Panalpina Welttransport GmBh v. Geosource, Inc., 84-2337
| Decision Date | 28 June 1985 |
| Docket Number | No. 84-2337,84-2337 |
| Citation | 764 F.2d 352 |
| Parties | PANALPINA WELTTRANSPORT GMBH and SGS Controll Co., m.b.H., Plaintiffs-Appellants, v. GEOSOURCE, INC. and Ucamar Shipping Co., (Cayman), Ltd., Defendants-Appellees. |
| Court | U.S. Court of Appeals — Fifth Circuit |
James J. Sentner, Jr., Antoinette van Heugten, Houston, Tex., for plaintiffs-appellants.
Vinson & Elkins, G. Wesley Urquhart, Jeffrey W. Steidley, Richard L. Lagarde, Houston, Tex., for Geosource, Inc.
Hill, Parker, Franklin, Cardwell, Jones, A. Glenn Diddel, III, Gregory N. Jones, Houston, Tex., for Ucamar Shipping.
Appeal from the United States District Court for the Southern District of Texas.
Before CLARK, Chief Judge, BROWN and POLITZ, Circuit Judges.
Panalpina Welttransport GmBh and SGS Controll Co., m.b.H. appeal the dismissal of their complaint against Geosource, Inc. and Ucamar Shipping and Transportation Co. (Cayman), Ltd. for failure of jurisdiction. Finding a lack of complete diversity, we affirm.
Panalpina and SGS are West German corporations with their principal place of business in West Germany. They sued Geosource and Ucamar in the southern district of Texas invoking diversity of citizenship jurisdiction. Geosource is a Texas corporation with its principal place of business in Houston. Ucamar is a subsidiary of Geosource and was incorporated in the Cayman Islands. Panalpina and SGS contend that Ucamar is the alter ego of Geosource and therefore should have the same citizenship for diversity purposes as its parent, Geosource. Plaintiffs urged the district court to ignore Ucamar's place of incorporation in order to preserve diversity jurisdiction. If Ucamar's place of incorporation is not ignored, then both plaintiffs and one defendant are aliens. The district court was not persuaded; it dismissed the case for lack of jurisdiction because there was not complete diversity of citizenship between all plaintiffs and all defendants.
It has long been settled that diversity of citizenship between plaintiffs and defendants must be complete to confer jurisdiction under 28 U.S.C. Sec. 1332. Strawbridge v. Curtiss, 7 U.S. (3 Cranch) 267, 2 L.Ed. 435 (1806); Owen Equipment & Erection Co. v. Kroger, 437 U.S. 365, 98 S.Ct. 2396, 57 L.Ed.2d 274 (1978). A corporation incorporated in a foreign country is a citizen of that country for purposes of diversity jurisdiction. Nat. Steamship Co. v. Tugman, 106 U.S. 118, 1 S.Ct. 58, 27 L.Ed. 87 (1882); Jerguson v. Blue Dot Inv., Inc., 659 F.2d 31 (5th Cir.), cert. denied, 456 U.S. 946, 102 S.Ct. 2013, 72 L.Ed.2d 469 (1981). Like a domestic corporation, an alien corporation may add an additional place of citizenship for diversity purposes if its principal place of business is within one of the states of the United States. Jerguson. It may also gain additional places of citizenship for purposes of diversity jurisdiction if it is consolidated with another corporation or if it is the alter ego of another corporation. Freeman v. Northwest Acceptance Corp., 754 F.2d 553 (5th Cir.1985). For example, when a subsidiary is the alter ego of a parent, the parent is deemed to be a citizen of (1) the place where it is incorporated, (2) the place where its subsidiary is incorporated, and (3) the place where it has its principal place of business. Id. Through multiple places of incorporation, principal place of business, and alter ego or consolidation doctrines, a corporation may become the citizen of several places for purposes of diversity jurisdiction. Such a result is in keeping with Congress' intendment to constrict the availability of diversity jurisdiction. Jerguson; Canton v. Angelina Casualty Company, 279 F.2d 553 (5th Cir.1960). A party cannot, however, pick and choose among the places of citizenship ignoring one or more in an effort to preserve diversity jurisdiction. Such a...
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