Opinion ID: 172626
Heading Depth: 1
Heading Rank: 4

Heading: Citizenship of BZC

Text: The last subpart under the local defendant provision requires that the defendant be a citizen of the state in which the action was originally filed, which in this case is Oklahoma. In order to establish Oklahoma citizenship, BZCa New York corporationmust have its principal place of business in Oklahoma. See 28 U.S.C. § 1332(c)(1) (a corporation shall be deemed to be a citizen of any State by which it has been incorporated and of the State where it has its principal place of business). In the district court, plaintiffs asserted that BZC was an active corporation with its principal place of business in Oklahoma because it owns real property in Oklahoma and pays taxes on that property; filed an application for a permit to operate a groundwater treatment plant in Oklahoma; has been conducting voluntary environmental remediation for many years in Oklahoma; and initiated a community outreach programwhich includes a community outreach office, public meetings, newsletters, and a websiteto educate the citizens of Blackwell about BZC's environmental remediation efforts. Moreover, plaintiffs asserted that BZC had been licensed to do business in Oklahoma since 1922, that its license was still active, and that it was conducting business only in Oklahoma. In response, the Freeport Defendants argued that BZC was not a citizen of Oklahoma because it had not conducted sufficient business there since it was acquired by Cyprus Amax in 1999. BZC's corporate secretary attested that, since that time, the company has conducted no business, other than following the formalities to keep the corporation in existence. BZC also submitted evidence that it has no significant assets and is not engaged in any revenue-generating operations. BZC asserted that its environmental remediation activities were in response to legal claims arising from its prior operations and that it was an inactive corporation with no principal place of business. BZC argued that it was solely a citizen of New York, its state of incorporation. The district court stated that it was not persuaded that the various environmental response activities that BZC has conducted or overseen beginning in the 1990's do not constitute `transacting business' for jurisdictional purposes. Aplt. App. at 1512 (alteration, quotation, and citation omitted). The court noted plaintiffs' argument that the only purpose for the continued existence of BZC is to clean up pollution in Blackwell left behind by the smelter. Id. (alteration and quotation omitted). The court concluded that BZC's clean up activity was a substantial activity in which it is currently engaged and that this activity suffices to establish Oklahoma as BZC's principal place of business. Id. (citing Gadlin v. Sybron Int'l Corp., 222 F.3d 797, 799 (10th Cir.2000)). A district court's determination about a corporation's principal place of business is a question of fact that we review for clear error. Gadlin, 222 F.3d at 799. The Freeport Defendants argue, however, that this court should conduct a de novo review of the district court's determination because the the underlying facts are not in dispute, instead [t]he issue is the legal significance of those facts when viewed through the prism of the appropriate test for citizenship, which is a question of law .... Aplt. Reply Br. at 11 n. 3. But the Freeport Defendants do not present any authority to support their position. The clear error standard of review has been used for the principal-place-of-business determination since this court issued its decision in Amoco Rocmount Co. v. Anschutz Corp., 7 F.3d 909, 914 (10th Cir. 1993). In Gadlin, this court held: When determining a corporation's principal place of business, a court should look to the total activity of the company or the totality of the circumstances .... Gadlin, 222 F.3d at 799 (quotation omitted). The district court's analysis is consistent with this precedent. The Freeport Defendants have failed to show that the district court's decision on BZC's citizenship was clearly erroneous.