Karen Marlatt v. Walmart Inc. et al.

Summary

The United States District Court for the Central District of California granted Plaintiff Karen Marlatt’s motion to remand an employment-discrimination action removed by Walmart. The court held that diversity jurisdiction must be assessed based on the citizenship of all named parties, regardless of service, and that Defendant Lucy Sanchez was domiciled in California when the complaint was filed, defeating complete diversity.

Holdings

1. When federal jurisdiction in a removal case depends on complete diversity, diversity is determined from the citizenship of all parties named in the complaint, not from which defendants were properly served.
2. Diversity of citizenship is measured at the time the complaint is filed, and a subsequent change in citizenship by an existing party does not cure a lack of complete diversity.
3. Sanctions were not warranted because the record did not establish that Walmart acted in bad faith in making representations about Sanchez's residency and contact information.

Questions Presented

1. Whether the citizenship of an allegedly unserved defendant must be considered when determining complete diversity for purposes of removal.
2. Whether a defendant's change in citizenship after the complaint was filed affects diversity jurisdiction.
3. Whether sanctions should be imposed under 28 U.S.C. § 1447(c) for the removal.

Disposition

remanded