Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-casd-3_07-cv-01057/USCOURTS-casd-3_07-cv-01057-0/pdf.json

Nature of Suit Code: 240
Nature of Suit: Torts to Land
Cause of Action: 28:1332 Diversity-Torts to Land

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UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF CALIFORNIA

CITY OF SAN DIEGO,

Plaintiff,

CASE NO. 07CV1057 IEG (BLM)

ORDER DENYING PLAINTIFF’S

MOTION TO REMAND

WITHOUT PREJUDICE

(Doc. No. 4)

vs.

BNSF RAILWAY COMPANY; DOES 1

through 50,

Defendant.

On June 8, 2007, BNSF Railway Company (“defendant”) removed this action from San

Diego County Superior Court to this Court. (Doc. No. 1.) Presently before the Court is the City of

San Diego’s (“plaintiff”) motion to remand (Doc. No. 4.) Plaintiff, a California citizen, contends

defendant is also a citizen of California, and, therefore, diversity jurisdiction is absent. 

For purposes of diversity citizenship, a corporation is a citizen of the state of its

incorporation and the state “where it has its principal place of business.” 28 U.S.C. § 1332(c)(1);

Indus. Tectonics, Inc. v. Aero Alloy, 912 F.2d 1090, 1092 (9th Cir. 1990). “[W]here a majority of

a corporation’s business activity takes place in one state, that state is the corporation’s principal

place of business,” regardless of the location of the corporation’s headquarters. Indus. Tectonics,

Inc., 912 F.2d at 1094. If the corporation does not conduct a “substantial predominance” of its

activity in any single state, the Court determines the corporation’s principal place of business by

applying the “nerve center” test. Id. The “nerve center” is the place where a corporation’s

Case 3:07-cv-01057-IEG-BLM Document 13 Filed 08/08/07 Page 1 of 2
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“executive and administrative functions are performed,” i.e., the location of the corporate

headquarters. Id. at 1092-93. 

Defendant is incorporated in Delaware. (Notice of Removal ¶ 4.) 

Defendant “employ[s] approximately 45,000 employees and cover[s] approximately 32,000

route miles in 28 states and two Canadian provinces.” (Boutwell Decla. ¶ 2.) Defendant owns

more than 1,000 miles of rail track in eleven different states. (Id., Exhibit B, at 4.) Therefore, the

Court finds defendant does not conduct a “substantial predominance” of its business activity in any

one state. See Tosco Corp. v. Cmtys. for a Better Env’t, 236 F.3d 495, 500 (9th Cir. 2001)

(“substantial predominance” test requires that corporation’s business activity in one state “be

significantly larger” than any other state where the corporation does business). Therefore, the

“nerve center” test applies to determine defendant’s principal place of business. Indus. Tectonics,

Inc., 912 F.2d at 1094.

Defendant’s principal corporate office is in Fort Worth, Texas. (Boutwell Decla. ¶ 2.) 

This location houses the offices of defendant’s executive officers, vice presidents, and executive

management. (Id. ¶ 3.) This location also includes the Network Operations Center, which

monitors the movement of all 6,330 locomotives in defendant’s system. (Id. ¶ 2.) Defendant

employs 3,684 employees in multiple office buildings at this site. (Id.) Therefore, the Court finds

Texas is defendant’s corporate headquarters and the place where defendant performs its executive

and administrative functions.

In reply, plaintiff concedes defendant’s “nerve center” is Texas. (Reply, at 2.) The Court

has diversity jurisdiction. However, Plaintiff also sued 50 DOE defendants who may have to be

joined as necessary and indispensable parties, once their identity is known. 

Therefore, the Court DENIES WITHOUT PREJUDICE plaintiff’s motion to remand.

IT IS SO ORDERED.

DATED: August 8, 2007

IRMA E. GONZALEZ, Chief Judge

United States District Court

Case 3:07-cv-01057-IEG-BLM Document 13 Filed 08/08/07 Page 2 of 2