Opinion
Case No. C-3-00-591
September 21, 2001
Plaintiff Reed Elsevier Inc., through its Lexis-Nexis Group Division ("Plaintiff") filed the underlying action against Defendant The Credit Index, L.L.C. ("Defendant" or "TCI"), seeking Declaratory Judgment (Doc. #2), pursuant to 28 U.S.C. §§ 2201 2202, Plaintiff asserts that this Court has jurisdiction pursuant to diversity of citizenship. 28 U.S.C. § 1332. Plaintiff contends that Defendant is a limited liability corporation, organized under the laws of the State of New Jersey. (Compl. ¶ 2.)
Defendant has moved to dismiss on several grounds, and the parties have submitted their respective arguments on the merits of Defendant's Motion to Dismiss (Doc. #4). For reasons which follow, the Court DISMISSES Plaintiff's Complaint upon its own Motion, and OVERRULES, as moot, Defendant's Motion without prejudice to renewal should Plaintiff cure the jurisdictional defect of its Complaint.
"A case falls within the federal district court's `original' diversity `jurisdiction' only if diversity of citizenship among the parties is complete, i.e., only if there is no plaintiff and no defendant who are citizens of the same State." Wisconsin Dept. of Corrections v. Schacht, 524 U.S. 381, 388 (1998) (citations omitted). This doctrine is referred to as "complete diversity." See Carden v. Arkoma Assoc., 494 U.S. 185, 187 (1989). Whereas a corporate entity is deemed to be a citizen of the state in which it is incorporated or in which it maintains its principal place of business, See id. at 188; 28 U.S.C. § 1332(c), unincorporated business associations are deemed citizens of any state in which any of its members or partners reside. See id. at 189; Certain Interested Underwriters v. Layne, 26 F.3d 39, 41 (6th Cir. 1994); Cosgrove v. Bartolotta, 150 F.3d 729, 731 (7th Cir. 1998). Thus, the Supreme Court has held that the citizenship of organizations such as limited partnerships is any state in which any of the partners, including limited partners, reside. Arkoma, 494 U.S. at 189-197.
Consistent with the rule laid out by the Supreme Court regarding the citizenship of unincorporated business associations, federal courts overwhelmingly treat the citizenship of limited liability corporations like partnerships, and not like full corporations. See Cosgrove, supra, at 731 (concluding that "the citizenship of an LLC for purposes of the diversity jurisdiction is the citizenship of its members"); Saecker v. Thorpe, 234 F.3d 1010, 1011 (7th Cir. 2000); Handelsman v. Bedford Village Assoc. Ltd. Partnership, 213 F.3d 48 (2d Cir. 2000);International Flavors and Textures. LLC v. Gardner, 966 F. Supp. 552 (W.D.Mich. 1997); JBG/JER Shady Grove, LLC v. Eastman Kodak Co., 127 F. Supp.2d 700 (D.Md. 2001).
See also Refco, LLC v. Herst Ventures, No. 01 C 6486, 2001 WL 987711 (N.D. Ill Aug. 27, 2001); Ketterson v. Wolf, No. Civ. A. 99-689-JJF, 2001 WL 940909 (D.Del. Aug. 14, 2001); Pippett v. Waterford Development, LLC, No. CIV, A.01-CV-539, 2001 WL 869583 (E.D.Pa. July 30, 2001); Strother v. Harte, No. 00 CIV.4460 (DC), 2001 WL 428251 (S.D.N Y Apr. 25, 2001).
This Court finds that it cannot be certain of its diversity jurisdiction without first knowing whether the members of TCI have complete diversity of citizenship from that of Plaintiff. Accordingly, because Plaintiff herein has not set forth the state(s) of citizenship of the members who comprise TCI, the Court's subject matter jurisdiction is not clear.
Therefore, Plaintiff is directed to conduct what reasonable discovery is necessary to ascertain the citizenship of the members of TCI. If, in good faith, Plaintiff ascertains that complete diversity does exist, it may refile its Complaint not later than thirty (30) days from date, stating such facts as would allow the Court to proceed to the merits of the case. If such a renewed Complaint is filed, and Defendant wishes to renew its Motion to Dismiss, it may do so. For purposes of establishing diversity, Plaintiff is directed to ascertain the citizenship of TCI's members as of the date of the filing of its original Complaint, December 15, 2000. See Napletana v. Hillsdale College, 385 F.2d 381, 382 (6th Cir. 1967) (finding that district court has jurisdiction "if diversity of citizenship existed at the time the complaint was filed") (citations omitted).
Of course, if, in the course of this limited discovery, Plaintiff ascertains that such diversity does not exist, the Complaint must not be refiled in this Court The captioned cause will then be terminated.