Opinion ID: 3029913
Heading Depth: 2
Heading Rank: 1

Heading: Motion to Remand for Lack of Diversity

Text: Front Street Pictures is a California corporation and is therefore nondiverse from Carteris, a California citizen, if California is either its place of incorporation or its primary place of business. 28 U.S.C. § 1332(c); Industrial Tectonics, Inc. v. Aero Alloy, 912 F.2d 1090, 1094 (9th Cir. 1990). The district court was in the best position to determine which of the two entities identified in the litigation called Front Street Pictures was the proper party, and to evaluate the conflicting evidence in the record regarding Front Street Pictures’s citizenship. See Inwood Labs., Inc. v. Ives Labs., Inc., 456 U.S. 844, 855 (1982). The district court’s findings that the proper Front Street Pictures is incorporated in, and has its primary place of business in, Canada were not clearly erroneous. See Kroske v. U.S. Bank Corp., 1 Front Street Pictures is not a party to this appeal because it has been voluntarily dismissed. Fed. R. App. P. 42(b). Because we are always under an obligation to inquire into whether federal subject matter jurisdiction existed and do not permit parties to voluntarily avoid that inquiry, see Wis. Dep’t of Corrections v. Schacht, 524 U.S. 381, 388-89 (1998), we consider the citizenship of Front Street Pictures even though it is no longer a party. 2 432 F.3d 976, 979 (9th Cir. 2005). Removal to the district court on the basis of diversity was therefore proper. 28 U.S. C. §§ 1332, 1441. 2. Defendants Porchlight Entertainment, Inc. and Joseph Broido Porchlight and Broido share Carteris’s California citizenship. However, if, viewing the facts most favorably towards the plaintiff, “the plaintiff fails to state a cause of action against a resident defendant, and the failure is obvious according to the settled rules of the state, the joinder of the resident defendant is fraudulent” and the defendant may be disregarded for the purpose of determining diversity jurisdiction. McCabe v. Gen. Foods Corp., 811 F.2d 1336, 1339 (9th Cir. 1987). It is well settled in California that an employee of an independent contractor cannot state a claim for personal injury against the hirer under a theory of retained control unless the hirer exercised that control in a way that affirmatively contributed to the employee’s injury. Hooker v. Dep’t of Transp., 27 Cal. 4th 198, 202 (2002). Neither the fact that Porchlight had and exercised certain control rights under its distribution agreement with Carteris’s employer, Central Myth Pictures, Inc., nor the fact that Broido frequently communicated with the film’s director concerning script approvals, is sufficient to give rise to the inference that Broido and Porchlight affirmatively contributed to Carteris’s on-set injuries. Accordingly, the district court correctly determined that Porchlight and Broido were “sham 3 defendants” who could be disregarded for the purpose of determining diversity jurisdiction. The remaining defendants were diverse. Thus, the district court properly denied the motion to remand.