Rogers v. State Farm Mutual Automobile Insurance Company

Filing 4

Order that plaintiff is to file and serve on defendant an Amended Complaint by 10/17/2014 that properly alleges citizenship of State Farm for the purpose of establishing diversity. Signed by Magistrate Judge Katherine P. Nelson on 10/10/2014. (srr)

IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF ALABAMA
SOUTHERN DIVISION
LILLY ROGERS,
Plaintiff,
v.
STATE FARM MUTUAL
AUTOMOBILE INSURANCE
COMPANY,
Defendant.

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CIVIL ACTION NO. 14-00470-N

ORDER
This action is before the Court on a sua sponte review of its subject-matter
jurisdiction.1 On October 8, 2014, the Plaintiff initiated this action by filing a
Complaint (Doc. 1) in this Court. The Complaint alleges diversity pursuant to 28
U.S.C. § 1332(a) as the sole basis for the Court’s subject-matter jurisdiction over the
claims in this action. The amount-in-controversy requirement of § 1332(a) appears
satisfied on the face of the Complaint, and the Plaintiff, a natural person, is alleged
to be a citizen of Alabama.

However, the Plaintiff, as the party invoking this

Court’s jurisdiction, has failed to allege sufficient facts establishing the citizenship of
the Defendant, State Farm Mutual Automobile Insurance Company (“State Farm”).2
“It is . . . axiomatic that the inferior federal courts are courts of limited jurisdiction. They
are ‘empowered to hear only those cases within the judicial power of the United States as
defined by Article III of the Constitution,’ and which have been entrusted to them by a
jurisdictional grant authorized by Congress.” Univ. of S. Ala. v. Am. Tobacco Co., 168 F.3d
405, 409 (11th Cir. 1999) (quoting Taylor v. Appleton, 30 F.3d 1365, 1367 (11th Cir. 1994)).
Accordingly, “it is well settled that a federal court is obligated to inquire into subject matter
jurisdiction sua sponte whenever it may be lacking.” Id. at 410. “[A] court should inquire
into whether it has subject matter jurisdiction at the earliest possible stage in the
proceedings.” Id.

1

“The burden of pleading diversity of citizenship is upon the party invoking federal
jurisdiction . . .” Ray v. Bird & Son & Asset Realization Co., Inc., 519 F.2d 1081, 1082 (5th
Cir. 1975) (citing Mas v. Perry, 489 F.2d 1396 (5th Cir. 1974)). “The pleader must
affirmatively allege facts demonstrating the existence of jurisdiction and include ‘a short

2

The Plaintiff alleges that State Farm is “a corporation or other business
entity, organized and existing under the laws of a State other than the State of
Alabama, with its offices and principal place of business in Bloomington, Illinois, or
other State outside the State of Alabama.”

(Doc. 1 at 1, ¶ 2).

The Plaintiff, however, must specify what kind of “business entity” State
Farm is. If State Farm is a corporation, then it is deemed a citizen of “every State
and foreign state by which it has been incorporated and of the State or foreign state
where it has its principal place of business…” 28 U.S.C. § 1332(c)(1).
However, if Plaintiff is an unincorporated entity, such as a limited liability
company or a partnership, then the citizenship(s) of its member(s) control. See
Rolling Greens, MHP, L.P. v. Comcast SCH Holdings, L.L.C., 374 F.3d 1020, 1021-22
(11th Cir. 2004) (“In Carden v. Arkoma Assocs., 494 U.S. 185, 195–96, 110 S. Ct.
1015, 1021, 108 L. Ed. 2d 157 (1990), the Supreme Court held that for purposes of
diversity of citizenship, a limited partnership is a citizen of each state in which any
of its partners, limited or general, are citizens. In reaching this holding, the Court
noted the long-standing rule that the citizenship of an artificial, unincorporated
entity generally depends on the citizenship of all the members composing the
organization…We hold that the general rule for unincorporated entities also applies
to limited liability companies, in the absence of Congress's extending the treatment
given to corporations…To sufficiently allege the citizenships of these unincorporated
business entities, a party must list the citizenships of all the members of the limited
liability company and all the partners of the limited partnership.”); Iraola & CIA,

and plain statement of the grounds upon which the court's jurisdiction depends.’ ” Taylor, 30
F.3d at 1367 (quoting Fed. R. Civ. P. 8(a)).

2

S.A. v. Kimberly-Clark Corp., 232 F.3d 854, 860 (11th Cir. 2000) (“[B]ecause
unincorporated entities are attributed the citizenship of their owners, that rule
would mean that Geo Med is an Argentinian entity because its owner, Alpert, is
Argentinian.” (citation and footnote omitted)).”); Mallory & Evans Contractors &
Engineers, LLC v. Tuskegee Univ., 663 F.3d 1304, 1305 (11th Cir. 2011) (per
curiam)(“In Rolling Greens MHP, L.P. v. Comcast SCH Holdings, L.L.C., 374 F.3d
1020, 1022 (11th Cir. 2004), we held that a limited liability company, like a
partnership, ‘is a citizen of any state of which a member of the company is a citizen.’
We continued: ‘To sufficiently allege the citizenships of these unincorporated
business entities, a party must list the citizenships of all the members of the limited
liability company....’ Id.).
The Plaintiff appears to treat State Farm as a corporation for purposes of
alleging citizenship. However, her allegations in this regard simply amount to the
assertion that State Farm is not a citizen of Alabama. This is insufficient to meet
the Plaintiff’s burden to “affirmatively allege facts demonstrating the existence of
jurisdiction…”

Taylor v. Appleton, 30 F.3d 1365, 1367 (11th Cir. 1994). As such, if

State Farm is indeed a corporation, the Plaintiff must plead both the state(s) where
it has been incorporated and the state where its principal place of business is located
in order to establish State Farm’s citizenship for purposes of diversity jurisdiction.
“Defective allegations of jurisdiction may be amended, upon terms, in the trial
or appellate courts.”

28 U.S.C. § 1653. “[L]eave to amend should be freely granted

when necessary to cure a failure to allege jurisdiction properly.”

Majd-Pour v.

Georgiana Cmty. Hosp., Inc., 724 F.2d 901, 903 n.1 (11th Cir. 1984). Accordingly,
the Plaintiff is ORDERED to file and serve on State Farm, on or before Friday,

3

October 17, 2014, an amended complaint that properly alleges the citizenship of
State Farm for the purpose of establishing diversity pursuant to § 1332(a) (or some
other basis of subject matter jurisdiction).3 The amended complaint, if filed, shall
become the operative complaint in this action,4 and State Farm shall respond to the
amended complaint in accordance with the Federal Rules of Civil Procedure.
DONE and ORDERED this the 10th day of October 2014.
/s/ Katherine P. Nelson
KATHERINE P. NELSON
UNITED STATES MAGISTRATE JUDGE

The Plaintiff is reminded that, for purposes of diversity, the relevant citizenships are those
at the time the case was filed. E.g., Grupo Dataflux v. Atlas Global Grp., L.P., 541 U.S.
567, 570-71 (2004).

3

“As a general matter, ‘[a]n amended pleading supersedes the former pleading; the original
pleading is abandoned by the amendment, and is no longer a part of the pleader's averments
against his adversary.’ ” Pintando v. Miami-Dade Hous. Agency, 501 F.3d 1241, 1243 (11th
Cir. 2007) (per curiam) (quoting Dresdner Bank AG, Dresdner Bank AG in Hamburg v. M/V
OLYMPIA VOYAGER, 463 F.3d 1210, 1215 (11th Cir. 2006) (citation and quotation
omitted)). See also, e.g., Fritz v. Standard Sec. Life Ins. Co. of New York, 676 F.2d 1356,
1358 (11th Cir. 1982) (“Under the Federal Rules, an amended complaint supersedes the
original complaint.”).

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