What You'll Learn
- Complete diversity
- Individuals and domicile
- Corporations and the nerve center
- LLCs and unincorporated entities
- Time of filing
- Advanced citizenship traps
Educational information only; not legal advice. This article is a general study aid and should be checked against current authority and course materials.
Diversity jurisdiction looks like geography, but the doctrine uses technical rules of citizenship. An address, a driver's license, a school, or a large business presence may be evidence, but none is the legal test by itself. Strong analysis begins with a party chart and assigns citizenship under the rule for each type of litigant.
1. Complete Diversity
Under the ordinary state-citizen provision of 28 U.S.C. § 1332(a), no plaintiff may share state citizenship with any defendant. Plaintiffs may share citizenship with one another, and defendants may share citizenship with one another. The forbidden overlap is across the "v."
Parties Complete diversity? Reason
P1 (Florida), P2 (Florida) v. D (Texas) Yes. No plaintiff shares citizenship with the defendant.
P (Florida) v. D1 (Texas), D2 (Texas) Yes. Multiple defendants may share citizenship with each other.
P1 (Florida), P2 (Georgia) v. D1 (Texas), D2 (Florida) No. P1 and D2 are both Florida citizens.
Key Takeaway
Build a party-by-party citizenship chart. One shared state between any plaintiff and any defendant defeats ordinary complete diversity, even if every other party is diverse.
2. Individuals: Domicile, Not Residence
An individual's state citizenship is the state of domicile. Domicile generally requires physical presence in the state plus intent to remain indefinitely. A person has one domicile at a time, and an established domicile continues until a new one is acquired. Courts may consider voting registration, taxes, property, employment, family ties, licenses, bank records, and statements of intent. No single fact is automatically controlling.
Exam Tip
A student lives in New York during law school but keeps a Florida home, votes in Florida, and plans to return after graduation. New York residence alone does not necessarily replace the Florida domicile.
Common Mistake
"Lives in" is not a complete citizenship analysis. State the physical-presence and intent requirements, then apply evidence of both.
3. Corporations: Incorporation Plus Principal Place of Business
Section 1332(c)(1) treats a corporation as a citizen of every state or foreign state in which it is incorporated and the state or foreign state where it has its principal place of business.
Hertz Corp. v. Friend defines the principal place of business as the corporation's "nerve center" - ordinarily the place where high-level officers direct, control, and coordinate corporate activities. The nerve center is usually the true headquarters, not a nominal office or the state with the most sales.
State of incorporation
Every qualifying state or foreign state under whose law the corporation is incorporated.
Principal place of business
One nerve center where senior officers direct, control, and coordinate the enterprise.
4. LLCs, Partnerships, and Other Unincorporated Entities
Do not give an LLC the corporate rule. An LLC, partnership, or other unincorporated association ordinarily takes the citizenship of every member or partner. If a member is itself an LLC or partnership, the analysis continues through each ownership layer until the citizenship of all relevant members is identified.
Exam Tip
An LLC has two members: a Texas individual and a partnership whose partners are citizens of Ohio and Nevada. The LLC is a citizen of Texas, Ohio, and Nevada. This rule can make entity citizenship more difficult to plead than corporate citizenship. A principal office or state of organization does not substitute for tracing members.
5. Citizenship Is Measured at Filing
The ordinary time-of-filing rule measures diversity when the action is commenced. A later move usually does not create or destroy jurisdiction that was properly assessed at filing. Attempts to manufacture diversity require close attention to the actual timing and legal change of domicile.
6. Advanced Traps
U.S. citizen domiciled abroad: ordinarily not a citizen of a state for § 1332(a)(1) and not a citizen or subject of a foreign state for alienage jurisdiction. Permanent resident alien domiciled in the same state as an opposing U.S. citizen: the statute contains a specific limitation on alienage jurisdiction. Representatives: § 1332(c)(2) attributes the represented person's citizenship to the legal representative of an estate, infant, or incompetent. Domestic relations and probate: judge-made exceptions can limit ordinary diversity jurisdiction even when the citizenship arithmetic appears satisfied.
7. Worked Hypothetical
Key Takeaway
A Mississippi citizen sues a Delaware corporation headquartered in Georgia and an LLC. The LLC's only member is the plaintiff's Mississippi business partner. The corporation is a citizen of Delaware and Georgia. The LLC is a citizen of Mississippi because its member is a Mississippi citizen. The Mississippi overlap between the plaintiff and LLC defeats complete diversity.
8. Exam Checklist
- List every plaintiff and defendant. 2. For individuals, determine domicile. 3. For corporations, identify incorporation and nerve center. 4. For LLCs and partnerships, trace every member or partner. 5. Compare all plaintiff citizenships against all defendant citizenships. 6. Measure at filing, then separately analyze the amount in controversy.
Primary Authorities
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28 U.S.C. § 1332(a)-(c).
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Strawbridge v. Curtiss, 7 U.S. (3 Cranch) 267 (1806).
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Mas v. Perry, 489 F.2d 1396 (5th Cir. 1974).
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Hertz Corp. v. Friend, 559 U.S. 77 (2010).
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Carden v. Arkoma Associates, 494 U.S. 185 (1990).
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Grupo Dataflux v. Atlas Global Group, L.P., 541 U.S. 567 (2004).
Exam-ready conclusion
Diversity is not a headcount and not a mailing-address test. Assign citizenship under the correct party rule, trace unincorporated entities through every layer, compare across the litigation, and only then move to the amount in controversy.