O'CONNOR v. Kawasaki Motors Corp., USA, 88-6029-CIV.

• Decision Date: 08 July 1988
• Docket Number: No. 88-6029-CIV.,88-6029-CIV.
• Citation: 699 F. Supp. 1538
• Parties: Stephen M. O'CONNOR, Plaintiff, v. KAWASAKI MOTORS CORPORATION, U.S.A., a foreign corporation, and Kawasaki Heavy Industries, Ltd., a foreign corporation, Defendants.
• Court: U.S. District Court — Southern District of Florida

699 F. Supp. 1538

Stephen M. O'CONNOR, Plaintiff, v. KAWASAKI MOTORS CORPORATION, U.S.A., a foreign corporation, and Kawasaki Heavy Industries, Ltd., a foreign corporation, Defendants.

No. 88-6029-CIV.

United States District Court, S.D. Florida.

July 8, 1988.

COPYRIGHT MATERIAL OMITTED

Rebecca M. Covey, Ft. Lauderdale, Fla., for plaintiff.

Jeffrey A. Miller, Miami, Fla., for defendants.

ORDER

PAINE, District Judge.

This cause comes before the court upon Defendant's, KAWASAKI MOTORS CORPORATION, U.S.A. (KAWASAKI, U.S.A.), Motion to Dismiss, dated January 5, 1988, filed in the Circuit Court of the Seventeenth Judicial Circuit in and for Broward County, Florida, and its supporting Memorandum of Law (DE 5), Defendant's, KAWASAKI, U.S.A., Motion to Strike, also filed in the Circuit Court of the Seventeenth Judicial Circuit in and for Broward County, Florida, and its supporting Memorandum of Law (DE 6), Defendant's, KAWASAKI, U.S.A., Motion for More Definite Statement (DE 11), Defendant's, KAWASAKI, U.S.A., Amended Motion to Dismiss (DE 12), Plaintiff's Memorandum of Law In Opposition to Defendant's Motion to Dismiss Counts 1, 3 and 5 (DE 17) and Defendant's Reply (DE 18), Defendant's, KAWASAKI, U.S.A., Combined Motion for Protective Order and Memorandum of Law in Support of Motion for Protective Order (DE 7), Plaintiff's, STEVEN M. O'CONNOR, Motion to Compel (DE 15) and Defendant's Motion to Strike Plaintiff's Motion to Compel (DE 19), Defendant's, KAWASAKI, U.S.A., Motion for Protective Order Regarding Interrogatories Dated February 22, 1988 (DE 16), Plaintiff's, STEVEN M. O'CONNOR, Motion to Remand (DE 22) and supporting Memorandum of Law (DE 23) and Defendant's, Memorandum of Law in Opposition to Plaintiff's Motion to Remand (DE 24) with supporting Affidavit (DE 26). Having reviewed the file and the relevant authorities, the court enters the following order.

Facts

In February of 1984, the Plaintiff, STEVEN M. O'CONNOR, rented a Jet Ski watercraft manufactured by the Defendants. Plaintiff alleges that while he was riding the Jet Ski, he hit a wave and was thrown up into the air and, when landing, struck his right shin on the gunwale portion of the craft. Plaintiff filed a complaint in the Circuit Court of the Seventeenth Judicial Circuit in and for Broward County, Florida, to recover for the injuries he suffered as a result of the above incident. The ten count complaint makes the following claims: Count I alleges negligence on the part of Defendant, KAWASAKI, U.S.A.; Count II makes a claim for breach of express warranty by KAWASAKI, U.S.A.; Count III alleges breach of implied warranty by KAWASAKI, U.S.A.; Count IV contains a strict liability claim against KAWASAKI, U.S.A.; and, Count V alleges that KAWASAKI, U.S.A. violated the Consumer Product Safety Act. Counts VI through X make identical claims with respect to Defendant, KAWASAKI HEAVY INDUSTRIES, LTD. The common thread throughout the Complaint is that the gunwale portion of the Jet Ski model on which the Plaintiff was injured was not padded as it is on later models of the same craft. Plaintiff contends that had the padding been present, he would not have suffered injuries to the extent that he has. The case came to this court by way of Defendants' Verified Petition for Removal (DE 2).

Motion to Remand

As the ruling on Plaintiff's Motion to Remand (DE 22) may obviate the need for this court to rule on the remaining motions, it will be considered first. The court finds that the allegations made in the Verified Petition (DE 2) are sufficient to justify removal. When the court is faced with a facially sufficient petition for removal which is challenged by a motion to remand it must make a factual determination with respect to the claim of diversity. Wright v. Continental Cas. Co., 456 F.Supp. 1075, 1078 (M.D.Fla.1978). "Once the plaintiff has put the allegations of the defendant's petition for removal at issue by denying them specifically in a motion to remand, then the burden of proof is upon the defendant to come forward with evidence to prove the allegations contained in the removal petition. Id. McNutt v. General Motors Acceptance Corp., 298 U.S. 178, 56 S.Ct. 780, 80 L.Ed. 1135 (1936)." The defendant may support its allegations of diversity by means of interrogatories, requests for admissions or other documentation. Wright, 456 F.Supp. at 1078.

In the instant case, in his Motion to Remand, Plaintiff denies Defendant's allegations as to its state of citizenship. Specifically, Plaintiff suggests that Florida might be considered KAWASAKI U.S.A.'s principle place of business, thus destroying diversity. Defendant has submitted the Affidavit of Hiromichi Kosato, Vice President of the Legal Department of KAWASAKI, U.S.A., (DE 26) in conjunction with its Memorandum of Law in Opposition to Plaintiff's Motion to Remand (DE 24). That affidavit supports KAWASAKI U.S. A.'s allegations that its principle place of business is California.

28 U.S.C. § 1332, which sets forth the jurisdictional rules relating to diversity of citizenship, provides that "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...." There is no dispute in this case regarding KAWASAKI U.S.A.'s state of incorporation, which is Delaware. Plaintiff raises the issue as to whether Florida is the "nerve center" of KAWASAKI U.S.A., thus making the forum state its principle place of business. This circuit follows the "total activity" test to determine a corporation's principal place of business. Anniston Soil Pipe Co. v. Central Foundry Co., 216 F.Supp. 473 (N.D.Ala.1963), aff'd 329 F.2d 313 (5th Cir.1964)¹. See also J.A. Olson Co. v. City of Winona, 818 F.2d 401 (5th Cir.1987). Two tests are contained within the total activity test itself, one of which will be applied depending on the nature of the corporation's activities. The court may look to the company's "nerve center" or "brain" or to the "place of activity". J.A. Olson, 818 F.2d at 404. The "determination of the principal place of business begins with the general rules of these component tests: (1) when considering a corporation whose operations are far flung, the sole nerve center of that corporation is more significant in determining principal place of business; (2) when a corporation has its sole operation in one state and executive offices in another, the place of activity is regarded as more significant; (3) when the activity of a corporation is passive and the "brain" of the corporation is in another state, the situs of the corporation's "brain" is given greater significance." Id. at 411 (citations omitted).

Defendants' Petition for Removal and the Affidavit with which the Memorandum in Opposition to Plaintiff's Motion to remand is supported indicate that KAWASAKI U.S.A. is one of those corporations which falls into the first of the above mentioned categories. The "far flung" nature of its operations requires the court to focus on its "nerve center". Florida is just one of the forty-nine states across the nation in which KAWASAKI U.S.A. has entered dealership agreements for the marketing of its Jet Skis. KAWASAKI U.S.A.'s vice president of legal affairs attests to the fact that KAWASAKI U.S.A. maintains no administrative or executive offices in Florida nor any administrative, clerical or managerial personnel, other than legal counsel for litigation purposes. KAWASAKI U.S.A. does not maintain any corporate bank accounts in Florida. The corporate offices are maintained in the state of California. All the daily operational activities of the company, including any executive, policy and managerial decisions regarding the distribution Kawasaki Jet Ski watercraft, are made in California. All corporate books and records are located in California. From the evidence provided by the Defendant, it appears that KAWASAKI U.S.A. has a concentrated "nerve center" in the state of California and diffuse places of activity throughout the country, including Florida. See Id. at 411. Accordingly, the court finds that KAWASAKI U.S.A.'s nerve center and thus its principle place of business is located in California, not Florida. Plaintiff's Motion to Remand (DE 22) is denied.

Motions to Dismiss

Pursuant to Local Rule 10 D, KAWASAKI U.S.A. filed a memorandum in this court to support its Motion to Dismiss filed in state court (DE 5). It has also filed an Amended Motion with a supporting Memorandum of Law (DE 12). Since subject matter jurisdiction in this case is based upon diversity of citizenship, the court must apply the substantive law of the state of Florida when ruling upon these motions. See Erie R. Co. v. Tompkins, 304 U.S. 64, 58 S.Ct. 817, 82 L.Ed. 1188 (1938).

On a motion to dismiss, all well plead allegations of the complaint must be taken as true. Jacobs v. Board of Regents, 473 F.Supp. 663 (S.D.Fla.1979). Consideration of matters beyond the four corners of the complaint is improper. Milburn v. United States, 734 F.2d 762 (11th Cir.1984). The rules of pleading under the Federal Rules of Civil Procedure are very liberal. Rule 8(a) merely requires the complaining party provide

(1) a short plain statement of the grounds upon which the court's jurisdiction depends, unless the court already has jurisdiction and the claim needs no new grounds of jurisdiction to support it, (2) a short, plain statement of the claim showing that the pleader is entitled to relief, and (3) a demand for judgment for the relief the pleader seeks.

Under the standard established by Conley v. Gibson, 355 U.S. 41, 78 S.Ct. 99, 2 L.Ed. 2d 80 (1957), a motion to dismiss should not be granted unless the plaintiff can prove no set of facts in support of his claim entitling him to relief.

In its first ground for dismissal, KAWASAKI, U.S.A. argues that Plaintiff has failed to state a claim for negligence in Count I of his Complaint. Plaintiff alleges that KAWASAKI, U.S.A. so ...