Eisenberg v. Commercial Union Assurance Company

• Decision Date: 19 December 1960
• Citation: 189 F. Supp. 500
• Parties: Max EISENBERG, Plaintiff, v. COMMERCIAL UNION ASSURANCE COMPANY Limited, North British Group, Defendant.
• Court: U.S. District Court — Southern District of New York

189 F. Supp. 500

Max EISENBERG, Plaintiff, v. COMMERCIAL UNION ASSURANCE COMPANY Limited, North British Group, Defendant.

United States District Court S. D. New York.

December 19, 1960.

Kaye, Scholer, Fierman, Hays & Handler, New York City, for plaintiff; Joseph J. Moscou, New York City, of counsel.

Edward F. Sweeney, New York City, for defendant.

DIMOCK, District Judge.

Defendant moves for dismissal of this action on the ground that there is no diversity of citizenship between plaintiff and defendant. Plaintiff is a citizen of New York. Defendant is a British corporation with its principal place of business in London. Defendant has many places of business in the United States but its principal one in the United States is in New York.

The question presented involves the interpretation of section 1332 of title 28 U.S.Code, as amended in 1958, which reads as follows:

"§ 1332. Diversity of citizenship; amount in controversy; costs

"(a) The district courts shall have original jurisdiction of all civil actions where the matter in controversy exceeds the sum or value of $10,000, exclusive of interest and costs, and is between—

"(1) citizens of different States;

"(2) citizens of a State, and foreign states or citizens or subjects thereof; and

"(3) citizens of different States and in which foreign states or citizens or subjects thereof are additional parties.

"(b) Except when express provision therefor is otherwise made in a statute of the United States, where the plaintiff who files the case originally in the Federal courts is finally adjudged to be entitled to recover less than the sum or value of $10,000, computed without regard to any setoff or counterclaim to which the defendant may be adjudged to be entitled, and exclusive of interest and costs, the district court may deny costs to the plaintiff and, in addition, may impose costs on the plaintiff.

"(c) For the purposes of this section and section 1441 of this title, 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.

"(d) The word `States', as used in this section includes the Territories, the District of Columbia, and the Commonwealth of Puerto Rico."

Defendant's position is that it has its principal place of business in the State of New York and that therefore, under the express terms of subdivision (c), it is to be deemed a citizen of New York and there is no diversity of citizenship between it and plaintiff New York citizen.

It is to be noted that the statute differentiates between States of the United States and foreign states by the use of a capital S for the word when applied to a State of the United States. Subdivision (c), therefore, in dealing with the place of incorporation refers only to a corporation incorporated in a State of the United States. When subdivision (c) goes on to deal with principal place of business it refers to the same corporation and thus only to a corporation incorporated in a State of the United States. The subdivision is not susceptible of the construction as if it read "all corporations shall be deemed citizens of the States by which they have been incorporated and of the States where they have their principal places of business."...