Filed: Aug. 20, 2020
Latest Update: Sep. 22, 2020
Summary: PUBLISHED UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT No. 19-1341 NAVY FEDERAL CREDIT UNION, Plaintiff – Appellant, v. LTD FINANCIAL SERVICES, LP; ADVANTAGE ASSETS II, INC.; DEBT MANAGEMENT PARTNERS, LLC; JOHN DOES #1 - #3; BAYVIEW SOLUTIONS LLC, Defendants – Appellees. - CREDIT UNION NATIONAL ASSOCIATION; NATIONAL ASSOCIATION OF FEDERALLY-INSURED CREDIT UNIONS, Amici Supporting Appellant. Appeal from United States District Court for the Eastern District of Virginia, at Alexandria. Ant
Summary: PUBLISHED UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT No. 19-1341 NAVY FEDERAL CREDIT UNION, Plaintiff – Appellant, v. LTD FINANCIAL SERVICES, LP; ADVANTAGE ASSETS II, INC.; DEBT MANAGEMENT PARTNERS, LLC; JOHN DOES #1 - #3; BAYVIEW SOLUTIONS LLC, Defendants – Appellees. - CREDIT UNION NATIONAL ASSOCIATION; NATIONAL ASSOCIATION OF FEDERALLY-INSURED CREDIT UNIONS, Amici Supporting Appellant. Appeal from United States District Court for the Eastern District of Virginia, at Alexandria. Anth..
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PUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 19-1341
NAVY FEDERAL CREDIT UNION,
Plaintiff – Appellant,
v.
LTD FINANCIAL SERVICES, LP; ADVANTAGE ASSETS II, INC.; DEBT
MANAGEMENT PARTNERS, LLC; JOHN DOES #1 - #3; BAYVIEW
SOLUTIONS LLC,
Defendants – Appellees.
------------------------------
CREDIT UNION NATIONAL ASSOCIATION; NATIONAL ASSOCIATION OF
FEDERALLY-INSURED CREDIT UNIONS,
Amici Supporting Appellant.
Appeal from United States District Court for the Eastern District of Virginia, at Alexandria.
Anthony J. Trenga, District Judge. (1:18-cv-01424-AJT-TCB)
Argued: April 7, 2020 Decided: August 20, 2020
Before WILKINSON and RICHARDSON, Circuit Judges, and Thomas E. JOHNSTON,
Chief United States District Judge for the Southern District of West Virginia, sitting by
designation.
Reversed by published opinion. Judge Richardson wrote the opinion, in which Judge
Wilkinson and Judge Johnston join.
ARGUED: Michael Julian Gottlieb, WILLKIE, FARR & GALLAGHER LLP,
Washington, D.C., for Appellant. Virginia Whitner Hoptman, REDMOND, PEYTON &
BRASWELL, Alexandria, Virginia; David E. Gutowski, ZDARSKY SAWICKI &
AGOSTINELLI, Buffalo, New York, for Appellees. ON BRIEF: Joshua Riley, Jon R.
Knight, BOIES SCHILLER FLEXNER LLP, Washington, D.C., for Appellant. James S.
Kurz, REDMOND, PEYTON & BRASWELL, Alexandria, Virginia; J. William
Eshelman, III, Bradford G. Hughes, CLARK HILL PLC, Washington, D.C., for Appellees.
Michael H. Pryor, Washington, D.C., Christine A. Samsel, Nicholas R. Santucci,
BROWNSTEIN HYATT FARBER SCHRECK, LLP, Denver, Colorado, for Amicus
Credit Union National Association. William M. Jay, Andrew Kim, GOODWIN
PROCTER LLP, Washington, D.C., for Amicus National Association of Federally-Insured
Credit Unions.
2
RICHARDSON, Circuit Judge:
This appeal centers on the meaning of a seemingly simple, three-letter word
connecting two clauses: and. For establishing diversity jurisdiction, Congress provides
that a corporation “shall be deemed a citizen of every State and foreign state by which it
has been incorporated and of the State or foreign state where it has its principal place of
business.” 28 U.S.C. § 1332(c)(1) (emphasis added). We regularly apply this subsection
to your bread-and-butter, state-chartered corporations. But federally chartered
corporations (not incorporated in a State or foreign state) do not “fit comfortably” under
the first clause. Wachovia Bank v. Schmidt, 546 U.S. 303, 306 (2006). What of the second?
According to defendants and the district court, a federal corporation is not a citizen
of the place where it has its principal place of business under § 1332(c)(1). In their view,
the use of the word and between the clauses means that § 1332(c)(1) applies only to those
corporations that satisfy both: those chartered by a “State or foreign state,” not by the
federal government. Plaintiff Navy Federal Credit Union, a federally chartered credit
union, disagrees. Acknowledging the first clause of § 1332(c)(1) does not grant state
citizenship to a federal corporation, Navy Federal argues the second clause deems it a
citizen of Virginia.
In our view, § 1332(c)(1)’s text, structure, and context show that Navy Federal is
correct. The plain meaning of and in context here is ‘in addition to,’ and when we add
something to nothing, something remains. Section 1332(c)(1) thus requires us to interpret
and to give effect to the second clause even when the first clause does not specify a
citizenship. Moreover, the district court’s and defendants’ understanding of and conflicts
3
with circuit precedent. See Athena Automotive, Inc. v. DiGregorio, 166 F.3d 288, 290 (4th
Cir. 1999). Finally, this approach to § 1332(c)(1) is supported by the Supreme Court’s
holding in Bankers Trust Co. v. Texas & Pacific Railway Co.,
241 U.S. 295 (1916). There,
the Court asked whether the common law, the constitution, or the legislature spoke to the
issue of corporate citizenship. But with no existing constitutional or legislative provision
on point, the Court found a federal corporation not diverse under then-existing federal-
common-law rules.
Id. at 309−10. Congress has since plainly provided a general rule for
corporate citizenship, and that text grants a federal corporation the citizenship of its
principal place of business. For these reasons, we find Navy Federal to be a citizen of
Virginia, and we reverse.
I. Background
This case arises from a contract dispute. In April 2012, Plaintiff Navy Federal
Credit Union sold a portfolio of debt instruments to defendant Advantage Assets II.
Advantage then turned around and resold those assets to its codefendants. This resale
ostensibly violated Advantage’s asset-purchase agreement with Navy Federal. Adding
insult to breach, the codefendants supposedly employed unscrupulous debt-collection
practices that defamed the credit union, interfered with its business, and injured its
members.
So Navy Federal filed this lawsuit in federal district court, asserting only state-law
claims and invoking diversity jurisdiction. The substance of Navy Federal’s claims is not
at issue today. Rather, this appeal concerns the federal courts’ jurisdiction over the
controversy in the first place. Defendants’ citizenship—Delaware, Florida, New York, and
4
Texas—is uncontested. And Navy Federal is seeking damages above the jurisdictional
minimum. See § 1332(a). The primary issue here is whether Navy Federal, as a federally
chartered credit union, is a citizen of any state.
A. Navy Federal Credit Union
Navy Federal Credit Union is a federally chartered, not-for-profit credit union. On
July 17, 1947, the Bureau of Federal Credit Unions issued a certificate of incorporation to
the “Navy Department Employees Federal Credit Union” under the Federal Credit Union
Act of 1934. At the time of its incorporation, the credit union limited its membership to
“military personnel [and employees] of the Navy Department in Washington, D.C. and
adjoining counties of Maryland and Virginia,” as well as employees of the credit union and
their families. J.A. 100. And at first, the credit union ran its operations from Washington,
D.C.
Over the next seventy years, the credit union experienced explosive growth. Navy
Federal now has over eight-million members in thirty states, the District of Columbia, two
U.S. territories, and twelve foreign countries. All “[m]ilitary and civilian personnel
regularly employed by the Department of Defense[, Coast Guard, or National Guard] . . .
at any Government installation, facility, or unit, afloat or ashore” may join the credit union
today. J.A. 104. Additionally, several idiosyncratic constituencies scattered across the
5
country have since become eligible for membership. 1 As of December 2017, Navy Federal
had accumulated over $63 billion in shares and member deposits.
Completing the transformation, the “Navy Department Employees Federal Credit
Union” eventually shortened its name to “Navy Federal” and moved its corporate
headquarters to Vienna, Virginia (nearby the Pentagon). This Vienna complex is home to
20 out of 21 executives serving on the Credit Union’s management committee. It is where
Navy Federal’s directors and officers meet and where all of its operations (except customer
service) are managed. Most of the credit union’s branches and members are located outside
of Virginia, and a plurality of its employees now live and work in Florida.
B. Proceedings below
After Navy Federal initiated this suit in federal court, one defendant, Debt
Management Partners, moved to dismiss it for lack of subject-matter jurisdiction. See Fed.
R. Civ. P. 12(b)(1). It argued that Navy Federal is not diverse under § 1332, so the district
court lacked federal-diversity jurisdiction. And with no other grounds for federal
jurisdiction, the case must be dismissed. See generally Northern Virginia Foot & Ankle
Assocs., LLC v. Pentagon Federal Credit Union, No. 10-cv-1640-RWT, 2011 WL 280983
(D. Md. Jan. 26, 2011).
1
See, e.g., J.A. 104–121 (Voting members of Elsinore Women’s Club in Lake
Elsinore, California; Employees of Inspire Kitchen and Bath in National City, California;
employees of the United States Congress who work in San Diego County, California;
Members of Serra High Football Boosters in San Diego, California; Employees of Jenks
Holdings in Las Vegas, Nevada; and Employees of Share Computing in San Diego,
California).
6
The district court agreed. See Navy Federal Credit Union v. LTD Financial
Services, LP, 368 F. Supp. 3d 889, 900 (E.D. Va. 2019). First, the court reasoned that
federal credit unions are, in fact, corporations under the plain language of the Federal Credit
Union Act (“FCUA”). See
id. at 894.
But the court found that § 1332(c)(1), in which
Congress provides for the citizenship of corporations, does not apply to federal
corporations. The district court reasoned that § 1332(c)(1) “states that a corporation is a
citizen of the state in which it was incorporated and in which it has its principal place of
business[, so] [t]he use of the word ‘and’ between the clauses . . . suggests that the provision
contemplates only those corporations that have both, i.e., those chartered under state law.”
Id. And since Navy Federal was chartered under federal law, the district court held that
§ 1332(c)(1) does not apply, meaning Navy Federal was not diverse. See
id. at 898. 2
Thus
the court dismissed the case for lack of subject-matter jurisdiction.
Navy Federal timely appealed, and we have jurisdiction. See 28 U.S.C. § 1291. 3
2
The district court also considered, and rejected, the so-called “localization
exception.” Navy Federal Credit Union, 368 F. Supp. 3d at 898–900 (discussing
Feuchtwanger Corp. v. Lake Hiawatha Fed. Credit Union,
272 F.2d 453 (3d Cir. 1959)).
Since we find Navy Federal to be diverse under § 1332, we decline to pass on the validity
of this supposed exception.
3
The question on appeal is whether § 1332(c)(1) applies at all. Defendants do not
contest that if § 1332(c)(1) provides that Navy Federal is a citizen of its principal place of
business, then that place would be Virginia. See, e.g., J.A. 25; see also Dist Ct. Dkt. 149
at 9, 10, 19; Navy Fed. Credit Union, 368 F. Supp. 3d at 891.
7
II. Discussion
We review de novo the district court’s determination that it lacked subject-matter
jurisdiction for lack of diversity. Elliott v. American States Insurance Co., 883 F.3d 384,
394 (4th Cir. 2018).
The judicial Power of the inferior federal courts extends only as far as Article III
permits and Congress chooses to confer. See U.S. Const. Art. III, § 1, cl. 2; Sheldon v. Sill,
49 U.S. 441, 448–49 (1850); cf. Martin v. Hunter’s Lessee,
14 U.S. 304, 328–31 (1816).
Among the several constitutional bases for jurisdiction, Article III § 2 permits courts to
decide “Controversies . . . between Citizens of different States.” Christened “diversity
jurisdiction,” this constitutional font allows for the judicial Power to flow where the
citizenship of any plaintiff differs from that of any defendant. See State Farm Fire &
Casualty Co. v. Tashire,
386 U.S. 523, 531 (1967). This we call “‘minimal diversity.’”
Id.
at 530.
But Congress (so far) has declined to extend federal-diversity jurisdiction to this
constitutional limit. As relevant here, § 1332(a) allows us to exercise diversity jurisdiction
when two requirements are satisfied. First, the “matter in controversy” must “exceed[] the
sum or value of $75,000.” § 1332(a). And second, the controversy must arise between
“citizens of different States.” § 1332(a)(1); see also § 1332(a)(2)–(4) (governing suits that
involve citizens of foreign states).
This appeal involves the latter requirement of § 1332(a). Unlike the constitutionally
permitted “minimal diversity” jurisdiction, diversity must be “complete” to satisfy this
Congressional grant. See Strawbridge v. Curtiss, 7 U.S. 267 (1806). This means that no
8
plaintiff may share a citizenship with any defendant. See id. Moreover, to be “citizens of
different States” (or a foreign state), all parties must have a state (or foreign) citizenship in
the first place. See § 1332(a)(2)–(3) (emphasis added). 4 And so “stateless” individuals
(or corporations) may destroy diversity jurisdiction. See, e.g., Newman-Green, Inc. v.
Alfonzo-Larrain,
490 U.S. 826, 829 (1989). Because of this “complete diversity” rule, a
federal court must determine and compare the citizenship(s) of all plaintiffs and all
defendants before exercising diversity jurisdiction under § 1332(a).
Of course, this only dodges the question of how a court is to determine the
citizenship of the parties before it—particularly when one of those parties is an artificial
entity. At common law, this question was a difficult one, and it has a long, conflicted, and
contentious history. See Hertz Corp. v. Friend, 559 U.S. 77, 84–88 (2010). But ultimately,
“how such citizenship is to be determined, and what if any related rules ought to apply, are
decisions . . . suited to the legislat[ure].” United Steelworkers of America, AFL-CIO v. R.
H. Bouligny, Inc.,
382 U.S. 145, 153 (1965).
Congress has decided. Section 1332(c)(1) specifies the rules governing the
citizenship of corporations. It provides:
“[A] corporation shall be deemed to be a citizen of every State and foreign
state by which it has been incorporated and of the State or foreign state where
it has its principal place of business.”
4
We note that, for assessing diversity jurisdiction, the term “citizenship” diverges
from its meaning in the immigration or passport context. See generally Gilbert v. David,
235 U.S. 561, 569 (1915) (discussing the concept of one’s domicile); 13E Wright & Miller,
Federal Practice and Procedure § 3611, The Requirement and Meaning of Citizenship—In
General (3d ed. 2008). This distinction is not at issue today.
9
§ 1332(c)(1). Here, we ask whether (and later how) this text applies to Navy Federal, a
federally chartered credit union.
Defendants argue that § 1332(c)(1) cannot apply to Navy Federal in three thrusts.
First, they urge that a federal credit union is not a corporation, so different rules apply.
Second, defendants assert that since the first clause of § 1332(c)(1) does not apply to Navy
Federal, the second clause cannot apply. Thus, Navy Federal is stateless, and its stateless
status destroys diversity. Below, the district court based its holding on this second
argument. Third, they argue that the Supreme Court’s decision in Bankers’ Trust Co. v.
Texas & Pacific Railway Co., 241 U.S. 295 (1916)—holding federal corporations are not
diverse without some common law, constitutional, or statutory indication to the contrary—
should control our decision today.
Navy Federal responds in three corresponding parries. According to Navy Federal,
the statute creating federal credit unions classifies them as “corporations,” meaning
§ 1332(c)(1) applies. Next, Navy Federal argues that the plain meaning of the word and
shows that the second clause of § 1332(c)(1) provides a basis for citizenship independent
of the first clause. Last, Navy Federal accepts the Bankers’ Trust precedent and argues
that—consistent with the Supreme Court’s instructions—we must give effect to Congress’s
since-provided rule in § 1332(c)(1) for conferring state citizenship on corporations.
We consider each engagement and find that Navy Federal wins the bout: Navy
Federal is a citizen of its principal place of business, Virginia.
10
A. Navy Federal is a corporation
We first consider whether Navy Federal is a “corporation.” Section 1332(c)(1)
governs the citizenship of only “true-blue ‘corporations.’” Hawkins v. i-TV Digitalis
Tavkozlesi zrt., 935 F.3d 211, 223 (4th Cir. 2019); see § 1332(c)(1) (“a corporation shall
be deemed . . .”) (emphasis added). If an unincorporated association, as defendants claim,
then different rules would apply to Navy Federal: An unincorporated association is imbued
with the citizenship of all its members. See, e.g., Americold Realty Trust v. Conagra
Foods, Inc.,
136 S. Ct. 1012, 1015 (2016); Chapman v. Barney,
129 U.S. 677, 682 (1889).
And because Navy Federal’s members include citizens of Florida, Texas, Delaware, and
New York—where defendants are also citizens—applying the unincorporated association
rule here would defeat complete diversity and thus deprive the federal courts of
jurisdiction.
To determine whether an entity is a “corporation” we look to the statute of its
formation to see if it is designated as such. See Carden v. Arkoma Associates, 494 U.S.
185, 189–90 (1990);
Hawkins, 935 F.3d at 223. 5 And so the district court began its analysis
quite properly, by looking to the plain text of the FCUA, 12 U.S.C. § 1751 et seq. The
FCUA specifies that, upon approval, a federal credit union “shall be a body corporate.”
Id.
5
Only in special circumstances—such as when a foreign corporation lacks a clear
domestic analogue—may we look to the structure of an entity to determine whether it
classifies as a corporation. See People of Puerto Rico v. Russell & Co., Sucesores S. En.
C.,
288 U.S. 476, 479−80 (1933) (analyzing a sociedad en comandita (a Puerto Rican
business entity that has some features of a corporation)); see also
Hawkins, 935 F.3d at
224–25 (discussing BouMatic, LLC v. Idento Operations, BV,
759 F.3d 790, 791 (7th Cir.
2014)). Defendants do not assert that special circumstances exist here.
11
§ 1754; accord 12 C.F.R. Part 701, App. A (an approved federal credit union is a
“corporation chartered under the laws of the United States”); Corporation, 3 Oxford
English Dictionary 956 (2d ed. 1989) (“A body corporate legally authorized to act as a
single individual”) (emphasis added). And upon becoming a “body corporate,” a federal
credit union is “vested with all of the powers and charged with all the liabilities conferred
. . . by [the FCUA] upon corporations organized hereunder.” 12 U.S.C. § 1754 (emphasis
added). Thus the FCUA explicitly states that federally chartered credit unions are, in fact,
corporations. Context clues confirm this understanding: A credit union’s powers and
governance structure must be set forth in an “organization certificate,” which serves as “the
charter of the corporation.” Id. (emphasis added). Congress has classified federal credit
unions as “corporations,” not unincorporated associations.
Defendants instead highlight other provisions of the FCUA that use the term
“association.” See, e.g., id. § 1752 (“the term ‘Federal credit union’ means a cooperative
association organized in accordance with the provisions of this chapter”). 6 Supposedly,
the use of the word “association” shows that federal credit unions are unincorporated. This
argument suffers from two flaws.
6
Defendants also look for support in First Nat’l Bank & Tr. Co. v. Nat’l Credit
Union Admin., 90 F.3d 525 (D.C. Cir. 1996), aff’d,
522 U.S. 479 (1998). The question in
that case was “whether the members of an occupational [Federal Credit Union] must all
share a single ‘common bond of occupation,’” or whether membership may be drawn from
unrelated groups.
Id. at 526. In using the word “association,” the D.C. Circuit simply
described the common bond requirement—and nowhere did it discuss or suggest whether
a federal credit union is a corporation.
12
First, defendants miss the point—the relevant line is between incorporated and
unincorporated entities, not “associations” and “corporations.” See Hawkins, 935 F.3d at
222 (“Different rules apply for corporations and unincorporated associations.”) (emphasis
added). An “association” merely signifies a group of persons, not how that group is
organized. See “The Dictionary Act,” 1 U.S.C. § 5 (The word “association” may be used
“in reference to a corporation.”); Association, 1 Oxford English Dictionary 718 (“A body
of persons who have combined to execute a common purpose or advance a common cause;
the whole organization which they form to effect their purpose.”). For instance, the Home
Owners’ Loan Act classifies “Federal savings associations” as corporations—despite the
use of the word “association” in their name, see 12 U.S.C. § 1464(a)(1)–(2), (d)(5). Thus
the mere use of the term “association” in the FCUA—without more—does not at all
suggest that Congress intended for federal credit unions to be unincorporated entities.
Second, even if association could generally be read to imply an unincorporated
entity, defendants ignore the context in which the word “association” is used. See, e.g.,
Taniguchi v. Kan Pacific Saipan, Ltd., 566 U.S. 560, 569–70 (2012) (defining the word
“interpreter” based on its statutory context). The FCUA uses the term “association” to
describe the characteristics of those groups eligible to incorporate as a federal credit union.
See 12 U.S.C. § 1759(b)(1)−(2) (A federal credit union “shall be limited to . . . group[s]
having a common bond of occupation or association.”); National Credit Union
Administration v. First National Bank & Trust Co.,
522 U.S. 479, 484 (1998) (discussing
the common bond requirement); cf. 8 Del. Code § 101 (“Any person, partnership,
association or corporation . . . may incorporate.”) (emphasis added). Section 1753 requires
13
an “association” of “seven or more natural persons” as a prerequisite to form a credit union.
So an individual alone cannot incorporate, he must be part of a group or association. And
that gang of (at least) seven must then specify “the name of [their] association” in an
“organization certificate” that serves as an application to form their credit union. Id. Once
the National Credit Union Administration Board determines “whether the organization
certificate conforms to the provisions of this chapter” (among other factors), the Board
approves the association’s organization certificate, and that certificate becomes “the charter
of the corporation.”
Id. § 1754 (emphasis added). Thus, we find the structure of the
FCUA—requiring association as a prerequisite to incorporation—consistent with its plain
classification of an approved credit union as “a body corporate.”
Id. 7
For these reasons, we hold that a federal credit union is a “corporation” and so turn
to the application of § 1332(c)(1) to federal credit unions.
7
Other courts have suggested that the word corporation in § 1332(c)(1) is at issue
for a separate reason. In Beaman v. Mountain Am. Fed. Credit Union, No. 19-cv-00053-
HCN, ---- F. Supp. 3d ----, 2020 WL 2085266, at *5 (D. Utah Apr. 30, 2020), the district
court reasoned that corporation is implicitly limited to entities incorporated by a State or
foreign state. We see no basis for reading this limitation into corporation. In fact, we think
this reading of § 1332(c)(1) puts the cart before the horse. “State” and “foreign state,”
following the preposition “of,” modify the object “citizen,” and thus specify the types of
citizenships that § 1332(c)(1) confers on “corporations.” They do not impose an ex-ante
limitation upon the kinds of corporations to which citizenship may be conferred.
14
B. Navy Federal is a citizen of the state of its principal place of business
1. Text, structure, and precedent support Navy Federal
“As in all statutory construction cases,” we start with the plain text of the provision.
Marx v. General Revenue Corp., 568 U.S. 371, 376 (2013). Section 1332(c)(1) states:
“[A] corporation shall be deemed to be a citizen of every State and foreign state by which
it has been incorporated and of the State or foreign state where it has its principal place of
business.” By its own terms, § 1332(c)(1) offers two grounds for corporate citizenship—
a corporation is (1) a citizen “of every State and foreign state by which it has been
incorporated” and (2) a citizen “of the State or foreign state where it has its principal place
of business.” § 1332(c)(1). 8 And the use of the mandatory “shall” requires us to deem a
corporation a citizen on the specified grounds where possible. Holland v. Pardee Coal
Co.,
269 F.3d 424, 431 (4th Cir. 2001). The first clause cannot grant Navy Federal a State
citizenship as it is federally incorporated, but the second confers Navy Federal with the
citizenship of Virginia, its principal place of business. We see no problem with this
straightforward interpretation.
‘Not so fast,’ defendants protest. Supposedly, an interpretive problem arises from
the word that connects the two clauses: and. According to defendants, and means “along
8
The parties refer to the relevant language of § 1332(c)(1) as “clauses”—as did the
district court and as have commentators. See, e.g., Navy Federal Credit Union, 368 F.
Supp. 3d at 894; Marc Miller, Diversity Jurisdiction Over Alien Corporations, 50 CHI. L.
REV. 1458, 1467 (1983). But the most accurate grammatical description for each of these
sets of words we think to be more nuanced. See Chicago Manual of Style § 5.176 (17th
ed. 2017). Yet, for the sake of consistency and simplicity—and because nothing here turns
on the characterization—we adopt the terminology advanced by the parties.
15
with.” And in this conjunctive sense, it means two items to be “taken jointly.” Appellees
Br. 13; see also J.A. 332. In defendants’ view, this creates a problem. If applying the state-
of-incorporation clause yields a null set, there is nothing for the principal-place-of-business
clause to go “along with.” So it just cannot be applied. Navy Federal counters that and
simply signifies “‘in addition to.’” Appellant Br. 12. And there is no problem with adding
to a null set: zero plus one is one. This dispute requires us to bring our normal tools of
statutory construction to bear on this simple conjunction.
We first look to the “‘ordinary or natural meaning’” of a term in dispute—a
“cardinal principle of statutory construction.” United States v. Mills, 485 F.3d 219, 222
(4th Cir. 2007) (quoting FDIC v. Meyer,
510 U.S. 471, 476 (1994)). Although the ordinary
meaning of a word normally aligns with its dictionary definition, see Blakely v. Wards,
738
F.3d 607, 611 (4th Cir. 2013) (en banc), this general rule offers less guidance when applied
to a word like and. And is an “elemental word[] in the English language” used to “combine
items.” Antonin Scalia and Bryan A. Garner, Reading Law: The Interpretation of Legal
Texts 116 (2012); see also Bob Dorough, Conjunction Junction in Schoolhouse Rock!
(1973). But and alone tells us little of how two items are to be combined.
Dictionaries do little to resolve the dispute. In fact, the parties here both find support
in the very same definition. See And, 1 Oxford English Dictionary 449 (“Introducing a
word, phrase, clause, or sentence, which is to be taken side by side with, along with, or in
addition to, that which precedes it.”) (emphasis added). Accordingly, we think and—as a
word with “many dictionary definitions” (the Oxford dictionary alone lists over thirty, see
1 Oxford English Dictionary 449–50)—“must draw its meaning from its context.”
16
Ardestani v. I.N.S., 502 U.S. 129, 135 (1991); see also Kenneth A. Adams & Alan S. Kaye,
Revisiting the Ambiguity of “And” and “Or” in Legal Drafting, 80 ST. JOHN’S L. REV.
1167, 1172 (“[W]hether and is ambiguous, and in what way, depends entirely on the
grammatical context.”). The Supreme Court labels words of this nature “chameleons”—
that is, the color of their surroundings determines their character. See Kucana v. Holder,
558 U.S. 233, 245 (2010) (discussing the word under); see also Shaw v. National Union
Fire Insurance Co.,
605 F.3d 1250, 1253 (11th Cir. 2010) (discussing and); Peacock v.
Lubbock Compress Co.,
252 F.2d 892, 893 (5th Cir. 1958) (same). Thus, the parties’
“diverse renderings of [and], standing alone, do not equip us to resolve this case,”
Kucana,
558 U.S. at 245, so we home in on “the specific context in which [and] is used, and the
broader context of the statute as a whole,” Robinson v. Shell Oil Co.,
519 U.S. 337, 341
(1997).
Three structural and contextual features of § 1332(c)(1) confirm Navy Federal’s
interpretation of and. First, we note the structural independence of § 1332(c)(1)’s two
clauses. Each provides a different basis for deeming a corporation a “citizen of” a
jurisdiction. The parallel use of the preposition “of” confirms that both clauses (really,
adjectival phrases) are directed toward the word “citizen,” not one another. See generally
Chicago Manual of Style § 5.176 (17th ed. 2017). So this structural independence suggests
that these clauses operate independently to deem a corporation a citizen of a particular
jurisdiction.
Second, the clauses’ logical independence confirms their structural independence.
Suppose a parent tells his child, “Today, we will go to the park and to the zoo.” It turns
17
out, however, that when the pair arrives at the first destination, the park is closed. Do they
proceed to the still-open zoo? We think it clear they do. That the park was closed has no
bearing on their also-expressed intention to go to the zoo. In this context, Navy Federal’s
interpretation of and carries the day. Consider, on the other hand, the scenario where the
zoo is in the park. Compare Central Park Zoo, NY (in Central Park), with Riverbanks Zoo,
Columbia, SC (near Riverfront Park). Because the park is closed, the intention to visit the
zoo is also defeated. In this circumstance, defendants’ interpretation of and prevails. This
simple example highlights the importance of the logical connection between two items
connected by a conjunction. When the objects connected are independent, they are
generally taken “in addition.” See Reed Dickerson, The Fundamentals of Legal Drafting
§ 6.2, at 105 (2d ed. 1986). When they are dependent, they must be taken “jointly.”
Here, the state-of-incorporation clause and principal-place-of-business clause are
logically independent: the park is closed, but the zoo remains open. It is a central feature
of corporate law that firms may choose where to incorporate, and so select which State,
federal, or foreign corporate law will govern them. See Lucian A. Bebchuck and Alma
Cohen, Firms’ Decisions Where to Incorporate 46 Johns. L. & ECON. 383, 383 (2003) (“A
central feature of the U.S. corporate environment is the presence of regulatory competition
in corporate law.”); see also Note, OCC Allows Fintech Companies to Apply for National
Bank Charters, 132 HARV. L. REV. 1361, 1363–66 (2019) (discussing these considerations
for FinTech companies); cf. Agency for International Development v. Alliance for Open
Society International, Inc.,
140 S. Ct. 2082, 2087 (2020) (“Plaintiffs’ foreign affiliates were
incorporated in other countries and are legally separate from plaintiffs’ American
18
organizations.”). And a corporation’s place of incorporation does not depend on the
location of its headquarters—nor does the place of its headquarters turn on the location of
its incorporation. See, e.g., Model Bus. Corp. Act § 5.01(a) (2016); Yitzhak Hadari, The
Choice of National Law Applicable to the Multinational Enterprise and the Nationality of
Such Enterprises, 1974 DUKE L. J. 1, 10. We see no reason to read and here to create a
conjunctive dependence where none structurally or logically exists.
Third, consider the way that and is used throughout § 1332(c). See Lomax v. Ortiz-
Marquez, 140 S. Ct. 1721, 1725 (2020) (“‘In all but the most unusual situations, a single
use of a statutory phrase must have a fixed meaning’ across a statute.”) (quoting Cochise
Consultancy, Inc. v. United States ex rel. Hunt,
139 S. Ct. 1507, 1512 (2019)). Although
defendants ask us to condition the function of the second clause on the first, § 1332(c)(1)
contains no qualifying language to support such a reading. The first clause itself uses the
word and, providing that a corporation is a citizen “of every State and foreign state” where
incorporated. § 1332(c)(1) (emphasis added). Of course, the use of and here supports only
Navy Federal’s usage. When and means “in addition to,” a corporation may be a citizen
of a domestic state, a foreign state, or both. But if and instead means “taken jointly,” so
that it contemplates only those corporations that have both, then the incorporation clause
would apply only to those entities incorporated in both a State and foreign state.
The latter reading would destroy diversity jurisdiction as we know it: § 1332(c)(1)
would apply only to entities incorporated both domestically and overseas—which, we feel
safe to say, is not most corporations. No court, to our knowledge, has adopted such an
illogical construction of that provision. And this flawed reading becomes particularly stark
19
when we recall that Congress only added the words “and foreign state” in 2011. See
Federal Courts Jurisdiction and Venue Clarification Act of 2011, PL 112-63, 125 Stat 758.
We doubt that this three-word addition can reasonably be read to dramatically curtail most
corporate diversity jurisdiction as we know it. Congress “does not, one might say, hide
elephants in mouseholes.” Whitman v. American Trucking Associations, 531 U.S. 457, 468
(2001).
And is also used in § 1332(c)(1) in reference to insurers—a usage that similarly
supports Navy Federal’s reading. 9 Section 1332 contains three bases for conferring
citizenship on an insurer in an insurance lawsuit: (1) where the insured is a citizen,
(2) where the insurer has been incorporated, and (3) where the insurer has its principal
place of business. § 1332(c)(1)(A)–(C). Because these clauses apply “whether [an insurer
is] incorporated or unincorporated,” Navy Federal’s reading of and, again, must apply here.
If we were to adopt defendants’ reading of and, the instruction to apply these clauses to
unincorporated insurers would be self-defeating. Section 1332(c)(1)(B) (“every State and
9
The rest of § 1332(c)(1) states:
[I]n 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—
(A) every State and foreign state of which the insured is a citizen;
(B) every State and foreign state by which the insurer has been
incorporated; and
(C) the State or foreign state where the insurer has its principal place
of business.
(emphasis added).
20
foreign state by which the insurer has been incorporated”) yields only a null set for
unincorporated associations, thus also precluding the application of § 1332(c)(1)(A) and
(C) to unincorporated insurers. This result is nonsensical. For § 1332(c)(1) to apply to
unincorporated insurers, as Congress has expressly instructed, we must invoke Navy
Federal’s interpretation of and. See Fontenot v. Taser International, Inc., 736 F.3d 318,
327 (4th Cir. 2013) (“It is presumed that the legislature intended each portion to be given
full effect and did not intend any provision to be mere surplusage.”) (quotation marks and
citations omitted).
In contrast, other provisions show that when Congress wishes to restrain a grant of
citizenship, it uses words of limitation. See, e.g., § 1332(c)(2) (“[T]he legal representative
. . . shall be deemed to be a citizen only of . . .”) (emphasis added). When Congress imposes
a conjunctive requirement in other subsections (as defendants ask us to do here), it
combines and with that language of limitation. So, in § 1332(a) for example, Congress
uses the word “where” to specify that diversity jurisdiction exists only “where” both “A”
and “B” are satisfied. See also § 1332(d)(2) (“in which” both “A” and “B”). But
§ 1332(c)(1) speaks in the language of conferral: “a corporation shall be deemed to be a
citizen of [both] . . . .” Id. (emphasis added). And § 1332(c)(1) confers generously at that:
“… of every State and foreign state . . . .”
Id. (emphasis added). This distinction shows
that Congress knew precisely how to impose conjunctive requirements but declined to do
so here. And it is not for this court to write that restriction in.
21
For all these reasons, we find that and in § 1332(c)(1) must be interpreted as Navy
Federal argues. The textual reading offered by defendants is simply implausible given
§ 1332(c)(1)’s text, structure, and context.
Defendant’s reading also conflicts with our precedent. In Athena Automotive, Inc.,
we considered how § 1332(c)(1) applied to determine the citizenship of an inactive
corporation with no principal place of business. 166 F.3d at 290. In that case, Athena
Automotive—a Georgia corporation—brought state-law claims in the District of Maryland
against a Maryland resident and his Maryland corporation. The Maryland defendants
sought to dismiss the suit for lack of diversity jurisdiction. We explained that because
“Athena Automotive was unquestionably a citizen of Georgia, its state of incorporation
. . . whether it also actually had a place of business at the commencement of this action is
not a matter that we need to decide, since it did not have its principal place of business in
Maryland.”
Id. at 292. 10
The import of our Athena Automotive ruling is that a corporation may still be a
citizen of the State of incorporation even if it has no principal place of business under
§ 1332. So although defendants’ conjunctive requirement would violate this rule,
10
See also Midlantic Nat. Bank v. Hansen, 48 F.3d 693, 696 (3d Cir. 1995) (“We
conclude that as a general matter, an ‘inactive’ corporation (that is, a corporation
conducting no business activities) has no principal place of business, and is instead a citizen
of its state of incorporation only.”); Holston Investments, Inc. B.V.I. v. LanLogistics Corp.,
677 F.3d 1068, 1071 (11th Cir. 2012) (“[W]e join the Third Circuit in holding a dissolved
corporation has no principal place of business. . . . Under the rule we adopt today,
LanLogistics is therefore only a citizen of Delaware, and this court has subject-matter
jurisdiction.”).
22
plaintiff’s additive interpretation follows. Under the district court’s contrary reading,
Athena Automotive could not have been a citizen of Georgia unless we had also determined
that it had a principal place of business somewhere. Thus, its reading cannot be correct. 11
2. Defendants’ statutory counterarguments fail
Defendants also object that Navy Federal’s reading of § 1332(c)(1) violates the
canon against superfluousness, see Freeman v. Quicken Loans, Inc., 566 U.S. 624, 635
(2012), and is precluded by negative implication, see N.L.R.B. v. SW General, Inc., 137 S.
Ct. 929, 940 (2017). Appellee Br. 22–25, 27–28. For both arguments, defendants look to
the same sources: statutes where Congress has conferred state citizenship on other federal
corporations. First, we disagree with the premise—the statutes identified trigger neither
canon. And second, even if they did, Congress has spoken with sufficient clarity to
overcome those canons here.
11
To avoid Athena Automotive, defendants seem to abandon the district court’s
“taken together” reading and suggest a “two-step” reading of § 1332(c)(1). In the first step,
they urge us to ask whether an entity is incorporated in a State or foreign state. If not, we
stop—the corporation is not a citizen of any State or foreign state. But if the corporation
is incorporated in a State or foreign state, then it may also have a second place of
citizenship: the State of its principal place of business. In contrast, if the corporation does
not have a principal place of business, then it remains a citizen of only its State of
incorporation. In other words, a corporation may be a citizen of its State of incorporation
or a citizen of both its State of incorporation and its principal place of business, but it may
never be a citizen of its principal place of business without a State of incorporation.
Assuming defendants could be understood to have advanced this argument below
(or even in other sections of their appellate brief), we reject it now. This “two-step” reading
defies any common understanding of the word and. And it runs into the same structural
and contextual difficulties discussed above.
23
Supposedly, two categories of statutes create this problem. Defendants start by
looking to special legislation that provides a fixed citizenship for certain federally chartered
corporations. For instance, Congress deemed the National Railroad Passenger Corporation
(“Amtrak”) and the Telecommunications Development Fund citizens of the District of
Columbia. See 49 U.S.C. § 24301(b); 12 U.S.C. § 2258. 12 But these statutes do not
implicate the canon against surplusage (nor do they conflict with § 1332(c)(1)). They
simply give a fixed, specific provision for D.C. citizenship, which controls over the
dynamic, two-pronged, general rule in § 1332(c)(1). See Varity Corp. v. Howe, 516 U.S.
489, 511 (1996) (“‘[T]he specific governs the general.’”).
Similarly, no negative implication militates against Navy Federal’s interpretation.
Negative implication, also called the expressio unius canon, instructs that the “expressi[on]
[of] one item of an associated group or series excludes another left unmentioned.” N.L.R.B.
v. SW General, Inc., 137 S. Ct. 929, 933 (2017) (internal citations and alterations omitted).
A fundamental premise of the expression unius canon is that the unum (the thing positively
specified) can reasonably be thought to occupy the field. Scalia and Garner, Reading Law,
at 107. But special legislation—affecting only specific corporations—has a narrow impact
by design. See Local and Special Legislation, Black’s Law Dictionary 1801 (11th ed.
2019). It does not exclude the application of a separate, general rule (like that in
§ 1332(c)(1)) to all others. The kindergarten teacher who specifically tells two children
12
Congress has provided that the District of Columbia is a “State” for purposes of
§ 1332. 28 U.S.C. § 1332(e).
24
not to hit one another does not imply that all the others may engage in violence—
particularly where a general school rule forbids fighting. So too here.
Defendants next call our attention to legislation that provides different rule-based
mechanisms for determining the citizenships of certain federal entities. 13 These kinds of
enactments govern the citizenship of entities such as national banks and federal savings
associations. 28 U.S.C. § 1348 (“national banking associations” are “deemed citizens of
the States in which they are respectively located”); 12 U.S.C. § 1464(x) (federal savings
associations are citizens of the state where their “home office” is located). But again, these
are different rules applicable to different entities, not surplusage. See Wachovia Bank, 546
U.S. at 317 n.9. 14 And these specific rules likely control over § 1332(c)(1)’s general
provision. See OneWest Bank, N.A. v. Melina,
827 F.3d 214, 219 (2d Cir. 2016); Rouse v.
Wachovia Mortg., FSB,
747 F.3d 707, 709 (9th Cir. 2014). But see Flinn v. Santander
Bank, N.A.,
359 F. Supp. 3d 128, 132 n.2 (D. Mass. 2019).
13
Note that federal law provides for chartering a variety of distinct financial
entities—each with their own structure, requirements, and regulators. National banking
associations (chartered by the Office of the Comptroller of the Currency) are thus distinct
from federal credit unions (chartered by the NCUA), which are distinct from Farm Credit
Banks (overseen by the Farm Credit Administration), and so on. See generally Marc
Labonte, Congressional Research Service, Who Regulates Whom? An Overview of the U.S.
Financial Regulatory Framework (2020).
14
In Hertz, the Supreme Court explained that the “principal place of business” of a
corporation is its actual headquarters—the “nerve center” of the corporation. 559 U.S. at
81. But national banking associations, “deemed citizens of the States in which they are
respectively located,” 28 U.S.C. § 1348, are “respectively located” based on where they
have designated their “main office” in their articles of incorporation. Wachovia
Bank, 546
U.S. at 318. This may or may not be the same location as the nerve center.
Id. at 317 n.9.
25
Our circuit, however, has not yet definitively construed the relationship between the
provisions cited by defendants and § 1332(c)(1). And we see no need to do so today.
Assuming, for the sake of argument, that some surplusage would result from Navy
Federal’s reading of and, we would not reach defendants’ conclusion. “The canon against
surplusage is strongest when an interpretation would render superfluous another part of the
same statut[e].” Marx, 568 U.S. at 386 (emphasis added). In contrast, “[r]edundancies
across statutes are not unusual events in drafting.” Connecticut National Bank v. Germain,
503 U.S. 249, 253 (1992) (emphasis added). Here, the other statutes that defendants
highlight are just that—other statutes. So “the force of this canon is diminished,”
Marx,
538 U.S. at 386, and it would not prevail over the plain text of the statute, see Connecticut
Nat.
Bank, 503 U.S. at 253.
3. Bankers’ Trust supports Navy Federal
Defendants also point to the Supreme Court’s 1916 decision in Bankers’ Trust as
support for their interpretation. 241 U.S. 295. In that case, the Court concluded that a
federally chartered railroad was not a citizen of any state. According to defendants, this
conclusion shows that Congress, when it passed § 1332(c) forty-two years later, did not
intend for that statute to apply to federal corporations. We disagree.
In Bankers’ Trust, the Supreme Court considered whether federal courts had
subject-matter jurisdiction over a suit to foreclose on a railroad mortgage. 241 U.S. at 301.
There, a New York corporation brought state-law contract claims against the Texas &
Pacific Railway Company, a federally chartered corporation, and the New Orleans Pacific
Railway Company, a Louisiana corporation.
Id. at 301–02. The Supreme Court began its
26
analysis by rejecting plaintiff’s arguments that the district court possessed federal-question
jurisdiction over the case by virtue of (1) the “sue and be sued” clause in Texas & Pacific
Railway’s federal charter and (2) the fact of its federal incorporation. Id. at 303–09
(discussing Osborn v. Bank of United States, 22 U.S. (9 Wheat.) 738 (1824), Bank of United
States v. Deveaux, 9 U.S. (5 Cranch) 61 (1809), and § 5 of the Judiciary Act of 1915).
Next, the Supreme Court turned to whether the federally chartered corporation was a
citizen of Texas.
The Court evaluated three grounds for conferring state citizenship on Texas &
Pacific Railway, but it rejected each. First, it considered the then-existing federal-
common-law rule for determining corporate citizenship. Id. at 309. At that time, the
federal common law generally presumed that a corporation possessed the citizenship of the
State where it was incorporated. See Marshall v. Baltimore & Ohio Railroad Co., 57 U.S.
(16 How.) 314, 328–29 (1853); see generally Richard H. Fallon, et al., Hart & Wechsler’s
The Federal Courts and the Federal System 1430–32 (7th ed. 2015). But Texas & Pacific
Railway “was incorporated under acts of Congress, not under state laws; and [so] its
activities and operations were not to be confined to a single state.” Bankers’
Tr., 241 U.S.
at 309. Thus, the Court reasoned that because Texas & Pacific Railway was so
incorporated, this common-law rule did not provide a basis for conferring State citizenship.
Id.
Second, the Supreme Court considered whether there was a constitutional basis for
conferring state citizenship on a federal corporation. The Court found none, explaining
that the 14th Amendment “declares that native born and naturalized citizens of the United
27
States shall be citizens of the state wherein they reside,” but that it says nothing about
corporations. Id. at 310.
Last, the Court considered whether Congress had provided a statutory basis for
jurisdiction “as is done in respect of national banks.” Id. But finding none, the Court held
that “there is no ground upon which the company can be deemed a citizen of Texas, and
this being so, the suit is not one between citizens of different states.”
Id.
As defendants point out, several district courts—including in our Circuit—have
relied on Bankers’ Trust to find that federal corporations are not diverse under
§ 1332(c)(1). See Hukic v. Aurora Loan Services,
588 F.3d 420, 428 (7th Cir. 2009)
(collecting cases). 15 These courts have generally read Bankers’ Trust to hold “that a
corporation chartered pursuant to an act of Congress was not a citizen of any state, and
therefore was ineligible to invoke federal diversity jurisdiction.” Lehman Brothers Bank,
15
Defendants also assert that the Second, Eleventh, and Ninth Circuits have held
that § 1332(c) does not apply to federally chartered corporations. Appellee Br. 18–19 n.58
(citing OneWest Bank, N.A., 827 F.3d at 220; Loyola Fed. Sav. Bank v. Fickling,
58 F.3d
603 (11th Cir. 1995); Hancock Fin. Corp. v. Fed. Sav. & Loan Ins. Corp.,
492 F.2d 1325
(9th Cir. 1974)). We do not read the cited Second and Eleventh Circuit cases as defendants
do.
In One West, the Second Circuit focused its interpretation on 28 U.S.C. § 1348,
which provides a different rule establishing the citizenship of national banks. But to the
extent that the specific controls the general, One West says nothing about the applicability
of § 1332(c)(1) to federal corporations writ large. See 827 F.3d 218–19. In Loyola, the
Eleventh Circuit applied the localization rule to confirm its subject-matter jurisdiction
without discussing §
1332(c)(1). 58 F.3d at 606–07. Although we acknowledge the Ninth
Circuit’s ruling in Hancock, we note that the court never considered the text of
§ 1332(c)(1), relying instead on its purpose.
See 492 F.2d at 1329 (quoting Fed. Deposit
Ins. Corp. v. Nat’l Sur. Corp.,
345 F. Supp. 885, 888 (S.D. Iowa 1972)).
28
FSB v. Frank T. Yoder Mortgage, 415 F. Supp. 2d 636, 639 (E.D. Va. 2006); see also
Federal Deposit Insurance
Corp., 345 F. Supp. at 887. 16 And some have suggested that a
clear indication of Congressional intent would be required for § 1332(c)(1) to confer state
citizenship to federally chartered corporations. See Crum v. Veterans of Foreign Wars,
502 F. Supp. 1377, 1380 (D. Del. 1980).
We take Bankers’ Trust to stand for something different. Bankers’ Trust teaches
that we look to three sources to determine whether a corporation is diverse: the common
law, the constitution, and the word of Congress. And based on an analysis of these sources,
the Court reasoned that the federal corporation in that case was not diverse. By focusing
on the conclusion and ignoring the reasons for the Bankers’ Trust decision, we think the
Lehman Brothers court (and others) misjudged the holding of Bankers’ Trust and applied
too blunt a rule. See Pierre N. Leval, Judging Under the Constitution: Dicta about Dicta,
81 N.Y.U. L. REV. 1249, 1256 (2006) (explaining that a holding “explains why the court’s
judgment goes in favor of the winner”); id. at n.20 (“It is only by reference to the court’s
reasoning that one can determine whether the factual differences between the earlier case
and the later one should change the result.”).
16
Other courts have relied on the supposed Congressional “purpose” behind
§ 1332(c)(1) to reach their conclusion. See Hancock Financial Corp., 492 F.2d at 1325
(quoting Federal Deposit Ins.
Corp., 345 F. Supp. at 888). Indeed, some make the
legislative history of § 1332(c)(1) the starting point (and the focal point) of their analysis,
which never reaches the provision’s text. See Northern Virginia Foot & Ankle Associates,
LLC,
2011 WL 280983, at *2–3. But we see no need to seek guidance in legislative history.
As the Supreme Court recently affirmed, statutory interpretation must begin with the text,
and it must end when the text resolves the case. See, e.g., Lomax,
140 S. Ct. 1724–25.
29
Since Bankers’ Trust, the final ground considered by the Court—whether Congress
has spoken to the issue—changed. Forty-two years after that decision, Congress passed
§ 1332(c)(1), providing a general rule for determining the citizenship of a corporation. It
was well within Congress’ prerogative to do so: “‘[w]hatever [the courts] say regarding
the scope of [our] jurisdiction . . . can of course be changed by Congress.” Exxon Mobil
Corp. v. Allapattah Servs., Inc., 545 U.S. 546, 557 (2005) (quoting Finley v. United States,
490 U.S. 545, 556 (1989)); United
Steelworkers, 382 U.S. at 153; see also Federal
Intermediate Credit Bank of Columbia, S.C., v. Mitchell,
277 U.S. 213, 217 (1928). And,
as we have explained, § 1332(c) plainly applies to federal corporations. “No sound canon
of interpretation requires Congress to speak with extraordinary clarity in order to modify
the rules of federal jurisdiction within appropriate constitutional bounds. Ordinary
principles of statutory construction apply.” Exxon Mobil
Corp., 545 U.S. at 558; see also
United States v. Texas,
507 U.S. 529, 534 (1993) (internal citations omitted) (“Congress
need not ‘affirmatively proscribe’ the common-law doctrine at issue.”); City of Milwaukee
v. Illinois & Michigan,
451 U.S. 304, 315 (1981) (same). 17
For these reasons, we agree that the holding of Bankers’ Trust supports Navy
Federal’s reading of § 1332(c)(1).
17
We acknowledge that Congress should not be taken to overrule, sub silentio,
statutory decisions of the Supreme Court. See Forest Grove Sch. Dist. v. T.A., 557 U.S.
230, 243 (2009); see generally William N. Eskridge, Overruling Statutory Precedents 76
GEO. L.J. 1361 (1987–88). For that, we may need a “clear expression . . . of Congress’
intent.” Forest
Grove, 557 U.S. at 240. But Bankers’ Trust did not turn on an interpretation
of a statute. To the contrary, the Supreme Court expressly noted the absence of any
statutory provision that would control its
decision. 241 U.S. at 310. Thus we do not find
any such statutory “clear statement” rule applicable here.
30
* * *
We think this a case that “begins, and pretty much ends, with [§ 1332(c)(1)’s text].”
Lomax, 140 S. Ct. at 1724. “[C]ourts must presume that a legislature says in a statute what
it means and means in a statute what it says there.” Connecticut Nat.
Bank, 503 U.S. at
253–54. And § 1332(c)(1) says that “a corporation shall be deemed a citizen of . . . the
State or foreign state where it has its principal place of business.” Navy Federal Credit
Union is a corporation. Its principal place of business is in Virginia. So we hold that Navy
Federal is a citizen of Virginia.
REVERSED
31
