Opinion
CIVIL ACTION NO. 03-3013 SECTION "K" (3)
February 10, 2004
ORDER AND REASONS
Before the Court is a Motion to Remand (Rec. Doc. No. 2) brought by plaintiff Sail. Dinh ("Dinh") pursuant to 28 U.S.C. § 1447. Having reviewed the pleadings, memoranda, exhibits and the relevant law, the Court finds that it has diversity jurisdiction over this matter. Thus, the Motion to Remand must be DENIED.
Background
Dinh is an employee of Structured Services, Inc. On May 27, 2002, he allegedly fell from scaffolding while working at KYE, Inc.'s shipyard aboard the Barge AMERICAN FREEDOM. Plaintiff fell approximately 20 to 30 feet, sustaining wrist and rib fractures, and other internal injuries prompting hospitalization from May 27 through June 3, 2002. Dinh underwent surgery on May 30, 2002, to repair a fractured left wrist and underwent a second surgery on July 18, 2002, to remove hardware from the wrist. He then received four months of physical therapy from June through September, 2002. As of January 8, 2003, the treating orthopedist concluded that Plaintiff could still not work a full day. plaintiff's selected physician concluded Plaintiff was still disabled as of October, 2003. As of November 21, 2003, compensation of $37,578.00 and medical expenses of $36,968.00 has been paid in connection with this accident.On May 27, 2003, plaintiff filed a Petition for Damages in Civil District Court for the Parish of Orleans, against American Steamship Company ("ASC"); Coastwise Bulk Transport Company ("CBTC"); K.Y.E., Inc. ("KYE"); Mooreco Marine, L.L.C.; Alan Moore d/b/a Mooreco Shipyard; and vessel. AMERICAN FREEDOM. On October 6, 2003, plaintiff voluntarily dismissed the Moore/Mooreco defendants, leaving only ASC, CBTC, and KYE as in personam defendants. Defendants filed a Notice of Removal with this Court on October 27, 2003 (Rec. Doc. No. 1).
On November 17, 2003, Dinh filed the instant Motion to Remand. He contends, inter alia, that removal was improper because diversity of citizenship is not present. He argues that KYE, as a corporation, has citizenship in two places-its place of incorporation and its principal place of business. 28 U.S.C. § 1332(c)(1). Plaintiff concedes that KYE was incorporated in Texas; however, as its letterhead lists both a Texas address and a Louisiana address, he contends that there is no proof as to where KYE's principal place of business is located. As such, with plaintiff being a citizen of Louisiana and KYE having a listed address in Louisiana, he maintains that there is no proof of diversity.
In addition, plaintiff argues that there is likewise a failure of proof with respect to the amount of damages at issue. As Louisiana is a state which prohibits the pleading a specific amount of damages, he argues that defendants must prove by a preponderance of the evidence that the amount in controversy is adequate and that they have failed to do so.
Because the Court finds that there is diversity jurisdiction present, the issue as to the propriety of removal of an in rem claim is moot.
Standard for Removal and Remand
Any civil action brought in a state court of which the district courts have original jurisdiction may be removed to the proper district court. 28 U.S.C. § 1441 (a). District courts have original jurisdiction of all civil actions where the matter in controversy exceeds the sum or value of $75,000, exclusive of interest and costs, and is between citizens of different States. 28 U.S.C. § 1332(a)(1). Thus, plaintiff has challenged both prerequisites to this Court's jurisdiction.Test for Jurisdictional Amount
"Because plaintiff's in Louisiana state courts, by law, may not specify the numerical value of claimed damages, 3 La. Code Civ. P. art 893 (West Supp. 2000), the removing defendant must prove by a preponderance of the evidence that the amount in controversy exceeds $75,000.00." Gebbia v. Wal-Mart Stores, Inc., 233 F.3d 880, 882 (5th Cir. 2000) citing Luckett v. Delta Airlines, Inc., 171 F.3d 295, 298 (5th Cir. 1999). To do so, a defendant may demonstrate that the claims are likely above $75,000 in sum or value, or by setting forth the facts in controversy that support a finding of the requisite amount. Id. In situations where it is not facially apparent from the petition, the district court can then require parties to submit summary-judgment-type evidence, relevant to the amount in controversy at the time of removal. Alien v. R H Oil Gas Co., 63 F.3d 1326, 1336 (5th Cir. 1995). Once a defendant has established, by a preponderance of the evidence, that the amount in controversy is sufficient to confer jurisdiction to the federal courts, the burden shifts back to the plaintiff to show, to a legal certainty, that the claim is really for less than the Jurisdictional amount. De Aguilar v. Boeing Co., 47 F.3d 1404, 1412 (5th Cir. 1995) (" DeAguilar II").Having reviewed the documents produced by the defendants, it is clear that the amount in controversy exceed $75,000.00. Plaintiff underwent surgery twice on his wrist and has received compensation in the amount of $37,578 that constitutes two-thirds of his lost wages or $56,367. As such, jurisdictional amount has been met.
Test for Diversity
Again, in this context, the party seeking removal of the action bears the burden of showing that removal is proper. Frank v. Bear Stearns Co., 128 F.3d 919, 921-22 (5th Cir. 1997). As to the issue of diversity for a corporation, the United States Court of Appeals for the Fifth Circuit applies a "total activity" test to determine the principal place of business of a corporation involved in multi-state activities. Nauru Phosphate Royalties, Inc. v. Drago Daic Interests. Inc., 138 F.3d 160, 164 (5th Cir. 1998); Grinter v. Petroleum Operation Support Serv., 846 F.2d 1006, 1008 (5th Cir. 1988), citing J.A. Olson Co. v. City of Winona 818 F.2d at 404; Toms v. Country Quality Meats, Inc., 610 F.2d 313, 315 (5th Cir. 1980); Village Fair Shopping Center v. Sam Broadhead Trust, 588 F.2d 431 (5th Cir. 1979). The total activity test requires the court to consider the location of both the "nerve center" and "place of activities" of KYE. Grinter, 846 F.2d at 1008; J.A. Olson Co., 818 F.2d at 404; Toms. 610 F.2d at 315.
As stated by Judge Barbier in Williams v. Johnson, 2002 WL 31697716 (E.D. La. Dec. 2, 2002):
In applying this test, a district court must "look to the nature, location, importance, and purpose of a corporation's activities and the degree to which those activities bring the corporation into contact with the local community." [ Nauru Phosphate Royalties, Inc. v. Drago Daic Interests, Inc., 138 F.3d 160, 164 (5th Cir. 19980]. Three general principles guide this inquiry:
(1) when considering a corporation whose operations arc 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; but (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. quoting WRIGHT, FEDERAL COURTS § 27, at 167-68 (5th ed. 1994).
From the affidavit of Ray O. Groot, the Vice President of Operations of KYE, Inc. presented to the Court, it is pellucid that the principle place of business of KYE, Inc. is in Houston, Texas. The corporate headquarters is in Houston, Texas; all of the policy and all significant administrative decisions are made there, the majority of the day to day business of KYE, Inc. is managed there. No directors or officers of KYE, Inc. are from, reside, or work in Louisiana. The payroll for all employees is conducted from Texas. KYE, Inc. engages in marine, engineering and design support and the purchasing, leasing and providing of equipment, including vessels, tugs and cranes of behalf of those providing services to the oil, gas, energy and utility industry all over the world. The shipyard only constitutes approximately twenty-five percent of the income of KYE, Inc. Accordingly,
IT IS ORDERED that the Motion to Remand (Doc. 2) is DENIED.