Today we join our sister circuits in holding that, for purposes of subject matter jurisdiction, a national bank is a citizen only of the state in which its main office is located.
The facts underlying this case are straightforward. On February 26, 2007, Defendant-Appellant Robert W. Melina (“Melina”) obtained and memorialized in a note (the “Note”) a loan from Wall Street Mortgage Bankers Ltd. for $591,000 in principal. As security for this loan, Melina executed a mortgage on his property at 1245 77th Street in Brooklyn, New York. Wall Street Mortgage Bankers indorsed the Note to the order of IndyMac Bank, F.S.B. (“IndyMac”), and IndyMac later indorsed the Note in blank.
In July 2008, the Office of Thrift Supervision closed IndyMac and appointed the Federal Deposit Insurance Corporation (“FDIC”) as its receiver. That same day, the Office of Thrift Supervision created a new entity, IndyMac Federal Bank, F.S.B. (“IndyMac Federal”), transferred Indy-Mac’s assets to IndyMac Federal, and appointed FDIC as IndyMac Federal’s conservator. FDIC later also became IndyMac Federal’s receiver.
On March 19, 2009, FDIC as IndyMac Federal’s receiver entered into a Loan Sale Agreement (“LSA”) to sell substantially all of IndyMac Federal’s assets to Plaintiff-Appellee OneWest Bank, N.A. (“OneWest”). Section 2.05 of the LSA, titled “Closing,” contemplates that transfer of the subject notes “shall” take place at some future time. See App. 76. Section 3.04(b) of the LSA requires that all notes subject to transfer pursuant to the LSA bear a specific form of endorsement.
Around the same time that OneWest acquired Melina’s loan, OneWest contracted with Deutsche Bank National Trust Company for Deutsche Bank to serve as document custodian for Melina’s original Note and mortgage. In that capacity, Deutsche Bank had physical possession of Melina’s original Note and mortgage from 2009 until April 2011, at which point Deutsche Bank sent them to OneWest. OneWest returned Melina’s Note and mortgage to Deutsche Bank in May 2011, and Deutsche Bank sent them back to OneWest in June 2014. OneWest then transmitted Melina’s original Note and
On August 1, 2009, Melina defaulted on his loan by failing to make the payment due that day. He did not cure the default after receiving notice from OneWest.
On July 21, 2014, CIT Group Inc. entered into a definitive Agreement and Plan of Merger between CIT Group and IMB HoldCo LLC, the parent company of OneWest. CIT Group is a Delaware corporation with its principal place of business located at 11 West 42nd Street, New York, New York. Article V, Section 5.2 of the Agreement and Plan of Merger requires that, during the period between the date of the agreement and the actual closing, OneWest seek CIT Group’s written permission prior to undertaking almost two dozen significant corporate decisions. These decisions include opening, closing, or relocating a branch.
On September 10, 2014, OneWest commenced a foreclosure action against Melina in the United States District Court for the Eastern District of New York, invoking the court’s diversity jurisdiction. On that day, Melina’s original Note and Mortgage were in the physical possession of OneW-est’s counsel at Gross Polowy. On October 13, 2014, OneWest filed an amended complaint containing substantively the same allegations as the original complaint. On February 3, 2015, Melina filed an answer, and on April 2, 2015, he filed an amended answer. OneWest thereafter moved for summary judgment, and Melina cross-moved to dismiss for lack of subject matter jurisdiction.
On June 18, 2015, the District Court heard oral arguments on the motions. In a memorandum and order dated August 31, 2015, the District Court denied Melina’s cross-motion to dismiss and granted OneWest’s motion for summary judgment. The District Court held that a national bank such as OneWest is a citizen only of the state in which its main office is located — not also of the state of its principal place of business — and that OneWest’s main office is indisputably in California. The District Court concluded further that, even if the principal place of business of a national bank mattered for jurisdictional purposes, OneWest’s was California.
The District Court also disagreed with Melina’s standing arguments on the basis of its finding that OneWest was the legal “holder” of Melina’s Note and entitled to enforce it under the New York Uniform Commercial Code. This finding was based on the affidavits of OneWest’s corporate representative and counsel, which established that OneWest was in physical possession of Melina’s original Note at the time it commenced its lawsuit. Additionally, the District Court found that OneWest had proven it was entitled to enforce Meli-na’s loan as the loan’s assignee.
Melina timely appealed the District Court’s memorandum and order and sought review of the District Court’s holdings on subject matter jurisdiction and standing.
DISCUSSION 1
Diversity jurisdiction under 28 U.S.C. § 1332 is proper “only if diversity
A corporation’s principal place of business under § 1332 is “the place where a corporation’s officers direct, control, and coordinate the corporation’s activities.”
Hertz Corp. v. Friend,
28 U.S.C. § 1348 provides that national banks shall “be deemed citizens of the States in which they are respectively located.” The Supreme Court has held unequivocally that a national bank is “located,” for diversity jurisdiction purposes, in the state designated in its articles of association as the locus of its main office — not in every state in which it has branch offices.
See Wachovia Bank v. Schmidt,
In
Wachovia Bank,
the Supreme Court left open the question of whether a national bank is also a citizen of the state of its principal place of business.
See id.
at 315 n. 8,
Several federal courts of appeals to have considered this issue in the wake of
Wa-chovia Bank
have held that a national bank is a citizen only of the state listed in its articles of association as its main office.
See, e.g., Rouse v. Wachovia Mortg., FSB,
We agree with our sister circuits that a national bank is a citizen only of the state listed in its articles of association as its main office. Though
Wachovia Bank
did not conclusively resolve whether a national bank is a citizen of the state in which it has its principal place of business, the Supreme Court in that case did provide some indication that, for diversity purposes, a national bank’s citizenship should be limited to the location of its main office.
See
Congress first addressed jurisdiction for national banks in 1882, when it enacted the statutory predecessor to the current § 1348. This 1882 statute ensured jurisdictional parity between national banks and state-chartered banks by “providfing], in clear and unmistakable terms, that the courts of the United States should not have jurisdiction ... unless they would have jurisdiction under like circumstances of suits by or against a state bank doing business in the same state with the national bank.”
Leather Mfrs.’ Nat'l Bank v. Cooper,
In 1911, Congress once again entertained the issue and provided, in relevant part, that “all national banking associations established under the laws of the United States shall, for the purposes of all other actions by or against them ... be deemed citizens of the States in which they are respectively located.” Act of Mar. 3, 1911, ch. 231, § 16, 36 Stat. 1087, 1093. It was not until 1948 that Congress arrived at the current version of this statute, codified at 28 U.S.C. § 1348, which provides in relevant part that “[a]ll national banking associations shall, for the purposes of all
Though Congress did not tinker further with the citizenship of national banks after 1948, it did dramatically shift the understanding of diversity jurisdiction with respect to the citizenship of state-chartered corporations in 1958. That year, Congress enacted a provision stating that a state-chartered corporation — which includes state-chartered banks- — -is a citizen of both the state of incorporation and the state of its “principal place of business.” Act of July 25, 1958, Pub. L. No. 85-554, sec. 2, § 1332, 72 Stat. 415. That provision is now codified at 28 U.S.C. § 1332(c)(1).
The meaning of a statute’s terms is to be determined as of the time that it became law.
See MCI Telecomms. Corp. v. Am. Tel. & Tel. Co.,
As observed by our sister circuits, “[njothing in the current version of the statute or in its history suggests that Congress intended to revive the principle of jurisdictional parity between state-chartered banks and national banks” once it affirmatively deleted that parity from earlier versions of the statute. Rouse, 747 F.3d at 715. We agree that
when Congress introduced principal-place-of-business citizenship for state banks and corporations in § 1332(c)(1), it made no reference to jurisdictional parity, nor to national banks or § 1348. And nothing in § 1348 indicates that it would incorporate by reference any subsequent change in the statutes governing jurisdiction over state banks and corporations.
WMR e-PIN,
If Congress wishes to amend § 1348, then of course it is free to do so. That task, however, is not for us.
See Rouse,
Melina argued before the District Court that OneWest’s principal place of business is in New York, and thus that there could be no diversity jurisdiction between the parties. He argued further that CIT Group’s proposed acquisition of OneWest’s parent company warranted use of CIT Group’s principal place of business instead of OneWest’s for purposes of diversity jurisdiction. The District Court rejected these arguments, concluding instead that (1) OneWest had successfully shown “that its main office and principal place of business is in California based on an affidavit submitted by Jon Dickerson, the First Vice President of its foreclosure department, and an application to the Federal Reserve System,” App. 167, and (2) “the citizenship of any actual or proposed parent of OneWest does not control OneW-est’s citizenship for purposes of diversity jurisdiction,” App. 168.
On appeal, Melina argues that “a national association is a citizen of the state of its
We do not find Melina’s arguments persuasive. The cases that Melina cites, which he concedes do not “directly settle[] the issue of whether a national association’s] principal place of business is relevant for diversity purposes,”- Appellant’s Br. 12, undermine rather than support his points.
World Trade Center Properties
was directly abrogated by
Wachovia Bank. See Wachovia Bank,
The interpretive letter from the Office of the Comptroller of the Currency does not fare much better. Though Melina is correct that the letter allows for a national bank’s citizenship to be determined by its principal place of business, the letter explicitly relies on and parrots the reasoning of
Firstar Bank, N.A. v. Faul,
Furthermore, the District Court correctly held that OneWest’s principal place of business is, like its main office, in California. Melina does not directly dispute this fact. Instead, he argues that OneWest’s principal place of business was New York because OneWest’s parent company, IMB HoldCo, was being purchased by CIT Group — a company headquartered in New York — at the time that OneWest filed its complaint. Melina claims that when OneW-est filed its original complaint on September 10, 2014, the Agreement and Plan of Merger between CIT Group and IMB HoldCo, dated July 21, 2014, had already “transferred responsibility for major corporate decisions to New York State, which in turn means New York is the place where One[W]est’s officers direct, control, and coordinate corporate activities.” Appellant’s Br. 17.
OneWest responds that “CIT Group’s future acquisition of OneWest’s parent company could not affect OneW-est’s principal place of business because ... ‘[w]hen formal separation is main
Melina also contends that the express terms of the Agreement and Plan of Merger “effectively transferred One[W]est[’]s principal place of business to New York, New York.” Appellant’s Br. 18. In making this argument, Melina relies heavily on § 5.2’s restriction on OneWest’s freedom to open, close, or relocate any branch office. He argues that this restriction means that OneWest, IMB HoldCo as its parent, and CIT Group as its proposed parent all “have the same principal place of business [■i.e., New York].” Appellant’s Br. 18.
This argument, too, must fail; a corporate subsidiary does not assume the principal place of business of its future corporate parent solely as a result of its subsidiary status. The merger agreement between IMB HoldCo and CIT Group says nothing about OneWest’s principal place of business. Though § 5.2 requires OneWest to obtain approval before undertaking certain transactions, this provision does not morph OneWest into an alter ego or agent of its parent, IMB HoldCo — and thus it does not mean that OneWest assumes IMB HoldCo’s principal place of business.
Finally, Melina argues that the District Court’s grant of summary judgment “should be reversed because there is a genuine issue of material fact as to plaintiff[’]s standing to commence a foreclosure action.” Appellant’s Br. 19. The “genuine issue of material fact,” in Melina’s view, is whether OneWest was the holder or as-signee of the mortgage or underlying Note at the time the action was commenced.
Under New York law, “[a] plaintiff establishes its standing in a mortgage foreclosure action by demonstrating that, when the action was commenced, it was either the holder or assignee of-the underlying note.”
Wells Fargo Bank, N.A. v. Rooney,
Melina does not contest OneW-est’s possession of the Note at the time it filed its complaint. Instead, Melina argues that OneWest’s failure “to provide the exact date the Note was transferred, or any details at all regarding the delivery of the Note prior to commencement of a foreclosure action” is fatal to its claim for summary judgment. Appellant’s Br. 24. This argument, however, has already been re
Moreover, OneWest was the assignee of Melina’s loan. In New York, standing to foreclose may be established by “a written assignment of the underlying note.”
Onewest, F.S.B. v. Goddard,
CONCLUSION
For the foregoing reasons, we AFFIRM the judgment of the District Court.
Notes
. We review
de novo
a district court’s legal determinations, including those regarding subject matter jurisdiction.
Wake v. United States,
We also review
de novo
a district court's decision to grant summary judgment.
Mathirampuzha v. Potter,
. National banks are “corporate entities chartered not by any State, but by the Comptroller of the Currency of the U.S. Treasury’’ and thus they do not fit within § 1332(c)’s definition of State-incorporated entities.
Wachovia Bank,
. Additional circuits have, in the wake of
Wa-chovia Bank,
held that a national bank is a citizen of the state in which its main office is located.
See, e.g., Arthur v. IP Morgan Chase Bank, NA,
.
See, e.g., Shell Rocky Mountain Prod.., LLC v. Ultra Res., Inc.,