Emma C. Lively v. Wild Oats Markets, Inc., a Delaware Corporation

DefendanL-Appellant Wild Oats Market, Inc. (“Wild Oats”) appeals the district court’s order remanding this action to state court. Wild Oats removed this action to the District Court for the Central District of California alleging that, because the parties were completely diverse and the amount in controversy exceeded $75,000, diversity jurisdiction existed under 28 U.S.C. § 1332 , and therefore removal was proper under 28 U.S.C. § 1441 (a). Plaintiff-Appellee Emma C. Lively (“Lively”) did not object to the removal. However, after the case had been pending in the district court for approximately eight months, the court, acting sua sponte and invoking its authority under 28 U.S.C. § 1447 (c), determined that diversity jurisdiction did not exist because Wild Oats, contrary to the removal requirement of 28 U.S.C. § 1441 (b), was a citizen of the state of California. Treating this requirement as a jurisdictional limitation on Wild Oats’ right of removal under § 1441(a), the district court remanded Lively’s action to state court.

Although Wild Oats does not dispute that it is a citizen of California and therefore a forum defendant within the meaning of § 1441(b), it argues that its…