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Lonsbury v. Woods

United States District Court, E.D. Kentucky, Central Division, Lexington

December 21, 2016

ILYSE LONSBURY, Plaintiff,
v.
KAREN N. WOODS and GEICO INSURANCE COMPANY, Defendants.

          MEMORANDUM OPINION AND ORDER

          DANNY C. REEVES, UNITED STATES DISTRICT JUDGE

         This matter is pending for consideration of Plaintiff Ilyse Lonsbury's motion to remand. [Record No. 20] For the reasons discussed below, the motion will be denied.

         I.

         This action arises out of a July 28, 201');">1');">1');">14, motor vehicle accident occurring near the intersection of East Reynolds Road and Nicholasville Road in Lexington, Kentucky. According to the state court complaint, Lonsbury was traveling in the right through lane of East Reynolds Road when Defendant Karen Woods, who was traveling in the left turn lane, turned her vehicle to the right, striking the front side of plaintiff's car. [Record 1');">1');">1');">1-1');">1');">1');">1 at ¶¶ 4-5] Lonsbury alleges that Woods “failed in her duties … to generally exercise reasonable care; to yield the right of way; to have her vehicle under proper control; and to pay attention and keep a proper lookout so as to keep her vehicle from coming into contact with others.” [Id. at ¶ 5] The plaintiff further alleges that, as a result of Woods' failure of her duties, Lonsbury has suffered serious bodily injury, present and future pain, mental anguish, inconvenience, and the permanent impairment of her ability to earn money. [Id. at ¶¶ 6-7]

         Lonsbury believes that her damages exceed the amount of Woods' liability insurance. [Id. at ¶ 8] As a result, she has joined Defendant GEICO Insurance Co. (“GEICO”), with whom she had a first party contract of insurance at the time of the incident, to recover the excess under uninsured motorist coverage. [Id. at ¶ 8]

         II.

         Lonsbury filed suit in Fayette County Circuit Court on July 20, 201');">1');">1');">16. [See Record No 20-1');">1');">1');">1, p. 1');">1');">1');">1.] GEICO filed its Answer and a Cross-Claim against Woods on August 8, 201');">1');">1');">16. [Id.] Woods filed Answers to the Complaint and Cross-Claims on August 1');">1');">1');">16, 201');">1');">1');">16. [Id.] On August 30, 201');">1');">1');">16, at the request of GEICO, counsel for Lonsbury provided, via e-mail, a summary, indicating a total of $92, 21');">1');">1');">11');">1');">1');">1.53 incurred in medical expenses. [Id.]

         On September 1');">1');">1');">1, 201');">1');">1');">16, GEICO filed a Notice of Removal in this Court, alleging jurisdiction under 28 U.S.C. 1');">1');">1');">1332(a)(1');">1');">1');">1). [Record No. 1');">1');">1');">1] On that same date, the Court entered an Order requiring GEICO to show cause why the matter should not be dismissed for lack of subject-matter jurisdiction. [Record No. 6] The Order explained that, because citizenship is distinct from residency for purposes of 28 U.S.C. §1');">1');">1');">1332(a), and because the Notice of Removal only referred to the residency of Lonsbury and Woods, GEICO failed to plead subject-matter jurisdiction. [Id.]

         On September 8, 201');">1');">1');">16, GEICO filed an amended Notice of Removal. [Record No. 7] The amended notice specified, for the first time, that Lonsbury is a citizen of Kentucky [Id. at ¶ 2] and that Woods is a citizen of Florida [Id. at ¶ 3]. However, the amended notice remained defective because it failed to properly allege the corporate citizenship of GEICO.

         Title 28 of the United States Code, section 1');">1');">1');">1332(c)(1');">1');">1');">1), provides that “a corporation shall be deemed to be a citizen of every State and foreign state by which it has been incorporated and of the State or foreign state where it has its principal place of business.” The Supreme Court explained in Hertz Corp. v. Friend that a corporation's principal place of business will “normally be the place where the corporation maintains its headquarters- provided that the headquarters is the actual center of direction, control, and coordination, i.e., the ‘nerve center, ' and not simply an office where the corporation holds its board meetings (for example, attended by directors and officers who have traveled there for the occasion).” 559 U.S. 77, 93 (201');">1');">1');">10). Under Hertz Corp. a corporation's “principal office” is not necessarily its “principle place of business.” Id. at 89. Nothing in GEICO's September 8, 201');">1');">1');">16 amended notice suggested that the two were the same. In light of the failure to allege subject matter as mandated by statute, the Court scheduled a hearing to allow the defendant to explain why the matter should not be dismissed. [Record No. 1');">1');">1');">10]

         In the meantime, Defendant GEICO filed a second amended Notice of Removal on September 28, 201');">1');">1');">16. The September 28th second amendment included exhibits tending to establish the citizenship of Lonsbury and Woods, but failed to account for the defective allegation of GEICO's citizenship. [Record No. 1');">1');">1');">11');">1');">1');">1]

         A hearing was held on October 3, 201');">1');">1');">16. [See Record No. 1');">1');">1');">16.] During the hearing, the parties agreed that the August 30, 201');">1');">1');">16, e-mail counted as “other paper” for purposes of 28 U.S.C. § 1');">1');">1');">1446(b)(3). However, the plaintiff expressed doubt regarding the citizenship of Woods. The Court gave the parties 30 days to schedule a deposition of Woods and 1');">1');">1');">15 days thereafter to file any motion to remand the case pursuant to 28 U.S.C. § 1');">1');">1');">1447. [Id.] Finally, the Court informed GEICO of the deficiency in its allegation of corporate citizenship. GEICO was given seven days to (again) amend the Notice of Removal to properly allege jurisdiction. [Id.] However, the leave to amend was without prejudice to plaintiff's ability to challenge the removal as untimely and incorrect. [Id.]

         On October 6, 201');">1');">1');">16, GEICO filed its third amended Notice of Removal, stating in pertinent part that GEICO is “a corporation duly organized and existing under the laws of the State of Maryland, with its principal place of business in Maryland. Thus, for diversity purposes, GEICO is a citizen of Maryland.” [Record No. 1');">1');">1');">14 at ¶ 5] On November 1');">1');">1');">1, 201');">1');">1');">16, within the timeframe mandated by the Court, a deposition of Woods was taken. [See Record No. 21');">1');">1');">1-2] ...


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