Summary
holding that a foreign corporation's Louisiana business address contained in a "Louisiana Secretary of State Unofficial Detail Report" is not its principal place of business for purposes of § 1332(c)
Summary of this case from McCurdy v. Hydradyne, LLCOpinion
Civil Action No. 01-1931 Section: E/5
August 21, 2001
RULING ON MOTION
Plaintiffs filed a motion to remand this case to the Civil District Court in and for the Parish of Orleans for lack of complete diversity of citizenship.
Plaintiff Robert Jarrell was injured when the helicopter he was piloting crashed or crash landed on Parker Rig 51B Ship Shoal Block 13 Bay side of Timbalier Island. He filed suit for damages against defendants Parker Drilling Company and/or Parker Drilling Company International, Inc., and/or Parker Drilling Management Services, Inc., and/or Parker Drilling Company North America, Inc., and/or Parker Drilling Offshore Corporation and/or Parker Drilling Offshore USA, LLC, and/or Parker Drilling USA LTD., and/or Texaco Exploration, Inc., and/or Texaco, Inc. Defendants removed the action to federal court pursuant to 28 U.S.C. § 1332 alleging complete diversity of citizenship.
Unnamed persons also included as defendants are irrelevant to this motion.
Plaintiffs correctly point out that the removing party bears the burden of establishing the facts necessary to show that federal jurisdiction exists. plaintiffs claim that the Parker defendants are not diverse pursuant to 28 U.S.C. 1332(c)(1) which provides "a corporation shall be deemed to be a citizen of any State by which it has been incorporated and of the State where it has its principal place of business. . . ." They offer copies of computer generated printouts from the "Louisiana Secretary of State Unofficial Detail Record" for each of the seven Parker defendants, each of which identifies the "Principal Business Establishment" as a location in Louisiana.
See Allen v. R H Oil Gas Co., 63 F.3d 1326, 1335 (5th cir. 1995), citing Gaitor v. Peninsular Occidental S.S. Co., 287 F.2d 252, 253-54 (5th Cir. 1961)
Plaintiffs' memorandum in support of their motion to remand, at page 6, alleges that Texaco has not met its burden of coming forward with facts necessary to establish diversity. However, nothing in the plaintiffs' motion or memorandum in support thereof suggests that either Texaco defendant has its principal place of business in Louisiana. Plaintiffs' lawsuit identifies Texaco Exploration and Production and/or Texaco, Inc., as a foreign corporation with its primary place of businessin Louisiana at 400 Poydras Street, New Orleans, Louisiana. See Record Doc. #1, Exhibit A. Defendants' Joint Memorandum in Opposition to Motion to Remand, signed by counsel for the Parker defendants and counsel for the Texaco defendants, states that "In fact, Texaco Inc., a Delaware corporation, has its principal place of business in the State of New York, and Texaco Exploration and Production Inc., a Delaware corporation, has its principal place of business in the State of Texas". Because plaintiffs have failed to specifically challenge or argue lack of diversity as to the Texaco defendants, the court accepts that diversity for purposes of 28 U.S.C. 1332(c)(1) is met as to those defendants.
Plaintiffs' reliance on the computer generated "Unofficial Detail Record" as evidence that the defendants are citizens of Louisiana is misplaced. Louisiana Revised Statute Title 12:304 governs a foreign corporation's application for a certificate of authority to do business in the State of Louisiana. Section 304(4) requires the foreign corporation to provide "[t]he address of the principal office of the corporation in this state, . . ." Exhibit 2, attached to defendants' opposition memorandum, is a copy of a blank document entitled "Application for Authority to Transact Business in Louisiana (R.S. 12:304)". Item 6 requests that the applicant enter the address of "Principal business establishment in Louisiana". Clearly, the Principal Business Establishment address shown on the Unofficial Detail Report is the foreign corporation's principal business establishment in Louisiana, not its principal place of business for purposes of 28 U.S.C. § 1332 (c) (1)
Attached as Exhibit 1 to defendants opposition memorandum is "Declaration of Thomas L. Wingerter". Mr. Wingerter declares that he is President and Chief Executive Officer of Parker Drilling Offshore USA, L.L.C.; that the Company was the owner and operator of the Parker Drilling Rig 51-B as of the date of Mr. Jarrell's alleged accident; that the Company was formed under the laws of Oklahoma and is qualified to do business in Oklahoma, Texas and Louisiana; that the Company conducted oil and gas well drilling services in "Offshore Texas" and "Offshore Louisiana"; that the Company headquarters were located in Tulsa, Oklahoma; that the Company maintains an office in New Iberia, Louisiana, but the principal business of the Company was conducted out of Houston, Texas, where the Company's President, Vice President-Finance, and Vice President-Domestic Operations were located; that from the Company's Houston office senior management personnel oversaw, supervised, and controlled the operations, activities, and policies of the Company; and the management, contract negotiations, legal services, accounting services, and policy were set and enforced in the Houston office.
The declaration was made pursuant to 28 U.S.C. § 1746, which states in pertinent part:
"Whenever, under any law of the United States or under any rule, regulation, order, or requirement made pursuant to law, any matter is required or permitted to be supported, evidence, established, or proven by the sworn declaration, verification, certificate, statement, oath, or affidavit, in writing of the person making the same (other than a deposition or an oath of office, or an oath required to be taken before a specified official other than a notary public), such matter may, with like force and effect, be supported, evidenced, established, or proved by the unaworn declaration, certificate, verification, or statement, in writing of such person which is subscribed by him, as true under penalty of perjury and dated . . ."
Mr. wingerter further declared that he is an officer and/or authorized representative of Parker Drilling Management Services, Inc.; Parker Drilling Company; Parker Drilling Company International, Inc.; Parker Drilling Company North America, Inc.; Parker Drilling Offshore corporation; and Parker Drilling U.S.A. Ltd.; that none of those companies had any interest in the ownership, operation or control over Parker Drilling Rig 51-B,; and that Parker Drilling Offshore Corporation was headquartered in Houston, Texas, and all other companies were headquartered in Tulsa, Oklahoma.
In Nauru Phosphate Royalties, Incorporated v. Drago Daic Interests, Incorporated, the Fifth Circuit stated the test to determine the principal place of business for purposes of diversity jurisdiction:
138 F.3d 160 (5th Cir. 1998), r'hg and suggestion for r'hg En Banc denied, (April 29, 1998), cert. denied, 525 U.S. 876, 119 5.Ct. 179 (1989).
This court applies a "total activity" test to determine the principal place of business. J.A. Olson Co. v. City of Winona, Miss., 818 F.2d 401, 411-12 (5th Cir. 1987). We 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. Id. Three general principles drawn from the insights of Professor Wright guide the inquiry (see Wright, Federal Courts § 27, at 167-68 (5th ed. 1994)):
(1) when considering a corporation whose operations are 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 corporations brain is given greater significance.
Id. at 164, citing Olson, 818 F.2d at 411 (citations omitted).
The only Parker defendant that has any interest in Parker Drilling Rig 51-B is Parker Drilling Offshore USA, L.L.C. Applying the Olson principles to determine that company's principal place of business, the Court finds the second Olson principal is not applicable because the company does not have its sole operation in one state and executive offices in another. The third Olson principal is not applicable because the company's activity is not "passive" — it provides oil and gas well drilling services. The Court finds the first Olson principle to be applicable in this case because the company was formed under Oklahoma law and is doing business in Oklahoma, Texas and Louisiana. The significant inquiry is to identify the "sole nerve center" of the company in determining its principal place of business. Based on the information provided by Mr. Wingerter's declaration, there can be no question that the principal place of business of Parker Drilling Offshore USA, L.L.C. is Houston, Texas, and that complete diversity exists.
Accordingly, upon reviewing the record, the law, the motion of plaintiffs Robert S. Jarrell and Vanessa Jarrell to remand and the memorandum in support thereof, and defendants joint memorandum in opposition and attachments thereto;
IT IS ORDERED that the motion of plaintiffs Robert S. Jarrell and Vanessa Jarrell to remand be and is hereby DENIED;