Tag Archives: Federal Court

*Supreme Court Adopts “Nerve Center” Test for Determining a Corporation’s “Principal Place of Business,” for Diversity Purposes.

Pursuant to 28 USC § 1332, a corporation shall, for the purposes of determining diversity “be deemed to be a citizen of any State by which it has been incorporated and of the State where it has its principal place of business, except that in any direct action against the insurer of a policy or contract of liability insurance, whether incorporated or unincorporated, to which action the insured is not joined as a party-defendant, such insurer shall be deemed a citizen of the State of which the insured is a citizen, as well as of any State by which the insurer has been incorporated and of the State where it has its principal place of business.”

Where a corporation’s “principal place of business” is, has engendered various tests, such as “total activities,” “center of gravity,” “nerve center,” “locus of operations,” or “center of corporate activities.” Judge Breyer, writing for a unanimous Supreme Court, this past week, in Hertz Corp. v. Friend et al., set forth which test is the one to use now.

In Hertz he wrote that “[i]n an effort to find a single, more uniform interpretation of the statutory phrase, [“principal place of business,”] we have reviewed the Courts of Appeals’ divergent and increasingly complex interpretations. … . We conclude that “principal place of business” is best read as referring to the place where a corporation’s officers direct, control, and coordinate the corporation’s activities. It is the place that Courts of Appeals have called the corporation’s “nerve center.” And in practice it should normally be the place where the corporation maintains its headquarters—provided that the headquarters is the actual center of direction, control, and coordination, i.e., the “nerve center,” and not simply an office where the corporation holds its board meetings (for example, attended by directors and officers who have traveled there for the occasion).
… [T]his approach, while imperfect, is superior to other possibilities.”

*Local Rules of the United States District Courts for the Southern and Eastern Districts of New York

Now that they are in effect, I have added the Eastern District version of the Local Rules of the United States District Courts for the Southern and Eastern Districts of New York to my link list.

*Time computation changes to Local Rules for the EDNY and SDNY

If you are not signed up for ECF in the EDNY or the SDNY, you would not have received the enclosed useful chart that sets forth the new time computation changes set forth in the Local Rules for the Eastern and Southern Districts of New York, which were made due to the changes in the F.R.C.P., all effective December 1, 2009. Also included is the Report of the joint committee on local rules concerning amendments to the local rules of the SDNY and EDNY required as a result of the time computation amendments to the federal rules

The major change is the discontinuance of not counting weekends and Federal holidays in certain instances. Now they are all counted, but the times to act have been extended in those instances when you would not have counted those days. Saturdays, Sundays, and legal holidays are no longer excluded in computing periods of time. If the last day of the period is a Saturday, Sunday, or legal holiday, the period continues to run until the end of the next day that is not a Saturday, Sunday, or legal holiday. Also most time periods have been adjusted to be week orientated, i.e. multiples of 7.

Chart – Time Computation – Local Rules NYED and NYSD – December 1 2009

The complete local rules on the SDNY site (Includes Amendments through December 1, 2009)

The complete local rules on the EDNY site (Includes Amendments through December 1, 2009)