PUBLISHED

UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT

AXEL JOHNSON, INCORPORATED,

Plaintiff-Appellant,

v.

CARROLL CAROLINA OIL COMPANY,

INCORPORATED; LINDA A. CARROLL;

No. 97-1629

CHARLES S. LANIER, Trustee,

Defendants-Appellees,

and

PACE OIL COMPANY, INCORPORATED,

Defendant.

Appeal from the United States District Court

for the Eastern District of North Carolina, at Wilmington.

W. Earl Britt, Senior District Judge.

(CA-96-130-7-BR)

Argued: March 2, 1998

Decided: June 4, 1998

Before WILKINS, LUTTIG, and MOTZ, Circuit Judges.

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Affirmed by published opinion. Judge Luttig wrote the opinion, in

which Judge Wilkins and Judge Motz joined.

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COUNSEL

ARGUED: Kenneth Berlin, Sr., SKADDEN, ARPS, SLATE,

MEAGHER & FLOM, L.L.P., Washington, D.C., for Appellant. Mat-
thew Patrick McGuire, HUNTON & WILLIAMS, Raleigh, North

Carolina, for Appellees Carroll and Carroll Oil; Michael Perkins Flanagan, WARD & SMITH, P.A., Greenville, North Carolina, for Appellee Lanier. ON BRIEF: Don J. Frost, Jr., SKADDEN, ARPS,

SLATE, MEAGHER & FLOM, L.L.P., Washington, D.C.; Kenneth

A. Shanklin, SHANKLIN & MCDANIEL, L.L.P., Wilmington, North

Carolina, for Appellant. Craig A. Bromby, HUNTON & WILLIAMS,

Raleigh, North Carolina, for Appellees Carroll and Carroll Oil.

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OPINION

LUTTIG, Circuit Judge:

This case arises on appeal from the district court's dismissal of four

counts of a six-count complaint for want of subject matter jurisdiction. For the reasons stated herein, we affirm.

I.

Defendant-appellee Carroll Carolina Oil Co., Inc. ("CCO") owns a

Superfund site, certain cleanup costs of which plaintiff-appellant Axel

Johnson, Inc. ("Axel") -- the former operator, either directly or

through its predecessors in interest, of petroleum refinery and storage

facilities at the site -- has agreed to pay pursuant to a consent decree

with the EPA. CCO received the property pursuant to a quitclaim

deed from defendant-appellee Linda Carroll, who at the relevant times

owned and operated CCO. Carroll had acquired the property through

a foreclosure sale conducted by defendant-appellee Charles Lanier,

the property's trustee.

Subsequent to entry of the consent decree, Axel brought a sixcount complaint against CCO, Carroll, and Lanier. The first two

counts ("the Superfund counts") of Axel's suit sought to hold Carroll

and CCO jointly and severally liable with Axel, under federal and

state law, for its Superfund cleanup costs. The four remaining counts

("the state-law counts") sought damages and rescission based on allegations that Carroll and Lanier had fraudulently manipulated the foreclosure sale through which Carroll obtained the Superfund property.

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The defendants-appellees moved to dismiss one of the two Superfund counts and the four state-law counts pursuant to FRCP 12(b)(1)

and FRCP 12(b)(6). The district court denied the motion as to the

Superfund count, but dismissed the state-law counts under FRCP

12(b)(1) on the grounds that Axel lacked standing to bring such

claims under North Carolina law. To expedite appeal of this decision,

Axel requested that the district court certify its decision as a final

judgment with respect to the state-law counts under FRCP 54(b). The

district court complied, and Axel noticed its appeal. Accordingly, neither Superfund count is before this court at this time.

II.

We hold that the district court lacked jurisdiction to consider

Axel's four state-law claims. In that court, Axel invoked three bases

for subject-matter jurisdiction: (1) 42 U.S.C.§ 9613(b) (exclusive

jurisdiction over Superfund litigation), (2) 28 U.S.C. § 1331 (federal

question jurisdiction), and (3) "principles of pendent jurisdiction."

J.A. at 42 (amended complaint); accord id. at 2 (initial complaint)

(same). It is undisputed -- and, of course, indisputable -- that neither

42 U.S.C. § 9613(b) nor 28 U.S.C. § 1331 extends federal jurisdiction

to state-law claims. Thus, jurisdiction can be sustained here only

under "principles of pendant jurisdiction."

These principles have been codified in 28 U.S.C.§ 1367, which

provides that,

in any civil action of which the district courts have original

jurisdiction, the district courts shall have supplemental jurisdiction over all other claims that are so related to claims in

the action within such original jurisdiction that they form

part of the same case or controversy under Article III of the

United States Constitution.

Id. § 1367(a). As is relevant here, the test for determining whether

state and federal claims form part of the same constitutional case or

controversy is set forth in United Mine Workers of America v. Gibbs:

Pendent jurisdiction, in the sense of judicial power, exists

whenever there is [a federal claim], and the relationship

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between that claim and the state claim permits the conclusion that the entire action before the court comprises but one

constitutional "case." The federal claim must have substance

sufficient to confer subject matter jurisdiction on the court.

. . . The state and federal claims must derive from a common

nucleus of operative fact. But if, considered without regard

to their federal or state character, a plaintiff's claims are

such that he would ordinarily be expected to try them all in

one judicial proceeding, then, assuming substantiality of the

federal issues, there is power in federal courts to hear the

whole.

383 U.S. 715, 725 (1966) (citations and footnotes omitted; second and

third emphases added). Accord ESAB Group, Inc. v. Centricut, Inc.,

126 F.3d 617, 628 (4th Cir. 1997).

Although neither party, nor the district court, noted this jurisdictional defect, Axel's submissions to the district court, as well as certain express findings made by that court at Axel's request, clearly

establish that Axel's four state-law counts were not within the district

court's supplemental jurisdiction. In particular, in requesting that the

district court certify as final its order dismissing those counts, Axel

argued that (1) the Superfund counts and state-law counts were factually distinct, J.A. at 91-93, (2) the Superfund counts and state-law

counts were legally distinct, id. at 93-94, and (3) because "the factual

and legal bases underlying [the Superfund and state-law counts] are

separate and distinct," id. at 98, "certification is warranted because . . .

the possibility of duplicative appellate review is remote," id. See also

id. at 93 n.1 ("Further, because there is minimal factual overlap

between the two claims, there is little concern that the Fourth Circuit

would have to relearn the same set of facts upon appeal after adjudication of all claims." (citation and internal quotation omitted)). Similarly, in certifying its order under FRCP 54(b), the district court

explicitly found that "the Superfund Claims that have not been dismissed . . . are factually and legally distinct from the State Claims."

J.A. at 104. It follows from these arguments and findings that the

state-law counts and Superfund counts neither "derive from a common nucleus of operative fact," nor are so closely related that Axel

"would ordinarily be expected to try them all in one judicial proceeding," and thus that supplemental jurisdiction could not be exercised

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over the state-law counts. Cf. Hales v. Winn-Dixie Stores, Inc., 500

F.2d 836, 848 (4th Cir. 1974) (noting failure of pendant jurisdiction

over state-law count that was "separately maintainable and determinable without any reference to the facts alleged or contentions stated

in or with regard to the other [federal] count").

III.

When, at oral argument, this court questioned Axel's counsel about

the apparent lack of supplemental jurisdiction, counsel tentatively

suggested that jurisdiction over the state-law counts could, perhaps,

be sustained under 28 U.S.C. § 1332 (diversity jurisdiction), a statutory basis for jurisdiction that Axel had previously invoked neither in

the district court nor before this court. An examination of the pleadings and record, however, revealed to counsel and this court that Axel

had not only failed to plead diversity jurisdiction, but that it had also

failed to plead facts from which the existence of such jurisdiction

could properly be inferred. Although the pleadings set forth the residence of each of the natural persons who are parties to the litigation,

they did not positively establish the citizenship of those persons. See,

e.g., J.A. at 43 (amended complaint) (stating residence, but not citizenship or domicile of Carroll and Lanier); id . at 3-4 (initial complaint) (same). Nor was counsel able to refer the court to anything

else in the record that clearly established the citizenship of those persons.

As the Supreme Court has consistently held, however, state citizenship for purposes of diversity jurisdiction depends not on residence,

but on national citizenship and domicile, see , e.g., Newman-Green,

Inc. v. Alfonzo-Larrain, 490 U.S. 826, 828 (1989) ("In order to be a

citizen of a State within the meaning of the diversity statute, a natural

person must both be a citizen of the United States and be domiciled

within the State."), and the existence of such citizenship cannot be

inferred from allegations of mere residence, standing alone. See, e.g.,

Realty Holding Co. v. Donaldson, 268 U.S. 398, 399 (1925) ("The

bill alleges that . . . appellee [is] a`resident' of Michigan. This is not

a sufficient allegation of appellee's Michigan citizenship."); Shaw v.

Quincy Mining Co., 145 U.S. 444, 447 (1892) ("It was held by this

court from the beginning that an averment that a party resided within

the State or the district in which the suit was brought was not suffi-

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cient to support the [diversity] jurisdiction, because in the common

use of words a resident might not be a citizen, and therefore it was

not stated expressly and beyond ambiguity that he was a citizen of the

State . . . . The same rule has been maintained to the present day

. . . ."); Robertson v. Cease, 97 U.S. 646, 648 (1878) ("Looking, then,

at the pleadings, and to such portions of the transcript as properly

constitute the record, we find nothing beyond the naked averment of

Cease's residence in Illinois, which, according to the uniform course

of decisions in this court, is insufficient to show his citizenship in that

State. Citizenship and residence, as often declared by this court, are

not synonymous terms."); Brown v. Keene, 33 U.S. (8 Pet.) 112, 115

(1834) (Marshall, C.J.) (holding allegation that defendant was "a citizen or resident" of Louisiana insufficient to support diversity jurisdiction); Bingham v. Cabot, 3 U.S. (3 Dall.) 382 (1798) ("str[iking] off

the docket" many cases that alleged residence rather than citizenship);

cf. Hodgson v. Bowerbank, 9 U.S. (5 Cranch) 303 (1809) (holding

allegation of residence, as opposed to citizenship, insufficient to support alienage jurisdiction); Mossman v. Higginson, 4 U.S. (4 Dall.) 12

(1800) (same).

When confronted with the distinction between residence and domicile, upon which distinction the above-cited cases largely rest, counsel

immediately acknowledged that he understood the difference between

these legal terms of art, see, e.g., Commissioner of Internal Revenue

v. Nubar, 185 F.2d 584, 587 (4th Cir. 1950) ("When these words,

`domicile' and `residence', are technically used by persons skilled in

legal semantics, their meanings are quite different."); that the complaint alleged neither citizenship nor domicile, but only residence, and

thus did not properly invoke the court's diversity jurisdiction; and that

the complaint had, in fact, never been intended to invoke such jurisdiction, but had been drafted instead with deliberate intent to invoke

only the supplemental jurisdiction of the court.

Thus, at the conclusion of oral argument, it was apparent to the

court that Axel had abandoned its tentative attempt to invoke the

diversity jurisdiction, and had chosen to rest, instead, solely on its

invocation of the supplemental jurisdiction. Axel's abandonment of

this attempt was confirmed when, after argument, counsel for Axel

submitted to the court a letter addressing "the jurisdictional issue that

the Court of Appeals raised," which rested entirely on a discussion of

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the supplemental jurisdiction without even mentioning the diversity

jurisdiction.

CONCLUSION

Because the district court lacked supplemental jurisdiction over

Axel's state-law counts, and because Axel has failed to establish any

other basis of federal jurisdiction over these counts, we hold that

Axel's state-law counts were properly dismissed for lack of subject

matter jurisdiction.*

AFFIRMED

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*Because Axel has apparently abandoned its short-lived attempt to

invoke the diversity jurisdiction, and because, in light of Axel's explicit

arguments below, it is plain that its invocation of the supplemental jurisdiction cannot be cured by amendment, we conclude that the district

court did not err in dismissing Axel's complaint with prejudice.

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