Only Kids Apparel, LLC v. Zulily, LLC

Background

Defendant Zulily, LLC filed a notice of removal on September 13, 2022, seeking to move the case from state court to the U.S. District Court for the Southern District of New York. The court’s order states that the notice failed to allege the citizenship of Plaintiff Only Kids Apparel, LLC and Defendant Zulily, LLC both when the original state-court action was filed and when removal was sought.

Reasoning

For federal diversity jurisdiction, the parties’ citizenship must be established at both relevant times. The court explained that citizenship depends on domicile, not merely residence. Even assuming that a notice of removal could sometimes rely on supporting emails discussing a party’s residency, the emails and notice in this case did not provide a basis to determine either party’s citizenship when the state case was originally filed.

The court also noted that it could remand a case on its own initiative for a procedural defect within 30 days after the notice of removal, or at any time if the court lacked subject-matter jurisdiction. Because the notice and state-court record did not establish that the parties were completely diverse, the case had to be returned to state court.

Ruling

The court ordered that the matter be remanded to state court. Under 28 U.S.C. § 1447(c), it directed the clerk to mail a certified copy of the opinion and order to the Supreme Court of the State of New York, New York County, and it directed the clerk to close the federal case. The order did not decide the underlying claims between Only Kids Apparel, LLC and Zulily, LLC.