Stephen Yagman v. Paul Gabbert
684 F. App'x 625 (2017)
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Rule of Law:
For purposes of diversity jurisdiction, a person's domicile is determined by their physical presence in a state combined with an intent to remain there indefinitely, which is ascertained by weighing objective factors such as residence, professional activities, and location of personal and family ties.
Facts:
- Stephen Yagman was a member of both the New York and California state bars.
- After a 1999 suspension from the New York bar, Yagman did not seek reinstatement there, but he did apply for reinstatement in California after a 1998 suspension and practiced there for many years.
- Since 2009, Yagman has resided exclusively in California.
- Yagman's spouse resides in California and Florida, not New York.
- Yagman maintains a California driver’s license, and his New York driver's license lists a California address.
- He holds a bank account in California.
- After being disbarred, Yagman continued to work as a paralegal for his former law partners, who are based in California.
- Yagman asserted ties to New York, including voter registration and jury service that ended in 2007, and alleged ownership of real property there.
Procedural Posture:
- Stephen Yagman filed a complaint in the U.S. District Court, which included a federal RICO claim and several state-law claims.
- The district court permitted Yagman to amend his original complaint once, resulting in the First Amended Complaint.
- The district court dismissed Yagman's RICO claim without granting further leave to amend, finding it inadequately pleaded.
- The district court also found that it lacked diversity jurisdiction over the remaining state-law claims, concluding that Yagman was domiciled in California.
- Consequently, the district court dismissed the state-law claims without prejudice.
- Yagman, as Plaintiff-Appellant, appealed the district court's dismissal to the U.S. Court of Appeals for the Ninth Circuit.
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Issue:
When determining domicile for diversity jurisdiction purposes, do courts rely on objective factors such as long-term residence, professional activities, and spousal location, or do they accept a party's subjective claim of domicile?
Opinions:
Per Curiam - The Court
Courts rely on objective factors to determine domicile, not subjective claims. A person's domicile is established where objective factors demonstrate a fixed habitation and an intent to remain, overriding a contrary subjective claim. Domicile requires both physical presence and an intent to remain indefinitely, a subjective component that is established through objective evidence. The court weighs several factors, with no single factor being dispositive, including current residence, voting registration, location of property and bank accounts, location of family, place of employment, and driver's license registration. In Yagman's case, the weight of these objective factors—residing exclusively in California since 2009, his professional life centered in California, his spouse's residence there, and his California driver's license and bank account—demonstrated that his domicile had changed to California by the time the lawsuit was filed, regardless of his assertion of New York domicile. Therefore, diversity of citizenship between the parties was lacking.
Analysis:
This decision reinforces the principle that domicile for diversity jurisdiction is a fact-intensive inquiry based on objective evidence, not a party's self-serving declaration. It serves as a strong reminder that federal courts will strictly guard their jurisdictional limits and prevent parties from manufacturing diversity through unsubstantiated claims of domicile. The ruling underscores that a person's true 'center of gravity'—where they live, work, and maintain significant personal connections—is determinative, and a long-term, exclusive residence in one state is powerful evidence of an intent to remain there, sufficient to overcome historical ties to another state.
