Nerve Center Over Corporate Labels: The Fifth Circuit Clarifies Corporate Citizenship and Strict Compliance with Guarantor Release Clauses in Cadence Bank v. Johnson

I. Introduction

The Fifth Circuit’s decision in Cadence Bank v. Johnson, Nos. 24‑10812 & 25‑11078 (5th Cir. Nov. 24, 2025), addresses two legally significant issues:

Diversity jurisdiction and corporate citizenship when a financial institution has multiple “headquarters” in different states; and
Strict enforcement of guarantor early‑release clauses where release is conditioned on the borrower’s financial performance and lender confirmations.

The case arose out of a $34 million credit facility extended by Cadence Bank and Century Bank (“the Banks”) to Bridgelink Engineering, LLC (“Bridgelink”), managed by Cole Wayne Johnson and Cord Henry Johnson (“the Johnsons”). After Bridgelink defaulted, the Banks sued Bridgelink, its affiliated LLC guarantors (the “Bighorn LLCs”), and the Johnsons personally on their guaranty. Only the Johnsons appealed.

On appeal, the Johnsons:

Attacked subject‑matter jurisdiction, claiming Cadence was also a Texas citizen (defeating complete diversity), and
Challenged summary judgment in favor of the Banks, arguing they had been released from their personal guaranty obligations before Bridgelink’s default.

The Fifth Circuit affirmed across the board. The opinion is especially important because it:

Clarifies how the Hertz “nerve center” test applies to corporations with multiple headquarters (here, a “corporate” HQ in Texas and a “bank HQ” in Mississippi), and
Emphasizes strict compliance with contractual conditions for early release of guarantors and rejects attempts to equate mere email receipt acknowledgments with contractual “confirmation” of compliance.

II. Factual and Procedural Background

A. The Credit Facility and Guaranties

In August 2021, Bridgelink entered into a credit agreement with the Banks, receiving:

$20 million from Cadence Bank; and
$14 million from Century Bank.

Bridgelink agreed to repay the loans with interest and to maintain certain financial covenants. Initially, three LLCs managed by the Johnsons — Bighorn Construction and Reclamation, LLC; Bighorn Sand & Gravel, LLC; and Bighorn Investments and Properties, LLC — guaranteed Bridgelink’s obligations.

Later, the Johnsons executed a personal guaranty. Under that agreement:

Their guaranty remained in force until the specified “Termination Date” of Bridgelink’s loans;
They also negotiated an early‑release clause (Section 9.3), under which they could be released from their guaranty obligations if three conditions were satisfied.

1. The Early‑Release Clause (Section 9.3)

The Johnsons could obtain early release as guarantors if:

No default: Bridgelink’s loan had to be in good standing and not in default;
Two consecutive compliant quarters – covenants: Bridgelink had to provide evidence of compliance with certain financial covenants for two consecutive quarters; and
Two consecutive compliant quarters – prepayment requirements: The Banks had to confirm Bridgelink’s compliance with prepayment obligations under Section 2.7(b)(ii) for those same two consecutive quarters.

Operationally, this meant:

Bridgelink would send quarterly “compliance packages” by email to the Banks;
The Banks would acknowledge receipt, review the information, and then indicate whether the covenants and prepayment requirements had been satisfied for the quarter.

B. The Timeline of Compliance and Default

1. Q1 2022

In May 2022, Bridgelink emailed its Q1 2022 compliance documents to the Banks.
About a month later, the Banks confirmed that Bridgelink had complied with its covenants for that quarter.
However, by July 2022, Bridgelink had defaulted (it failed to make required interest payments, which was an “event of default” under § 8.1(b)).

To address this default, the parties amended the credit agreement. Under that amendment:

The Banks conditionally waived Bridgelink’s events of default, if certain conditions were met;
Two key conditions were:
- Bridgelink had to pay a $170,000 waiver fee; and
- The Johnsons had to agree that Q1 2022 would not count as a “compliant quarter” for purposes of their early‑release clause.

The Banks asserted, and Bridgelink did not contest, that the waiver fee was never paid.

2. Q2 2022

Bridgelink sent Q2 2022 compliance documents.
The Banks acknowledged receipt and stated they would review the submission.
There was no written confirmation in the record that the Banks found Q2 2022 compliant, but at the summary‑judgment hearing the Banks conceded Q2 2022 compliance.

3. Q3 2022

Bridgelink again emailed compliance documents shortly after Q3 2022 ended.
The Banks acknowledged receipt.
However, the Banks contested Bridgelink’s Q3 compliance at the summary‑judgment hearing, and there was no evidence of an express confirmation of compliance.

4. Q4 2022 and Q1 2023 Default

By Q4 2022, Bridgelink had defaulted again.
Defaults continued in Q1 2023 (missed payments).
None of the guarantors — the Johnsons or the Bighorn LLCs — made any payments.

C. The Lawsuit and District Court Proceedings

The Banks sued Bridgelink, the Johnsons, and the Bighorn LLCs in the Northern District of Texas for breach of contract. The complaint alleged only state‑law claims, so federal jurisdiction rested solely on diversity of citizenship under 28 U.S.C. § 1332.

Approximately ten months later, the Banks moved for summary judgment. The Johnsons argued:

They had been released from their guaranty obligations before the December 2022 default; and
They produced email threads allegedly showing the Banks had confirmed Bridgelink’s compliance for Q1–Q3 2022 for purposes of the early‑release clause.

The district court granted summary judgment, concluding that the Johnsons had not met the early‑release conditions.

After briefing the appeal, the Johnsons filed a motion in the district court to dismiss for lack of subject‑matter jurisdiction, arguing that Cadence was a citizen of both Texas and Mississippi at the time of filing, destroying complete diversity. The district court deferred ruling pending the appeal, then later issued a comprehensive opinion holding that Cadence was a Mississippi citizen only. See Cadence Bank v. Bridgelink Eng’g LLC, No. 4:23‑CV‑609, 2025 WL 2699044 (N.D. Tex. Sept. 8, 2025).

On limited remand pursuant to the Fifth Circuit’s order, the district court rejected the jurisdictional challenge. The case returned to the Fifth Circuit, which then addressed both:

The existence of subject‑matter jurisdiction, and
The propriety of summary judgment against the Johnsons on their guaranty.

III. Summary of the Fifth Circuit’s Opinion

A. Jurisdiction: Complete Diversity Exists

The Fifth Circuit held that the district court properly exercised diversity jurisdiction because:

The Johnsons are Texas citizens.
The Bighorn LLCs are also Texas citizens, through multiple layers of LLC ownership ultimately controlled by the Johnsons.
Century Bank is a New Mexico citizen (New Mexico‑chartered bank with its principal place of business in Santa Fe, New Mexico).
Cadence Bank is a Mississippi citizen, because:
- It is incorporated in Mississippi; and
- Its “principal place of business” — its Hertz nerve center — is in Tupelo, Mississippi, despite maintaining a “corporate headquarters” in Houston, Texas.

The court rejected the Johnsons’ arguments that:

Cadence’s principal place of business was in Houston based on SEC filings, officer residence, and public representations; and
Cadence should be judicially estopped from asserting a Mississippi nerve center due to allegedly inconsistent prior pleadings in other cases.

B. Merits: Guarantors Remain Liable; Summary Judgment Affirmed

Applying Texas contract law, the court held:

There was no dispute over the existence of valid contracts, the defendants’ nonperformance, or the Banks’ damages.
The only live issue was whether the Johnsons had been released under the early‑release clause before Bridgelink’s December 2022 default.
The Johnsons failed to show they met the first condition (no default), because:
- Bridgelink defaulted in Q1 2022 by failing to make interest payments.
- The Banks’ waiver of that default was conditional on payment of a $170,000 waiver fee, which was never paid.
- Thus, Bridgelink remained in default since at least Q1 2022.
Even if that default were set aside, the Johnsons still failed to meet the second and third conditions:
- The July 2022 amendment expressly excluded Q1 2022 as a compliant quarter under the release clause.
- While the Banks conceded Q2 2022 compliance, they disputed Q3 2022 compliance and there was no evidence of a separate confirmation of compliance beyond mere receipt acknowledgments.
- “Confirmation of receipt” is not “confirmation of compliance.”

Accordingly, the court held that the Johnsons remained liable on their guaranty and affirmed the grant of summary judgment for the Banks.

IV. Detailed Legal Analysis

A. Diversity Jurisdiction and Corporate Citizenship

1. Governing Principles

The court began by reaffirming foundational jurisdictional rules:

Time of filing rule. Diversity citizenship is determined based on “the state of facts that existed at the time of filing.” Grupo Dataflux v. Atlas Global Group, 541 U.S. 567, 571 (2004).
Complete diversity. Diversity under 28 U.S.C. § 1332(a) requires that “the citizenship of each plaintiff” be “diverse from the citizenship of each defendant.” Caterpillar Inc. v. Lewis, 519 U.S. 61, 68 (1996).

The case involved three categories of parties:

Individuals: Citizenship equals domicile; residence is prima facie evidence of domicile. MidCap Media Fin., L.L.C. v. Pathway Data, Inc., 929 F.3d 310, 313 (5th Cir. 2019) (quoting Stine v. Moore, 213 F.2d 446, 448 (5th Cir. 1954)).
LLCs: An LLC’s citizenship is determined by the citizenship of all its members, including through every layer of ownership. Harvey v. Grey Wolf Drilling Co., 542 F.3d 1077, 1080 (5th Cir. 2008).
Corporations: Under 28 U.S.C. § 1332(c)(1), a corporation is a citizen of:
- its state of incorporation, and
- its principal place of business — the “nerve center” where corporate officers “direct, control, and coordinate” corporate activities. Hertz Corp. v. Friend, 559 U.S. 77, 92–93 (2010).

The Hertz nerve‑center test is especially important when:

A corporation operates nationally; or
It maintains multiple “headquarters” or significant offices in different states.

Hertz instructs courts to look to a single place — usually the actual headquarters — where top officers direct and coordinate corporate operations. But when a corporation uses multiple “headquarters” labels, courts must look at substance over labels.

2. Application to the Parties

The Fifth Circuit agreed with the district court’s findings on the citizenship of all parties other than Cadence:

The Johnsons admitted they were Texas citizens.
The Bighorn LLCs were Texas citizens because their ownership traced back through multiple LLC layers to the Johnsons:
- Bighorn Sand & Gravel LLC → Bighorn Construction & Reclamation LLC → Bridgelink Engineering LLC → Bridgelink Power Operating LLC → Bridgelink Power, LLC → Bridgelink Power Holdings, LLC → the Johnsons.
- Bighorn Investments and Properties, LLC’s sole members were also the Johnsons.
Century Bank is a New Mexico citizen (New Mexico charter; principal place in Santa Fe).

The only real dispute concerned Cadence Bank’s principal place of business.

3. Cadence Bank’s Nerve Center: Tupelo vs. Houston

The Johnsons argued that Cadence’s nerve center was in Houston, Texas, based on:

Representations in SEC filings;
The presence and activities of executive officers in Houston;
Various references to Houston as Cadence’s “corporate headquarters.”

Cadence maintained that:

It was incorporated in Mississippi;
Its bank headquarters — where the core corporate direction and decision‑making occur — is in Tupelo, Mississippi; and
Houston serves as a “corporate headquarters” but not the nerve center.

The Fifth Circuit agreed with the district court’s “comprehensive analysis” and found that Cadence’s principal place of business under Hertz is Tupelo, not Houston.

a. Evidence of the Nerve Center

The court’s conclusion rested on a detailed factual analysis:

Location of key officers:
- The CEO — the most important executive — has his primary office in Mississippi.
- Of 22 corporate officers “who direct, control, and coordinate Cadence Bank’s activities,” a plurality (8) have their primary office in Mississippi, compared to only 6 in Texas.
- Thus, the “center of gravity” of executive leadership is in Mississippi.
Board of directors and Management Committee:
- The “Management Committee” — comprised of “named executive officers” (NEOs) selected by the board — sets major policies and makes key decisions.
- A majority of the NEOs have primary offices in Tupelo.
- The committee meets weekly; a majority of members attend these meetings in person in Tupelo.
- The board of directors also meets in Tupelo, with a majority attending in person.
Formal corporate designations:

Against this evidentiary backdrop, the court held that Tupelo is Cadence’s nerve center for § 1332 purposes, notwithstanding the presence of a significant corporate office in Houston.

b. Key Clarification: Multiple Headquarters vs. Single Nerve Center

The opinion thus reinforces a critical aspect of Hertz:

A corporation may have more than one “headquarters” in ordinary business parlance — e.g., a “corporate headquarters” in one state and a “bank headquarters” or primary operations base in another.
But for diversity jurisdiction, there is only one principal place of business, and courts must identify the actual nerve center based on evidence of where the corporation is truly directed and controlled.
Public‑facing labels and marketing language about headquarters are not dispositive; actual governance practices are.

This is especially significant for multi‑state financial institutions, which often brand themselves as headquartered in prominent financial centers while maintaining operational command structures elsewhere.

B. Judicial Estoppel and Jurisdictional Positions

1. The Doctrine

The Johnsons attempted to invoke judicial estoppel to prevent Cadence from asserting a Mississippi principal place of business, arguing that Cadence had previously claimed to be headquartered in Houston for purposes of other federal cases.

Judicial estoppel prevents a party from:

Taking a legal position that is plainly inconsistent with a prior position;
Where a court has accepted the prior position; and
Where the change is not the product of inadvertence. See Reed v. City of Arlington, 650 F.3d 571, 574 (5th Cir. 2011) (en banc).

The Fifth Circuit also noted that it remains “doubtful” whether the circuit recognizes judicial estoppel in matters affecting subject‑matter jurisdiction at all, citing Haverkamp v. Linthicum, 6 F.4th 662, 671 n.8 (5th Cir. 2021). But the court assumed for argument’s sake that it might apply and then found the requirements unsatisfied.

2. No Plainly Inconsistent Positions

The alleged inconsistencies came from two prior pleadings:

A complaint stating Cadence had its “principal place of business in Tupelo, Mississippi” and its “corporate headquarters . . . in Houston, Texas.”
An answer stating Cadence’s “principal corporate office is in Houston, Harris County, Texas.”

The Fifth Circuit found that:

These statements are not inconsistent with Cadence’s position in this case — namely, that it maintains a corporate headquarters in Houston but its nerve center and principal place of business (for § 1332) is in Tupelo.
Distinguishing “principal place of business” from “principal corporate office” or “corporate headquarters” is permissible where the former is a jurisdictional term of art and the latter are descriptive labels.

Thus, the Johnsons failed the first prong of Reed, and judicial estoppel did not apply.

3. Practical Significance

The opinion sends several practical messages:

Counsel must be careful with jurisdictional terminology; but courts will not automatically treat all references to “headquarters” or “principal corporate office” as binding admissions of “principal place of business” under § 1332.
Judicial estoppel is a demanding doctrine, especially where the alleged inconsistency concerns jurisdictional facts rather than substantive positions.
Parties cannot easily estop a corporation from asserting its nerve center simply because the corporation has at times described itself as “headquartered” elsewhere in public or regulatory filings.

In effect, the court prefers a fact‑intensive, evidence‑based Hertz analysis over rigid reliance on prior shorthand descriptions.

C. Guarantor Liability and the Early‑Release Clause

1. Texas Breach‑of‑Contract Law

The court framed the Banks’ claims under Texas law, which requires proof of:

A valid contract;
Performance or tendered performance by the plaintiff;
Breach by the defendant; and
Damages caused by the breach.

See Smith Int’l, Inc. v. Egle Group, LLC, 490 F.3d 380, 387 (5th Cir. 2007) (quoting Valero Mktg. & Supply Co. v. Kalama Int’l, L.L.C., 51 S.W.3d 345, 351 (Tex. App. 2001)).

At the summary‑judgment stage, the Johnsons did not dispute:

The existence of valid contracts (credit agreement, guaranties);
Their failure to perform (no payments after default); or
The Banks’ damages.

Their only argument was that they had been released from their guaranty obligations under Section 9.3 before Bridgelink defaulted in December 2022.

2. The Continuing Default: Failure of Waiver Conditions

The first condition for early release was that the underlying loan not be “in default.” However:

Bridgelink failed to make its first interest payment in Q1 2022, triggering default under Section 8.1(b).
The Johnsons did not contest this occurred.
The Banks offered to waive this default via a July 2022 amendment, but the waiver was conditional on, among other things, payment of a $170,000 waiver fee.
The record contained no evidence that the waiver fee was ever paid, and Bridgelink did not dispute this.

As a result, the Fifth Circuit held that Bridgelink’s loan had been in default since at least Q1 2022. That alone was fatal to the Johnsons’ early‑release argument, because condition (1) — “no default” — was never satisfied.

3. Even Ignoring the Default: Failure to Meet Conditions (2) and (3)

The court went further and held that even if it assumed (contrary to fact) that the Q1 2022 default were somehow cured, the Johnsons still could not show compliance with the other two conditions for early release.

a. Effect of the July 2022 Amendment

As part of the amendment intended to address the Q1 default, the Johnsons agreed that Q1 2022 would not count as a compliant quarter for purposes of Section 9.3. That had two critical consequences:

The “two consecutive compliant quarters” for early release could not include Q1 2022.
The Johnsons therefore had to prove compliance (including lender confirmation) for both Q2 2022 and Q3 2022.

b. Q2 2022: Conceded Compliance

The Banks conceded at the summary‑judgment hearing that Bridgelink met the relevant conditions for Q2 2022. That concession, not the mere acknowledgment‑of‑receipt emails, established that Q2 could be treated as a compliant quarter for purposes of conditions (2) and (3).

c. Q3 2022: Receipt vs. Confirmation

For Q3 2022, the Banks had only:

Acknowledged receipt of Bridgelink’s compliance documents; and
Contested Bridgelink’s actual compliance at the summary‑judgment hearing.

The Johnsons tried to treat the Q3 acknowledgement email as the functional equivalent of a confirmation of compliance under the release clause. The Fifth Circuit rejected this:

The parties’ course of dealing showed a between an acknowledgment of receipt and a substantive confirmation of compliance.
For Q1 2022, the Banks:
- First acknowledged receipt; and then
- Later sent a separate confirmation that Bridgelink had complied with its covenants.
For Q2 2022, again, only receipt was acknowledged in writing; compliance was established via the Banks’ explicit concession in court — not by the acknowledgement email.

Given this background, the court held:

“Confirmation of receipt is not the same as confirmation of compliance.”

Without a distinct confirmation of Q3 2022 compliance (or an equivalent concession), the Johnsons could not show “two consecutive quarters” of lender‑confirmed compliance with financial covenants and prepayment requirements.

4. Summary Judgment Posture

Under Federal Rule of Civil Procedure 56(a), summary judgment is appropriate when there is no genuine dispute of material fact and the movant is entitled to judgment as a matter of law. The Fifth Circuit reviewed the grant of summary judgment de novo, consistent with Bagley v. Albertsons, Inc., 492 F.3d 328, 330 (5th Cir. 2007).

On the early‑release issue:

The Banks met their burden by showing:
- Undisputed default in Q1 2022 and nonpayment of the waiver fee;
- Amendment excluding Q1 2022 as a compliant quarter;
- No evidence of Q3 2022 compliance confirmation; and
- Nonpayment by guarantors after defaults.
The Johnsons failed to produce evidence that:
- The default was cured or waived under the terms of the amendment; or
- The Banks ever confirmed Q3 2022 compliance.

Because the Johnsons’ evidence at most showed receipt of documents, not substantive confirmation, the court found no genuine factual dispute. The Johnsons’ failure to satisfy one or more conditions precedent to their release meant their guaranty remained in force.

D. Precedents and Cross‑References

Several precedents feature prominently in the opinion and shape its analysis:

Mitchell v. Maurer, 293 U.S. 237, 244 (1934):
- Reiterated that appellate courts must verify the existence of subject‑matter jurisdiction — both their own and the district court’s — in cases under review.
Grupo Dataflux v. Atlas Global Group, 541 U.S. 567 (2004):
- “Time of filing” rule; jurisdictional facts are assessed as of the time the complaint is filed.
Caterpillar Inc. v. Lewis, 519 U.S. 61 (1996):
- Reaffirms complete diversity requirement; each plaintiff must be diverse from each defendant.
Hertz Corp. v. Friend, 559 U.S. 77 (2010):
- Establishes the “nerve center” test for corporate principal place of business.
- The Fifth Circuit applied this framework to a complex, multi‑headquarters financial institution.
Harvey v. Grey Wolf Drilling Co., 542 F.3d 1077 (5th Cir. 2008):
- LLCs take citizenship of all their members.
- Guided the tracing of the Bighorn LLCs’ citizenship through multiple layers up to the Johnsons.
MidCap Media Fin., L.L.C. v. Pathway Data, Inc., 929 F.3d 310 (5th Cir. 2019); Stine v. Moore, 213 F.2d 446 (5th Cir. 1954):
- Clarified that an individual’s citizenship equals domicile, with residence being prima facie evidence.
Reed v. City of Arlington, 650 F.3d 571 (5th Cir. 2011) (en banc):
- Provides the three‑factor test for judicial estoppel, adopted by the court here.
Haverkamp v. Linthicum, 6 F.4th 662 (5th Cir. 2021):
- Noted doubt whether judicial estoppel applies to questions of subject‑matter jurisdiction; cited by the court in expressing skepticism about using estoppel in this context.
Smith Int’l, Inc. v. Egle Group, LLC, 490 F.3d 380 (5th Cir. 2007); Valero Mktg. & Supply Co. v. Kalama Int’l, L.L.C., 51 S.W.3d 345 (Tex. App. 2001):
- Supplied the Texas breach‑of‑contract elements applied to the guaranty and loan agreements.
Bagley v. Albertsons, Inc., 492 F.3d 328 (5th Cir. 2007):
- Confirmed de novo review of summary‑judgment rulings.
In re Fort Worth Chamber of Commerce, 100 F.4th 528 (5th Cir. 2024) & Fed. R. Civ. P. 62.1(a):
- Support the limited remand procedure used to allow the district court to decide the jurisdictional motion while the appeal was pending.

V. Simplifying Key Legal Concepts

1. Diversity Jurisdiction

“Diversity jurisdiction” allows federal courts to hear certain civil cases between citizens of different U.S. states if more than $75,000 is at stake. The idea is to provide a neutral forum and avoid perceived home‑state bias.

Two core requirements:

Complete diversity: No plaintiff can share a state of citizenship with any defendant.
Time of filing: The relevant citizenships are those that existed when the case was first filed.

2. Citizenship: Individuals, LLCs, and Corporations

Individuals: Citizen of the state where they are domiciled (their permanent home, not just where they happen to be living temporarily).
LLCs: An LLC is a citizen of every state in which any of its members is a citizen; this requires tracing up through all ownership layers.
Corporations: Citizens of their:
- State of incorporation; and
- Principal place of business (the “nerve center”).

3. The “Nerve Center” Test

Under Hertz, a corporation’s principal place of business is the single place where top officers:

Direct;
Control; and
Coordinate

corporate activities — typically the real, functioning headquarters. It is not about where the most business is done or where the most employees are located, but about where high‑level corporate decisions are made.

4. Judicial Estoppel

Judicial estoppel is a fairness doctrine that stops a party from playing “fast and loose” with the courts by taking contradictory legal positions in different cases (or at different times in the same case) when:

The positions are clearly inconsistent;
A court has already accepted the earlier position; and
The inconsistency is not an honest mistake or based on new facts.

In Cadence Bank v. Johnson, the Fifth Circuit declined to apply judicial estoppel because Cadence’s earlier references to its “corporate headquarters” or “principal corporate office” in Houston were not plainly inconsistent with asserting that its jurisdictional principal place of business was in Tupelo.

5. Guaranties and Early‑Release Clauses

A guaranty is a promise by a third party (here, the Johnsons) to pay a debtor’s obligations if the debtor (Bridgelink) does not. An early‑release clause allows guarantors to be released before the loan is fully repaid if specified conditions are met.

Such clauses often require:

A period of good payment history (no defaults);
Proof of financial covenant compliance; and
Affirmative confirmation by the lender.

Courts typically require strict compliance with these conditions. In this case, the Johnsons’ early‑release clause failed because:

Default had occurred and not been effectively waived; and
They lacked evidence of two consecutive quarters of lender‑confirmed compliance.

6. Default, Waiver, and Conditional Waiver

Default: The borrower violates the loan terms (for example, by missing a payment).
Waiver: The lender agrees to overlook or forgive a default. This can be unconditional or conditioned on satisfying negotiated requirements (e.g., paying a fee).
Conditional waiver: If the borrower does not satisfy the conditions (here, payment of a $170,000 waiver fee), the default is not actually waived and continues to exist.

7. Summary Judgment

Summary judgment is a way to resolve a case without a trial when there is no real dispute about the facts that matter and the law clearly favors one side. The moving party must show:

No genuine dispute as to any material fact; and
Entitlement to judgment as a matter of law.

If the movant meets this burden, the opposing party must bring forward specific evidence creating a genuine factual dispute. Mere argument or speculation is not enough.

VI. Likely Impact and Practical Implications

A. Corporate Citizenship for Multi‑State Financial Institutions

The opinion has notable consequences for banks and financial institutions that:

Operate across state lines;
Maintain multiple offices labeled as “headquarters”; and
Engage in frequent federal litigation premised on diversity jurisdiction.

Key takeaways:

Evidence‑driven analysis: Courts will look to where the CEO and top executives actually work, where the board and key committees meet, and where major corporate policies are set.
Labels are not controlling: Public branding of a city as “corporate headquarters” or “principal corporate office” does not automatically make that city the principal place of business under § 1332.
Single nerve center: Even for large, complex institutions with multiple hubs, there is only one principal place of business. This can stabilize and clarify jurisdictional analyses for such entities.

B. Litigation Strategy in Diversity Cases

For litigators, Cadence Bank v. Johnson underscores:

The importance of developing a robust factual record on corporate governance when principal place of business is contested.
The limited utility of judicial estoppel for forcing a corporation to accept a particular nerve center based merely on marketing or prior shorthand descriptions.
That arguments raised late in the day (e.g., jurisdictional attacks mounted after briefing on appeal) will be scrutinized but, if they raise genuine jurisdictional questions, must still be addressed — sometimes via limited remand.

C. Drafting and Enforcing Guarantor Release Clauses

For lenders and borrowers, the case highlights:

Precision in drafting: Early‑release clauses should clearly distinguish:
- What constitutes “submission” of compliance information;
- What constitutes “confirmation” by the lender; and
- How defaults and waivers affect those rights.
Strict compliance: Guarantors seeking release must be prepared to prove that each condition in the clause was fully satisfied, including lender confirmations, especially when defaults have occurred.
Documenting waivers and confirmations: Lenders should:
- Expressly distinguish between “receipt” and “approval/confirmation” in emails and correspondence; and
- When waiving defaults, clearly document the conditions and the effect of non‑payment or non‑performance of those conditions.

The decision strengthens lenders’ hands in enforcing guaranties and underscores that guarantors cannot rely on ambiguous or informal communications to establish release.

D. Post‑Judgment Jurisdictional Challenges

The procedural history — with the Johnsons raising a substantial jurisdictional challenge after briefing on appeal, followed by a limited remand — emphasizes:

Court of appeals’ duty to ensure jurisdiction sua sponte (Mitchell v. Maurer);
The usefulness of Fed. R. Civ. P. 62.1 and decisions like In re Fort Worth Chamber of Commerce for managing late‑breaking jurisdictional issues efficiently;
The importance for plaintiffs of thoroughly and accurately pleading jurisdictional facts from the outset to avoid costly detours.

VII. Conclusion

Cadence Bank v. Johnson is more than a routine enforcement of guaranty obligations. It:

Clarifies how the Hertz nerve center test applies to a multi‑headquartered bank, concluding that Cadence’s principal place of business is in Tupelo, Mississippi, notwithstanding a large and highly publicized corporate presence in Houston, Texas.
Reaffirms that complete diversity is assessed via a meticulous examination of individual, LLC, and corporate citizenship — including deep tracing of LLC ownership chains.
Signals continued skepticism toward judicial estoppel as a tool to manipulate jurisdictional facts, especially where prior statements about “headquarters” are not truly inconsistent with the corporation’s asserted nerve center.
Strengthens the principle that guarantor release clauses are strictly construed and that creditors are entitled to insist on literal satisfaction of each condition, including lender confirmations and the absence (or proper waiver) of default.

In the broader legal landscape, the decision:

Provides a detailed roadmap for courts and practitioners confronting jurisdictional disputes involving multi‑state corporations and banks;
Offers guidance for drafting and enforcing complex guaranty and waiver provisions in large commercial credit facilities; and
Reaffirms the centrality of careful factual development and precise language in both jurisdictional and contractual disputes.

Taken together, the Fifth Circuit’s opinion reinforces a consistent message: in both jurisdiction and contract enforcement, substance, structure, and documented practice control — not labels, assumptions, or wishful interpretations.