UNITED STATES DISTRICT COURT 

NORTHERN DISTRICT OF INDIANA 

ABRO INDUSTRIES, INC., ) 

 ) 

 Plaintiff, ) 

 ) 

 v. ) CAUSE NO.: 3:14-CV-1984-TLS 

 ) 

1 NEW TRADE, INC., et al., ) 

 ) 

 Defendants. ) 

OPINION AND ORDER 

 This matter is before the Court sua sponte. On July 15, 2016, the Court issued an Order 

directing “all Defendants” and “any other parties asserting claims that would remain pending in 

the event that the Court grants (in whole or in part) the pending Rule 41(a)(2) motion to dismiss, 

to submit . . . a jurisdictional statement and supporting brief providing the independent basis of 

jurisdiction for their claims.” (Op. & Order 2, ECF No. 119.) In response, counsel for 1 New 

Trade, Inc., Igor Zorin, and Boris Babenchik filed a brief and affidavits. These documents 

identified 1 New Trade, Inc., as a Maryland corporation with its principal place of business in 

Russia. Further, Zorin and Babenchik were identified as Russian citizens who have been residing 

in Russia “before and during the pendency of this matter.” (1 New Trade, Inc., Igor Zorin & 

Boris Babenchik’s Jurisdictional Statement & Mem. Law 2, ECF No. 122.) Counsel also stated 

that ABRO Industries, Inc., is an Indiana corporation with its principal place of business in 

Indiana, and Peter Baranay is a Michigan resident.1

 

1

 As will be discussed later in greater detail, 1 New Trade, Inc., Zorin, and Babenchik have raised several 

counterclaims against ABRO Industries, Inc. Separately, Zorin and Babenchik filed a third-party 

complaint against Baranay.
2 

 Without explanation, the parties’ respective counsel agree that if ABRO Industries, Inc.’s 

claims are dismissed with prejudice, the Court will retain jurisdiction over the remaining claims 

under 28 U.S.C. § 1332(a)(1).2 The Court has “an independent obligation to be sure that 

jurisdiction exists,” Andrews v. E.I. Du Pont De Nemours & Co., 447 F.3d 510, 514 (7th Cir. 

2006), and the parties may not simply stipulate to jurisdiction, Bayerische Landesbank, N.Y. 

Branch v. Aladdin Capital Mgmt. LLC, 692 F.3d 42, 48 (2d Cir. 2012). Under § 1332(a)–(1), the 

district courts “have original jurisdiction of all civil actions where the matter in controversy 

exceeds the sum or value of $75,000, exclusive of interest and costs, and is between—(1) 

citizens of different States.” Further, “[§] 1332 requires complete diversity: no plaintiff may be a 

citizen of the same state as any defendant.” Altom Transp., Inc. v. Westchester Fire Ins. Co., 823 

F.3d 416, 420 (7th Cir. 2016). 

For a natural person to invoke § 1332(a)(1), he must be both a “citizen of the United 

States” and “a citizen of one of the United States.” Sadat v. Mertes, 615 F.2d 1176, 1180 (7th 

Cir. 1980). Similarly, a corporation must be a citizen of a state of the United States. E.g., 

Hallingby v. Hallingby, 574 F.3d 51, 56 (2d Cir. 2009) (finding no diversity jurisdiction under 

§ 1332(a)(1) because even though all parties were citizens of various U.S. states, corporate 

defendant and plaintiff were both citizens of New York); MAS Capital Inc. v. Biodelivery Scis. 

Int’l, Inc., 524 F.3d 831, 832–33 (7th Cir. 2008) (“Section 1332 uses the word ‘State’ frequently, 

 

2

 Although counsel for 1 New Trade, Inc., Zorin, and Babenchik asserts that all remaining claims invoke 

§ 1332(a)(1), counsel for ABRO Industries, Inc., and Baranay merely responded that “it agrees that the 

Court retains jurisdiction of [the counterclaims of 1 New Trade, Inc., Zorin, and Babenchik] under 28 

U.S.C. § 1332(a)(1).” (Resp. Quest’s Jurisdictional Statement & Supporting Mem. 4 n.4, ECF No. 127). 

However, this does not address Zorin’s and Babenchik’s third-party complaint filed against Baranay. 

Further, Quest Specialty Coatings, LLC, which is a defendant against ABRO Industries, Inc., and filed a 

cross-claim against 1 New Trade, Inc., submitted a jurisdictional statement and supporting memorandum 

dated July 19, 2016. This document merely reasserts its claim for costs and attorney’s fees in the event 

ABRO Industries, Inc.’s copyright infringement claim is dismissed, and does not provide any 

jurisdictional facts because it consents that a dismissal with prejudice of the copyright infringement action 

would moot its cross-claim. 
3 

always in contexts that refer to a domestic state, while the statute consistently refers to a foreign 

nation as a ‘foreign state.’”); see also 13E Charles Alan Wright et al., Federal Practice and 

Procedure § 3603 (3d ed.) (explaining that § 1332(e), which defines “States” as including “the 

Territories, the District of Columbia, and the Commonwealth of Puerto Rico,” altered the 

definition by no longer limiting the term to states of the United States (first quoting Hepburn v. 

Ellzey, 6 U.S. (2 Cranch) 445, 452 (1805); then quoting Corp. of New Orleans v. Winter, 14 U.S. 

(1 Wheat.) 91, 94–95 (1816))). 

Considering § 1332(a)(1)’s requirements, it is axiomatic that this provision does not 

provide a basis for jurisdiction in this case. The parties do not dispute that 1 New Trade, Inc., has 

its principal place of business in Russia, or that Zorin and Babenchik are Russian citizens who 

have been residing in Russia. Despite these circumstances, this case may still invoke alienage 

jurisdiction. In addition to meeting the amount in controversy, under § 1332(a)(2), a district court 

has original jurisdiction between 

citizens of a State and citizens or subjects of a foreign state, except that the district 

courts shall not have original jurisdiction under this subsection of an action 

between citizens of a State and citizens or subjects of a foreign state who are 

lawfully admitted for permanent residence in the United States and are domiciled 

in the same State. 

Alternatively, a district court has jurisdiction between “citizens of different States and in which 

citizens or subjects of a foreign state are additional parties.” Id. § (a)(3). 

 Section 1332(a)(2) permits an alien to sue a citizen of a state of the United States in 

federal district court. Extra Equipamentos E Exportação Ltda. v. Case Corp., 541 F.3d 719, 721 

(7th Cir. 2008); Soc’y of Lloyd’s v. Ashenden, 233 F.3d 473, 475 (7th Cir. 2000) (hearing suits 

by a foreign corporation against several American defendants under § 1332(a)(2)). In this case, 

Zorin and Babenchik have filed a Third-Party Complaint against Baranay. These Third-Party 
4 

Plaintiffs submitted affidavits stating that they are Russian citizens who have been residing in 

Russia “before and during the pendency of this matter.” (Jurisdictional Statement & Mem. Law 

2; Zorin Decl. 1, ECF No. 122-2; Babenchik Decl. 1, ECF No. 123.) Further, each affiant states 

that he has “never been a citizen or a resident of Indiana or Michigan.” (Zorin Decl. 1; 

Babenchik Decl. 1.) The third-party defendant is Baranay, and according to the Third-Party 

Plaintiffs, “Baranay is a resident of Michigan as he testified at his deposition and has been 

residing in Michigan before and during the pendency of this matter.”3 (Jurisdictional Statement 

& Mem. Law 3.) 

 Although the Third-Party Plaintiffs have identified Baranay’s residence, his citizenship 

remains unclear. Am.’s Best Inns, Inc. v. Best Inns of Abilene, L.P., 980 F.2d 1072, 1074 (7th Cir. 

1992) (per curiam) (“In federal law citizenship means domicile, not residence.”). An individual’s 

citizenship depends on his or her domicile. See Meyerson v. Harrah’s E. Chi. Casino, 299 F.3d 

616, 617 (7th Cir. 2002) (per curiam). Domicile is the place one intends to remain. Dakuras v. 

Edwards, 312 F.3d 256, 258 (7th Cir. 2002). Therefore, the Third-Party Plaintiffs will need to 

file a supplemental jurisdictional statement that identifies Baranay’s citizenship. 

Additionally, Zorin’s and Babenchik’s statements that they lack ties to Indiana or 

Michigan appear directed toward the bar to jurisdiction when an action is “between citizens of a 

State and citizens or subjects of a foreign state who are lawfully admitted for permanent 

residence in the United States and are domiciled in the same State.” § 1332(a)(2). However, the 

declarations of Zorin and Babenchik do not identify their “domicile,” nor do they disclose 

whether either of them is a permanent resident alien. This missing information, combined with 

the uncertainty as to Baranay’s citizenship, must be filled in to determine whether the Court has 

 

3

 Excerpts from Baranay’s deposition were not attached to the filing and it does not appear that this 

deposition transcript has been filed elsewhere on this case’s docket. 
5 

jurisdiction under § 1332(a)(2). Wei Zhou v. Marquette Univ., 444 F. App’x 896, 897 (7th Cir. 

2008) (per curiam); cf. Karazanos v. Madison Two Assocs., 147 F.3d 624, 627 (7th Cir. 1998) 

(“We do not know from the present record whether the people denominated as ‘citizen[s] of . . . 

foreign state[s]’ . . . were domiciled in their native countries, in a third country, or perhaps in the 

state of Illinois [(the adverse party’s state)]. If they were permanent resident aliens domiciled in 

Illinois, then the effect . . . would be to destroy complete diversity.”). 

 The counterclaims raised by 1 New Trade, Inc., Zorin, and Babenchik against ABRO 

Industries, Inc., would fall within § 1332(a)(3). The pleadings establish that 1 New Trade, Inc., is 

a Maryland corporation, and the declarations of Zorin and Babenchik add that its principal place 

of business has always been in Russia. This means 1 New Trade, Inc., is a citizen of Maryland 

and Russia. § 1332(c)(1) (“[A] corporation shall be deemed to be a citizen of every State and 

foreign state by which it has been incorporated and of the State or foreign state where it has its 

principal place of business . . . .”).4

 With Zorin and Babenchik being Russian citizens, and the 

pleadings showing that ABRO Industries, Inc., is an Indiana citizen, the parties are aligned as a 

U.S. citizen and aliens against a U.S. citizen. “When citizens of states are on both sides of the 

litigation and are completely diverse, the presence of aliens on one or both sides of the 

controversy ‘fits section 1332(a)(3) to a t.’” Dresser Indus., Inc. v. Underwriters at Lloyd’s of 

London, 106 F.3d 494, 498 (3d Cir. 1997) (quoting Allendale Mut. Ins. Co. v. Bull Data Sys., 

Inc., 10 F.3d 425, 428 (7th Cir. 1993)); Karazanos, 147 F.3d at 627 (acknowledging that 

 

4

 Had this case been commenced before January 6, 2012, the Court would have only considered 1 New 

Trade, Inc.’s Maryland incorporation to determine citizenship. MAS Capital, Inc. v. Biodelivery Scis. 

Int’l, Inc., 524 F.3d 831, 832–33 (7th Cir. 2008); Bayerische Landesbank, 692 F.3d at 51 (explaining the 

amendment to § 1332(c)(1)); see also Fellowes, Inc. v. Changzhou Xinrui Fellowes Office Equip. Co., 

759 F.3d 787, 788 (7th Cir. 2014) (noting amendment). However, the amendment to § 1332(c)(1) 

mandates that the Court also consider 1 New Trade, Inc.’s foreign principal place of business. Bayerische 

Landesbank, 692 F.3d at 51.
6 

jurisdiction exists under §1332(a)(3) where alignment is citizen of state A v. citizen of state B + 

alien (citing Hunter v. Shell Oil Co., 198 F.2d 485, 488 (5th Cir. 1952))). Considering this, and 

there being no sign that “a legitimate controversy between diverse citizens” is absent, the 

counterclaims independently invoke § 1332(a)(3). Zenith Elecs. Corp. v. Kimball Int’l Mfg., Inc., 

114 F. Supp. 2d 764, 767 n.3 (N.D. Ill. 2000) (quoting Dresser, 106 F.3d at 498). 

 Accordingly, the Court ORDERS Igor Zorin and Boris Babenchik to submit, on or 

before, August 19, 2016, a supplemental jurisdictional statement and supporting brief identifying 

(1) the citizenship of Peter Baranay; and (2) their permanent resident alien status and domicile. 

SO ORDERED on August 4, 2016. 

 s/ Theresa L. Springmann 

 THERESA L. SPRINGMANN 

 UNITED STATES DISTRICT COURT 

 FORT WAYNE DIVISION