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Florence A. Konosky and v. Phl Variable Life Insurance Company

December 8, 2010


The opinion of the court was delivered by: (judge Caputo)


Presently before the Court is the defendant's notice of removal. (Doc. No. 1.) Because the notice of removal fails to establish that this Court has subject matter jurisdiction over the action, it will be remanded unless the defendant can show that diversity jurisdiction is proper.

I. Background

Plaintiffs Florence A. Konosky and Florence C. Konosky (Florence A. and Florence C., respectfully)*fn1 brought this action in the Court of Common Please of Lackawanna County against defendant PHL Variable Life Insurance Company. PHL timely removed the action to federal court, invoking diversity-of-citizenship jurisdiction under 28 U.S.C. § 1332.

The complaint describes Florence A. as residing in Pennsylvania, while plaintiff Florence C. resides in Milan, Italy (but maintains "a permanent legal address" in Pennsylvania). The notice of removal summarily refers to both plaintiffs as citizens of Pennsylvania. The notice of removal describes PHL as a Connecticut corporation with its principal place of business in Connecticut.

II. Analysis

"It is an elementary principle that federal courts are courts of limited jurisdiction, empowered to hear cases only as provided for under Article III of the Constitution and congressional enactments pursuant thereto." Employers Ins. of Wausau v. Crown Cork & Seal Co., Inc., 905 F.2d 42, 45 (3d Cir. 1990) (citing Bender v. Williamsport Area Sch. Dist., 475 U.S. 534, 541 (1986)). Federal courts have an obligation to address concerns over subject matter jurisdiction sua sponte. Id.

Under 28 U.S.C. § 1441, a civil action brought in state court may be removed by the defendant to federal district court whenever a district court would have original jurisdiction over the action. Under 28 U.S.C. § 1332, the diversity jurisdiction statute, the district courts have original jurisdiction of civil actions "where the amount in controversy exceeds the sum or value of $75,000, exclusive of interest and costs, and is between citizens of different States . . . [or] citizens of different States and in which citizens or subjects of a foreign state are additional parties."

Complete diversity must exist between the adverse parties in the action; that is, the citizenship of each plaintiff must be diverse from that of each defendant. See Owen Equipment & Erection Co. v. Kroger, 437 U.S. 365 (1978), 373--74 (1978). Diversity of citizenship is determined at the time the action is filed. See Freeport-McMoran Inc. v. K.N. Energy Inc., 498 U.S. 426, 428 (1991).

For purposes of diversity jurisdiction, a natural person is deemed to be a citizen of the state where he is domiciled. Swiger v. Allegheny Energy, Inc., 540 F.3d 179 182 (3d Cir. 2008) (citing Gilbert v. David, 235 U.S. 561, 569 (1915)). To be domiciled in a state, a person must reside there and intend to remain indefinitely. Krasnov v. Dinan, 465 F.2d 1298, 1300--01 (3d Cir. 1972). "In order to be a citizen of a State within the meaning of the diversity statute, a natural person must . . . be domiciled within the State." Newman-Green, Inc. v. Alfonzo-Larrain, 490 U.S. 826, 828 (1989). An American citizen domiciled abroad "is 'stateless' for purposes of diversity jurisdiction . . . [and] cannot be sued (or sue) in federal court based on diversity jurisdiction." Swiger v. Allegheny Energy, Inc., 540 F.3d 179, 184 (3d Cir. 2008).

The defendant bears the burden of establishing federal jurisdiction in a removal case. Samuel-Bassett v. KIA Motors America, Inc., 357 F.3d 392, 396 (3d Cir. 2004). Removal statutes are to be strictly construed and all doubts are to be resolved in favor of remand. See Batoff v. State Farm Ins. Co., 977 F.2d 848, 851 (3d Cir. 1992).

Here, the complaint claims that Florence C. resides in Italy; thus, she cannot be domiciled in Pennsylvania and is not a citizen of Pennsylvania. Assuming she is a citizen of the United States, her foreign residence renders her "stateless" for purposes of the diversity statute and the action must be remanded to state court. The only way removal can be saved is if Florence C. is a "citizen or subject of a foreign state" and not an American national. See Frett-Smith v. Vanterpool, 511 F.3d 396, 400 ("We . . . hold that for purposes of diversity jurisdiction, only the American nationality of a dual national is recognized.")

If the defendant can show that Florence C. is a citizen or subject of a foreign state, thereby saving removal, it will be permitted to do so pursuant to 28 U.S.C. § 1653. See USX Corp. v. Adriatic Ins. Co., 345 F.3d 190, 204 (3d Cir. 2003) (noting that Section 1653 gives district courts "the power to remedy ...

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