Dynamic Enjoy Corporation v. Piccolo by Gambrinus, LLC

Background

On August 14, 2024, the court advised the parties that federal subject-matter jurisdiction appeared to be lacking because there was not complete diversity under 28 U.S.C. § 1332(a). Complete diversity generally requires that opposing parties not share state citizenship, although the opinion specifically states only that Plaintiff Nadia Christopolous was pleaded to be a member of Defendant Piccolo by Gambrinus, LLC, creating a lack of complete diversity between the adversaries. The court asked the parties whether it should dismiss the case or drop the non-diverse party under Federal Rule of Civil Procedure 19(b).

Parties’ Requests

In their joint letter, the plaintiffs requested jurisdictional discovery—discovery intended to determine whether federal jurisdiction exists—before any final decision on dismissal. The court explained that such discovery may be ordered when a plaintiff makes an initial showing of facts supporting a plausible basis for jurisdiction. It concluded that the complaint did not make that initial showing because it alleged that Christopolous was a member of Piccolo by Gambrinus, LLC.

The parties also urged the court to remand the case to state court. The court rejected the parties’ reliance on the defendants’ stated lack of objection to the case remaining in the Southern District of New York, explaining that venue and subject-matter jurisdiction are different concepts and that parties cannot waive or create subject-matter jurisdiction by agreement. The court also stated that it was unaware of authority allowing a federal court to remand a case that was originally filed in federal court.

Order

The court did not decide the requested dismissal, removal of a party, jurisdictional discovery, or remand in this order. Instead, Judge Vernon S. Broderick ordered the parties to submit a joint letter by September 13, 2024, explaining their positions on whether the court had authority to order jurisdictional discovery and whether it had authority to remand the case to state court. The order therefore addressed threshold jurisdictional and procedural issues without reaching the merits of the parties’ underlying claims.