"Castle Harbour" or the "Hotel") is not a separate or independent
Bermuda Properties Limited ("Bermuda Properties"), a Bermuda
corporation not named as a defendant herein, owns the Hotel
buildings and land upon which the Hotel is situated.*fn5
Defendant Marriott International, Inc. ("Marriott
International"), is a corporation organized and existing under
the laws of the State of Delaware. Marriott Services is a wholly
owned subsidiary of Marriott International. See Conklin Aff. ¶ 6.
Plaintiffs Jeffrey D. Klein, M.D., Barbi Blaire Klein,
Alexander Bennett Klein, Ian Daniel Klein,*fn6 Barbara Blumberg,
Murrey Targownik, Frank Brookfield, Eleanor Brookfield and
Michelle Brookfield are residents and citizens of the State of
New York, and were such at all times relevant to their
Plaintiffs David Whitaker and Mary Lou Whitaker are residents
and citizens of the State of New Jersey, and were such at all
times relevant to their Complaint.
All plaintiffs were guests of the Hotel for different periods
of time between February 14, 1998 and February 23, 1998.
Plaintiffs claim that during their stay at the Hotel, they
ingested contaminated water and became ill as a result. All
Complaints allege that this Court has subject matter jurisdiction
pursuant to 28 U.S.C. § 1332 because there is a diversity of
citizenship between plaintiffs and defendants and the amounts in
controversy exceed $75,000.00 exclusive of interest and costs.
Defendants now move to dismiss these actions for lack of
subject matter jurisdiction on the ground that the amounts in
controversy do not exceed $75,000, or, in the alternative,
pursuant to the doctrine of forum non conveniens.
Plaintiffs invoke this Court's diversity jurisdiction under
28 U.S.C. § 1332(a)(3), which provides original jurisdiction over
civil actions where the amount in controversy exceeds $75,000,
and are between "citizens of different States and in which
citizens or subjects of a foreign state are additional parties."
The diversity statute must be strictly construed. See Matimak
Trading Co. v. Khalily, 118 F.3d 76, 87 (2d Cir. 1997), cert.
denied, ___ U.S. ___, 118 S.Ct. 883, 139 L.Ed.2d 871 (1998).
Further, when plaintiffs sue more than one defendant in a
diversity action, the plaintiffs must meet the requirements of
the diversity statute for each defendant or face dismissal. See
Strawbridge v. Curtiss, 7 U.S. (3 Cranch) 267, 2 L.Ed. 435
(1806). Therefore, if a putative U.S. citizen joined as a
defendant with foreign defendants pursuant to
28 U.S.C. § 1332(a)(3) is proven to be "stateless," complete diversity is
destroyed and the Court must either dismiss the case in its
entirety, or dismiss only the nondiverse party if he is
dispensable and his dismissal would preserve the court's
diversity jurisdiction. See Newman-Green, Inc. v.
Alfonzo-Larrain, 490 U.S. 826, 109 S.Ct. 2218, 104 L.Ed.2d 893
(1989). The same action would be required if the U.S. citizen met
the diversity requirement, but the foreign defendants proved not
to qualify as "citizens or subjects of a foreign state" within
the meaning of 28 U.S.C. § 1332(a)(3).*fn7
Marriott Services (d/b/a the Castle Harbour) is a corporation
organized and existing under the laws of Bermuda.*fn8 See
Conklin Aff. ¶ 2. "For purposes of diversity jurisdiction, a
corporation is a `citizen' or `subject' of the entity under whose
sovereignty it is created." See Matimak, 118 F.3d at 79 (citing
Nat'l S.S. Co. v. Tugman, 106 U.S. 118, 121, 1 S.Ct. 58, 27
L.Ed. 87 (1882)). Therefore, Marriott Services is a citizen of
Bermuda.*fn9 Thus, Marriott Services would be a properly diverse
defendant if Bermuda were a "foreign state" within the meaning of
28 U.S.C. § 1332(a)(3).
The general rule, which was adopted by the Second Circuit in
Matimak, is that a "foreign state" for purposes of
28 U.S.C. § 1332 is one "formally recognized by the executive branch of the
United States government." See Matimak, 118 F.3d at 79.*fn10
Bermuda is a Dependent Territory of the United Kingdom which is
not regarded as an independent sovereign nation or foreign state
by the U.S. Department of State. See Koehler, 1998 WL 557595,
at *6-7. Therefore, Marriott Services is not a "citizen or
subject of a foreign state" within the meaning of
28 U.S.C. § 1332(a)(3). See id. (holding that court lacked diversity
jurisdiction over Bermuda corporations). In so holding, we agree
with the Koehler court that Matimak is the controlling
authority in the Second Circuit on this issue,*fn11 and that it
is determinative with respect to the exercise of alienage
jurisdiction over a Bermuda corporation.
Rule 21 of the Federal Rules of Civil Procedure invests this
Court with the authority to dismiss nondiverse dispensable
parties in order to preserve diversity jurisdiction. See
Newman-Green, 490 U.S. at 832, 109 S.Ct. 2218. However, because
these suits cannot proceed without indispensable parties, we must
dismiss these cases in their entirety if Marriott Services is
indispensable within the meaning of Rule 19(b). See id., 490
U.S. at 838, 109 S.Ct. 2218; Kerr v. Compagnie De Ultramar,
250 F.2d 860, 863 (2d Cir. 1958); Fed.R.Civ.P. 19(b).
Rule 19(b) requires a district court to decide "whether in
equity and good conscience" an action should be dismissed because
an absent person is "regarded as indispensable." The factors to
be considered are:
first, to what extent a judgment rendered in the
person's absence might be prejudicial to the person
or those already parties; second, the extent to
which, by protective provisions in the judgment, by
the shaping of relief, or other measures, the
prejudice can be lessened or avoided; third, whether
a judgment rendered in the person's absence will be
adequate; fourth, whether the plaintiff will have an
adequate remedy if the action is dismissed. . . .