LIFEFORCE CRYOBANK SCIENCES, INC.
v.
RSUI INDEMNITY COMPANY
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The court held that removal was improper because complete diversity of citizenship was lacking between the plaintiff and defendant.
Plaintiff sued its insurers in state court. One defendant removed the case to federal court based on diversity jurisdiction. The plaintiff moved to re…
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This matter comes before the Court without a hearing on the Motion to Remand (Doc 12) filed by the Plaintiff, Lifeforce Cryobank Sciences, Inc. (henceforth, “Lifeforce”), and the response in opposition (Doc. 17) filed by Defendant Starstone Specialty Insurance Company (“Starstone”). In the underlying state court action, Lifeforce has sued its insurers, asserting that they owe it a defense in an arbitration action before the American Arbitration Association.
On January 6, 2020, Lifeforce filed an amended complaint in state court.
On February 24, 2020, Starstone removed the case to this court, pursuant to 28 U.S.C. 1332, which provides that this court has original jurisdiction over matters involving at least $75,000 in controversy and between, inter alia, citizens of different states.1 Lifeforce does not dispute that this action involves at least $75,000 in controversy.
However, both Lifeforce and Starstone are incorporated in Delaware (although Lifeforce has its principal place of business in Florida).
And 28 U.S.C. 1 The Court cannot find that Defendant RSUI ever consented to removal pursuant to 28 U.S.C. 1446(b)(2)(C). § 1332(c) provides, in pertinent part, that a corporation shall be deemed a citizen of every state in which it is incorporated and of the state where it has its principal place of business. As such, it appears that both Lifeforce and Starstone are citizens of Delaware, and Starstone’s removal was therefore improper. Starstone responds by pointing to two cases – Kozikowski v. Delaware River Port Auth., 397 F. Supp. 1115, 1117 (D.N.J. 1975) and Hudak v. Port Auth. Trans-Hudson Corp., 238 F. Supp. 790 (S.D.N.Y. 1965) – that seem to authorize diversity citizenship in this case. But both of those cases involve the specialized problem of bi-state agencies that are incorporated in two states – Pennsylvania and New Jersey in the former, New York and New Jersey in the latter. In the instant case, Starstone is incorporated in only one state, and neither Kozikowski nor Hudson apply. As such, 28 U.S.C. 1332(c) makes Lifeforce a Delaware citizen, just like Starstone. The Court therefore lacked diversity jurisdiction, and remand is appropriate.2
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