United States District Court, E.D. Pennsylvania
May 5, 2004.
JERRY GARGIULO, Plaintiff
JOHN P. DESSAUER, et al., Defendants
The opinion of the court was delivered by: BERLE M. SCHILLER, District Judge
MEMORANDUM AND ORDER
On March 19, 2004, Defendants John P. Dessauer, John Dessauer's
Investor's World and Phillips Investment Resources, LLC ("PIR") removed
this action to this Court from the Court of Common Pleas of Philadelphia
County. Presently before the Court is Plaintiff's timely Petition to
Remand under 28 U.S.C. § 1447(c). For the reasons stated below, I
deny Plaintiff's Petition to Remand.
Plaintiff brought suit in the Court of Common Pleas of Philadelphia
County against Defendants for breach of contract, negligent
misrepresentation, negligence, and violations of the Pennsylvania Unfair
Trade Practices and Consumer Protection Law ("UTPCPL"). In his complaint,
Plaintiff alleges that he purchased a subscription to "John Dessauer's
Investor's World," in which Defendant Dessauer pledged to "bring unique
benefits each month . . . [through] confidence that comes from
firsthand research [by] travel[ing] the globe, grill[ing] the CEOs and
run[ning] the numbers [him]self for all the companies [he] recommend[s]."
(Compl. ¶ 13.) Plaintiff also alleges that in subsequent written representations, Defendant Dessauer
reiterated the pledge to do firsthand research on the companies that he
recommended. From January to November 2001, Plaintiff allegedly relied on
this promise when he purchased shares of Global Crossings Ltd. ("Global
Crossing") stock pursuant to Defendants' recommendations.
In the March 2002 issue of John Dessauer's Investor's World, Defendant
Dessauer allegedly admitted a mistake in recommending Global Crossing
stock to subscribers, stating that: (1) "I let my guard down"; (2) "In
light of the collapse of Global Crossing, I will redouble my effort
toward getting to know the top management of our companies"; (3) "My
mistake was relying on other people's judgment of top management, rather
than making my own evaluation"; and (4) "The bankruptcy proposal by
management says that I was 100% wrong about their character . . .
Management should be fired and replaced by people with some sense of
equity and ethics." (Compl. ¶ 21, Ex. B.) Plaintiff asserts that as a
direct result of this breach of Defendants' promise to conduct firsthand
research, Plaintiff suffered losses in excess of $50,000.00.
On March 19, 2004, Defendants removed this action to this Court from
the Court of Common Pleas. In their Notice of Removal, Defendants alleged
complete diversity of citizenship as the basis for removal under
28 U.S.C. § 1332, stating that "plaintiff, Jerry Gargiulo is alleged to
be a resident of Philadelphia, Pennsylvania, while defendant Dessauer is
a resident and defendant PIR is a limited liability company organized
under the laws of the State of Maryland and with a principal place of
business in Potomac, Maryland." (Notice of Removal ¶ 1
(citing Compl. ¶¶ 2, 3, 5).) Plaintiff moved this Court for
remand to the Court of Common Pleas, asserting that removal was defective
as Defendants failed to sufficiently allege diversity of citizenship.
Specifically, Plaintiff argues that: (1) there is no allegation of
"citizenship" as Defendants have only alleged "residency;" (2) Defendants failed to properly allege citizenship of PIR in that "a" principal
place of business was alleged instead of "its" principal place of
business; and (3) Defendants have failed to allege the existence of
diversity of citizenship both at the commencement of the action in state
court and at the time of removal. (Pet. to Remand ¶ 6.)
Defendants thereafter filed an amended Notice of Removal, which
specifically stated that at the time the complaint was removed to the
time the amended notice was filed, Plaintiff was a citizen of
Pennsylvania, Defendant Dessauer was a citizen of Florida, and Defendant
PIR was a citizen of Maryland with its principal place of business in
Potomac, Maryland. (Am. Notice of Removal ¶¶ 1-4.) Plaintiff
supplemented his petition for remand by reiterating his previous
arguments and asserting that Defendants' amendment was untimely.
Under 28 U.S.C. § 1441 and 1446, a state court action may be
removed by the defendant to the district court having original
jurisdiction and embracing the place where such action is pending within
thirty days after the service of summons upon the defendant.
28 U.S.C. § 1441(a), 1446(c)(1) (2004). Defendants allege that this Court has
original jurisdiction over this case pursuant to 28 U.S.C. § 1332.
28 U.S.C. § 1332 (2004). Under § 1332, a district court has
jurisdiction over a civil action if the parties are citizens of different
states and the amount in controversy exceeds $75,000.00.*fn1
28 U.S.C. § 1332(a). In order to remove a case where jurisdiction is
predicated upon 28 U.S.C. § 1332, diversity jurisdiction must be alleged at the
time the complaint was filed and at the time of removal. Ellerbee v.
Union Zinc, Inc., 881 F. Supp. 162, 164 (E.D. Pa. 1995). Where a
corporation is one of the parties to the action, it is 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."
28 U.S.C. § 1332(c)(1).
A notice of removal that alleges that a corporate defendant has "a"
principal place instead of "its" principal place of business fails to
properly plead diversity jurisdiction. Hunt v. Acromed Corp.,
961 F.2d 1079, 1080, 1082 n.7 (3d Cir. 1992); Meltzer v. Continental
Ins. Co., 163 F. Supp.2d 523, 526 (E.D. Pa. 2001) (holding that "the
replacement of `its' with `a' renders the notice of removal `technically
defective.'"(quoting Hunt, 961 F.2d at 1080, 1082). Under
28 U.S.C. § 1653, however, a court may permit a defendant to amend a
notice of removal to correct defects in allegations of jurisdiction.
28 U.S.C. § 1653; J & R Ice Cream Corp. v. Ca. Smoothie
Licensing Corp., 31 F.3d 1259, 1265 n.3 (3d Cir. 1994);
Ellerbee, 881 F. Supp. at 164-65 (allowing amendment to cure
technical pleading deficiencies). An imperfect or defective allegation
can be amended outside the thirty-day period for removal provided for
under 28 U.S.C. § 1446, but a missing or completely new
jurisdictional allegation may not be added by amendment after the
thirty-day period has expired. 28 U.S.C. § 1446(b); Miller v.
Principal Life Ins. Co., 189 F. Supp.2d 254, 258 (E.D. Pa. 2002)
(holding that amended notice of removal is permitted where amendment
simply corrects technical omission); Ellerbee, 881 F. Supp. at
164-65; 14C CHARLES A. WRIGHT ET AL., FEDERAL PRACTICE & PROCEDURE.
§ 3733 (3d ed. 1998) (stating that in amending defective notice of
removal, "completely new grounds for removal jurisdiction may not be
added and missing allegations may not be furnished"). In this case, it is clear that diversity of citizenship has been
sufficiently alleged by Defendants. Although Defendants' original notice
of removal contained a defective allegation that diversity of citizenship
existed, Defendants' amended notice of removal successfully cured the
technical defect by replacing "a" with "its" and replacing "resident"
with "citizen." In doing so, Defendants did not add a new jurisdictional
allegation. Notably, Plaintiff does not contest that diversity exists,
rather he argues that it was merely pled improperly. Accordingly, I find
that the defects with Defendants' allegation were technical in nature and
thus were cured by amendment. Hunt, 961 F.2d at 1080, 1082; J&R
Ice Cream Corp., 31 F.3d at 1265 n.3; Ellerbee, 881 F. Supp.
at 165; Stellwagen v. ChemLawn Servs. Corp., Civ. A. No.
92-6437, 1993 U.S. Dist. LEXIS 210, at *4-5, 1993 WL 9025, at *1-2 (E.D.
Pa. Jan. 11, 1993) (permitting amendment to cure jurisdictional
allegation in notice of removal where plaintiff did not deny that
diversity existed); Camacho v. Cove Trader, Inc., 612 F. Supp. 1190,
1192-93 (E.D. Pa. 1985) (permitting amendment where residency
alleged instead of citizenship and diversity of citizenship was not
contested); Moser v. Bostitch Div. of Textron, Inc.,
609 F. Supp. 917, 919 (W.D. Pa. 1985) (permitting amendment where notice of
removal averred defendant had "a" principal place of business in Ohio and
that plaintiff was resident, not citizen, of Pennsylvania). Thus,
diversity of citizenship has been sufficiently alleged, and Plaintiff's
Petition to Remand is denied.
For the foregoing reasons, Plaintiff's Petition to Remand is denied. An
appropriate Order follows.
AND NOW, this 5th day of May, 2004,
upon consideration of Plaintiff's Petition to Remand, his Supplemental
Petition to Remand, and Defendants' response thereto, it is hereby
Plaintiff's Petition to Remand (Document No. 15) is DENIED.