United States District Court, S.D. New York
Patrick J. Coughlin, Esq., Daniel S. Drosman, Esq., Jessica T. Shinnefield, Esq., Jarrett S. Charo, Esq., Darryl J. Alvarado, Esq., Robbins Geller Rudman & Dowd LLP, San Diego, CA, Samuel H. Rudman, Esq., Robbins Geller Rudman & Dowd LLP, Melville, NY, Luke O. Brooks, Esq., Jason C. Davis, Esq., Robbins Geller Rudman & Dowd LLP, San Francisco, CA, for Plaintiffs.
Marc I. Gross, Esq., Tamar A. Weinrib, Esq., Pomertantz Haudek Grossman & Gross LLP, New York, NY, for Plaintiff State Board of Administration of Florida.
James P. Rouhandeh, Esq., Antonio J. Perez-Marques, Esq., William R. Miller, Jr., Esq., Davis Polk & Wardwell LLP, New York, NY, for Defendants Morgan Stanley & Co. Incorporated and Morgan Stanley & Co. International Limited.
Joshua M. Rubins, Esq., James J. Coster, Esq., Mario Aieta, Esq., James I. Doty, Esq., Satterlee Stephens Burke & Burke LLP, New York, NY, Mark A. Kirsch, Esq., Christopher M. Joralemon, Esq., Joel M. Cohen, Esq., Lawrence J. Zweifach, Esq., Mary K. Dunning, Esq., Gibson, Dunn & Crutcher, LLP, New York, NY, for Defendants Moody's Investors Service, Incorporated and Moody's Investors Service Limited.
Floyd Abrams, Esq., Dean I. Ringel, Esq., Charles A. Gilman, Esq., Tammy L. Roy, Esq., Jason M. Hall, Esq., Cahill Gordon & Reindel LLP, New York, NY, for Defendants Standard & Poor's Rating Services and The McGraw-Hill Companies, Incorporated.
OPINION AND ORDER
SHIRA A. SCHEINDLIN, District Judge.
Defendants challenge this Court's subject matter jurisdiction under 28 U.S.C. § 1332 on the ground that joinder of the Commonwealth of Pennsylvania Public School Employees' Retirement System
(" PSERS" ) and the State Board of Administration of Florida (" FSBA" ) destroys diversity jurisdiction because PSERS and FSBA are arms of their respective States, and not citizens of any state. Plaintiffs argue that the Court has supplemental jurisdiction over the claims of non-diverse parties joined under Federal Rule of Civil Procedure 20 and, moreover, that entities which are citizens of no state do not destroy diversity. In addition they argue that FSBA is not an arm of the state of Florida. I conclude that joinder of an arm of the State under Rule 20 destroys diversity jurisdiction, but that only PSERS is an arm of the state requiring dismissal in order to preserve this Court's jurisdiction.
II. APPLICABLE LAW
A. Supplemental Jurisdiction
Section 1367(a) provides in ...