1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA 10 11 CAROLYN JANE BLAKELY, Case No.: 3:25-cv-02330-CAB-DEB 12 Plaintiff, 13 ORDER DENYING REMAND v. 14 ELUTIA, INC. F/K/A AZIYO 15 BIOLOGICS, INC., et al., [Doc. No. 8] 16 Defendants. 17 18 19 Before the Court is Plaintiff Carolyn Jane Blakely’s motion to remand the action to 20 state court. [Doc. No. 8.] The motion has been fully briefed, and the Court finds it suitable 21 for determination on the papers. See CivLR 7.1(d)(1). For the reasons set forth below, 22 the motion to remand is DENIED. 23 I. BACKGROUND 24 This claim arises out of a spinal surgery performed on Plaintiff in La Jolla, 25 California on April 13, 2023. [Doc. No. 1-2 (“Compl.”) at ¶ 14.] Plaintiff alleges that 26 during this spinal surgery, Plaintiff was implanted with the ViBone product (the “Recalled 27 Product”) and subsequently tested positive for tuberculosis. [Id. at ¶ 14.] The Recalled 28 1 Product is a human tissue allograft consisting of cryopreserved bone matrix that is 2 aseptically processed to preserve native factors that support bone repair. [Id. at ¶ 18.] 3 Plaintiff has named three defendants in connection with making the Recalled Product. 4 Defendant Elutia, Inc. (“Elutia”) formerly did business under the name Aziyo Biologics, 5 Inc. (“Aziyo”). [Id. at ¶ 3.] Plaintiff alleges that Aziyo developed and supplied the 6 Recalled Product. [Id. at ¶¶ 5, 20.] As alleged, Defendant DCI Donor Services, Inc. 7 (“DCI”) harvested and/or supplied the human tissue used in the Recalled Product. [Id. at 8 ¶ 8.] Defendant Berkeley Biologics, LLC (“Berkeley”) purchased Aziyo’s (now Elutia’s) 9 orthobiologics business in 2023 and became Aziyo’s direct successor. [Id. at ¶ 9.] 10 On June 30, 2025, Plaintiff filed a complaint in the Superior Court of the State of 11 California for the County of San Diego asserting claims for: (1) negligence against Elutia 12 and Berkeley; (2) negligence against DCI; (3) strict products liability against Elutia and 13 Berkeley; and (4) breach of implied warranty of merchantability against Elutia and 14 Berkeley. [See generally Compl.] 15 On September 5, 2025, Elutia removed this action to this Court based on diversity 16 jurisdiction. [Doc. No. 1 (“NOR”) at ¶ 6.] On October 2, 2025, Plaintiff filed a motion 17 to remand, contesting that the parties do not have diverse citizenship because Berkeley is 18 a citizen of California. [See Doc. No 8; Doc. No. 8-1 at 1–2.] 19 II. LEGAL STANDARD 20 “A defendant may remove an action to federal court based on federal question 21 jurisdiction or diversity jurisdiction.” Hunter v. Philip Morris USA, 582 F.3d 1039, 1042 22 (9th Cir. 2009) (citing 28 U.S.C. § 1441). Thus, a case brought in state court that originally 23 could have been brought in federal court based on diversity of citizenship is removable. 24 See Caterpillar Inc. v. Williams, 482 U.S. 386, 392 (1987); 28 U.S.C. § 1441(a). 25 “Removal on the basis of diversity jurisdiction requires that the parties be completely 26 diverse and that the amount in controversy exceed $75,000.” Magnum Prop. Invs., LLC 27 v. Pfeiffer, No. 18-CV-02855, 2019 WL 459194, at *2 (S.D. Cal. Feb. 6, 2019); 28 U.S.C. 28 § 1332(a)(1). Defendants have the burden of demonstrating all the requirements for 1 diversity jurisdiction. Hertz Corp. v. Friend, 559 U.S. 77, 96 (2010) (“The burden of 2 persuasion for establishing diversity jurisdiction, of course, remains on the party asserting 3 it.”). 4 For diversity purposes, a natural person is a “citizen” of the state in which he or she 5 is domiciled. Kanter v. Warner–Lambert Co., 265 F.3d 853, 857 (9th Cir. 2001). A 6 corporation is “deemed to be a citizen of every state . . . by which it has been incorporated 7 and of the State . . . where it has its principal place of business.” 28 U.S.C. § 1332(c)(1). 8 For diversity purposes, an LLC is a citizen of every state of which its owners/members 9 are citizens. Johnson v. Columbia Props. Anchorage, LP, 437 F.3d 894, 899 (9th Cir. 10 2006). 11 III. DISCUSSION 12 In the NOR, Defendant argues that this Court has subject matter jurisdiction because 13 complete diversity of citizenship exists and the amount in controversy exceeds $75,000. 14 [NOR at ¶¶ 13, 21.] Plaintiff responds that remand is appropriate because both she and 15 Berkeley are citizens of California, which destroys complete diversity in an otherwise non- 16 removable state-based action. [Doc. No. 8-1 at 1–2.] 17 A. Amount in Controversy 18 To establish federal diversity jurisdiction, the amount in controversy must exceed 19 $75,000. 28 U.S.C. § 1332(a). Plaintiff seeks far more than this amount, [Doc. No. 1-3 20 at 2 (Plaintiff’s Statement of Damages; NOR ¶ 25], and does not dispute that the amount 21 in controversy requirement has been satisfied. The Court finds that Elutia has successfully 22 established the amount in controversy requirement required for diversity jurisdiction. 23 B. Diversity of Citizenship 24 Plaintiff argues that because Plaintiff and Berkeley are both citizens of California, 25 complete diversity is destroyed. [Doc. No. 8-1 at 1–2.] Defendants argue that the Court 26 should find diverse citizenship for two reasons: (1) Berkeley is not a citizen of California, 27 [Doc. No. 14 at 4–6], and (2) even if Berkeley had a member that was a citizen of 28 1 California, this citizenship should be disregarded because Plaintiff fraudulently joined 2 Berkeley to defeat diversity jurisdiction. [Id. at 10–11.] 3 i. Berkeley’s Citizenship 4 Defendants argue that Berkeley is not a California citizen because Berkeley is a 5 wholly owned subsidiary of GNI Group Ltd., which is a Japanese corporation with its 6 principal place of business in Tokyo, Japan. [NOR ¶ 19.] Plaintiff alleges that Berkeley 7 is a Delaware limited liability company with its principal place of business in Richmond, 8 California. [Compl. ¶ 9.] In an attempt to prove Berkeley’s California citizenship, 9 Plaintiff attaches Berkeley’s Statement of Information retrieved from California’s 10 Secretary of State website, which lists two Berkeley “Manager(s) or Member(s)” as each 11 having a California address.1 [Doc. No. 8-3 at 1.] 12 As an LLC, Berkeley is a citizen of every state of which its owners/members are 13 citizens. See Johnson, LP, 437 F.3d at 899. Defendants assert that Berkeley is “a wholly 14 owned subsidiary of GNI Group, Ltd., which is a Japanese corporation with its principal 15 place of business in Tokyo, Japan.” [E.g., Doc. No. 1 at ¶ 9; Doc. No. 14 at ¶ 5]. Plaintiff’s 16 Exhibit 2 to her Motion to Remand lists Berkeley’s ownership as a wholly owned 17 subsidiary of GNI Group Ltd. [Doc. No. 8-4 at 1.] 18 A corporation, whether incorporated in a state of the United States or in a foreign 19 country, is “deemed a citizen of its place of incorporation and the location of its principal 20 place of business.” Nike, Inc. v. Comercial Iberica de Exclusivas Deportivas, S.A., 20 21 F.3d 987, 990 (9th Cir. 1994).
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1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA 10 11 CAROLYN JANE BLAKELY, Case No.: 3:25-cv-02330-CAB-DEB 12 Plaintiff, 13 ORDER DENYING REMAND v. 14 ELUTIA, INC. F/K/A AZIYO 15 BIOLOGICS, INC., et al., [Doc. No. 8] 16 Defendants. 17 18 19 Before the Court is Plaintiff Carolyn Jane Blakely’s motion to remand the action to 20 state court. [Doc. No. 8.] The motion has been fully briefed, and the Court finds it suitable 21 for determination on the papers. See CivLR 7.1(d)(1). For the reasons set forth below, 22 the motion to remand is DENIED. 23 I. BACKGROUND 24 This claim arises out of a spinal surgery performed on Plaintiff in La Jolla, 25 California on April 13, 2023. [Doc. No. 1-2 (“Compl.”) at ¶ 14.] Plaintiff alleges that 26 during this spinal surgery, Plaintiff was implanted with the ViBone product (the “Recalled 27 Product”) and subsequently tested positive for tuberculosis. [Id. at ¶ 14.] The Recalled 28 1 Product is a human tissue allograft consisting of cryopreserved bone matrix that is 2 aseptically processed to preserve native factors that support bone repair. [Id. at ¶ 18.] 3 Plaintiff has named three defendants in connection with making the Recalled Product. 4 Defendant Elutia, Inc. (“Elutia”) formerly did business under the name Aziyo Biologics, 5 Inc. (“Aziyo”). [Id. at ¶ 3.] Plaintiff alleges that Aziyo developed and supplied the 6 Recalled Product. [Id. at ¶¶ 5, 20.] As alleged, Defendant DCI Donor Services, Inc. 7 (“DCI”) harvested and/or supplied the human tissue used in the Recalled Product. [Id. at 8 ¶ 8.] Defendant Berkeley Biologics, LLC (“Berkeley”) purchased Aziyo’s (now Elutia’s) 9 orthobiologics business in 2023 and became Aziyo’s direct successor. [Id. at ¶ 9.] 10 On June 30, 2025, Plaintiff filed a complaint in the Superior Court of the State of 11 California for the County of San Diego asserting claims for: (1) negligence against Elutia 12 and Berkeley; (2) negligence against DCI; (3) strict products liability against Elutia and 13 Berkeley; and (4) breach of implied warranty of merchantability against Elutia and 14 Berkeley. [See generally Compl.] 15 On September 5, 2025, Elutia removed this action to this Court based on diversity 16 jurisdiction. [Doc. No. 1 (“NOR”) at ¶ 6.] On October 2, 2025, Plaintiff filed a motion 17 to remand, contesting that the parties do not have diverse citizenship because Berkeley is 18 a citizen of California. [See Doc. No 8; Doc. No. 8-1 at 1–2.] 19 II. LEGAL STANDARD 20 “A defendant may remove an action to federal court based on federal question 21 jurisdiction or diversity jurisdiction.” Hunter v. Philip Morris USA, 582 F.3d 1039, 1042 22 (9th Cir. 2009) (citing 28 U.S.C. § 1441). Thus, a case brought in state court that originally 23 could have been brought in federal court based on diversity of citizenship is removable. 24 See Caterpillar Inc. v. Williams, 482 U.S. 386, 392 (1987); 28 U.S.C. § 1441(a). 25 “Removal on the basis of diversity jurisdiction requires that the parties be completely 26 diverse and that the amount in controversy exceed $75,000.” Magnum Prop. Invs., LLC 27 v. Pfeiffer, No. 18-CV-02855, 2019 WL 459194, at *2 (S.D. Cal. Feb. 6, 2019); 28 U.S.C. 28 § 1332(a)(1). Defendants have the burden of demonstrating all the requirements for 1 diversity jurisdiction. Hertz Corp. v. Friend, 559 U.S. 77, 96 (2010) (“The burden of 2 persuasion for establishing diversity jurisdiction, of course, remains on the party asserting 3 it.”). 4 For diversity purposes, a natural person is a “citizen” of the state in which he or she 5 is domiciled. Kanter v. Warner–Lambert Co., 265 F.3d 853, 857 (9th Cir. 2001). A 6 corporation is “deemed to be a citizen of every state . . . by which it has been incorporated 7 and of the State . . . where it has its principal place of business.” 28 U.S.C. § 1332(c)(1). 8 For diversity purposes, an LLC is a citizen of every state of which its owners/members 9 are citizens. Johnson v. Columbia Props. Anchorage, LP, 437 F.3d 894, 899 (9th Cir. 10 2006). 11 III. DISCUSSION 12 In the NOR, Defendant argues that this Court has subject matter jurisdiction because 13 complete diversity of citizenship exists and the amount in controversy exceeds $75,000. 14 [NOR at ¶¶ 13, 21.] Plaintiff responds that remand is appropriate because both she and 15 Berkeley are citizens of California, which destroys complete diversity in an otherwise non- 16 removable state-based action. [Doc. No. 8-1 at 1–2.] 17 A. Amount in Controversy 18 To establish federal diversity jurisdiction, the amount in controversy must exceed 19 $75,000. 28 U.S.C. § 1332(a). Plaintiff seeks far more than this amount, [Doc. No. 1-3 20 at 2 (Plaintiff’s Statement of Damages; NOR ¶ 25], and does not dispute that the amount 21 in controversy requirement has been satisfied. The Court finds that Elutia has successfully 22 established the amount in controversy requirement required for diversity jurisdiction. 23 B. Diversity of Citizenship 24 Plaintiff argues that because Plaintiff and Berkeley are both citizens of California, 25 complete diversity is destroyed. [Doc. No. 8-1 at 1–2.] Defendants argue that the Court 26 should find diverse citizenship for two reasons: (1) Berkeley is not a citizen of California, 27 [Doc. No. 14 at 4–6], and (2) even if Berkeley had a member that was a citizen of 28 1 California, this citizenship should be disregarded because Plaintiff fraudulently joined 2 Berkeley to defeat diversity jurisdiction. [Id. at 10–11.] 3 i. Berkeley’s Citizenship 4 Defendants argue that Berkeley is not a California citizen because Berkeley is a 5 wholly owned subsidiary of GNI Group Ltd., which is a Japanese corporation with its 6 principal place of business in Tokyo, Japan. [NOR ¶ 19.] Plaintiff alleges that Berkeley 7 is a Delaware limited liability company with its principal place of business in Richmond, 8 California. [Compl. ¶ 9.] In an attempt to prove Berkeley’s California citizenship, 9 Plaintiff attaches Berkeley’s Statement of Information retrieved from California’s 10 Secretary of State website, which lists two Berkeley “Manager(s) or Member(s)” as each 11 having a California address.1 [Doc. No. 8-3 at 1.] 12 As an LLC, Berkeley is a citizen of every state of which its owners/members are 13 citizens. See Johnson, LP, 437 F.3d at 899. Defendants assert that Berkeley is “a wholly 14 owned subsidiary of GNI Group, Ltd., which is a Japanese corporation with its principal 15 place of business in Tokyo, Japan.” [E.g., Doc. No. 1 at ¶ 9; Doc. No. 14 at ¶ 5]. Plaintiff’s 16 Exhibit 2 to her Motion to Remand lists Berkeley’s ownership as a wholly owned 17 subsidiary of GNI Group Ltd. [Doc. No. 8-4 at 1.] 18 A corporation, whether incorporated in a state of the United States or in a foreign 19 country, is “deemed a citizen of its place of incorporation and the location of its principal 20 place of business.” Nike, Inc. v. Comercial Iberica de Exclusivas Deportivas, S.A., 20 21 F.3d 987, 990 (9th Cir. 1994). Therefore, GNI Group, Ltd. is a citizen of Japan. Because 22 Berkeley as an LLC would take the citizenship of its owner, Johnson, 437 F.3d at 899, 23 Berkeley takes the citizenship of its parent corporation, GNI Group, Ltd. Therefore, 24 Berkeley is a citizen of Japan. 25
26 1 The Court takes judicial notice of the Statement of Information, as courts routinely take notice of 27 information contained in the California Secretary of State’s website. See, e.g., No Cost Conf., Inc. v. Windstream Commc’ns, Inc., 940 F. Supp. 2d 1285, 1295–96 (S.D. Cal. 2013) (taking judicial notice of 28 1 “Absent unusual circumstances, a party seeking to invoke diversity jurisdiction 2 should be able to allege affirmatively the actual citizenship of the relevant parties.” 3 Kanter, 265 F.3d at 857. Plaintiff fails to sufficiently allege Berkeley’s citizenship. While 4 Berkeley’s Statement of Information lists two “Manager(s) or Member(s)” with California 5 addresses, it is unclear whether those individuals are managers or members. If they are 6 managers and not members, the Court cannot impute California citizenship to that LLC 7 because an LLC’s citizenship is based off of its members and owners. 8 Furthermore, Plaintiff does not appear to contest Defendants’ argument that the 9 individuals listed on the Statement of Information are managers, not members. Instead, 10 Plaintiff argues that “based upon all the information available to her at the time of filing 11 her Complaint and Motion to Remand, it was reasonable for her to believe that Berkeley 12 is a citizen of California because of Berkeley’s substantial connection to the state.” [Doc. 13 No. 17 at 7.] Plaintiff asks the Court to resolve all ambiguities in her favor at the pleading 14 stage. But it is “hornbook law (quite literally)” that “all challenges to subject-matter 15 jurisdiction [are] premised upon diversity of citizenship against the state of facts that 16 existed at the time of filing,” Grupo Dataflux v. Atlas Glob. Grp., L.P., 541 U.S. 567, 570, 17 (2004), not on what state of facts was reasonable for a plaintiff to believe. 18 Although Plaintiff stipulated that Berkeley was a citizen of California, Plaintiff 19 cannot stipulate or admit to a party’s citizenship if that citizenship is not accurate. Cf. 20 Owen Equip. & Erection Co. v. Kroger, 437 U.S. 365, 377 n.21 (1978). Plaintiff has failed 21 to plead any meaningful evidence that Berkeley is a California LLC, and Elutia has plead 22 meaningful evidence that Berkeley is a citizen of Japan. [Doc. No. 14-6 at 12.] Further, 23 the Court need not order discovery on the issue on the citizenship of Berkeley’s members, 24 as district courts have discretion to permit or deny jurisdictional discovery. Boschetto v. 25 Hansing, 539 F.3d 1011, 1020 (9th Cir. 2008). Ultimately, Defendants have met their 26 burden to establish diversity of citizenship and the Court concludes that remand would be 27 improper. 28 /// l ii. Fraudulent Joinder 2 Because the Court found that Berkeley is not a citizen of California, the Court need 3 ||not address the fraudulent joinder arguments. 4 IV. CONCLUSION 5 Defendants have met their burden to establish diversity of citizenship as required for 6 || diversity jurisdiction. The Court has subject matter jurisdiction over this case. The Court 7 || DENIES Plaintiff's motion to remand this action to the Superior Court of California, 8 ||County of San Diego. DCI and Berkeley may respond to Plaintiff's complaint by 9 || February 6, 2026. 10 Itis SO ORDERED. 11 Dated: January 9, 2026 € 12 Hon. Cathy Ann Bencivengo 13 United States District Judge 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28