First Hawaiian Bank v. Tianchi Corporation

Northern Mariana Islands

First Hawaiian Bank v. Tianchi Corporation

CourtDistrict Court, Northern Mariana Islands

DecidedApril 9, 2024

Docket1:23-cv-00015

StatusUnknown

This text of First Hawaiian Bank v. Tianchi Corporation (First Hawaiian Bank v. Tianchi Corporation) is published on Counsel Stack Legal Research, covering District Court, Northern Mariana Islands primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

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First Hawaiian Bank v. Tianchi Corporation, (nmid 2024).

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FILED Clerk 1 District Court 2 APR 09 2024 3 for the Northern iana Islands y LA 4 IN THE UNITED STATES DISTRICT COURT — (DePutyClerk) FOR THE NORTHERN MARIANA ISLANDS 5 6 FIRST HAWAIIAN BANK, Case No. 1:23-cv-00015 a Hawaii Corporation, 7 Plaintiff, 8 DECISION AND ORDER SUA SPONTE 9 Vv. DISMISSING ACTION FOR LACK OF TIANCHI CORPORATION, a Northern SUBJECT MATTER JURISDICTION 10 Mariana Islands Corporation, and YONG FU HONG, 1] Defendants. 12 13 Plaintiff First Hawaiian Bank filed a complaint against Defendants Tianchi Corp. and Yong Ft 14 Hong (“Hong”) asserting diversity jurisdiction and alleging breach of contract. (Compl. 2-4, ECF No. 1. 15 Although the summons and complaint were served on Tianchi Corp. on January 6, 2024 through it 16 registered agent (ECF No. 2), Tianchi Corp. has yet to appear in this action. First Hawaiian Bank filed □ 17 18 motion for order of service by publication (ECF No. 3) to serve Hong. However, before the Court can ac

19 || the motion, it must first determine if it has subject matter jurisdiction. A review of the complaint reveal 20 || that subject matter jurisdiction has not been properly pleaded; therefore, the Court issues this decision anc order sua sponte dismissing the action for lack of jurisdiction and granting First Hawaiian Bank leave □□ 22 || amend its complaint. As such, the motion for order of service by publication is MOOT. 23 I. BACKGROUND 24 The facts as alleged in the complaint, in relevant part, are as follows. Plaintiff First Hawaian Bank 25 76 || citizen of the State of Hawaii, is a corporation organized and existing under the laws of the State o 97 || Hawaii, and duly licensed and authorized to conduct banking business in the Commonwealth of th 28 || Northern Mariana Islands (“CNMI”). (Compl. [§ 1, 4.) Defendant Tianchi Corp, a citizen of the CNMI, 1

1 incorporated in the CNMI and doing business as Jiuzhou Car Wash. (Id. ¶¶ 2, 4.) Hong, a citizen of the 2 People’s Republic of China, resides in the CNMI. (Id. ¶ 3.) 3 II. LEGAL STANDARD 4 Federal courts are courts of limited jurisdiction empowered to hear only those cases authorized by 5 the Constitution or by Congress. Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 377 (1994). A 6 court must dismiss an action if it determines that it lacks subject-matter jurisdiction. Fed. R. Civ. P. 7 8 12(h)(3). 9 Federal courts have diversity jurisdiction over 10 all civil actions where the matter in controversy exceeds the sum or value of $75,000, exclusive of interest and costs, and is between— 11

12 (1) citizens of different States;

13 (2) citizens of a State and citizens or subjects of a foreign state, except that the district courts shall not have original jurisdiction under this subsection of an 14 action between citizens of a State and citizens or subjects of a foreign state who 15 are lawfully admitted for permanent residence in the United States and are domiciled in the same State; [and] 16 (3) citizens of different States and in which citizens or subjects of a foreign state 17 are additional parties[.]

18 28 U.S.C. § 1332(a). “The party seeking to invoke the district court’s diversity jurisdiction always bears 19 the burden of both pleading and proving diversity jurisdiction.” Rainero v. Archon Corp., 844 F.3d 832, 20 840 (9th Cir. 2016) (quoting NewGen, LLC v. Safe Cig, LLC, 840 F.3d 606, 613–14 (9th Cir. 2016)). “In 21 cases where entities rather than individuals are litigants, diversity jurisdiction depends on the form of the 22 23 entity.” Johnson v. Columbia Props. Anchorage, LP, 437 F.3d 894, 899 (9th Cir. 2006). For example, a 24 corporation is a citizen of the state of incorporation and the state where its principal place of business is 25 located. Id. For individuals or a natural person, citizenship in a state requires United States citizenship and 26 is determined by domicile. Kanter v. Warner-Lambert Co., 265 F.3d 853, 857 (9th Cir. 2001). Otherwise, 27 that natural person is a citizen or subject of a foreign state. 28 U.S.C. § 1332(a)(2). 28 1 III. DISCUSSION 2 In its complaint, First Hawaiian Bank asserts diversity jurisdiction pursuant to 28 U.S.C. § 1332. 3 (Compl. ¶ 4.) However, the Court concludes it does not have diversity jurisdiction based on the complaint 4 as presently alleged. This Court has repeatedly recognized its lack of diversity jurisdiction for parties’ 5 failure to adequately plead the citizenship of businesses. See Supertech, Inc. v. My Choice Software, LLC, 6 No. 1:23-cv-00002, 2023 WL 2600396, at *2 (D. N. Mar. I. Mar. 23, 2023) (collecting cases); BigBang 7 8 Ent., LLC v. Imperial Pac. Int’l (CNMI), LLC, No. 1:23-cv-00008, 2023 WL 4406287, at *2 (D. N. Mar. 9 I. July 10, 2023). 10 Here, First Hawaiian Bank has failed to sufficiently plead the citizenship of itself and Tianchi Corp. 11 because the complaint merely alleges the place of incorporation and where each corporation is doing 12 business.1 In order to adequately plead citizenship for itself and Tianchi Corp., First Hawaiian Bank must 13 14 plead facts regarding the location of each corporation’s principal place of business.2 See Harris v. Rand, 15 682 F.3d 846, 850 (9th Cir. 2012) (citing 28 U.S.C. § 1332(c)(1)). It is insufficient to state in a conclusory 16 manner that a party is a citizen of State X. Prochaska v. Walgreens Co., No. CV-06-1117-PCT-PGR, 2006 17 WL 1094803, at *1 (D. Ariz. Apr. 24, 2006) (citing Fifty Assocs. v. Prudential Ins. Co. of Am., 446 F.2d 18 1187, 1190 (9th Cir. 1970)). Since the complaint lacks these allegations, First Hawaiian Bank has not met 19 its burden to establish diversity jurisdiction. See id. (requiring plaintiff to file an amended complaint as 20 21 corporate party’s citizenship was inadequately alleged). 22 23 1 First Hawaiian Bank alleges that Hong is an alien, as he is a citizen of a foreign state, the People’s Republic of China. (Compl. ¶ 3.) Hong’s alien status does not necessarily defeat jurisdiction as there is diversity jurisdiction “where (1) there is a legitimate 24 controversy between diverse citizens and aliens are additional parties; and (2) there is complete diversity as to the citizens.” Transure, Inc. v. Marsh & McLennan, Inc., 766 F.2d 1297, 1298 (9th Cir. 1985) (citations omitted). Nevertheless, First Hawaiian 25 Bank is reminded of 28 U.S.C. § 1332(a)(2), which states that “district courts shall not have original jurisdiction under this subsection of an action between citizens of a State and citizens or subjects of a foreign state who are lawfully admitted for 26 permanent residence in the United States and are domiciled in the same State.”

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FILED Clerk 1 District Court 2 APR 09 2024 3 for the Northern iana Islands y LA 4 IN THE UNITED STATES DISTRICT COURT — (DePutyClerk) FOR THE NORTHERN MARIANA ISLANDS 5 6 FIRST HAWAIIAN BANK, Case No. 1:23-cv-00015 a Hawaii Corporation, 7 Plaintiff, 8 DECISION AND ORDER SUA SPONTE 9 Vv. DISMISSING ACTION FOR LACK OF TIANCHI CORPORATION, a Northern SUBJECT MATTER JURISDICTION 10 Mariana Islands Corporation, and YONG FU HONG, 1] Defendants. 12 13 Plaintiff First Hawaiian Bank filed a complaint against Defendants Tianchi Corp. and Yong Ft 14 Hong (“Hong”) asserting diversity jurisdiction and alleging breach of contract. (Compl. 2-4, ECF No. 1. 15 Although the summons and complaint were served on Tianchi Corp. on January 6, 2024 through it 16 registered agent (ECF No. 2), Tianchi Corp. has yet to appear in this action. First Hawaiian Bank filed □ 17 18 motion for order of service by publication (ECF No. 3) to serve Hong. However, before the Court can ac

19 || the motion, it must first determine if it has subject matter jurisdiction. A review of the complaint reveal 20 || that subject matter jurisdiction has not been properly pleaded; therefore, the Court issues this decision anc order sua sponte dismissing the action for lack of jurisdiction and granting First Hawaiian Bank leave □□ 22 || amend its complaint. As such, the motion for order of service by publication is MOOT. 23 I. BACKGROUND 24 The facts as alleged in the complaint, in relevant part, are as follows. Plaintiff First Hawaian Bank 25 76 || citizen of the State of Hawaii, is a corporation organized and existing under the laws of the State o 97 || Hawaii, and duly licensed and authorized to conduct banking business in the Commonwealth of th 28 || Northern Mariana Islands (“CNMI”). (Compl. [§ 1, 4.) Defendant Tianchi Corp, a citizen of the CNMI, 1

1 incorporated in the CNMI and doing business as Jiuzhou Car Wash. (Id. ¶¶ 2, 4.) Hong, a citizen of the 2 People’s Republic of China, resides in the CNMI. (Id. ¶ 3.) 3 II. LEGAL STANDARD 4 Federal courts are courts of limited jurisdiction empowered to hear only those cases authorized by 5 the Constitution or by Congress. Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 377 (1994). A 6 court must dismiss an action if it determines that it lacks subject-matter jurisdiction. Fed. R. Civ. P. 7 8 12(h)(3). 9 Federal courts have diversity jurisdiction over 10 all civil actions where the matter in controversy exceeds the sum or value of $75,000, exclusive of interest and costs, and is between— 11

12 (1) citizens of different States;

13 (2) citizens of a State and citizens or subjects of a foreign state, except that the district courts shall not have original jurisdiction under this subsection of an 14 action between citizens of a State and citizens or subjects of a foreign state who 15 are lawfully admitted for permanent residence in the United States and are domiciled in the same State; [and] 16 (3) citizens of different States and in which citizens or subjects of a foreign state 17 are additional parties[.]

18 28 U.S.C. § 1332(a). “The party seeking to invoke the district court’s diversity jurisdiction always bears 19 the burden of both pleading and proving diversity jurisdiction.” Rainero v. Archon Corp., 844 F.3d 832, 20 840 (9th Cir. 2016) (quoting NewGen, LLC v. Safe Cig, LLC, 840 F.3d 606, 613–14 (9th Cir. 2016)). “In 21 cases where entities rather than individuals are litigants, diversity jurisdiction depends on the form of the 22 23 entity.” Johnson v. Columbia Props. Anchorage, LP, 437 F.3d 894, 899 (9th Cir. 2006). For example, a 24 corporation is a citizen of the state of incorporation and the state where its principal place of business is 25 located. Id. For individuals or a natural person, citizenship in a state requires United States citizenship and 26 is determined by domicile. Kanter v. Warner-Lambert Co., 265 F.3d 853, 857 (9th Cir. 2001). Otherwise, 27 that natural person is a citizen or subject of a foreign state. 28 U.S.C. § 1332(a)(2). 28 1 III. DISCUSSION 2 In its complaint, First Hawaiian Bank asserts diversity jurisdiction pursuant to 28 U.S.C. § 1332. 3 (Compl. ¶ 4.) However, the Court concludes it does not have diversity jurisdiction based on the complaint 4 as presently alleged. This Court has repeatedly recognized its lack of diversity jurisdiction for parties’ 5 failure to adequately plead the citizenship of businesses. See Supertech, Inc. v. My Choice Software, LLC, 6 No. 1:23-cv-00002, 2023 WL 2600396, at *2 (D. N. Mar. I. Mar. 23, 2023) (collecting cases); BigBang 7 8 Ent., LLC v. Imperial Pac. Int’l (CNMI), LLC, No. 1:23-cv-00008, 2023 WL 4406287, at *2 (D. N. Mar. 9 I. July 10, 2023). 10 Here, First Hawaiian Bank has failed to sufficiently plead the citizenship of itself and Tianchi Corp. 11 because the complaint merely alleges the place of incorporation and where each corporation is doing 12 business.1 In order to adequately plead citizenship for itself and Tianchi Corp., First Hawaiian Bank must 13 14 plead facts regarding the location of each corporation’s principal place of business.2 See Harris v. Rand, 15 682 F.3d 846, 850 (9th Cir. 2012) (citing 28 U.S.C. § 1332(c)(1)). It is insufficient to state in a conclusory 16 manner that a party is a citizen of State X. Prochaska v. Walgreens Co., No. CV-06-1117-PCT-PGR, 2006 17 WL 1094803, at *1 (D. Ariz. Apr. 24, 2006) (citing Fifty Assocs. v. Prudential Ins. Co. of Am., 446 F.2d 18 1187, 1190 (9th Cir. 1970)). Since the complaint lacks these allegations, First Hawaiian Bank has not met 19 its burden to establish diversity jurisdiction. See id. (requiring plaintiff to file an amended complaint as 20 21 corporate party’s citizenship was inadequately alleged). 22 23 1 First Hawaiian Bank alleges that Hong is an alien, as he is a citizen of a foreign state, the People’s Republic of China. (Compl. ¶ 3.) Hong’s alien status does not necessarily defeat jurisdiction as there is diversity jurisdiction “where (1) there is a legitimate 24 controversy between diverse citizens and aliens are additional parties; and (2) there is complete diversity as to the citizens.” Transure, Inc. v. Marsh & McLennan, Inc., 766 F.2d 1297, 1298 (9th Cir. 1985) (citations omitted). Nevertheless, First Hawaiian 25 Bank is reminded of 28 U.S.C. § 1332(a)(2), which states that “district courts shall not have original jurisdiction under this subsection of an action between citizens of a State and citizens or subjects of a foreign state who are lawfully admitted for 26 permanent residence in the United States and are domiciled in the same State.”

27 2 First Hawaiian Bank pleads that it is a corporation (Compl. ¶ 1) and must therefore allege facts to indicate the state of incorporation and the state where its principal place of business is located, Johnson, 437 F.3d at 899. However, if Plaintiff is a 28 1 IV. CONCLUSION 2 Because First Hawaiian Bank has not adequately plead diversity jurisdiction, the Court sua spont 3|| DISMISSES this action, but grants First Hawaiian Bank leave to amend the complaint to correct th 4 || deficiencies. First Hawaiian Bank’s first amended complaint is due fourteen days from issuance of thi order. As such, First Hawaiian Bank’s motion for order of service by publication (ECF No. 3) is MOOT. 6 IT IS SO ORDERED this 9th day of April 2024. 7 Midler 9 RAMONA V. MANGLO Chief Judge 10 1] 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28

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