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Jordan v. Osmun

United States District Court, E.D. Virginia, Alexandria Division

September 29, 2016

Robert Jordan, et al., Plaintiffs,
Susan A. Osmun, et al., Defendants.


          Liam O'Grady United Suites District Judge

         This matter comes before the Court on Defendant Susan Osmun's Motion to Dismiss for Lack of Jurisdiction, Dkt. No. 7, 8, [1] Defendant Susan Osmun's Second Motion to Dismiss for Lack of Jurisdiction, Dkt. No. 20, and Defendant David Osmun's Motion to Dismiss for Lack of Subject Matter Jurisdiction. Dkt. No. 29. For the reasons discussed below, the Court ORDERS that the Motions to Dismiss are DENIED.

         I. Background

         Robert Jordan and Cheryl Anacker (hereafter "Plaintiffs"), pursuant to their Durable Power of Attorney for Lucille Kelly dated April 1, 2016, filed a complaint against Susan Osmun, Ms. Kelly's former attorney-in-fact since September 2008, alleging breach of fiduciary duty, conversion, fraud and unjust enrichment. Plaintiffs filed the Complaint on May 3, 2016, and alleged federal jurisdiction based on diversity of citizenship and sufficient amount in controversy. The Complaint identifies Mr. Jordan as a "resident of New Jersey" and does not list his citizenship. The Complaint identifies Ms. Anacker as a resident of Florida, Ms. Kelly as a citizen of Virginia and Ms. Osmun as a citizen of New Jersey. Plaintiffs allege that Ms. Osmun misappropriated Ms. Kelly's funds for personal gain through abuse of her powers as attorney-in-fact. Ms. Osmun moved to dismiss the Complaint for lack of diversity of citizenship on the grounds that Mr. Jordan and Ms. Osmun were both citizens of New Jersey. Plaintiffs obtained leave to amend the Complaint to remedy procedural defects and to add Ms. Osmun's husband as a co-defendant. Plaintiffs filed a first amended complaint ("FAC") on July 8, 2016. The FAC identifies Mr. Jordan as "an individual resident, citizen, and domiciliary of Maryland" and Ms. Anacker as "an individual resident, citizen, and domiciliary of Florida." Mr. Osmun is identified as a citizen of New Jersey. The FAC did not amend the citizenship of the remaining parties. Ms. Osmun and Mr. Osmun filed separate motions to dismiss this proceeding for lack of diversity jurisdiction raising different arguments in support of their claims. The matter has since been fully briefed and supplemented with affidavits by the Plaintiffs.

         The parties do not dispute that at the time of filing the Complaint Mr. Jordan owned a home in New Jersey, lived there during the week with his seven year-old daughter and intended to remain there (on weekdays) until the completion of his daughter's school year. Plaintiffs also present the sworn affidavit of Mr. Jordan who avows that his wife has lived and worked in Maryland since March 2016, that Mr. Jordan has been approved to transfer to Maryland by his employer since March 2016, that Mr. Jordan signed a lease in April 2016 on a property in Maryland and lives there with his wife on the weekends, that Mr. Jordan's connection to New Jersey is limited to providing for his seven year old daughter to complete the school year in New Jersey, that his daughter will attend school in Maryland for the 2016/2017 school year and thereafter, and that at the time of the complaint Mr. Jordan lived part time in Maryland with an intent to remain there permanently and indefinitely. Mr. Jordan has not yet voted in or paid taxes to Maryland but intends to do so.

         II. Legal Standard

         Congress "has granted district courts original jurisdiction in civil actions between citizens of different States, between U.S. citizens and foreign citizens, or by foreign states against U.S. citizens." Exxon Mobil Corp. v. Allapattah Servs., Inc., 545 U.S. 546, 552, 125 S.Ct. 2611, 2617, 162 L.Ed.2d 502 (2005) (citing 28 U.S.C. § 1332). This so-called "diversity jurisdiction" has a "complete diversity" requirement. Owen Equip. & Erection Co. v. Kroger; 437 U.S. 365, 373, 98 S.Ct. 2396, 2402, 57 L.Ed.2d 274 (1978). Under this requirement, "diversity jurisdiction does not exist unless each defendant is a citizen of a different State from each plaintiff." Id. For the purposes of the diversity jurisdiction statute, an individual is considered to be a citizen of the state in which they are domiciled-"i.e. the state he considers his permanent home." See Gambelli v. United States, 904 F.Supp. 494 (E.D. Va. 1995), affirmed by 87 F.3d 1308 (4th Cir. 1996). Virginia law defines domicile as "residence or physical presence accompanied by an intention to remain for an unlimited time." Smith v. Wellberg (In re Wellberg), 12 B.R. 48 (Bankr. E.D. Va. 1981), citing Smith v. Smith, 122 Va. 341, 94 S.E. 777 (1918). Diversity of citizenship is determined at the time of the filing of the action. See Freeport-McMoRan, Inc. v. KN Energy, Inc., 498 U.S. 426 (1991).

         Diversity jurisdiction is subject to an amount in controversy requirement. See Exxon Mobil Corp., 545 U.S. at 552. Currently, a district court does not have original jurisdiction over a diversity action unless the amount in controversy exceeds $75, 000. Id.

         III. Analysis

         There is no dispute between the parties that the amount in controversy in this dispute exceeds $75, 000. Defendants move to dismiss for lack of complete diversity of the parties alleging that Mr. Jordan, one of Ms. Kelly's attorney-in-fact, is a domiciliary of New Jersey and that Defendants are also domiciliaries of New Jersey. Plaintiffs challenge this motion on two grounds: (1) that Mr. Jordan is not a party in interest so his domicile is not relevant to establishing party diversity; and (2) that even if Mr. Jordan is a party in interest, his proper domicile is Maryland rather than New Jersey.

         A. Party in Interest for Diversity

         The parties dispute whether Ms. Kelly's attorneys-in-fact, Mr. Jordan and Ms. Anacker, are parties in interest to this controversy and as such, whether their domicile should be considered for purposes of determining diversity jurisdiction.

         Pursuant to Federal Rule of Civil Procedure 17(a), a party may sue in his own name with or without joining the party for whose benefit the action is brought. Fed.R.Civ.P. 17(a) ("An executor, administrator, guardian, bailee, trustee of an express trust, a party with whom or in whose name a contract has been made for the benefit of another, or a party authorized by statute may sue in that person's own name without joining the party for whose benefit the action is brought."). Plaintiffs contend that they are authorized by statute to bring a suit in Ms. Kelly's name. Va. Code § 64.2-1633 provides that "language in a power of attorney granting general authority with respect to claims and litigation authorizes the agent to... [a]ssert and maintain.. .a claim, claim for relief, cause of action...". Ms. Kelly granted Durable General Power of Attorney to Plaintiffs on April 1, 2016, more than a month before the filing of the original complaint. This grant conferred authority to bring a claim under Virginia law and similarly conferred authority to bring an action in federal court under Rule 17(a).

         "In a diversity analysis.. .courts must take into account the citizenship of real parties in interest, and not just the party under whose name the suit was initiated." Symeonidis ex rel. Symeonidis v. Hurley & Koort, P.L.C., No. CIV A 3:05CV762 JRS, 2006 WL 2375743, at *4 (E.D. Va. Aug. 15, 2006) (quoting Car den v. Arkoma Assocs.,494 U.S. 185, 200 (1990)). It is the citizenship of the real parties in interest which is determinative of diversity jurisdiction. See Roche v. Lincoln Prop. Co.,373 F.3d 610, 615 (4th Cir. 2004), rev'd on other grounds, Lincoln Prop. Co. v. Roche,546 U.S. 81, 126 S.Ct. 606, 163 L.Ed.2d 415 (2005). "[A] federal court must disregard nominal or ...

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