Page v. Democratic Nat'l Comm.

• Decision Date: 21 June 2021
• Docket Number: No. 20-2781,20-2781
• Parties: Carter PAGE, an individual, et al., Plaintiffs-Appellants, v. DEMOCRATIC NATIONAL COMMITTEE, an unincorporated association, et al., Defendants-Appellees.
• Court: U.S. Court of Appeals — Seventh Circuit

2 F.4th 630

Carter PAGE, an individual, et al., Plaintiffs-Appellants,

v.DEMOCRATIC NATIONAL COMMITTEE, an unincorporated association, et al., Defendants-Appellees.

No. 20-2781

United States Court of Appeals, Seventh Circuit.

Argued April 21, 2021

Decided June 21, 2021

James Kelly, John Mark Pierce, Andrew Calderon, Attorneys, Pierce Bainbridge, P.C., Los Angeles, CA, Charles L. Philbrick, Attorney, Rathje & Woodward, LLC, Wheaton, IL, Attorney, for Plaintiffs-Appellants.

Terra Leigh Brown Reynolds, Attorney, Latham & Watkins LLP, Chicago, IL, Stephen Barry, Attorney, Latham & Watkins LLP, Washington, DC, for Defendants-Appellees.

Before Scudder, St. Eve, and Kirsch, Circuit Judges.

Scudder, Circuit Judge.

Carter Page, a former advisor to the Donald J. Trump Presidential Campaign, filed suit against the Democratic National Committee, a subsidiary DNC Services Corporation, the law firm Perkins Coie LLP, and two Perkins Coie partners. Page alleges various acts of defamation based on news stories published in the fall of 2016. Having advanced only violations of state law, and further alleging that no defendant is a citizen of his home state of Oklahoma, Page relies on diversity jurisdiction as his gateway into federal court.

The district court dismissed the case for lack of personal jurisdiction. Upon reviewing Page's notice of appeal and accompanying docketing statement, we questioned the existence of subject matter jurisdiction on the basis that Perkins Coie (with a few of its U.S. based partners working and living abroad) may not qualify as a proper defendant for purposes of diversity jurisdiction under 28 U.S.C. § 1332. Our concern proved accurate. So, while we have no reason to question the district court's conclusion on personal jurisdiction, we affirm the dismissal of Page's complaint for lack of subject matter jurisdiction.

I

Carter Page served as a foreign policy advisor to former President Donald Trump's 2016 campaign. In his complaint, Page alleged that Perkins Coie and the DNC retained a company called Fusion GPS to conduct opposition research on then-candidate Trump. Fusion GPS, the complaint continued, engaged the services of Christopher Steele, who drafted various memoranda including two that mentioned meetings during the campaign between Page and Russian officials.

Page also alleged that Perkins Coie facilitated meetings between Fusion GPS and news outlets that ultimately led to the publication of stories reporting these allegations of contacts between the Trump campaign and Russian officials. Specifically, Page's complaint identified a Yahoo! News article from September 23, 2016 reporting on the supposed meetings with Russian officials. Page reacted by suing Perkins Coie, the DNC, and the individual defendants for defamation.

Page initially filed a pro se complaint in the Western District of Oklahoma, his state of residence. After the district court dismissed the claim for lack of personal jurisdiction, Page refiled his suit in the Northern District of Illinois with the assistance of retained counsel.

The district court in Illinois likewise dismissed all claims for lack of personal jurisdiction. The district court concluded that the complaint did not allege facts sufficient to establish specific or general jurisdiction in Illinois. Page's complaint, the district court explained, recounted only actions performed outside of Illinois by persons from other states, with no accompanying allegation that the defendants targeted Illinois with the allegedly defamatory news story.

Page appeals and, in an attempt to establish closer ties to Illinois, now reframes his allegations as centering on the role of Perkins Coie's general counsel, Matthew Gehringer, who works out of the firm's Chicago office. Though we see few facts in the complaint supporting these alleged contacts with Illinois, we find ourselves confronted with a more fundamental issue—whether this case belongs in any federal court at all.

Our review of the citizenship of the parties involved leaves us of the firm conviction that we lack subject matter jurisdiction. We therefore affirm the district court's dismissal of Page's complaint.

II

A

Article III of the Constitution extends the "judicial Power" to nine specified categories of Cases and Controversies, including Controversies "between Citizens of different States." But constitutional authorization, while necessary, is not sufficient to empower a federal court to resolve a Controversy between citizens of different states. Congressional authorization also must exist. See Sheldon v. Sill , 49 U.S. (8 How.) 441, 448–49, 12 L.Ed. 1147 (1850) (explaining that Congress's authority to create the lower federal courts brings with it the discretion to confer jurisdiction less than that allowed by Article III). Congress first authorized diversity jurisdiction in the Judiciary Act of 1789.

Today's diversity jurisdiction statute finds its home in 28 U.S.C. § 1332. The enactment establishes federal jurisdiction over "all civil actions where the matter in controversy exceeds" $75,000 and, as relevant here, if the action is between "citizens of different States" or "citizens of a State and citizens or subjects of a foreign state." 28 U.S.C. § 1332(a).

The party invoking diversity jurisdiction (most often the plaintiff) bears the burden of showing its existence. See Hertz Corp. v. Friend , 559 U.S. 77, 96, 130 S.Ct. 1181, 175 L.Ed.2d 1029 (2010). And, as the Supreme Court has long instructed, federal courts, as courts of limited jurisdiction, must make their own inquiry to ensure that all statutory requirements are met before exercising jurisdiction. See Great Southern Fire Proof Hotel Co. v. Jones , 177 U.S. 449, 453, 20 S.Ct. 690, 44 L.Ed. 842 (1900) ("On every writ of error or appeal, the first and fundamental question is that of jurisdiction, first, of this court, and then of the court from which the record comes. This question the court is bound to ask and answer for itself, even when not otherwise suggested, and without respect to the relation of the parties to it.").

With diversity jurisdiction, the proper inquiry must account for each statutory requirement:

Amount in Controversy . The statutory implementation of diversity jurisdiction has always been tied to a minimum dollar amount at issue in the underlying dispute—the idea being that the federal courts should not become an interstate small claims court. See R. Marcus et al., Civil Procedure a Modern Approach 878 (2d ed. 2018). The Judiciary Act of 1789 set that amount at $500. See Section 11, 1 Stat. 73, 78. Today it is $75,000. The plaintiff must allege that the controversy entails a dispute over more than $75,000, exclusive of interests and costs. See 28 U.S.C. § 1332(a). The burden of doing so is not heavy and dismissal is warranted only if it "appear[s] to a legal certainty that the claim is really for less than the jurisdictional amount to justify dismissal." Saint Paul Mercury Indem. Co. v. Red Cab Co. , 303 U.S. 283, 289, 58 S.Ct. 586, 82 L.Ed. 845 (1938).

Page's complaint does not specify the amount of damages he seeks, but he does more generally advance a good-faith request for more than the $75,000 jurisdictional minimum. Given the nature of the allegations, and the types of monetary damages implicated by the complaint, we have no reason to question the sufficiency of his pleading as to the amount in controversy. See id. at 288, 58 S.Ct. 586 ("[U]nless the law gives a different rule, the sum claimed by the plaintiff controls if the claim is apparently made in good faith." (footnote omitted)).

Determining Citizenship. By the terms of § 1332(a), Congress also hinged the existence of diversity jurisdiction on the "citizenship" of the parties involved. The inquiry here can be complex depending on the parties to the dispute.

Starting on the simpler side, it has long been established that natural persons are typically a citizen of the state in which they reside or—to be more precise—are "domiciled." See Gilbert v. David , 235 U.S. 561, 569, 35 S.Ct. 164, 59 L.Ed. 360 (1915) ; see also 13E Charles Alan Wright & Arthur R. Miller, Federal Practice and Procedure § 3612 (3d ed. 2021) (explaining with great clarity how federal courts determine a person's domicile for purposes of jurisdictional citizenship); Erwin Chemerinsky, Federal Jurisdiction § 5.3.3 (7th ed. 2016) (providing another excellent overview of how courts determine the citizenship of the parties as part of assessing diversity jurisdiction). An individual can have only one domicile at a time. See Williamson v. Osenton , 232 U.S. 619, 625, 34 S.Ct. 442, 58 L.Ed. 758 (1914).

When it comes to corporations, however, the diversity statute itself makes clear that a corporation is a citizen of both its state of incorporation and the state in which it maintains its "principal place of business." See 28 U.S.C. § 1332(c)(1). The Supreme Court has determined that a corporation's principal place of business is the same as its "nerve center," or "the place where the corporation's high level officers direct, control, and coordinate the corporation's activities." Hertz Corp. , 559 U.S. at 80, 130 S.Ct. 1181.

Determining the citizenship of other forms of business associations is often more difficult. Partnerships, for example, are citizens of every state in which an individual partner is a citizen. See Carden v. Arkoma Assocs. , 494 U.S. 185, 195, 110 S.Ct. 1015, 108 L.Ed.2d 157 (1990). The same rule applies to other unincorporated entities, like limited liability companies, whose citizenship is also determined by the citizenship of its "members." See Americold Realty Trust v. Conagra Foods, Inc. , 577 U.S. 378, 381–82, 136 S.Ct. 1012, 194 L.Ed.2d 71 (2016). Think about the size of many of today's partnerships, whether law firms, accounting firms, consulting firms, and so on. It is often no easy task for a plaintiff to discern the domicile (and, by extension, citizenship) of each partner or member. See Hart v. Terminex...