Danjaq, S.A. v. Pathe Communications Corporation Mgm-Pathe Communications Co. Tracinda Corporation Kirk Kerkorian Mgm/ua Communications Co.

This appeal involves two arcane issues of subject matter jurisdiction that are of first impression in this Circuit. Both issues relate to the determination of a corporation’s principal place.of business for purposes of diversity jurisdiction. The first is whether alien corporations are subject to 28 U.S.C. § 1332 (c), which states that a corporation is a citizen both of its place of incorporation and the location of its principal place of business. We agree with the district court that an alien corporation, like a domestic corporation, is a citizen of both.

The second issue is whether the activities of a subsidiary corporation — not a party to the litigation — should be considered to determine the principal place of business of the parent. We hold that a subsidiary’s activities should not be considered for this purpose, at least absent a showing that the subsidiary is merely an alter ego of its parent.

The final issue is to determine the principal place of business of Plaintiff-Appellant Danjaq, S.A., a Swiss corporation. We conclude the district court correctly determined that place to be California, where appellant’s business activities are conducted. Switzerland, where the…