General Electric Capital Business Asset Funding Corporation of Connecticut et al v. East Coast Foods I LLC et al

Filing 8

ORDER: the complaint in this action is dismissed for lack of subject matter jurisdiction, the plaintiffs shall file an amended complaint properly stating a jurisdictional basis for this action no later than October 3, 2011, the plaintiffs shall immediately provide a copy of this order to any defendant already served with process. Signed by Judge Paul G Rosenblatt on 9/21/2011. (ALS)

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IN THE UNITED STATES DISTRICT COURT

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FOR THE DISTRICT OF ARIZONA

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General Electric Capital Business
Asset Funding Corporation of
Connecticut, et al.,
Plaintiffs,

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vs.
East Coast Foods I, LLC, et al.,
Defendants.

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No. CV-11-1843-PHX-PGR

ORDER

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In a complaint filed on September 20, 2011, the plaintiffs allege that the

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Court has diversity of citizenship jurisdiction over this action pursuant to 28

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U.S.C. § 1332(a). Having reviewed the complaint, the Court finds that the

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jurisdictional allegations therein are patently insufficient as a matter of law to

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establish the existence of subject matter jurisdiction. The Court will therefore

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require the plaintiffs to file an amended complaint properly stating a jurisdictional

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basis for this action. See 28 U.S.C. § 1653; see also, Smith v. McCullough, 270

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U.S. 456, 459, 46 S.Ct. 338, 339 (1926) ("The established rule is that a plaintiff,

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suing in federal court, must show in his pleading, affirmatively and distinctly, the

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existence of whatever is essential to federal jurisdiction, and, if he does not do so,

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the court, on having the defect called to its attention or on discovering the same,

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must dismiss the case, unless the defect be corrected by amendment.")

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The existence of diversity jurisdiction is not evident from the face of the

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complaint inasmuch as the complaint fails to properly allege the citizenship of six

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of the seven named parties. First, as to the limited liability company parties, i.e.,

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plaintiff CEF Funding V, LLC and defendants East Coast Foods I, LLC and East

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Coast Foods II, LLC, the complaint improperly attempts to allege their citizenship

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as if they are corporations notwithstanding that it has been clearly established for

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years that a limited liability company cannot be treated as a corporation for

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purposes of alleging citizenship under § 1332. See Johnson v. Columbia

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Properties Anchorage, LP, 437 F.3d 894, 899 (9th Cir. 2006) ("Notwithstanding

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LLCs' corporate traits, ... every circuit that has addressed the question treats

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them like partnerships for the purposes of diversity jurisdiction. ... We therefore

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join our sister circuits and hold that, like a partnership, an LLC is a citizen of every

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state of which its owners/members are citizens.") Since the complaint fails to set

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forth the citizenship of any member of these limited liability companies, the Court

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will require the plaintiff to specifically identity in its amended complaint each LLC

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member by name, specifically allege the type of business entity that any non-

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individual member is, and affirmatively allege the state of citizenship of each

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member.1

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Second, as to the individual defendants, i.e., John Lopis, Stacey Lopis, and

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Alfred Duff, the complaint improperly attempts to allege their citizenship by setting

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Since only a corporation or an individual may be a citizen for purposes
of § 1332 jurisdiction, the amended complaint must set forth any sub-layers of
partners or members the limited liability companies may have.
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forth the location where each has a residence. See Steigleder v. McQuesten, 198

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U.S. 141, 143, 25 S.Ct. 616, 617 (1905) ("It has long been settled that residence

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and citizenship [are] wholly different things within the meaning of the Constitution

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and the laws defining and regulating the jurisdiction of the ... courts of the United

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States; and that a mere averment of residence in a particular state is not an

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averment of citizenship in that state for the purpose of jurisdiction."); accord,

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Kanter v. Warner-Lambert Co., 265 F.3d 853, 857-58 (9th Cir. 2001) (“Plaintiffs'

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complaint ... state[s] that Plaintiffs were 'residents' of California. But the diversity

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jurisdiction statute, 28 U.S.C. § 1332, speaks of citizenship, not of residency. ...

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[The] failure to specify Plaintiffs' state of citizenship was fatal to [the] assertion of

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diversity jurisdiction.") The plaintiffs must affirmatively set forth the citizenship of

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each individual defendant in the amended complaint.

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The plaintiffs are advised that their failure to timely or sufficiently comply

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with this order will result in the dismissal of this action for lack of subject matter

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jurisdiction. Therefore,
IT IS ORDERED that the complaint in this action is dismissed for lack of

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subject matter jurisdiction.

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IT IS FURTHER ORDERED that the plaintiffs shall file an amended

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complaint properly stating a jurisdictional basis for this action no later than

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October 3, 2011.2
IT IS FURTHER ORDERED that the plaintiffs shall immediately provide a

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The parties are advised that the complete capitalization of a party’s
name in the caption of any document filed with the Court violates LRCiv 7.1(a)(3)
unless that party’s name is completely capitalized in its normal use.
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copy of this order to any defendant already served with process.
DATED this 21st day of September, 2011.

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