## Facts

- John D. Sheehan, Sr. sued Deil O. Gustafson in federal court asserting a breach of an oral contract concerning proceeds from the sale of the Tropicana Hotel and Casino in Las Vegas, Nevada.
- Sheehan alleged he was a Nevada citizen and that Gustafson was a Minnesota citizen, invoking diversity jurisdiction under 28 U.S.C. § 1332(a)(1).
- Gustafson moved to dismiss under Rule 12(b)(1), contending he was domiciled in Nevada at the time suit was filed and thus not diverse from Sheehan.
- Evidence in the record indicated Gustafson had moved to Nevada in 1973, had been incarcerated in Minnesota from 1984 to 1987, and maintained Minnesota business contacts and accounts.
- Other indicia reflected Nevada ties, including a Nevada address used as a permanent address on government and official records (e.g., license/registration, tax and voting-related records), a will stating Nevada domicile, and plans for a Nevada residence.
- The district court found Gustafson was domiciled in Nevada when the action commenced and dismissed for lack of subject-matter jurisdiction.
- Sheehan appealed.

## Issues

1. Whether complete diversity existed under 28 U.S.C. § 1332(a)(1) at the time the complaint was filed—specifically, whether Gustafson was domiciled in Minnesota or Nevada.
2. What burden of proof applies to the party invoking diversity jurisdiction when citizenship is challenged.
3. What standard of appellate review applies to a district court’s determination of domicile/citizenship for diversity purposes.

## Decision

- The Eighth Circuit affirmed the dismissal for lack of subject-matter jurisdiction.
- The court held citizenship for diversity purposes is determined as of the filing date, and “domicile” and “citizenship” are synonymous in this context.
- The party invoking federal jurisdiction bears the burden, if challenged, to prove diverse citizenship by a preponderance of the evidence.
- A district court’s citizenship determination is a mixed question of law and fact that is primarily factual; underlying factual findings are reviewed for clear error.
- The district court’s findings supporting Nevada domicile were not clearly erroneous; Sheehan failed to meet his burden to show Gustafson was a Minnesota citizen at filing.

## Legal Principles

- Diversity jurisdiction under 28 U.S.C. § 1332(a)(1) requires complete diversity; the statute is strictly construed.
- Diversity is assessed based on the parties’ citizenship at the time the action is filed.
- For diversity jurisdiction, citizenship equals domicile.
- The party seeking a federal forum must establish diversity jurisdiction by a preponderance of the evidence when jurisdiction is contested.
- Appellate review of the factual findings supporting a domicile determination is for clear error.

## Conclusion

Because the district court permissibly found that Gustafson was domiciled in Nevada when the suit was filed and the plaintiff did not prove otherwise by a preponderance of the evidence, complete diversity was absent and the federal courts lacked subject-matter jurisdiction.


Sheehan v. Gustafson, 967 F.2d 1214 (8th Cir. 1992)