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The Supreme Court unanimously held 11/29/05 that a defendant may remove an action from state court to federal court on the basis of diversity of citizenship even if a potential but unnamed defendant would not be diverse. The Fourth Circuit remanded this case to state court, despite complete diversity between all named defendants and all named plaintiffs, because it suspected that an entity not named as a party (a limited partnership affiliated with a defendant and operating in the same state as the plaintiffs) was the real party in interest. The Supreme Court reversed, holding that 28 U.S.C. §§ 1332 and 1441 permit removal on the basis of diversity as long as all named defendants are citizens of different states than all named plaintiffs and no named defendant is a citizen of the forum state. The Court explained that a properly joined defendant seeking removal has no obligation to negate the existence of a potential codefendant that the plaintiff permissively might have joined and whose presence in the action would destroy diversity. The Court did not reach the second question presented by the petitioners, concerning the standards for determining the citizenship of a limited partnership, because no limited partnership was a party to the case. This case is important to all businesses that operate in multiple states. Decision Below: 373 F.3d 610 (4th Cir. 2004)

Decision Below: 373 F.3d 610 (4th Cir. 2004),