Smith v. Dolgencorp, LLC et al
Filing
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ORDER TO SUPPLEMENT re 1 Notice of Removal filed by Dolgencorp, LLC. See Order for specifics. Signed by Honorable P. K. Holmes, III on February 3, 2017. (hnc)
IN THE UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF ARKANSAS
FORT SMITH DIVISION
JOHN SMITH
v.
PLAINTIFF
No. 2:17-CV-02019
DOLGENCORP, LLC; and
JOHN DOES 1 – X
DEFENDANTS
ORDER TO SUPPLEMENT
The Court, having preliminarily reviewed the pleadings in this case, now directs
Defendants to supplement their jurisdictional allegations to address the Court’s concerns listed
below. Subject matter jurisdiction and the issue of this Court’s authority to hear an action may be
raised at any time. Fed. R. Civ. P. 12(h)(3). The Court finds it to be most prudent and efficient to
address any jurisdictional concerns at the outset of the case to avoid any surprises after the parties
and the Court have expended time and resources in litigation. See, e.g., Reece v. Bank of New York
Mellon, 760 F.3d 771, 777 (8th Cir. 2014) (chastising district court for incorrectly and “summarily
announc[ing]” that diversity of citizenship existed based on flawed jurisdictional allegations by
the parties); Belleville Catering Co. v. Champaign Market Place L.L.C., 350 F.3d 691, 692-93 (7th
Cir. 2003) (lamenting that “[o]nce again litigants’ insouciance toward the requirements of federal
jurisdiction has caused a waste of time and money,” noting that failure to ensure jurisdiction exists
“has the potential, realized here, to waste time (including that of put-upon jurors) and run up legal
fees”, remanding, and directing counsel for parties invoking jurisdiction to perform remaining
legal services without charging additional fees to clients).
The Court has identified the following issue with the jurisdictional allegations in this case.
The notice of removal does not sufficiently allege the citizenship of Defendant Dolgencorp, LLC.
The notice of removal states that “Dolgencorp is a Kentucky limited liability company with its
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principal place of business in Tennessee. Diversity is therefore not disputed.” (Doc. 1, ¶ 4). This
is insufficient to properly plead the citizenship of a Defendant for purposes of determining whether
this Court can exercise diversity jurisdiction.
In order to properly plead the citizenship of an LLC or other unincorporated entity for
diversity purposes, a party must plead the state or states of citizenship of each member. OnePoint
Solutions, LLC v. Borchert, 486 F.3d 342, 346 (8th Cir. 2007). Furthermore, citizenship of such
entities must be traced “down the various organizational layers where necessary.” See Mullins v.
TestAmerica Inc., 564 F.3d 386, 397 (5th Cir. 2009); see also OnePoint Solutions, 486 F.3d at 346
(in analyzing diversity jurisdiction, identifying the citizenship of each of the individual corporate
members of the LLC). Citizenship of the members should be pleaded with specificity and not in
a conclusory fashion. See, e.g., Lindley Contours, LLC v. AABB Fitness Holdings, Inc., 414 Fed.
Appx. 62, 63-64 (9th Cir. 2011) (unpublished) (ordering district court to vacate all orders and
remand to state court after raising jurisdictional deficiencies sua sponte on appeal, and finding that
an allegation stating that no member of an LLC “is an Oregon citizen” without identifying actual
state(s) of citizenship or whether members are composed of another layer of business entities is
insufficient to establish complete diversity); Armada Coal Export, Inc. v. Interbulk, Ltd., 726 F.2d
1566, 1568-69 (11th Cir. 1984) (rejecting allegation of citizenship in the negative and remanding
case for removing party to “amend its removal petition to state unequivocally” that diversity
jurisdiction existed).
Absent an alternative basis for jurisdiction, Dolgencorp, LLC must properly establish that
complete diversity exists among the parties as set forth above. Congress has provided that
“[d]efective allegations of jurisdiction may be amended, upon terms, in the trial or appellate
courts.” 28 U.S.C. § 1653. The Court therefore directs Dolgencorp, LLC to supplement its
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jurisdictional allegations by filing a response to this order, by Friday, February 10, 2017, fully
addressing the concerns listed above. Dolgencorp, LLC is advised that jurisdictional allegations
should be alleged as of the time of removal and at the time the case was commenced in state court.
Chavez-Lavagnino v. Motivation Educ. Training, Inc., 714 F.3d 1055, 1056 (8th Cir. 2013)
(Remanding case that had been tried to a jury, for determination of whether jurisdiction existed,
holding that “[f]or a party to remove a case to federal court based on diversity jurisdiction, the
parties must be diverse both when the plaintiff initiates the action in state court and when the
defendant files the notice of removal in federal court.”).
Dolgencorp, LLC is further advised that failure to substantiate that this Court can
appropriately exercise jurisdiction will result in remand of this action to state court for lack of
subject matter jurisdiction.
IT IS SO ORDERED this 3rd day of February, 2017.
/s/P. K. Holmes, III
P.K. HOLMES, III
CHIEF U.S. DISTRICT JUDGE
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