Demetralis v. General Motors LLC et al
Filing
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MEMORANDUM Opinion and Order. Signed by the Honorable Milton I. Shadur on 10/25/2016:Mailed notice(clw, )
IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION
THEODORA DEMETRALIS,
Plaintiff,
v.
GENERAL MOTORS LLC, et al.,
Defendants.
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Case No. 16 C 9862
MEMORANDUM OPINION AND ORDER
Theodora Demetralis ("Demetralis") has invoked diversity-of-citizenship jurisdiction to
sue a group of General Motors affiliated companies -- General Motors LLC, General Motors
Company, General Motors Holdings LLC and GM LLC 1 -- because an allegedly defective
ignition switch in her 2012 Chevrolet Cruze assertedly caused a serious accident that injured
Demetralis severely. This memorandum opinion and order is issued sua sponte because of some
problematic aspects of Demetralis' Complaint.
It should made clear at the outset, however, that nothing said here raises any substantive
issues as to Demetralis' claim. As always, her well-pleaded allegations in that respect are
accepted as true for present purposes.
Instead one problem is posed by her jurisdictional allegations. As the first paragraph of
this memorandum opinion and order reflects, three of Demetralis' targets are limited liability
companies, and the references in Complaint ¶¶ 3 and 4 to the members and owners of two of
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1
Although the case caption lists the last-named defendant simply as "GM," Complaint
¶ 5 identifies it as "GM LLC."
those companies reflect her counsel's awareness of the well-established principle that the
citizenship of a limited liability company for diversity purposes is that of all its members, not
that of the company itself (see, e.g., the reiteration of that principle in Wise v. Wachovia Sec.,
LLC, 450 F.3d 265, 267 (7th Cir. 2006)). But in spite of that awareness, Demetralis' counsel has
committed two errors, one of them harmless and the other not.
As for the harmless (but frankly not understandable) error, as to each of General Motors
LLC (Complaint ¶ 2) and General Motors Holdings LLC (Complaint ¶ 3) the Complaint follows
jurisdictionally irrelevant allegations as to the state of the LLC's formation (Delaware) and its
principal place of business (Michigan) with the incorrect follow-up allegation that the LLC "is a
citizen of the States of Delaware and Michigan." As stated earlier, that is simply wrong, and that
allegation must be and is stricken.
More serious, and indeed fatal in jurisdictional terms, is the total failure in Complaint ¶ 5
to identify the members of defendant GM LLC. That failure equates to a failure to allege the
total diversity required to establish federal jurisdiction, and the caselaw teaches that is a ground
for dismissal of the Complaint.
Before this memorandum opinion and order returns to that subject, though, there is
another material problem with the Complaint: Its introductory paragraph collectivizes the four
defendants as "General Motors," and all of the Complaint's ensuing substantive paragraphs
impermissibly speak of "General Motors" as having committed the asserted tortious acts that
caused great harm to Demetralis. But tort liability is individual in nature -- for example, if as its
name suggests General Motors Holdings LLC is in fact just a holding company, the negligence
of its subsidiary General Motors LLC would not render the holding company liable for that
negligence.
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So Demetralis' counsel cannot properly lump the defendants together as he has. Hence
the Complaint is dismissed without prejudice. 2 Leave is granted to file an Amended Complaint
on or before November 15, 2016 (with a courtesy copy to be delivered to this Court's chambers),
and if the Amended Complaint has cleaned up matters appropriately this Court would anticipate
then issuing its customary initial scheduling order.
One last point: It would seem quite unfair for client Demetralis to bear the costs of
correcting her counsel's mistakes. So no charge may be made to Demetralis by her counsel for
the added work and expense incurred in correcting counsel's errors. Demetralis' counsel is
ordered to apprise his client to that effect by letter, with a copy to be transmitted to this Court's
chambers as a purely informational matter (not for filing).
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Milton I. Shadur
Senior United States District Judge
Date: October 25, 2016
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2
Although the jurisdictional defect identified earlier would, under our Court of Appeals'
teaching, call for outright dismissal of the action, this Court will give counsel a second chance to
correct his obviously unintended mistake (which would seem to be curable).
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