Fifteen Twenty-One Second Avenue Condominium Association v. Viracon LLC
2:23-cv-01999
W.D. Wash.Jun 7, 2024Background
- Plaintiff is the Fifteen Twenty-One Second Avenue Condominium Association, representing a Seattle condo building with allegedly defective Insulated Glass Units (IGUs).
- Plaintiff seeks recovery from manufacturers and certifiers of the IGUs, claiming design and manufacturing defects and false certification.
- Defendants removed the action from Washington state court to federal court, asserting diversity jurisdiction under 28 U.S.C. §§ 1332, 1441, and 1446.
- Plaintiff moved to remand, arguing lack of complete diversity because its members’ (unit owners) citizenship should control.
- The association is a Washington non-profit corporation; all defendants are organized and have principal places of business outside Washington.
- The dispute focuses on whether the citizenship of the association’s members controls for diversity jurisdiction where the association sues on both its own and its members’ behalf.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the citizenship of member unit owners should determine the association’s citizenship for federal diversity jurisdiction | Because Plaintiff sues in a representative capacity for members, their citizenship controls, destroying diversity | Plaintiff is a corporation, so only its citizenship matters, not its members' | Only the corporation's citizenship counts; complete diversity exists |
| Whether the same principle applies to the IGCC’s members | IGCC’s membership citizenship should control, as they are real parties in interest | IGCC is an incorporated entity, so only its own citizenship matters | IGCC’s status as a corporation means only its own citizenship is relevant |
| Whether Plaintiff can rely on post-removal amendments to assert member-assignment of claims | Plaintiff’s members are now stated to be assignees of developer/contractor claims, affecting jurisdiction | Removal is judged based on pleadings at time of removal; post-removal assignments don’t count | Post-removal amendments are irrelevant to jurisdiction |
| Whether Plaintiff is a real party in interest or merely nominal | Plaintiff acts as a conduit for members’ interests, so members are the true parties | Plaintiff also seeks relief for itself as a stakeholder, so it is a real party to the controversy | Plaintiff is a real party in interest; membership citizenship need not be considered |
Key Cases Cited
- Kuntz v. Lamar Corp., 385 F.3d 1177 (9th Cir. 2004) (corporate citizenship controls for diversity even for nonprofit member corporations)
- Navarro Sav. Ass'n v. Lee, 446 U.S. 458 (1980) (federal courts look to the real parties to the controversy for jurisdiction)
- Hertz Corp. v. Friend, 559 U.S. 77 (2010) (jurisdictional rules should be clear and simple)
- Airlines Reporting Corp. v. S and N Travel. Inc., 58 F.3d 857 (2d Cir. 1995) (citizenship of represented parties only counts if representative is a mere conduit)
