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LIAKAKOS v. CIGNA CORP.

November 23, 1988

GEORGE S. LIAKAKOS
v.
CIGNA CORPORATION; CIGNA WORLDWIDE, INCORPORATED; JAMES T. MORONE; ARNOLD A. TRILLET J.J. TALARICO; and DOES 1-100, Inclusive



The opinion of the court was delivered by: GAWTHROP, III

 On August 16, 1988, it appearing that this court had diversity jurisdiction, I entered an order permitting further discovery to proceed. Upon further examination of the pertinent law and the facts of this case, I now, sua sponte,1 vacate and modify my previous order as it relates to subject matter jurisdiction.

 Background

 Plaintiff, George S. Liakakos, is a Greek national and a naturalized citizen of the United States. In 1978, he became an employee of AFIA Worldwide (AFIA), working as a senior branch assistant in AFIA's Athens office. AFIA was later acquired by CIGNA Worldwide, Incorporated (CIGNA), a Delaware corporation with its principal place of business in Philadelphia, Pennsylvania. *fn2" In 1984, plaintiff was assigned to the position of Director, Loss Control in Athens. In 1985, CIGNA notified plaintiff that his employment would be terminated effective April 1, 1985. Plaintiff brought suit in the Superior Court of California for the County of Los Angeles on March 14, 1986. Eight months later, the case was removed to the United States District Court for the Central District of California, which transferred the case to the United States District Court for the Eastern District of Pennsylvania.

 I. Does this court have subject matter jurisdiction under 28 U.S.C. § 1332(a)(2)?

 Under 28 U.S.C. § 1332(a)(2), federal courts are vested with original jurisdiction in cases involving "citizens of a State and citizens or subjects of a foreign state." In my previous memorandum, I stated:

 
In [his] affidavit, plaintiff states that he is both a naturalized United States citizen and a citizen of Greece. He also asserts that "notwithstanding my United States citizenship, Greece always has considered and continues to consider me a Greek citizen." Since plaintiff is recognized as a Greek citizen, he has a diversity claim under 28 U.S.C. § 1332(a)(2) . . . .

 Liakakos v. Cigna Corp., slip op. at 2-3, No. 87-390 (E.D. Pa. August 16, 1988).

 The result in Aguirre has been criticized by most commentators, see, e.g., Wright, Miller & Cooper, Federal Practice and Procedure § 3621 (2d ed. 1984), and the few cases that have ruled on the issue have refused to follow it in the case of naturalized Americans. *fn3" See: Raphael v. Hertzberg, 470 F. Supp. 984 (C.D.Cal. 1979), appeal dismissed, 636 F.2d 1227 (9th Cir. 1980), Sadat v. Mertes, 615 F.2d 1176 (7th Cir. 1980), Nazareth Candy Co., Ltd. v. Sherwood Group, Inc., 683 F. Supp. 539 (M.D.N.C. 1988). The reasoning behind these cases is as follows:

 1. The purposes behind alienage jurisdiction are not present in the case of naturalized Americans. One of the major considerations that may have prompted this provision was the fear of "entanglements with other sovereigns that might ensue from failure to treat the legal controversies of aliens on a national level." Iran Handicraft and Carpet Export Center v. Marjan Intern'l Corp., 655 F. Supp. 1275, 1277 (S.D.N.Y. 1987), quoting Chang v. Northwestern Memorial Hospital, 506 F. Supp. 975, 977 n.1 (N.D. Ill. 1980). Where, however, the proponent of diversity jurisdiction is a United States citizen, "there is little reason to fear that a foreign government may be affronted by a decision adverse to that citizen, even if the American citizen also purports to be a citizen of that foreign nation." Raphael v. Hertzberg, supra., 470 F. Supp. at 986.

 2. Where the plaintiff is an American citizen, "the risk of bias in a state forum against the litigant because he is also a foreign national would appear less substantial." Sadat v. Mertes, supra., 615 F.2d at 1186, n. 13.

 3. To permit dual citizens the right to use their prior citizenship to create or destroy diversity would give them an unfair advantage over other litigants.

 
Imagine, for example, a native-born American, born of Japanese parents, domiciled in the State of California, and now engaged in international trade. A dispute could arise in which an Australian customer seeks to sue the American for, say, breach of contract in a federal court in California. The native-born American possibly could claim Japanese citizenship by virtue of his parentage, . . . as well as his status as a citizen of California and defeat the jurisdiction of the federal courts because of the absence of complete diversity. Arguably, cases as ...

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