Michael Cormier v. P Securitas Security Services, USA, Inc., et al.

2022 DNH 002

• Court: District Court, D. New Hampshire
• Decided: January 3, 2022
• Docket: 21-cv-123-LM
• Status: Published

Opinion

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NEW HAMPSHIRE

Michael Cormier

v. Civil No. 21-cv-123-LM Opinion No. 2022 DNH 002 P Securitas Security Services, USA, Inc., et al.

ORDER Michael Cormier individually, in his capacity as executor of the Estate of

Catherine Heppner, and as next friend of a minor, J.C., brings this negligence suit

against Securitas Security Services and Cadient LLC. The matter is before the

court on Cormier’s “Notice Regarding Compliance with the Court’s November 18,

2021 Order” (doc. no. 27), the provisionally sealed affidavit of Attorney Steve Yoost

(doc. no. 28), and Cadient’s motion to seal Attorney Yoost’s Affidavit (doc. no. 29).

DISCUSSION

On November 18, 2021, the court directed Cormier to file an affidavit of

jurisdictional facts about the identities and citizenships of all Cadient’s members as

of the date Cormier filed the action. As noted in that order, the Revised Complaint

alleges that Cormier is a citizen of New Hampshire, that Securitas is a Delaware

corporation with a principal place of business in New Jersey, and that Cadient is a

Delaware limited liability company with a principal place of business in North

Carolina. For purposes of diversity jurisdiction, a limited liability company such as

Cadient is deemed to be a citizen of every state of which any of its members is a citizen. See D.B. Zwirn Special Opportunities Fund, L.P. v. Mehrotra, 661 F.3d 124,

125 (1st Cir. 2011). The Revised Complaint, however, contains no information

about the citizenship of Cadient’s members. Accordingly, the court directed

Cormier to file an affidavit of jurisdictional facts with the court. Specifically, the

court instructed that the affidavit “shall relate the identities and citizenship of all of

Cadient’s members as of the date this action was filed,” noted that “if any of

Cadient’s members is itself an unincorporated entity, then the citizenship of each of

that entity’s members or partners must also be determined,” and observed that

“merely stating that Cadient has no members that are citizens of New Hampshire

will be insufficient.” Doc. no. 25 at 2.

Cormier timely submitted his “Notice Regarding Compliance” in an effort to

comply with the court’s directions. Cormier’s response refers the court to the

affidavit of Attorney Steve Yoost, who is general counsel for a financial advisor for

Cadient’s owners and avers to knowledge of Cadient’s ownership structure. In that

affidavit, which was filed by Cadient, Attorney Yoost relates information about

Cadient’s ownership structure. Cadient asks that Attorney Yoost’s affidavit be

placed under seal because Cadient’s ownership structure includes highly

confidential business information that is subject to nondisclosure requirements.

Cormier’s counsel states that he has not reviewed Attorney Yoost’s affidavit, which

Cadient seeks to keep under seal at Level II.1

1 A Level II seal prohibits anyone from viewing the filing except the filer and

the court. See LR 83.12(b)(2).

2 While the court appreciates Cormier’s and Attorney Yoost’s efforts to unwind

the multi-tiered and branching ownership structure of Cadient, Attorney Yoost’s

recitation of the relevant facts is insufficient to demonstrate that the court has

subject-matter jurisdiction. Specifically, the citizenships and corporate nature of

the members listed in Paragraph 7 of Attorney Yoost’s affidavit are not sufficiently

detailed. Because the entity discussed in Paragraph 7 is a partnership, the

citizenships of each of its members (including limited partners)2 must be

determined, and if any of those members are themselves unincorporated entities,

their members’ citizenships must also be determined. Accordingly, the court needs

to know whether each member is a person or business entity and, if a business

entity, of what type (e.g., corporation, partnership, limited liability company, trust)

in addition to the facts related to citizenship. See Champney v. Apple New Eng.,

LLC, No. 20-cv-397-LM, 2021 WL 2186435, at *1-*2 (D.N.H. May 28, 2021).

And, finally, a statement that no member or no members are residents (or

citizens) of New Hampshire is not sufficient; a plaintiff must plead jurisdiction in

the affirmative. D.B. Zwirn, 661 F.3d at 126.3 This is because some persons and

entities are considered “stateless” or are treated as “stateless,” a status which

2 Carden v. Arkoma Assocs., 494 U.S. 185, 195 (1990) (“In sum, we reject the

contention that to determine, for diversity purposes, the citizenship of an artificial entity, the court may consult the citizenship of less than all of the entity’s members.”).

3 To be clear, the Third Circuit’s rule that citizenship may be pleaded in the

negative does not apply in the First Circuit. Compare Lincoln Ben. Life Co. v. AEI Life, LLC, 800 F.3d 99, 106-07 (3d Cir. 2015) (“Thus, rather than affirmatively alleging the citizenship of a defendant, a plaintiff may allege that the defendant is not a citizen of the plaintiff's state of citizenship.”), with D.B. Zwirn, 661 F.3d at 126.

3 destroys diversity jurisdiction. See id.; e.g., Newman-Green, Inc. v. Alfonzo-

Larrain, 490 U.S. 826, 829 (1989) (discussing United States citizens who are

domiciled abroad); Hometown Am., LLC v. StarNet Ins. Co., 2020 WL 5939539, at

*3 (D. Mass. Oct. 7, 2020) (discussing entities that are alter egos or arms of a state).

Thus, Attorney Yoost’s note in Paragraph 7 that “none [of the members] are

residents of New Hampshire” does not suffice.

CONCLUSION

Cormier shall file a second affidavit of jurisdictional facts with the court that

demonstrates the existence of diversity jurisdiction in this case no later than

February 3, 2022. Cormier may serve limited discovery requests on Cadient for the

purpose of complying with this Order and the Order of November 18, 2021 (doc. no.

25). See Platten v. HG Bermuda Exempted Ltd., 437 F.3d 118, 139 (1st Cir. 2006).

Cadient shall comply with those requests. Any failure to comply with appropriate

jurisdictional discovery requests will result in sanctions, including but not limited

to payment of Cormier’s attorney fees and costs incurred.

Cadient’s motion (doc. no. 29) to seal Attorney Yoost’s declaration (doc. no.

28) is denied as moot. Because the affidavit does not demonstrate the existence of

jurisdiction and because the court is directing Cormier to produce a supplemental

filing, there is no need to maintain Attorney Yoost’s affidavit as a public record kept

under seal. Doc. no. 28 shall be stricken from the docket and the filing returned to

Cadient. See LR 83.12(d).

4 The second affidavit of jurisdictional facts may be filed under seal at Level I.

See D.B. Zwirn, 661 F.3d at 126. The parties can enter a confidentiality agreement

to protect any produced confidential information such that Cormier’s counsel may

see the material and evaluate its sufficiency for establishing jurisdiction and

responsiveness to the relevant discovery request. While the court appreciates

counsel’s efforts to work together to resolve this issue, the court is disinclined to

permit a procedure in which Cormier’s counsel relies on Cadient’s filings sight

unseen.

Failure to comply with this order will result in dismissal of the case for

failure to show subject-matter jurisdiction.

SO ORDERED.

__________________________ Landya McCafferty United States District Judge

January 3, 2022 cc: Counsel of Record