Dismissal over Diversity Consideration

Apr 25, 2017 | Featured, News

Nashville attorneys Michael J. Vetter, Sr., and Lance W. Thompson recently obtained the dismissal of a lawsuit filed in Federal Court in the Eastern District of Tennessee. Originally, the lawsuit, which was in excess of $75,000, was filed against only one defendant. When the complaint was filed, the plaintiffs were citizens of Tennessee, and that one defendant was a Mississippi corporation.

Subsequent to the original complaint, the plaintiffs amended the complaint to add new claims and new parties. The newly named defendants were Tennessee residents. Mike and Lance filed a motion to dismiss, arguing that the addition of the new defendants necessitated a re-evaluation of the diversity of the parties. Their motion was opposed by the plaintiffs, and the court requested an oral argument of the issues presented for its consideration.

Under federal statutes, in order for a case based upon diversity to proceed, the plaintiffs and defendants must not share the same citizenship. As a general rule, jurisdiction is determined at the time of filing the complaint. However, Mike and Lance argued that the addition of the new parties required diversity to be reconsidered. They relied upon Phillips v. Allergan, 2008 U.S. Dist. LEXIS 44692 (M.D. Tenn. June 2, 2008) and other cases for precedent seeking the dismissal of the lawsuit. Following the oral arguments, the court agreed with the position of Mike and Lance and held that there was no longer subject matter jurisdiction and that the case could not proceed in Federal Court. The case was then dismissed.

Mike is the chair of Spicer Rudstrom’s Products Liability group, and his practice is also concentrated in property and casualty litigation, construction litigation, insurance coverage and bad faith, and uninsured motorist litigation. He has achieved an AV-Preeminent rating from Martindale-Hubbell.

Lance is an associate attorney with Spicer Rudstrom PLLC. He serves as the lead attorney for research and writing, including dispositive motions and pretrial motions with an emphasis on appellate briefs for all of the firm’s attorneys. He works with American and international companies, providing them with in-depth analysis of often very convoluted issues arising under Tennessee law and surrounding jurisdictions.