Nunnally v. Zhejiang Huahai Pharmaceutical Co Ltd
1:19-cv-15764
D.N.J.Jul 19, 2019Background
- Plaintiff David Nunnally, a Louisiana resident, sued multiple pharmaceutical defendants alleging state-law products-liability, negligence, misrepresentation, redhibition, and fraud claims and MMWA breach-of-warranty claims.
- Complaint pleads diversity and federal-question jurisdiction and alleges the amount in controversy exceeds $75,000.
- Several defendants are foreign or New Jersey entities (Zhejiang Huahai Pharmaceutical Co., Huahai US, Prinston, Solco, Aurobindo, Aurobindo USA, Aurolife) with pleadings identifying their states/countries of incorporation and principal places of business.
- Citizenship of Acetris, LLC (an unincorporated entity) is not alleged by reference to its members, so its citizenship is unclear from the complaint.
- Plaintiff invokes federal-question jurisdiction under the Magnuson-Moss Warranty Act; the complaint alleges damages and relief sufficient to meet the MMWA $50,000 threshold.
- The magistrate judge conducted a preliminary jurisdictional review, finding federal-question jurisdiction on the face of the complaint but noting diversity jurisdiction is unclear because of deficient allegations as to LLC citizenship.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether federal-question jurisdiction exists | MMWA breach-of-warranty claim invokes federal jurisdiction and amount in controversy exceeds threshold | N/A (not disputed in review) | Federal-question jurisdiction under the MMWA appears on the face of the complaint |
| Whether diversity jurisdiction exists | Complaint alleges complete diversity and amount in controversy > $75,000 | Diversity is defeated or unclear because citizenship of certain defendants (LLCs) is not properly alleged | Diversity jurisdiction is not clearly established from the pleadings |
| Citizenship of unincorporated entities (LLCs) | Pleads Acetris’ principal place of business (New Jersey) | Citizenship of an LLC is determined by its members, not its principal place; members’ citizenship not alleged | Complaint fails to adequately allege Acetris’ citizenship; must allege members’ domiciles |
| Whether court must sua sponte examine subject-matter jurisdiction | Jurisdictional basis was pleaded; court should accept it | Court has independent obligation to assess subject-matter jurisdiction | Court may and did independently review jurisdiction and may reconsider sua sponte or on motion |
Key Cases Cited
- Arbaugh v. Y & H Corp., 546 U.S. 500 (2006) (subject-matter jurisdiction cannot be forfeited or waived)
- Ruhrgas AG v. Marathon Oil Co., 526 U.S. 574 (1999) (courts must ensure they have jurisdiction)
- Harvey v. Grey Wolf Drilling Co., 542 F.3d 1077 (5th Cir. 2008) (LLC citizenship determined by citizenship of each member)
- Getty Oil Corp. v. Ins. Co. of N. Am., 841 F.2d 1254 (5th Cir. 1988) (citizenship must be distinctly and affirmatively alleged)
- Acridge v. Evangelical Lutheran Good Samaritan Soc., 334 F.3d 444 (5th Cir. 2003) (individual citizenship = domicile)
- Tewari De-Ox Sys., Inc. v. Mountain States/Rosen, L.L.C., 757 F.3d 481 (5th Cir. 2014) (corporate citizenship: state of incorporation and principal place of business)
- Int'l Paper Co. v. Denkmann Assocs., 116 F.3d 134 (5th Cir. 1997) (partnership citizenship determined by citizenship of each partner)
- Carpenter v. Wichita Falls Indep. Sch. Dist., 44 F.3d 362 (5th Cir. 1995) (federal-question jurisdiction must appear on the face of the complaint)
- Elam v. Kansas City S. Ry. Co., 635 F.3d 796 (5th Cir. 2011) (same)