Opinion
No. 06 Civ. 1433 (LTS)(KNF).
April 24, 2006
MEMORANDUM OPINION AND ORDER
On February 16, 2006, Plaintiffs commenced the instant action in New York State Supreme Court. The state court set a February 22, 2006, return date for a hearing on Plaintiffs' application for a temporary restraining order and preliminary injunction. On February 22, 2006, Defendants removed the case to federal court on the basis of diversity of citizenship. During a March 22, 2006, conference before the undersigned, the parties stipulated that diversity jurisdiction did not exist by virtue of Florida citizenship on both sides. Plaintiffs subsequently moved for an order remanding this action back to state court; both Plaintiffs and Defendant seek awards of costs and fees incurred in connection with the removal. The Court has considered carefully the motions before it, and the opposition thereto, as well as the arguments presented before the Court during the March 22, 2006, conference. For the following reasons, Plaintiffs' motion for remand is granted, and the parties applications for costs and fees are denied.
Pursuant to 28 U.S.C. section 1441(a), in general, "any civil action brought in a State court of which the district courts of the United States have original jurisdiction, may be removed by the defendant . . . to the district court of the United States for the district . . . where such action is pending." 28 U.S.C. § 1441(a) (West 1996).
DISCUSSION
Motion for Remand
The parties now stipulate that diversity is not present in the instant action because Defendant Kosachuk is a Florida citizen and Plaintiff Good Energy, L.P., is a Florida citizen as well by reason of the citizenship of are of its members. Pursuant to 28 U.S.C. section 1447(c), "[i]f at any time before final judgment it appears that the district court lacks subject matter jurisdiction, the case shall be remanded." 28 U.S.C. § 1447(c) (West 1996). Therefore, because the Court clearly lacks diversity jurisdiction over the instant action, and there being no other basis for federal jurisdiction of this matter, the Court grants Plaintiffs' motion to remand.
Motions for Costs Fees
Plaintiffs seek an award of costs and fees in connection with Defendant's removal of this action to federal court in the total amount of $20,941 ($19,725 in legal fees and $1,216 in disbursements). (Affirmation of Kenneth Sussmane ("Sussmane Affirmation") ¶ 23.) Under 28 U.S.C. section 1447(c), "[a]n order remanding the case may require payment of just costs and any actual expenses, including attorney fees, incurred as a result of the removal." 28 U.S.C. § 1447(c) (West 1996). In Martin v. Franklin Capital Corp., the Supreme Court clarified the standard the district court should utilize for awarding attorney's fees when remanding a case to state court: "Absent unusual circumstances, courts may award attorney fees under the . . . removal statute only where the removing party lacked an objectively reasonable basis for seeking removal." 126 S. Ct. 704, 711 (2005); see also Johnson-Kamara v. W. Chacon Trucking, No. 05 Civ. 9900(JFK)(THK), 2006 WL 336041, at *3 (S.D.N.Y. Feb. 9, 2006). "Conversely, when an objectively reasonable basis exists, fees should be denied."Martin, 126 S. Ct. at 711 (citations omitted).
Here, it cannot be said that Defendant's assertion that complete diversity jurisdiction existed between the parties at the time of removal lacked an objectively reasonable basis. Plaintiffs have provided the Court with an e-mail message from Hoover to Kosachuk, dated October 15, 2003, wherein Hoover informed Kosachuk that Hoover's mother and grandmother are members of Good Offices, a limited partner of defendant Good Energy, L.P. (Sussmane Affirmation Ex. E.) The e-mail does not contain any information as to the state citizenship or even the residence of either woman. (Id.) However, Plaintiffs claim that Kosachuk was involved in the management of the two artificial entity plaintiffs and that his personal relationship with Hoover necessitated knowledge of the citizenship of Hoover's mother and grandmother, because Kosachuk "has known [Hoover's] family for over ten years and sat at a desk next to [Hoover] for several years" and knew that the two individuals reside in Florida. (Aff. of Maximilian Hoover ¶ 5.)
However, even "a statement of the parties' residence is insufficient to establish their citizenship" for purposes of diversity jurisdiction. Leveraged Leasing Admin. Corp. v. PacifiCorp Capital, Inc., 87 F.3d 44, 47 (2d Cir. 1996). In order to be a citizen of a given state, the individual must be domiciled in that state. Linardos v. Fortuna, 157 F.3d 945, 948 (2d Cir. 1998). While domicile often subsumes residency, it also requires an element of intent, that is, the individual's desire to remain in that state indefinitely. Id. There is nothing on the record before the Court to indicate that Kosachuk knew or should have known the domicile of Hoover's mother and grandmother. Kosachuk's assertion in connection with the instant motion that Hoover's mother "and her husband have abodes in New York, New Mexico, Spain, Greece . . . as well as Florida," (Aff. of Chris Kosachuk, dated Mar. 28, 2006, ¶ 6), further undermines any suggestion that the removal was objectively unreasonable.
Furthermore, it is worth noting, as Defendant has, that the LP and LLC Plaintiffs were aware of the citizenship of their members and could have easily challenged Defendant's removal at any time prior to the instant motion practice, thereby mitigating their costs and expenses. Cf. Martin, 126 S. Ct. at 711 (finding that, "[f]or instance, a plaintiff's delay in seeking remand or failure to disclose facts necessary to determine jurisdiction may affect the decision to award attorney's fees."). The Court also finds that, notwithstanding Plaintiffs' arguments that Defendant has proceeded in bad faith, the circumstances of the removal are not sufficiently unusual to warrant deviation from the objective reasonableness standard set in Martin.
Accordingly, after consideration of the circumstances of the removal of the instant case, and the purposes of the removal statue, the Court denies Plaintiffs' motion for costs and expenses in connection with Defendant's removal. The Court also declines to accept Defendant's invitation to "sua sponte consider awarding costs and reasonable attorney's fees to Kosachuk." ([Def.'s] Mem. of Law [in Opp'n to Pl.'s Mot. for Fees], 4.)
CONCLUSION
For the foregoing reasons, the motion for remand is granted and Plaintiffs' and Defendant's respective applications for costs and fees in connection with the removal and remand are denied.
SO ORDERED.