LaShaonda Hammond v. Sutherland Global Services, Inc.
2:21-cv-02999
C.D. Cal.Jul 15, 2021Background
- Hammond worked for Sutherland as a Collection Specialist (hired April 2012) and was terminated in January 2020 after intermittent absences and an extended workers’ compensation leave.
- Hammond sued in California state court (filed Feb. 26, 2021) asserting six causes of action arising from alleged disability discrimination, failure to accommodate, failure to engage in the interactive process, failure to prevent discrimination/harassment, retaliation, and wrongful termination in violation of public policy.
- Sutherland removed the case to federal court, alleging complete diversity: Hammond is a California citizen and Sutherland is a New York citizen (incorporated in New York with its principal place of business there).
- Hammond moved to remand, arguing Sutherland failed to prove its principal place of business is in New York and pointing to Sutherland’s website listing offices in New York, San Francisco, and London.
- Sutherland supported removal with a declaration from René Lafferty (senior HR officer) attesting that Sutherland is incorporated in New York and that its principal place of business (nerve center) is in Pittsford, New York, where most of the executive team is based.
- The Court denied the motion to remand, holding Sutherland met its burden to establish diversity by a preponderance of the evidence via the declarations.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether federal diversity jurisdiction exists because Sutherland is a citizen of New York (i.e., whether Sutherland’s principal place of business is in New York) | Hammond: Sutherland’s website shows offices in California; Sutherland hasn’t proven its principal place of business is New York, so diversity is lacking | Sutherland: Incorporated in New York and its nerve center (principal place of business) is Pittsford, NY; supported by sworn HR declaration | Court: Denied remand. The declaration established by a preponderance that Sutherland’s principal place of business is in New York, so complete diversity exists |
| What evidentiary showing is required at the removal stage when diversity is challenged | Hammond: Removal notice alone was insufficient; pointing to multiple office locations raises doubt | Sutherland: Removal notice need not include evidentiary submissions; when challenged it may submit declarations and other proof; its sworn declaration satisfies the requirement | Court: Cited Dart Cherokee—if diversity is challenged, parties submit proof and court decides by preponderance; Sutherland’s sworn declarations were sufficient |
Key Cases Cited
- Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375 (1994) (federal courts’ subject-matter jurisdiction is limited to that authorized by Constitution and Congress)
- Dart Cherokee Basin Operating Co. v. Owens, 574 U.S. 81 (2014) (when removability is challenged, parties may submit proof and court decides jurisdiction by preponderance)
- 3123 SMB LLC v. Horn, 880 F.3d 461 (9th Cir. 2018) (corporate citizenship limited to state of incorporation and state of principal place of business)
- Hertz Corp. v. Friend, 559 U.S. 77 (2010) (principal place of business = corporation’s nerve center where high-level officers direct, control, and coordinate activities)
- Gaus v. Miles, Inc., 980 F.2d 564 (9th Cir. 1992) (removal statute strictly construed; party seeking removal bears burden of establishing federal jurisdiction)