Conagra Foods, Inc. v. Americold Logistics, LLC
2015 U.S. App. LEXIS 1201
10th Cir.2015Background
- Multiple plaintiffs (including ConAgra Foods and Swift‑Eckrich) sued Americold Logistics, LLC and Americold Realty Trust in Kansas state court; defendants removed to federal district court asserting complete diversity.
- The district court decided the merits on summary judgment for the Americold entities; plaintiffs appealed.
- This court sua sponte questioned the sufficiency of the notice of removal because it did not state the citizenship of the beneficial shareholders/beneficiaries of Americold Realty Trust.
- Americold argued a trust’s citizenship is determined solely by the citizenship of its trustees (relying on Navarro), so omission of beneficiaries’ citizenship was not fatal.
- The Tenth Circuit held Navarro is limited to suits brought by trustees in their individual capacity; for suits by the trust itself Carden controls and requires considering the citizenship of all members (including beneficiaries).
- Because Americold failed to prove the beneficiaries’ citizenship, the court concluded diversity was not established, vacated the federal judgment, and remanded to state court.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether a trust’s citizenship for diversity is determined solely by trustees’ citizenship | Navarro allows trustees to invoke diversity based on their citizenship when they sue in their own names | Trust’s citizenship is the trustees’ citizenship; beneficiaries’ citizenship need not be shown | Navarro is limited to suits by trustees; when the trust itself is a party Carden requires considering all members’ citizenship |
| Whether Americold’s notice of removal was sufficient without listing beneficiaries | Plaintiffs argued omission meant federal jurisdiction was not established | Americold contended beneficiary citizenship unnecessary because trustee citizenship controls | Notice insufficient; Americold failed to carry burden to show complete diversity |
| Whether prior Tenth Circuit language binds court to trustee‑only rule | Americold cited prior Tenth Circuit mentions treating trustee citizenship as controlling | Plaintiffs noted those precedents were inapposite (trustees sued in their names or nonbinding) | Prior citations did not control; they did not resolve Carden vs Navarro tension |
| Remedy when diversity not established on appeal | Plaintiffs: remand to state court | Defendants: argued majority practice favored trustee rule (thus no remand) | Case remanded: district court must vacate its judgment and remand to state court |
Key Cases Cited
- Carden v. Arkoma Assocs., 494 U.S. 185 (1990) (non‑corporate artificial entities’ citizenship is the citizenship of all their members)
- Navarro Sav. Ass’n v. Lee, 446 U.S. 458 (1980) (trustees suing in their own names may invoke diversity based on their citizenship when they are real parties in interest)
- Emerald Investors Trust v. Gaunt Parsippany Partners, 492 F.3d 192 (3d Cir. 2007) (Navarro does not govern trusts that are parties; Carden requires considering beneficiaries in trust citizenship)
- Riley v. Merrill Lynch, Pierce, Fenner & Smith, 292 F.3d 1334 (11th Cir. 2002) (trust citizenship determined by beneficiaries’ citizenship when the trust itself is a party)