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Rowell v. Franconia Minerals Corp.

April 16, 2010

WILLIAM ROWELL, PLAINTIFF,
v.
FRANCONIA MINERALS CORP., DEFENDANT.



The opinion of the court was delivered by: Geraldine Soat Brown United States Magistrate Judge

Magistrate Judge Geraldine Soat Brown

MEMORANDUM OPINION AND ORDER

Plaintiff William Rowell brought this action against defendant Franconia Minerals Corporation ("Franconia") alleging breach of contract. (2nd Am. Compl. ¶¶ 5-38.) [Dkt 35.] The case originated in the Circuit Court of Cook County, Illinois, but was removed to federal court by Franconia on the basis of diversity jurisdiction pursuant to 28 U.S.C. § 1332. (Notice of Removal.) [Dkt 1.] The parties consented to the exercise of jurisdiction by a magistrate judge pursuant to 28 U.S.C. § 636(c). [Dkt 54.]

Franconia has moved for summary judgment. [Dkt 100.] Upon reviewing the motion, the court detected a potential flaw in subject matter jurisdiction: Rowell, a Canadian citizen, is an alien admitted to the United States for permanent residence. (Pl.'s LR Resp. ¶¶ 1, 2.) [Dkt 120.] He has lived in Illinois for 10 years. (Id.) Franconia is incorporated in Alberta, Canada and has its principal place of business in the state of Washington. (Id.) The court requested supplemental briefing from the parties about whether there is federal jurisdiction in the case. (Order, Dec. 23, 2009.) [Dkt 137.] Proceedings on Franconia's motion were stayed until a determination was reached regarding subject matter jurisdiction. (Id.)

For the reasons set out below, the case is remanded to the Circuit Court of Cook County, Illinois for lack of subject matter jurisdiction. Franconia's motion for summary judgment is stricken as moot without prejudice.

DISCUSSION

Federal courts are courts of limited jurisdiction. Turner/Ozanne v. Hyman/Power, 111 F.3d 1312, 1316 (7th Cir. 1997). In the absence of jurisdiction, a court is powerless to act. Lewis v. Local Union No. 100 of the Laborers' Intl. Union of N.A., AFL-CIO, 750 F.2d 1368, 1377 n. 11 (7th Cir. 1984). Federal courts are expected to monitor their jurisdictional boundaries vigilantly and to guard carefully against expansion by judicial interpretation. American Fire & Cas. Co. v. Finn, 341 U.S. 6, 17-18 (1951); see also FW/PBS, Inc. v. City of Dallas, 493 U.S. 215, 230-31 (1990) (stating that federal courts "are under an independent obligation to examine their own jurisdiction"); Long v. Shorebank Dev. Corp., 182 F.3d 548, 554 (7th Cir. 1999) (district court is not limited to the jurisdictional allegations of the complaint and may look to whatever evidence has been submitted to determine whether subject matter jurisdiction indeed exists); In re Shell Oil Co., 966 F.2d 1130, 1133 (7th Cir. 1992). Just as a federal court cannot expand its jurisdiction, parties may not confer subject matter jurisdiction on a federal court by oversight or consent. Nightingale Home Healthcare, Inc. v. Anodyne Therapy, LLC, 589 F.3d 881, 886 (7th Cir. 2009).

Article III, Section 2 of the Constitution provides in part that the judicial power of the United States shall extend to controversies "between a State, or the Citizens thereof, and foreign States, Citizens or Subjects." 28 U.S.C. § 1332(a), which governs federal jurisdiction in diversity cases, requires complete diversity among the parties. Lincoln Prop. Co. v. Roche, 546 U.S. 81, 89 (2005). That statute states, in relevant part:

The district courts shall have original jurisdiction of all civil actions where the matter in controversy exceeds the sum or value of $75,000, exclusive of interest and costs, and is between --

(1) citizens of different States;

(2) citizens of a State and citizens or subjects of a foreign state;

(3) citizens of different States and in which citizens or subjects of a foreign state are additional parties; and

(4) a foreign state . . . as plaintiff and citizens of a State or ...


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