Chau v. Standard Mutual Insurance Company, 2:16-cv-15596

On February 16, 2016, Kanetha Chau was involved in a motor vehicle collision with Clarence Osteen in New Orleans; Chau sued for damages.
Chau filed suit in Orleans Parish Civil District Court on July 7, 2016 naming Osteen and his insurer, Standard Mutual Insurance Company, as defendants.
Chau alleged she was a Louisiana citizen and that both Osteen and Standard Mutual were Illinois citizens.
Standard Mutual removed the case to federal court on diversity grounds on October 14, 2016; at removal Osteen had not yet been served.
After service, Chau deposed Osteen and learned he had changed his domicile to Louisiana before the accident, making him a Louisiana citizen and thus non-diverse with Chau.
Because Osteen (a non-diverse defendant) had been served, the court concluded it lacked subject-matter jurisdiction and granted Chau’s unopposed motion to remand.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether diversity jurisdiction remains after a served defendant is shown to be domiciled in the forum state	Remand is required because Osteen is domiciled in Louisiana, destroying complete diversity	Removal was proper based on the parties’ alleged citizenship at time of removal; subsequent facts should not defeat jurisdiction	Court held that service of a non-diverse defendant (Osteen) destroys diversity and remanded the case to state court

Louisiana v. Am. Nat’l Prop. & Cas. Co., 746 F.3d 633 (5th Cir. 2014) (jurisdictional facts are generally assessed at time of removal)
Hensgens v. Deere & Co., 833 F.2d 1179 (5th Cir. 1987) (addition of a non-diverse party defeats diversity jurisdiction)
Owen Equip. & Erection Co. v. Kroger, 437 U.S. 365 (1978) (diversity jurisdiction requires complete diversity between plaintiffs and defendants)
Sharp v. Kmart Corp., 991 F. Supp. 519 (M.D. La. 1998) (when a non-diverse party is added or revealed post-removal, remand is required)