Santiago v. Intercontinental Hotels Group Resources, Inc.

Background

Defendants removed the action from New York Supreme Court to the U.S. District Court for the Southern District of New York. They invoked diversity jurisdiction, which allows a federal court to hear certain disputes between citizens of different states. The notice of removal alleged that Lisa Santiago was a citizen of New York and that Intercontinental Hotels Group Resources, Inc., Intercontinental Hotels Corporation, and Six Continents Hotels, Inc. were Delaware corporations and therefore citizens of Delaware.

Jurisdictional issue

The court explained that a corporation is considered a citizen of both its state of incorporation and the state where it has its principal place of business. Because the notice of removal did not fully allege those facts for each defendant entity, the court identified a potential defect in the allegations supporting subject-matter jurisdiction. Subject-matter jurisdiction is the court's legal authority to hear the case, and the court noted that it has an independent duty to determine whether that authority exists.

Order

The court ordered defendants to amend their notice of removal within ten days to fully allege each defendant entity's citizenship, including its state of incorporation and principal place of business. The court did not dismiss the case in this order. It stated that if defendants were unable to amend the notice to truthfully allege complete diversity of citizenship, the case would be dismissed for lack of subject-matter jurisdiction without further notice.