Cormier v. Securitas Security Services USA Inc. et al

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.
O R D E R
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
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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).
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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.
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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).
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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
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