The opinion of the court was delivered by: Honorable Barry Ted Moskowitz United States District Judge
ORDER GRANTING MOTION TO REMAND
Plaintiff Valley Research, Inc. ("Plaintiff" or "VR") has filed a motion to remand this action to state court. For the reasons discussed below, Plaintiff's motion to remand is GRANTED.
On December 7, 2006, VR filed its original complaint against Diversa in San Diego Superior Court for the County of San Diego. VR is an Indiana corporation. The complaint alleged that Diversa had a principal place of business in California. (Leventhal Decl., Ex. A.)
On January 8, 2007, Diversa filed an answer and cross-complaint.
Subsequently, VR notified Diversa of its intent to file an amended complaint. Diversa refused to stipulate to the amended complaint. (Leventhal Decl. ¶ 12.) On June 20, 2007, Diversa consummated a merger transaction with Celunol Corporation ("Celunol") and became Verenium Corporation ("Verenium"). (McCarthy Decl. ¶ 2.) On July 3, 2007, Verenium's counsel contacted VR's counsel and indicated that Verenium was willing to stipulate to the filing of an amended complaint given earlier comments by the presiding judge that he did not see a basis for denying leave to amend at that time. (Leventhal Decl. ¶ 16.)
Counsel for VR sent a proposed amended complaint to counsel for Verenium and asked counsel for Verenium to forward suggested changes. (Leventhal Decl., Ex. I.) Counsel for Verenium made changes to the proposed amended complaint which were reflected in a red-lined version of the document. (Leventhal Decl., Ex. J.) The changes suggested by counsel for Verenium included, among other things, substituting "Verenium, as successor-in-interest to Diversa" in place of "Diversa" in the caption and "Diversa, as predecessor in interest to Verenium" in place of "Diversa" in the body of the complaint. Counsel for Verenium also inserted the following paragraph in the "Parties and Preliminary Allegations" section of the complaint:
Verenium Corporation ("Verenium") is a Delaware corporation, with its principal place of business in Cambridge, Massachusetts, qualified to do business and doing business in the State of California. Verenium is the successor in interest to Diversa Corporation ("Diversa"), which merged on June 20, 2007, with Cellunol Corporation. As stated herein, Verenium and Diversa shall be used interchangeably.
On July 10, 2007, VR filed the amended complaint with all of Verenium's suggested revisions.
On July 19, 2007, Verenium filed its notice of removal on the basis of diversity jurisdiction.
VR contends that Verenium's principal place of business is California, not Massachusetts, as it was led to believe. Thus, VR moves to remand this action to state court on the ground that it was removed in violation of the "forum defendant" rule set forth in 28 U.S.C. § 1441(b). As discussed below, the Court finds that Verenium has failed to establish by a preponderance of evidence that its principal place of business is Massachusetts (or any other state besides California). Therefore, the Court grants VR's motion to remand.
As an initial matter, Verenium argues that VR has waived its right to seek a remand by filing a jury demand, a motion to seal documents, and an ex parte application to reschedule the ENE conference. Verenium also points to VR's objections to discovery in which VR cited to the Federal Rules of Civil Procedure. The Court is not persuaded by Verenium's waiver argument. The Court agrees with the courts that have held that the prompt filing of a jury demand is necessary to protect the plaintiff's right to a jury trial in the event that the case is not remanded and should not be construed as a waiver of the right to remand. See, e.g., Student A. v. Metcho, 710 F. Supp. 267, 269 (N.D. Cal. 1989). The motion to seal documents and ex parte application to reschedule the ENE conference were filed after the motion to remand and did not seek substantial relief. Furthermore, the motion to seal was filed after Verenium complained that some of the exhibits attached to VR's Answer to Verenium's Amended Cross-Complaint contained "confidential information," as defined by the parties' Distribution Agreement. Finally, VR's citation to the Federal Rules of Civil Procedure in its discovery objections does not rise to the level of consent to this Court's jurisdiction. Accordingly, the Court turns to the merits of VR's motion to remand.
The rule limiting removal on the basis of diversity jurisdiction to instances where no defendant is a citizen of the forum state is a procedural rule, not a jurisdictional one. Lively v. Wild Oats Markets, Inc., 456 F.3d 933 (9th Cir. 2006). Nevertheless, Verenium bears the burden of showing that it has complied with the rule -- i.e., that it is not a citizen of California. Schwartz v. FHP Int'l Corp., 947 F. Supp. 1354, 1360 (D. Ariz. 1996). A corporation is a citizen of the state in which it is incorporated as well as the state in which it has its principal place of business. 28 U.S.C. ...