Civil Procedure Keyed to Yeazell
Walker v. Northwest Corp
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Massey filed a complaint in the District Court for the District of South Dakota on behalf of Plaintiffs, alleging breach of fiduciary duty and other state law causes of action against the Northwest Corp., Northwest Bank and others (Defendants) in connection with the administration of a trust fund held for Jimmy Lee Walker at a Northwest Bank located in South Dakota. The complaint stated that jurisdiction was based on diversity since “the Plaintiff and some of the Defendants” were citizens of different states. Both plaintiffs were citizens of South Dakota. The complaint averred that one of the defendants, Norwest Corporation, was a Minnesota corporation. The complaint did not allege the other defendants’ citizenship precisely, but stated that many of them were South Dakota “residents.” Defendant moved to dismiss and for an award of sanctions. The court held that there was no diversity jurisdiction because there was not complete diversity among plaintiffs and defendants, since plaintiffs were South Dakotans and numerous defendants were alleged to be South Dakota “residents.” Additionally, the district court awarded sanctions against Massey for failing to properly plead complete diversity. Plaintiffs appealed from the district court’s award of sanctions against Massey. Plaintiffs contended that the district court erred in awarding sanctions at all, in determining the amount of sanctions, and in not allowing the Defendant to amend his complaint before instituting sanctions.
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