GGC International Limited v. Ver

Background

GGC International Limited filed this action in the Supreme Court of the State of New York, County of New York. Roger Ver removed it to the U.S. District Court for the Southern District of New York on February 24, 2023. He asserted diversity jurisdiction under 28 U.S.C. § 1332, arguing that the parties were diverse and that the amount in controversy exceeded $75,000.

The court issued an order requiring Ver to explain why the case should not be sent back to state court. In his response, Ver acknowledged that GGC International Limited was formed under the laws of the British Virgin Islands, but argued that federal jurisdiction was still proper because GGC’s principal place of business was in New York.

Court’s Analysis

The court rejected Ver’s reliance on Daimler AG v. Bauman, explaining that Daimler addressed constitutional limits on personal jurisdiction—the power to exercise authority over a defendant—not subject-matter jurisdiction, meaning the court’s power to hear the type of case presented.

The court also explained that, under 28 U.S.C. § 1332(c), a corporation is a citizen of both its place of incorporation and the place of its principal place of business. Thus, GGC’s principal place of business was immaterial because GGC was incorporated in the British Virgin Islands. The court stated that Ver’s response established that GGC was an alien and that Ver was also an alien. Complete diversity requires every defendant to be a citizen of a different state from every plaintiff, and the court relied on precedent holding that diversity is lacking when the only parties are foreign entities or aliens.

Disposition

The court held that it did not have subject-matter jurisdiction over the action. It remanded the case to the Supreme Court of the State of New York, County of New York, and directed the Clerk of Court to do so without delay.