart, 245 U.S. 359, at p. 363, 38 S.Ct. 130, at p. 131, 62 L.Ed. 345 (1917) where the court stated:

"Amendments have been permitted so as to make the allegations more accurate and certain when the amendment is intended to set forth in proper form the ground for removal already imperfectly stated. Kinney v. Columbia Savings, etc., & Loan Ass'n, 191 U.S. 78 24 S.Ct. 30, 48 L.Ed. 103."

28 U.S.C.A. § 1446(a) requires "a verified petition containing a short and plain statement of the facts which entitle him * * * to removal * * *." Italics added. While the analogies of pleadings need not be carried so far as to disregard the plain mandate of the statute they do cast some light upon the niceties which the defendant raises here. If this lawsuit had been originally brought to this court by the plaintiff, Rule 8(a) F.R.Civ.P., 28 U.S.C.A., would have required his complaint to contain inter alia, "* * * (1) a short and plain statement of the grounds upon which the court's jurisdiction depends * * *."

Any doubt about the interpretation of § 1332, as amended, was finally laid to rest when the Supreme Court of the United States on April 17, 1961, adopted Amendments to Rules of Civil Procedure for the United States District Court. These included amendments to the Forms under Rule 84, F.R.Civ.P. Form 2, Allegation of Jurisdiction, set forth at p. 3, was amended to embrace the new definition of corporate citizenship. The Explanatory Notes at page 4 state:

"1. Diversity of Citizenship. U. S.C., Title 28, § 1332 (Diversity of citizenship; amount in controversy; costs), as amended by PL 85-554, 72 Stat. 415, July 25, 1958, states in subsection (c) that `For the purposes of this section and section 1441 of this title removable actions, a corporation shall be deemed a citizen of any State by which it has been incorporated and of the State where it has its principal place of business.' Thus if the defendant corporation in Form 2(a) had its principal place of business in Connecticut, diversity of citizenship would not exist. An allegation regarding the principal place of business of each corporate party must be made in addition to an allegation regarding its place of incorporation." Italics added.

The sufficiency of an allegation of the facts required by statute in a petition for removal would certainly not be less than that required in a complaint originally brought here. Rule 84, F.R.Civ.P., reads:

"The forms contained in the Appendix of Forms are sufficient

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