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KOONS v. KAISER

June 23, 1950

KOONS et al.
v.
KAISER et al.



The opinion of the court was delivered by: KAUFMAN

The defendants have made the following motions:

(1) to quash service and return of summons on, and to dismiss the action as to, defendant Kaiser Colorado Company (hereinafter referred to as 'Colorado') upon the ground that the defendant is a corporation organized under the laws of California and was not and is not licensed to do or doing business in New York State and is therefore not subject to service of process within the State of New York;

(2) to quash service and return of summons on, and to dismiss the action as to, defendant Kaiser Steel Corporation (hereinafter referred to as 'Steel') upon the ground that the defendant is a corporation organized under the laws of Nevada and was not and is not licensed to do or doing business in New York State and is therefore not subject to service of process within the State of New York;

 (3) to dismiss the action for lack of venue or in the alternative to transfer the action pursuant to Section 1406 of Title 28 United States Code Annotated to the United States District Court for the Northern District of California, Southern Division, where the action might have been brought, on the ground that the venue of the action now is in the wrong district because the jurisdiction of this Court is invoked solely on the ground of diversity of citizenship and neither all of the plaintiffs nor all of the defendants reside in the Southern District of New York or the State of New York;

 (4) transfer the action to the United States District Court for the Northern District of California, Southern Division, on the ground of forum non conveniens pursuant to Section 1404(a) of Title 28 United States Code Annotated;

 (5) if the first motion is granted, to dismiss the action for lack of an indispensable party, to wit, Colorado;

 (6) if the second motion is granted to dismiss the action for lack of an indispensable party, to wit, Steel.

 The plaintiffs subsequently moved this Court by order to show cause

 (1) for an order to take the depositions in New York of seven individuals among them being the defendant Kaiser, officers of Steel and Colorado, the manager of the Waldorf Astoria Hotel and a Deputy U.S. Marshal in this district, for use upon the pending motions of the defendants to quash service of process and to dismiss the actions, on the issue as to whether the corporate defendants are doing business in this jurisdiction and therefore subject to service of process;

 (2) that pending the taking and conclusion of said depositions, the defendants' aforesaid motions be adjourned.

 The defendants urge this Court to consider initially their motion with respect to venue for if the Court should consider this favorably, all of the other motions will become academic. The defendants' argument is substantially as follows: The depositions requested by the plaintiff cannot have any bearing on the motion with respect to improper venue for, if the defendant Henry J. Kaiser is found to be a resident of California, then irrespective of the finding with respect to the corporate defendants, not all of the plaintiffs or all of the defendants will be residents of this district. Section 1391, Title 28 United States Code Annotated. Furthermore, the defendants urge that if their motion is granted there will be no need for this Court to decide whether depositions should be taken nor will there be any need to rule upon defendants' other motions. There is merit to this argument of the defendants and hence this Court will consider at the outset the motion as it is addressed to the question of venue.

 The plaintiffs' moving papers make it perfectly clear that the use of the depositions which they seek is for 'the pending motions of the defendants to quash service of process and to dismiss the action on the ground that the corporate defendants are not doing business within the jurisdiction of this Court and therefore are not subject to service of process here.' It can be stated in passing that were defendants' motion under Section 1406 of the Judicial Code not dispositive of all of the motions, this Court would be inclined to order the dispositions requested- of course under certain conditions which would have been imposed- since these depositions would have thrown some light upon the issues, always difficult to decide, respecting the quantity and quality of corporate business sufficient to subject itself to services of process. But these issues with respect to corporate business are not involved on the question of the residence of defendant Kaiser, which residence will determine the motion addressed to venue.

 The complaint herein alleges that the jurisdiction of this Court is predicated on the existence of diversity of citizenship between plaintiffs and defendants. Venue of this action accordingly is controlled by Title 28 United States Code Annotated § 1391(a) and (c), which read:

 '(a) A civil action wherein jurisdiction is founded only on diversity of citizenship may, except as otherwise provided by law, be brought only in the judicial district ...


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