Excerpt From Fulbright ::::::::::::::

February 23, 2010
Fulbright Alert – Litigation
Supreme Court Adopts More Predictable Principal-Place-of-Business Test

In a case handed down today, the United States Supreme Court clarified and simplified the judicial test to determine where a corporation has its principal place of business for diversity jurisdiction purposes. In Hertz Corp. v. Friend, No. 08-1107 (U.S. Feb. 23, 2010), Justice Breyer, writing for a unanimous court, noted that the “Court of Appeals’ divergent and increasingly complex interpretations” of the principal-place-of-business provision has grown unworkable. To simplify the inquiry and provide greater certainty as to jurisdiction for both potential plaintiffs and defendants, the Court adopted the “nerve center” test as the proper inquiry to determine a corporation’s principal place of business.

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This article was prepared by Jonathan S. Franklin (jfranklin@fulbright.com or 202 662 0466), Anne M. Rodgers (arodgers@fulbright.com or 713 651 3797) and Benjamin Vetter (bvetter@fulbright.com or 303 801 2720) from Fulbright’s Litigation Practice Group.

Note: Jonathan Franklin, a partner in Fulbright’s Washington, D.C., office was counsel of record for a group of amici curiae who filed a brief in the Supreme Court urging that the Court adopt the nerve center test.