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Pound for Pound Promotions, Inc. v. Golden Boy Promotions, Inc.

United States District Court, D. Nevada

March 27, 2017



          Gloria M. Navarro, Chief Judge United States District Judge

         Pending before the Court is the Motion to Remand, (ECF No. 14), filed by Plaintiff Pound For Pound Promotions, Inc. (“PFP”). Defendant Golden Boy Promotions, Inc. (“Golden Boy”) filed a Response, (ECF No. 26), and PFP filed a Reply, (ECF No. 29). On October 18, 2016, Magistrate Judge Peggy Leen held a hearing regarding the jurisdictional dispute in this case and ordered additional briefing on the issue. (ECF No. 35). Both parties filed supplemental briefs on December 14, 2016. (ECF Nos. 41, 44). For the reasons set forth herein, PFP's Motion to Remand is GRANTED.

         I. BACKGROUND

         This case arises out of a contract dispute over Golden Boy's promotional and professional relationship with boxer “Sugar” Shane Mosley (“Mosley”). (Compl., Ex. 1 to Pet. Removal, ECF No. 1-1). PFP is a Nevada corporation that furnishes the professional services of Mosley. (Pl.'s Mot. to Remand 1:17-21, ECF No. 14). Specifically, PFP promotes Mosely's professional boxing matches, promotes the boxing matches of PFP's other boxers, and operates Mosley's boxing-related activities. (Id.). Golden Boy is a boxing promotional company headquartered in Los Angeles, California. (Def.'s Mot. to Transfer 2:8-9, ECF No. 7).

         PFP initiated this action in Clark County District Court on July 5, 2016. (Compl., Ex. 1 to Pet. Removal). On August 8, 2016, Golden Boy removed the case to federal court, alleging that this Court has jurisdiction under the diversity of citizenship statute, 28 U.S.C. § 1332. (Pet. Removal, ECF No. 1).


         Federal courts are courts of limited jurisdiction, possessing only those powers granted by the Constitution and by statute. See United States v. Marks, 530 F.3d 799, 810 (9th Cir. 2008). “If at any time before final judgment it appears that the district court lacks subject matter jurisdiction, the case shall be remanded.” 28 U.S.C. § 1447(c). Removal statutes are strictly construed against removal jurisdiction. Gaus v. Miles, Inc., 980 F.2d 564, 566 (9th Cir. 1992). “Federal jurisdiction must be rejected if there is any doubt as to the right of removal in the first instance.” Id. (citing Libhart v. Santa Monica Dairy Co., 592 F.2d 1062, 1064 (9th Cir. 1979)). In evaluating diversity jurisdiction, the defendant has the burden of overcoming the “strong presumption” against removal. Gaus, 980 F.2d at 566.

         Pursuant to 28 U.S.C. § 1332, a federal district court has original jurisdiction over all civil actions between citizens of different states where the amount in controversy exceeds $75, 000. See 28 U.S.C. § 1332(a)(1). Section 1332 requires complete diversity among the parties; each of the plaintiffs must be a citizen of a different state than each of the defendants. Morris v. Princess Cruises, Inc., 236 F.3d 1061, 1067 (9th Cir. 2001).


         In the instant Motion, PFP argues that the parties are non-diverse and therefore the Court does not have subject matter jurisdiction over this action. (Pl.'s Mot. to Remand 2:1-5). Neither party disputes that Golden Boy is a citizen of California and PFP is a citizen of Nevada. Rather, the issue is whether PFP is also a citizen of California based on its principal place of business.

         For purposes of diversity jurisdiction, a corporation is deemed to be a citizen of every state by which it is incorporated, as well as the state where it has its principal place of business. See 28 U.S.C. § 1332(c)(1). In Hertz Corp. v. Friend, the Supreme Court held that a corporation's principal place of business is solely determined by the state of its “never center.” 130 S.Ct. 1181, 1192 (2010). A corporation's nerve center is “where a corporation's officers direct, control, and coordinate the corporation's activities . . . [a]nd in practice it should normally be the place where the corporation maintains its headquarters-provided that the headquarters is the actual center of direction, control, and coordination.” Id. Thus, the presence of an office in a state does not necessarily dictate diversity-rather, courts look to where the company's “executive-level decisions” are made. See Giannini v. Am. Home Mortg. Servicing, Inc., 2011 WL 6291789, at *3 (N.D. Cal. Dec. 15, 2011).

         When jurisdiction is challenged, the party asserting federal jurisdiction must present “competent proof” to substantiate its jurisdictional allegations. Hertz, 130 S.Ct. at 1195. In the Ninth Circuit, the removing party must demonstrate that removal is proper by a preponderance of evidence, and any doubts about the propriety of removal should be resolved in favor of remand. Gaus, 980 F.2d at 566.

         In this case, PFP asserts that the company operated in “both Nevada and California with its principal place of business being Nevada until 2014.” (Mosley Decl. ¶ 5, ECF No. 15). Beginning in 2014, however, PFP claims that the principal place of business changed to California. (Id. ¶ 15). In support of this change, PFP raises a number of factual assertions: (1) Mosley has not fought in Nevada since 2014; (2) PFP operates a training camp in Big Bear, California; (3) Mosley conducts all calls and meetings regarding PFP in California; (4) all of PFP's employees-an accountant, secretary, and treasurer-currently reside in California and perform their duties in California; (5) all of Mosley's meetings with PFP employees occur in Playa Vista, California; and (6) PFP's Nevada address is effectively a mail drop. (See Mosley Decl. ¶¶ 17-28). PFP's Secretary/Treasurer, Trista Pisani, attests to the validity of these assertions. (See Pisani Decl., ECF No. 30).

         In its Response, Golden Boy raises two counterarguments: (1) PFP is not registered to do business in California and thus cannot have its principal place of business in the state; and (2) PFP has failed to submit “competent evidence” to support its claim of California citizenship. ...

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