Morris Dweck v. Japan Cbm Corp., 877 F.2d 790 (9th Cir. 1989). · Go Syfert
Morris Dweck v. Japan Cbm Corp., 877 F.2d 790 (9th Cir. 1989). Cases Citing This Book View Copy Cite
47 citation events (19 in the last 25 years) across 13 distinct courts.
Strongest positive: Peterson v. Best (waed, 2023-12-19)
Treatment trajectory · 1989 → 2026 · click a year to view as-of
1989 2007 2026
Top citers, strongest first. 25 distinct citers. How cited ↗
discussed Cited as authority (rule) Peterson v. Best (2×) also: Cited "see"
E.D. Wash. · 2023 · confidence medium
Assignments by corporations to their officers or directors “‘are 13 presumptively ineffective to create diversity jurisdiction.’” Dweck v. Japan CBM 14 Corp., 877 F.2d 790, 792 (9th Cir. 1989) (quoting Simpson v. Alaska State Comm'n 15 for Human Rights, 608 F.2d 1171 , 1174 (9th Cir. 1979)).
discussed Cited as authority (rule) de Borja v. Razon
D. Or. · 2021 · confidence medium
Some types of assignments “warrant particularly close scrutiny,” including assignments “between parent companies and subsidiaries, and assignments by corporations to their officers or directors, which ‘are presumptively ineffective to create diversity jurisdiction.’” Id. at 809-10 (quoting Dweck v. Japan CBM Corp., 877 F.2d 790, 792 (9th Cir. 1989)).
cited Cited as authority (rule) BGH Holdings, LLC v. DL Evans Bank
W.D. Wash. · 2021 · confidence medium
Haw. 1994) (citing Dweck v. Japan CBM Corp., 6 877 F.2d 790, 792 (9th Cir. 1989)).
discussed Cited as authority (rule) de Borja v. Razon
D. Or. · 2020 · confidence medium
Some types of assignments “warrant particularly close scrutiny,” including assignments “between parent companies and subsidiaries, and assignments by corporations to their officers or directors, which ‘are presumptively ineffective to create diversity jurisdiction.’” Id. at 809-10 (quoting Dweck v. Japan CBM Corp., 877 F.2d 790, 792 (9th Cir. 1989)).
discussed Cited as authority (rule) Reinhart Oil & Gas, Inc. v. Excel Directional Technologies, LLC
D. Colo. · 2006 · confidence medium
"Instead, the burden falls on [that party] to demonstrate that the reason given for the assignment is legitimate, not pretextual.” Airlines Reporting, 58 F.3d at 863; Nike, 20 F.3d at 991-93; Yokeno, 973 F.2d at 810 ; Dweck v. Japan CBM Corp., 877 F.2d 790, 792-93 (9th Cir. 1989); Prudential Oil, 546 F.2d at 475 .
discussed Cited as authority (rule) McCulloch v. Malave-Velez (2×) also: Cited "see"
D.P.R. · 2005 · confidence medium
Courts have held that transfers between affiliated corporations “are presumptively ineffective to create diversity jurisdiction.” Dweck v. Japan CBM Corp., 877 F.2d 790, 792 (9th Cir.1989); Simpson v. Alaska State Comm’n for Human Rights, 608 F.2d 1171 , 1174 (9th Cir.1979); Airlines Reporting Corp. v. S and N Travel, 58 F.3d 857, 862 (2d Cir.1995); Nike, Inc. v. Comercial Iberica de Exclusivas Deportivas, S.A., 20 F.3d 987, 991-93 (9th Cir.1994); Prudential Oil Corp. v. Phillips Petroleum Co., 546 F.2d 469, 475 (2d Cir.1976); To ste Farm, 70 F.3d at 643-644 (1st Cir.1995).
discussed Cited as authority (rule) Boston Post Road Medical Imaging, P.C. v. Allstate Insurance
S.D.N.Y. · 2004 · confidence medium
See, e.g., Airlines Reporting Corp. v. S and N Travel, Inc., 58 F.3d 857 , 863 (2d Cir.1995); Dweck v. Japan CBM Corp., 877 F.2d 790, 792 (9th Cir.1989); Prudential Oil Corp. v. Phillips Petroleum Co., 546 F.2d 469 , 476 n. 2 (2d Cir. 1976); Bradbury v. Dennis, 310 F.2d 73, 74 (10th Cir. 1962). .
cited Cited as authority (rule) McCulloch v. Velez-Malave
1st Cir. · 2004 · confidence medium
Dweck v. Japan CBM Corp., 877 F.2d 790, 792 (9th Cir.1989); Prudential Oil, 546 F.2d at 476 .
discussed Cited as authority (rule) McCulloch v. Vélez Malavé (2×) also: Cited "see"
D.P.R. · 2003 · confidence medium
The Courts have held that transfers between . affiliated corporations “are presumptively ineffective to create diversity jurisdiction.” Dweck v. Japan CBM Corp., 877 F.2d 790, 792 (9th Cir.1989); Simpson v. Alaska State Comm’n for Human Rights, 608 F.2d 1171 , 1174 (9th Cir.1979); Airlines Reporting Corp. v. S and N Travel, 58 F.3d 857, 862 (2d Cir.1995); Nike, Inc. v. Comercial Iberica de Exclusivas Deportivas, S.A., 20 F.3d 987 , 991-93 (9th Cir.1994); Prudential Oil Corp. v. Phillips Petroleum Co., 546 F.2d 469, 475 (2d Cir. 1976); Toste Farm, 70 F.3d at 643-644 (1st Cir.1995).
cited Cited as authority (rule) Wilson v. A. H. Belo Corp.
9th Cir. · 1996 · confidence medium
Id.; Dweck v. Japan CBM Corp., 877 F.2d 790, 792 (9th Cir.1989).
discussed Cited as authority (rule) Toste Farm Corp. v. Hadbury, Inc.
1st Cir. · 1995 · confidence medium
Dweck v. Japan CBM Corp., 877 F.2d 790, 792 (9th Cir. 1989). _____ _______________ The district courts have original jurisdiction over civil actions between citizens of different states in which the amount in controversy exceeds $50,000. 28 U.S.C. 1332(a).
cited Cited as authority (rule) Toste Farm Corp. v. Hadbury, Inc.
1st Cir. · 1995 · confidence medium
Dweck v. Japan CBM Carp., 877 F.2d 790, 792 (9th Cir.1989).
cited Cited as authority (rule) Western Farm Credit Bank v. Hamakua Sugar Co., Inc.
D. Haw. · 1994 · confidence medium
Dweck v. Japan CBM Corp., 877 F.2d 790, 792 (9th Cir.1989).
examined Cited as authority (rule) Matao C. Yokeno v. Ramon C. Mafnas (5×) also: Cited "see"
9th Cir. · 1992 · confidence medium
Assignments between parent companies and subsidiaries, and assignments by corporations to their officers or directors “ ‘are presumptively ineffective to *810 create diversity jurisdiction.’ ” Dweck v. Japan CBM Corp., 877 F.2d 790, 792 (9th Cir.1989) (quoting Simpson v. Alaska State Comm’n for Human Rights, 608 F.2d 1171 , 1174 (9th Cir.1979)); see also Prudential Oil Corp. v. Phillips Petroleum Co., 546 F.2d 469, 475 (2d Cir.1976).
discussed Cited "see" Canary Date Sculpting, Inc v. Kentucky Farm Bureau Mutual Insurance Company
W.D. Ky. · 2025 · signal: see · confidence high
See Dweck v. Japan CBM Corp., 877 F.2d 790, 193 (9th Cir. 1989) (citing R.C.
cited Cited "see" Airlines Reporting Corporation v. S And N Travel, Inc.
2d Cir. · 1995 · signal: see · confidence high
See Dweck v. Japan CBM Corp., 877 F.2d 790, 792 (9th Cir.1989).
cited Cited "see" Airlines Reporting Corp. v. S & N Travel, Inc.
2d Cir. · 1995 · signal: see · confidence high
See Dweck v. Japan CBM Corp., 877 F.2d 790, 792 (9th Cir.1989).
cited Cited "see" Airlines Reporting Corp. v. S AND N TRAVEL, INC.
E.D.N.Y · 1994 · signal: see · confidence high
See Dweck v. Japan CBM Corp., 877 F.2d 790 (9th Cir.1989) (the fact that no consideration was paid for assignment was evidence of collusion).
cited Cited "see" Donnelly v. United States Department of the Interior
9th Cir. · 1990 · signal: see · confidence high
See Dweck v. Japan CBM Corp., 877 F.2d 790, 792 (9th Cir.1989).
cited Cited "see" National Ass'n for the Advancement of Colored People-Special Contribution Fund v. Jones
N.D. Ohio · 1990 · signal: accord · confidence high
McNutt, supra, 298 U.S. at 189 , 56 S.Ct. at 785 , 80 L.Ed. at 1141 ; Accord, Dweck v. Japan CBM Corp., 877 F.2d 790, 792 (9th Cir.1989).
cited Cited "see" United States v. Kersting
9th Cir. · 1989 · signal: see · confidence high
See Dweck v. Japan CBM Corp., 877 F.2d 790, 792 (9th Cir.1989).
cited Cited "see" United States Court of Appeals, Ninth Circuit
9th Cir. · 1989 · signal: see · confidence high
See Dweck v. Japan CBM Corp., 877 F.2d 790, 792 (9th Cir.1989).
discussed Cited "see, e.g." Nike, Inc. v. Comercial Iberica de Exclusivas Deportivas, S.A.
9th Cir. · 1994 · signal: see also · confidence medium
We have treated assignments “by corporations to their officers or directors ‘[as] presumptively ineffective to create diversity jurisdiction,’ ” id. at 809-10 ; see also Dweck v. Japan CBM Corp., 877 F.2d 790, 792 (9th Cir.1989), and have generally stated that the same presumption applies to “ [assignments between parent companies and subsidiaries.” Yokeno, 973 F.2d at 809-10 (citations omitted).
Retrieving the full opinion text from the archive…
Morris DWECK, Plaintiff-Appellant,
v.
JAPAN CBM CORPORATION, Defendant-Appellee
87-6351.
Court of Appeals for the Ninth Circuit.
Jun 12, 1989.
877 F.2d 790
1989 U.S. App. LEXIS 8354
1989 WL 61341
Donald S. Burris, Burris, Wapner & Hie-stand, Los Angeles, Cal., for plaintiff-appellant., Derrick Fisher, Kalisch & Fisher, Beverly Hills, Cal., for defendant-appellee.
Sneed, Reinhardt, Brunetti.
Cited by 25 opinions  |  Published
SNEED, Circuit Judge:

Dweck appeals from the dismissal of his action for lack of subject-matter jurisdiction. We affirm.

I.

FACTS AND PROCEEDINGS BELOW

Japan CBM Corp. (CBM), a Japanese corporation, contracted to sell R.G.A. Co. (RGA), a Hong Kong corporation, 20,000 commercial videocassette players for approximately $7,000,000. The contract was never performed. Dweck brings this action for breach of contract, although he was not a party to the contract. He asserts, however, that he was to resell the videocassette players to Dalamal & Sons, Inc., a New York corporation and that he is the assignee of RGA’s interest in the contract. Dweck invokes federal jurisdiction on diversity of citizenship.

Dweck, a United States citizen residing in New York, imports electronic products into the United States from Asia. Dweck asserts that he became “affiliated” with RGA in order to facilitate his business. He claims that he is “neither a shareholder nor a principal” of RGA. RGA was wholly owned by Chu, a Hong Kong resident and business associate of Dweck. They agreed, Dweck asserts, that although all foreign trading would be done in the name of the corporation, each man would receive the profits from transactions which he negotiated. Dweck contends that he alone negotiated the contract with CBM and thus, under his agreement with Chu, was entitled to all of the profits. In 1986, Chu died and his heirs decided to liquidate the corporation. As a consequence, RGA assigned its interest in the contract to Dweck. No consideration was exchanged. This assignment needed no consideration, Dweck contends, because he was entitled to all of the profits from the contract by virtue of his agreement with Chu.

CBM contests this version of the facts. It points out that Dweck testified at his deposition that he is a director of RGA. CBM also points out that, although requested to do so, Dweck failed to produce[*792] any documentary evidence of the agreement between Chu and himself or the corporate structure of RGA. Dweck also failed to produce any evidence of any debts owed by RGA to himself that would support his claim that consideration was exchanged for the assignment.

On this showing, CBM moved to dismiss the action for lack of subject-matter jurisdiction or, alternatively, forum non conve-niens. The district court held that the assignment was collusive and dismissed the action. See 28 U.S.C. § 1359 (1982). It also ruled that it would dismiss on the basis of forum non conveniens were it not dismissing on the “collusive assignment” basis. Dweck appeals.

II.

JURISDICTION

Jurisdiction is the subject of this appeal. Dweck alleged jurisdiction under 28 U.S.C. § 1332(a) (1982). This court has jurisdiction under § 1291.

III.

STANDARD OF REVIEW

Whether the district court had subject-matter jurisdiction is a question of law which this court reviews de novo. Peter Starr Prod. Co. v. Twin Continental Films, Inc., 783 F.2d 1440, 1442 (9th Cir.1986). The district court’s findings of fact made in conjunction with its rulings on the jurisdictional issues must be accepted unless they are clearly erroneous. See Bruce v. United States, 759 F.2d 755, 758 (9th Cir.1985).

IV.

ANALYSIS

The district court dismissed Dweck’s complaint, ruling that the assignment of the breach of contract claims “was collusive, sham, and improper and made for the sole purpose of creating diversity jurisdiction.” A party may not create diversity jurisdiction by the use of an improper or collusive assignment. See 28 U.S.C. § 1359 (1982). The party asserting jurisdiction has the burden of proof. See, e.g., Aetna Cas. & Sur. Co. v. Hillman, 796 F.2d 770, 775 (5th Cir.1986); Bradbury v. Dennis, 310 F.2d 73, 74 (10th Cir.1962), cert. denied, 372 U.S. 928, 83 S.Ct. 874, 9 L.Ed.2d 733 (1963).

The facts in this case are similar to those involving assignments between parent and subsidiary corporations. This court has held that assignments between parent and subsidiary corporations “are presumptively ineffective to create diversity jurisdiction.” Simpson v. Alaska State Comm’n for Human Rights, 608 F.2d 1171, 1174 (9th Cir.1979). Unless there is a legitimate business reason which justifies such an assignment, it cannot create diversity jurisdiction. See, e.g., Prudential Oil Corp. v. Phillips Petroleum Co., 546 F.2d 469, 476 (2d Cir.1976); Green & White Constr. Co. v. Cormat Constr. Co., 361 F.Supp. 125, 127 (N.D.Ill.1973).

We think it proper that this presumption should be applied to assignments between corporations and its officers or directors. Otherwise, any employee or officer of a corporation could sue based on an assignment from a corporation. Section 1359 was designed to prevent parties from channelling a “vast quantity of ordinary contract and tort litigation ... into the federal courts_” Kramer v. Carribean Mills, Inc., 394 U.S. 823, 828-29, 89 S.Ct. 1487, 1490-91, 23 L.Ed.2d 9 (1969). Permitting corporations to assign their claims to corporate officers or directors, without requiring that this presumption be overcome, could lead to just such a result.

Courts addressing somewhat similar situations have employed this approach. For example, in Blythe Indus., Inc. v. Puerto Rico Aqueduct & Sewer Auth., 573 F.Supp. 563 (D.P.R.1983), two corporations, Blythe Industries and Vanguard Constructions Corporation, as joint-venturers, owned Blythe-Vanguard Construction Corporation. This corporation was formed for the sole purpose of performing construction for the Puerto Rico Aqueduct & Sewer Authority. A dispute arose between Blythe-Vanguard and the Authority. Seven months before suit was filed, Blythe-Vanguard assigned its claims to its owners.[*793] Because no legitimate reason for the transfer was demonstrated, the court found the assignment by the corporation to its owners collusive. Id. at 564.

Similarly, in Syms v. Castleton Indus., Inc., 470 F.2d 1078, 1079 (5th Cir.1972), a family trust, with mother and son acting as trustees, invested a large sum of money with the defendants. Defendants failed to pay federal income tax on profits for the investment. Mother and all the trust members assigned their interest in the action against the defendants to her son. No consideration was given for the assignments and the son admitted that any recovery would be shared with all members of the trust. Id. at 1081-82. The court concluded that the assignment was collusive and dismissed the action. The court relied on the lack of consideration for the transfer and noted that the assignors effectively retained an interest in the proceeds. Id. at 1082. Once more the assignee failed to carry the burden of establishing genuine diversity.

The same must be said in this case. The assignment was not supported by consideration. See 14 C. Wright, A. Miller & E. Cooper, Federal Practice and Procedure § 3639, at 109 (2d ed. 1985). This distinguishes cases like Bradbury v. Dennis, 310 F.2d 73 (10th Cir.1962), cert. denied, 372 U.S. 928, 83 S.Ct. 874, 9 L.Ed.2d 733 (1963), on which Dweck relies. The assignment in this case also failed to include provisions that expressly disavowed any continuing interest in the litigation or its proceeds on the part of the assignor. Courts have relied on these provisions to support a finding that the assignment did not violate § 1359. See, e.g., R.C. Hedreen Co. v. Crow Tribal Hous. Auth., 521 F.Supp. 599, 607 (D.Mont.1981); Nagle v. LaSalle Nat’l Bank, 472 F.Supp. 1185, 1190 (N.D.Ill.1979). Finally, Dweck did not explain his failure to produce any documentary evidence of the agreement with either Chu or RGA.

Dweck attempts to leap over the collusion barrier by insisting that his agreement with Chu made him the real party in interest in this transaction and that therefore the assignment merely memorialized the true relationship of the parties. See Bonnet v. Trustees of Schools, 563 F.2d 831, 833-34 (7th Cir.1977); Transcontinental Oil Corp. v. Trenton Prods. Co., 560 F.2d 94, 103, 110 n. 10 (2d Cir.1977).

The district court did not accept this representation of the facts. We cannot say its finding is clearly erroneous. The contract with Japan CBM was signed by Dweck as an officer of RGA, not in his individual capacity. Thus RGA, on the face of contract, was the real party in interest. See, e.g., Bradbury, 310 F.2d at 74; Edlow Int’l Co. v. Nuklearna Elektrarna Krsko, 441 F.Supp. 827, 830-31 (D.D.C.1977). Only Dweck’s unsupported assertion to the contrary appears on the record.

In sum, we believe that Dweck has failed to carry his burden to establish the existence of diversity jurisdiction. Because of this, we need not reach CBM’s further contention that the district court properly dismissed the action as forum non conve-niens.

AFFIRMED.