12-3504

Universitas Education, LLC v. Nova Group, Inc.

UNITED STATES COURT OF APPEALS

FOR THE SECOND CIRCUIT

SUMMARY ORDER

RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A SUMMARY ORDER FILED

ON OR AFTER JANUARY 1, 2007, IS PERMITTED AND IS GOVERNED BY FEDERAL RULE OF APPELLATE

PROCEDURE 32.1 AND THIS COURT’S LOCAL RULE 32.1.1. WHEN CITING A SUMMARY ORDER IN A

DOCUMENT FILED WITH THIS COURT, A PARTY MUST CITE EITHER THE FEDERAL APPENDIX OR AN

ELECTRONIC DATABASE (WITH THE NOTATION “SUMMARY ORDER”). A PARTY CITING A SUMMARY ORDER MUST

SERVE A COPY OF IT ON ANY PARTY NOT REPRESENTED BY COUNSEL.

1 At a stated term of the United States Court of Appeals

2 for the Second Circuit, held at the Thurgood Marshall United

3 States Courthouse, 40 Foley Square, in the City of New York,

on the 4th 4 day of March, two thousand thirteen.

5

6 PRESENT: DENNIS JACOBS,

7 Chief Judge,

8 ROSEMARY S. POOLER,

9 Circuit Judge.

10 ERIC N. VITALIANO,

District Judge.* 11

12

13 - - - - - - - - - - - - - - - - - - - -X

14 UNIVERSITAS EDUCATION, LLC, 

15 Plaintiff-Appellee,

16

17 -v.- 12-3504

18

19 NOVA GROUP, INC., AS TRUSTEE, SPONSOR

20 AND NAMED FIDUCIARY OF THE CHARTER OAK

21 TRUST WELFARE BENEFIT PLAN, 

22 Defendant-Appellant.

23

24 - - - - - - - - - - - - - - - - - - - -X

* The Honorable Eric N. Vitaliano, District Judge of

the United States District Court for the Eastern District of

New York, sitting by designation.

1
1 FOR APPELLANT: JACK E. ROBINSON, Robinson Law

2 Offices, Stamford, Connecticut.

3

4 FOR APPELLEE: PAULA K. COLBATH, Loeb & Loeb

5 LLP (Michael Barnett, Loeb &

6 Loeb LLP, on the brief), New

7 York, New York.

8

9 Appeal from a judgment of the United States District

10 Court for the Southern District of New York (Swain, J.).

11

12 UPON DUE CONSIDERATION, IT IS HEREBY ORDERED, ADJUDGED

13 AND DECREED that the judgment of the district court be

14 AFFIRMED. The mandate shall issue immediately. Nova Group

15 shall bear the costs of appeal.

16

17 Nova Group, Inc. (“Nova Group”) appeals from the

18 judgment of the United States District Court for the

19 Southern District of New York (Swain, J.), confirming an

20 arbitration award in favor of Universitas Education, LLC

21 (“Universitas”) in the amount of $26,525,535.88, plus

22 prejudgment interest and attorneys’ fees. We assume the

23 parties’ familiarity with the underlying facts, the

24 procedural history, and the issues presented for review. 

25

26 The sole issued raised on appeal is whether the

27 district court had subject matter jurisdiction over this

28 action. We review this question de novo. See Oscar Gruss &

29 Son, Inc. v. Hollander, 337 F.3d 186, 193 (2d Cir. 2003).

30

31 The underlying dispute involves a trustee’s refusal to

32 pay approximately $30 million in life insurance proceeds to

33 the trust beneficiary following the insured’s death in June

34 2008. When Nova Group (the trustee) rejected a claim by

35 Universitas (the beneficiary) to the death benefit,

36 Universitas filed a demand for arbitration, pursuant to a

37 contract-based arbitration clause. On January 24, 2011, the

38 arbitrator held Nova liable to Universitas for

39 $26,525,535.88. Nova then filed a Petition to Vacate in

40 Connecticut Superior Court pursuant to the Federal

41 Arbitration Act (“FAA”), 9 U.S.C. § 10, and Universitas

42 filed an action in New York Supreme Court seeking

43 confirmation of the award pursuant to 9 U.S.C. § 9. Both

44 parties removed the respective actions to federal court,

45 asserting the existence of diversity of citizenship and a

46 federal question.

47

2
1 After losing on the merits, Nova Group then challenged

2 the district court’s subject matter jurisdiction over the

3 case. The court court summarily dismissed this argument as

4 “wholly without merit” and entered judgment for Universitas. 

5 A 249. We agree with this decision.

6

7 “[S]ubject matter jurisdiction is an unwaivable sine

8 qua non for the exercise of federal judicial power.” Curley

9 v. Brignoli, Curley & Roberts Assocs., 915 F.2d 81, 83 (2d

10 Cir. 1990). So Nova Group’s motion is late in the day, but

11 not untimely.

12

13 Subject matter jurisdiction clearly exists here. 

14 Federal courts have diversity jurisdiction over

15 controversies between “citizens of different States.” 28

16 U.S.C. § 1332(a)(1); U.S. Const. art. III, § 2. “Diversity

17 jurisdiction exists over ‘civil actions where the matter in

18 controversy exceeds the sum or value of $75,000, exclusive

19 of interest and costs, and is between . . . citizens of

20 different States.’” Hallingby v. Hallingby, 574 F.3d 51, 56

21 (2d Cir. 2009) (quoting 28 U.S.C. § 1332(a)(1)). 

22

23 Universitas is a citizen of New York because it is a

24 limited liability company whose members are domiciled in New

25 York. Nova Group is a Delaware corporation with its

26 principal place of business and headquarters in Simsbury,

27 Connecticut, making it a citizen of both Delaware and

28 Connecticut. The amount in controversy indisputably exceeds

29 $75,000. Nova Group argues that a court must also consider

30 the citizenship of trust beneficiaries for purposes of

31 subject matter jurisdiction if suit is brought by a trustee

32 (which, in this case, would undermine the parties’ diversity

33 of citizenship). This argument was rejected in Navarro

34 Savings Association v. Lee, 446 U.S. 458 (1980). See id. at

35 465-66 (affirming the rule, “more than 150 years” old, that

36 permits trustees “to sue in their own right, without regard

37 to the citizenship of the trust beneficiaries”). Contrary

38 to Nova Group’s contentions, Carden v. Arkoma Associates,

39 494 U.S. 185 (1990), which concerned the citizenship of a

40 limited partnership, did not overrule Navarro. Rather, the

41 Supreme Court explicitly held that the two opinions did not

42 conflict. See id. at 191-94. Navarro therefore remains

3
1 good law, and the district court properly held that it had

jurisdiction pursuant to 28 U.S.C. § 1332(a)(1).1 2

3

4 For the foregoing reasons, and finding no merit in Nova

5 Group’s other arguments, we hereby AFFIRM the judgment of

6 the district court. The mandate shall issue immediately. 

7 Nova Group shall bear the costs of appeal.

8

9 FOR THE COURT:

10 CATHERINE O’HAGAN WOLFE, CLERK

11

1 Because we hold that the district court had

jurisdiction under 28 U.S.C. § 1332(a)(1), we need not

determine whether the case also presented a federal question

and thus created an independent basis for jurisdiction under

28 U.S.C. § 1331. 

4