Opinion
Civil Action No. 3:99CV-121-S
December 2, 1999
MEMORANDUM OPINION AND ORDER
This matter is before the Court on the Motion to Remand made by the Plaintiff, Susan Mills. Defendant, American Underground Structures, Inc., removed this case from Jefferson Circuit Court on the basis of diversity jurisdiction. Plaintiff asserts that no diversity of citizenship exists among the parties. It is undisputed that Plaintiff is a citizen of Kentucky. The parties differ on the citizenship of the defendant corporation.
For purposes of determining diversity jurisdiction, a corporation may be a citizen of two states: 1) the state of its incorporation, and 2) the state of its principal place of business. 28 U.S.C. § 1332(c)(1). The parties agree that Defendant is incorporated in Virginia but disagree as to whether its principal place of business is Kentucky or Virginia. The test to be applied in this determination is the "total activity" test. Gafford v. General Electric Co., 997 F.2d 150, 163 (6th Cir. 1993).
The "total activity" test encompasses two other tests which had been used in the past to determine a corporation's principal place of business: the "nerve center" test and the "place of activity" test. Gafford, 997 F.2d at 162. The "nerve center" test emphasized the situs of corporate decision-making authority and overall control. Id. The "place of activity" test focused on the location of production or service activities. Id. The Sixth Circuit has chosen to adopt the "total activity" test because it recognizes that determining a corporation's principal place of business is a question of fact to be determined on a case-by-case basis. Id.
In examining the evidence before this Court, we note that only the Defendant has offered any proof in support of its contentions. Counsel for Plaintiff attached to the motion to remand an affidavit stating that the Defendant's principal place of business is Kentucky and that no diversity jurisdiction exists. Plaintiff's counsel has no firsthand knowledge of Defendant's corporate activity, and her affidavit only contains statements that are legal conclusions. Thus, her affidavit is not evidence and is no more probative than any other argument made by legal counsel.
Defendant attached to its response an affidavit of Robert Iliff, General Manager of Defendant's Louisville facility. Iliff's affidavit states that the Defendant has production operations in both Kentucky and Virginia and that those operations are roughly equal in volume and scope. The majority of the employees of the Defendant are in Virginia, as well as all of the executive and upper level management of the corporation, with the exception of one executive, who spends two-thirds of his time in Kentucky. Personnel decisions, including the one that forms the basis of the instant case, are made in Virginia.
In assessing the activity of defendant corporation, this Court concludes that its principal place of business is Virginia. The production activity of the Defendant is split between Virginia and Kentucky, while the situs of corporate decision-making and overall control of the corporation is in Virginia. Thus, on balance, more of the total activity of the corporation is in Virginia, and we find this to be its principal place of business under 28 U.S.C. § 1332(c)(1). As Plaintiff is a citizen of Kentucky, this Court has diversity jurisdiction over this case.
Therefore, the motion to remand made by the Plaintiff is DENIED.
IT IS SO ORDERED.
MEMORANDUM OPINION AND ORDER
This matter is before the Court on motion of the plaintiff, Susan Mills ("Mills"), to set aside an order entered by the Magistrate Judge on October 6, 1999, requiring disclosure of Mills' attorney's total hours expended and her hourly rate in this employment discrimination case. The defendant, American Underground Structures, Inc. ("American Underground"), requested this information as part of its pretrial discovery for the purpose of settlement negotiations because there is a statutory authorization for attorney's fees for a prevailing plaintiff under the Kentucky Civil Rights Act, KRS Chapter 344.
Under 28 U.S.C. § 636 and Fed.R.Civ.P. 72, the non-dispositive orders of magistrate judges are binding unless they are clearly erroneous or contrary to law. Discovery orders, such as the one at issue in this case, fall into that category.Grimes v. City and County of San Francisco, 951 F.2d 236, 240 (9th Cir. 1991).
Mills argues that this information is only discoverable upon conclusion of the case and only if she is successful. The parties agree that the only case addressing whether attorney's fees are discoverable before trial is Maddow v. Proctor Gamble Co, Inc., 107 F.3d 846 (11th Cir. 1997). In Maddow, an age discrimination case, the district court compelled the plaintiff's attorney to produce contingency fee information in pretrial discovery. Because this information was relevant to calculating reasonable attorney's fees as provided for under the statute, the Eleventh Circuit found that the district court's decision was not an abuse of discretion.
The Magistrate Judge's order in this case is consistent with the Maddow decision. Therefore, this Court finds that the order was not clearly erroneous or contrary to law. The plaintiff's motion to set aside the order is DENIED.
IT IS SO ORDERED.