Determining a Defendant's State of Residency and Citizenship — Maryland and Federal Practice: Which Date Controls?
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Where does the defendant live?
It sounds like one of the simplest questions in litigation. It frequently is not.
A person may own homes in two states, work in one and sleep in another, move shortly before suit is filed, retain a driver's license from a former state, register vehicles elsewhere, vote in another jurisdiction, or claim that a temporary residence has become permanent. Businesses present additional complications because corporations, LLCs, partnerships, and other entities have different rules for determining citizenship.
And sometimes the decisive question is not merely where the defendant resided or was domiciled, but when that determination must be made.
The answers can affect personal jurisdiction, venue, service, federal diversity jurisdiction, removal, remand, and ultimately which court will decide the case.
Residence and Domicile Are Not the Same Thing
The words "resident," "residence," "domicile," and "citizenship" are often used casually as though they mean the same thing.
They do not.
A person can have more than one residence.
A person ordinarily has only one domicile at a time.
For federal diversity jurisdiction, an individual's state citizenship generally follows domicile, not merely residence.
Domicile ordinarily requires two things:
1. physical presence in a place; and
2. an intention to make that place one's home for the indefinite future.
A person therefore does not necessarily become a citizen of Maryland for diversity purposes simply by renting an apartment in Maryland.
Conversely, a person who temporarily leaves Maryland does not necessarily lose Maryland domicile.
Why the Distinction Matters
Suppose a complaint alleges:
"Defendant is a resident of Virginia."
That may be perfectly adequate for some purposes.
But if federal diversity jurisdiction depends upon the defendant's citizenship, merely proving a Virginia mailing address may not answer the question.
The defendant might maintain an apartment in Virginia while remaining domiciled in Maryland.
When jurisdiction depends upon citizenship, lawyers should think in terms of domicile, not simply where the defendant receives mail.
How Is Domicile Determined?
No single fact necessarily controls.
Courts may consider evidence including:
• where the person actually lives;
• how long the person has lived there;
• whether the residence is owned or rented;
• where the person's spouse and family live;
• voter registration;
• voting history;
• driver's license;
• vehicle registration;
• state tax filings;
• federal tax return addresses;
• employment;
• professional licenses;
• bank and financial records;
• property ownership;
• utility records;
• mailing addresses;
• insurance records;
• memberships in local organizations;
• statements concerning where the person considers home; and
• conduct demonstrating an intention to remain or leave.
The analysis considers the entire picture.
A person cannot necessarily manufacture a new domicile overnight merely by changing the address on a driver's license.
Nor can a person necessarily preserve an old domicile indefinitely merely by saying, "I still consider that home," when all objective conduct demonstrates otherwise.
Intent Matters — But Conduct Tests the Claim of Intent
Domicile contains a subjective component because intention matters.
That does not mean the litigant's testimony controls.
A defendant may testify:
"I always intended to remain a Maryland resident."
The court can compare that assertion with objective evidence.
If the defendant sold the Maryland home, purchased a home in Florida, moved the family there, obtained a Florida driver's license, registered to vote there, registered vehicles there, filed appropriate tax documents, and established permanent employment there, the objective evidence may say considerably more than the litigant's preferred description of intent.
Intent is important.
Conduct makes intent believable—or unbelievable.
The Critical Date for Federal Diversity Jurisdiction
Federal diversity jurisdiction ordinarily depends upon the citizenship of the parties when the action is commenced.
That timing rule can be outcome determinative.
Suppose a Maryland plaintiff sues a defendant who is domiciled in Maryland on the date the complaint is filed.
The defendant moves permanently to Virginia two weeks later.
The later move ordinarily does not retroactively create diversity jurisdiction that was absent when the action commenced.
Conversely, if complete diversity existed when the federal action was commenced, a later move by one of the parties ordinarily does not destroy jurisdiction that properly attached.
This is sometimes described as the time-of-filing rule.
Moving Before Suit Can Produce a Different Result
Change the facts.
The defendant formerly lived in Maryland but genuinely relocated to Virginia before the complaint was filed.
If the defendant had established Virginia domicile before commencement of the action, the citizenship analysis may be different.
The critical question is therefore not:
"Where does the defendant live today?"
It may be:
"Where was the defendant domiciled on the legally relevant date?"
That date should be identified before counsel begins collecting evidence about domicile.
State-Court Filing Followed by Removal Requires Additional Care
Removal adds another timing issue.
Under 28 U.S.C. § 1441, certain actions filed in state court may be removed to federal court when federal subject-matter jurisdiction exists.
When removal is based upon diversity, counsel must examine the citizenship of the parties under the applicable jurisdictional rules and the circumstances existing at the legally relevant time.
A lawyer should not assume that a defendant can create removability simply by changing domicile after the state action has already begun.
Post-filing events generally do not permit a party to manufacture diversity that did not exist when required.
Complete Diversity
Ordinary federal diversity jurisdiction under 28 U.S.C. § 1332 generally requires complete diversity.
No plaintiff may share state citizenship with any defendant.
Suppose:
• Plaintiff A is a Maryland citizen.
• Plaintiff B is a Virginia citizen.
• Defendant C is a Pennsylvania citizen.
• Defendant D is a Maryland citizen.
Complete diversity is absent because Plaintiff A and Defendant D are both Maryland citizens.
The fact that the other parties are citizens of different states does not cure the problem.
This differs from specialized jurisdictional statutes—such as federal statutory interpleader—which may use minimal rather than complete diversity.
The Amount in Controversy Also Matters
Different citizenship alone does not establish ordinary diversity jurisdiction.
Under 28 U.S.C. § 1332, the amount in controversy generally must exceed $75,000, exclusive of interest and costs.
Citizenship and amount in controversy are separate jurisdictional requirements.
A case involving a Maryland citizen and Virginia citizen does not automatically belong in federal court merely because the parties are diverse.
The Forum-Defendant Rule
Even when complete diversity exists, removal presents another trap.
Under 28 U.S.C. § 1441(b)(2), an otherwise removable diversity action generally may not be removed if any properly joined and served defendant is a citizen of the state in which the action was filed.
This is commonly called the forum-defendant rule.
Suppose a Virginia plaintiff files a diversity action in Maryland state court against a Maryland defendant.
The parties are diverse.
But the Maryland defendant ordinarily cannot remove the action based solely upon diversity if the requirements of the forum-defendant rule are satisfied.
Thus:
Diversity jurisdiction and removability are related but distinct questions.
A federal court might have original diversity jurisdiction over a case that nevertheless cannot be removed by a particular defendant under § 1441(b)(2).
Snap Removal
The phrase "properly joined and served" in the forum-defendant rule has generated litigation concerning so-called snap removal.
A non-forum defendant—or sometimes a forum defendant depending upon the jurisdiction's interpretation—may attempt to remove a diversity case before the forum defendant has been served.
This is a highly procedural area in which timing can matter dramatically.
Counsel contemplating or opposing removal should review current Fourth Circuit and District of Maryland authority rather than assume that the mere presence of an unserved forum defendant necessarily prevents removal.
Electronic docket monitoring can make the period between filing and service consequential.
Removal Has Its Own Deadline
Citizenship is only part of the removal analysis.
Under 28 U.S.C. § 1446, removal generally must occur within the prescribed statutory period after receipt or service of the pleading or other qualifying paper that triggers removability.
If the case was not initially removable but later becomes removable, separate statutory provisions govern the later removal window.
Diversity cases also have a statutory one-year limitation on certain later removals, subject to the statutory bad-faith exception.
A defendant therefore may possess a theoretically removable case and still lose the opportunity by waiting too long.
Corporations Are Different
A corporation's citizenship is governed by statute.
Under 28 U.S.C. § 1332(c)(1), a corporation generally is deemed a citizen of:
• every state in which it has been incorporated; and
• the state where it has its principal place of business.
The Supreme Court addressed the meaning of "principal place of business" in Hertz Corp. v. Friend, 559 U.S. 77 (2010).
The Court adopted the familiar nerve center approach, generally looking to the place where the corporation's high-level officers direct, control, and coordinate the corporation's activities.
For many corporations, that will be corporate headquarters.
But labels do not necessarily control over operational reality.
LLCs Are Not Corporations
One of the most common diversity-jurisdiction mistakes involves limited liability companies.
An LLC ordinarily does not take citizenship merely from:
• the state where it was organized;
• the location of its headquarters;
• its principal office; or
• the state identified in its public registration.
For diversity purposes, an LLC generally possesses the citizenship of each of its members.
If an LLC has five members, counsel must determine the citizenship of all five.
If one member is itself an LLC or partnership, the inquiry continues through that entity's ownership.
The process can become surprisingly complicated.
Follow the Ownership Chain
Suppose a defendant LLC has two members.
One member is an individual domiciled in Virginia.
The other member is another LLC.
That second LLC has three members, one of whom is a partnership.
The inquiry does not stop at the first layer.
Counsel may have to trace citizenship through every layer until the citizenship of the relevant individuals or corporations is established.
A pleading stating merely that:
"ABC, LLC is a Delaware limited liability company with its principal office in Virginia"
may tell the court almost nothing necessary to establish the LLC's citizenship for diversity purposes.
Partnerships
Partnerships and many other unincorporated associations generally take the citizenship of their partners or members rather than being treated like corporations.
Again, ownership structure matters.
Counsel should identify the legal form of every business party before assuming how citizenship is determined.
Trusts Can Be Complicated
Trust citizenship can present additional difficulties because the answer may depend upon the nature of the trust and the particular jurisdictional context.
Questions may involve trustees, beneficiaries, the entity status of the trust, and the capacity in which suit is brought.
Trusts should therefore not casually be treated as corporations, LLCs, or individuals.
When diversity jurisdiction depends upon a trust's citizenship, the trust instrument and governing federal authority should be examined carefully.
Estates and Legal Representatives
Federal law contains specific citizenship rules for legal representatives.
Under 28 U.S.C. § 1332(c)(2), the legal representative of a decedent's estate is generally deemed to be a citizen only of the same state as the decedent.
Similarly, the legal representative of an infant or incompetent person generally is deemed a citizen of the same state as the infant or incompetent person.
This prevents diversity from being manufactured simply by selecting a representative from another state.
A Defendant's Address Is Evidence, Not the Answer
The address appearing on a police report is useful.
So is the address on a driver's license.
Neither necessarily establishes domicile conclusively.
This becomes particularly important in motor-vehicle litigation.
The address on the accident report may be stale. A defendant may have moved shortly before the collision or shortly afterward. The driver's license may not have been updated. The vehicle may be registered at a relative's home. The defendant may be a student, military member, temporary worker, or person maintaining residences in several states.
If citizenship matters, investigate it.
Do not simply copy the police-report address into the complaint and assume the jurisdictional question has been answered.
Military Personnel
Military service can make domicile particularly difficult to determine.
A service member may be physically stationed in Maryland for years without intending to make Maryland a permanent home.
Military orders explain physical presence but do not necessarily establish domicile.
Evidence concerning the service member's home of record, voter registration, driver's license, tax treatment, property ownership, family residence, declarations of intent, and other objective conduct may therefore become significant.
College Students
Students present a similar problem.
A student may live in Maryland for four years while attending college but remain domiciled in another state.
Or the student may genuinely abandon the former domicile and establish Maryland as the new one.
Student status alone does not answer the question.
Again, physical presence and intent must be considered together.
Prisoners and Institutionalized Persons
Physical presence resulting from incarceration or institutional placement does not necessarily establish a new domicile.
The circumstances surrounding the person's presence and the person's preexisting domicile and intent must be examined under the applicable law.
The general lesson remains the same:
Where someone happens to be physically located is not always where that person is legally domiciled.
Discovery Concerning Citizenship
When jurisdiction genuinely depends upon disputed domicile, targeted discovery may be appropriate.
Useful material may include:
• driver's-license records;
• voter-registration records;
• property records;
• leases;
• utility bills;
• tax returns or appropriately limited tax information;
• vehicle registrations;
• employment records;
• insurance applications;
• school records;
• bank-address records;
• professional licenses;
• change-of-address documentation; and
• testimony concerning the circumstances and intent surrounding a move.
Discovery should focus on the legally relevant date.
A defendant's present circumstances may have limited value if citizenship must be determined as of an earlier filing date.
Social Media and Electronic Evidence
Modern domicile disputes can also produce revealing electronic evidence.
A person claiming to have permanently moved to another state may have posted:
"Finally moving home to Maryland next month."
A LinkedIn profile may identify a permanent employment location.
Real-estate listings may establish when a home was placed for sale.
Electronic utility records may show when service began or ended.
Location history, where properly discoverable and proportionate, may provide evidence of actual physical presence.
None of these facts necessarily controls, but collectively they can test a litigant's stated intent.
Jurisdictional Discovery
When the available information is insufficient to determine citizenship, a federal court may permit limited jurisdictional discovery before deciding a motion to dismiss or remand.
That can be particularly important with LLCs whose ownership is not publicly transparent or with individuals whose domicile is genuinely disputed.
Counsel should identify the missing jurisdictional facts specifically rather than request broad merits discovery under the label of jurisdiction.
Challenging Federal Jurisdiction
Federal courts are courts of limited jurisdiction.
Subject-matter jurisdiction cannot simply be created by agreement of the parties.
If diversity is absent, the parties ordinarily cannot stipulate that it exists because both would prefer a federal forum.
Likewise, a party's failure to appreciate a citizenship problem does not necessarily cure it.
Questions concerning subject-matter jurisdiction can arise well after the litigation begins, making careful investigation at the outset especially important.
Residence for Maryland Venue Is a Different Question
Federal diversity citizenship should not be confused with Maryland venue rules.
Maryland venue is governed principally by Courts and Judicial Proceedings Article §§ 6-201 and 6-202 and related provisions.
Those statutes determine where an action may be brought within Maryland and use concepts and statutory criteria appropriate to state venue.
The fact that a defendant is a Maryland citizen for federal diversity purposes does not by itself answer which Maryland county is the proper venue.
Similarly, a venue statute's use of residence does not automatically import federal diversity's domicile analysis.
Always identify the legal question before deciding which definition of "residence" matters.
Personal Jurisdiction Is Yet Another Question
Citizenship, venue, and personal jurisdiction are related only in the broad sense that all concern where litigation may proceed.
They are distinct doctrines.
A defendant can be domiciled outside Maryland yet subject to personal jurisdiction in Maryland because of conduct connected to the State.
For example, an out-of-state driver who causes an automobile collision in Maryland may be subject to Maryland jurisdiction even though the driver has never been domiciled here.
Do not substitute citizenship analysis for minimum-contacts or statutory personal-jurisdiction analysis.
The Date Question Should Come First
When a residency or citizenship dispute appears, the first question should not be:
Where does this person live?
Ask:
Why does the person's location matter, and what date does the governing law use?
Only then should counsel investigate the facts.
Otherwise, substantial effort may be spent proving where a defendant lives today when the legally decisive issue is where that defendant was domiciled months or years earlier.
Practical Example
A Maryland plaintiff is injured in an automobile collision.
The police report lists the defendant at a Maryland address.
Six months later, the plaintiff files suit. The defendant now claims Virginia citizenship and removes the case to federal court.
Do not stop at the defendant's current Virginia address.
Determine:
• when the defendant physically left Maryland;
• when the Virginia residence was obtained;
• whether the Maryland residence was retained;
• where the defendant's family lived;
• when licenses and registrations changed;
• where the defendant was registered to vote;
• where the defendant paid taxes;
• where the defendant worked;
• what objective evidence demonstrates intent; and, most importantly,
• where the defendant was domiciled on the legally controlling date.
If the defendant did not establish Virginia domicile until after the relevant date, the later move ordinarily cannot manufacture diversity jurisdiction retroactively.
The calendar may therefore be as important as the map.
Related Maryland Cases and Authorities
• 28 U.S.C. § 1332 — Federal diversity jurisdiction; addresses citizenship and the amount-in-controversy requirement and contains special citizenship provisions for corporations and legal representatives.
• 28 U.S.C. § 1441 — Governs removal generally and includes the forum-defendant rule applicable to diversity removals.
• 28 U.S.C. § 1446 — Establishes removal procedure and important timing requirements.
• 28 U.S.C. § 1447 — Governs procedure following removal, including remand.
• Grupo Dataflux v. Atlas Global Group, L.P., 541 U.S. 567 (2004) — reaffirms the time-of-filing rule for determining diversity citizenship.
• Hertz Corp. v. Friend, 559 U.S. 77 (2010) — adopts the "nerve center" test for determining a corporation's principal place of business.
• Carden v. Arkoma Associates, 494 U.S. 185 (1990) — explains the citizenship treatment of unincorporated associations for diversity purposes.
• Central West Virginia Energy Co. v. Mountain State Carbon, LLC, 636 F.3d 101 (4th Cir. 2011) — discusses domicile and citizenship principles within the Fourth Circuit.
• Md. Code, Cts. & Jud. Proc. §§ 6-201 and 6-202 — Maryland's principal general and additional venue provisions; state venue should be analyzed separately from federal diversity citizenship.