Hindrichs et al v. United Repossessors, Inc. et al

Filing 3

ORDER requiring defendant to correct allegations of citizenship by July 31, 2012.Signed by Chief Judge David R. Herndon on 7/17/2012. (mtm)

IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF ILLINOIS

TODD and STACEY HINDRICHS,
Plaintiffs,
v.

UNITED REPOSSESSORS, INC.
TD AUTO FINANCE, JOHN DOE
ONE, JOHN DOE TWO, and JANE
DOE,
Defendants.

Case No. 12-cv-804-DRH-SCW
MEMORANDUM & ORDER

HERNDON, Chief Judge:
The matter of defendant United Repossessors, LLC’s, improper notice of
removal is currently before the Court (Doc. 2), as the Court is obligated to raise
sua sponte whether it has subject matter jurisdiction over this case. See Craig v.
Ontario Corp., 543 F.3d 872, 875 (7th Cir. 2008) (citing Sadat v. Mertes, 615
F.2d 1176, 1188 (7th Cir. 1980) (stating, “it has been the virtually universally
accepted practice of the federal courts to permit any party to challenge or, indeed,
raise sua sponte the subject-matter jurisdiction of the court at any time and at
any stage of the proceedings”)).

Due to the deficiencies below mentioned,

defendant is ORDERED to correct its jurisdictional allegations by July 31, 2012,
or this case shall be REMANDED.
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Defendant removes this case on the basis of diversity jurisdiction, pursuant
to 28 U.S.C. § 1332. The statute regarding diversity jurisdiction, 28 U.S.C. §
1332, requires complete diversity between the parties plus an amount in
controversy exceeding $75,000, exclusive of interest and costs.

The removal

statute, 28 U.S.C. § 1441, is construed narrowly and doubts concerning removal
are resolved in favor of remand. Doe v. Allied-Signal, Inc., 985 F.2d 908, 911
(7th Cir. 1993).
Instantly, defendant has inadequately alleged complete diversity. First,
defendant states plaintiffs are residents of Missouri. It is well-established that
allegations of residency may or may not demonstrate citizenship, as citizenship
depends on domicile. See Meyerson v. Harrahs East Chicago Casino, 299 F.3d
616, 617 (7th Cir. 2002); see also McMahon v. Bunn-O-Matic Corp., 150 F.3d
651, 653 (7th Cir. 1998) (An allegation of residence is inadequate.). Thus, an
individual is a citizen of the state in which he or she is domiciled, meaning where
he or she has a permanent home and principal establishment, and to which he or
she has the intention of returning when absent from it. Dakuras v. Edwards, 312
F.3d 256, 258 (7th Cir. 2002). As "[i]t is well-settled that when the parties allege
residency but not citizenship, the court must dismiss the suit," defendant is
ordered to correctly allege the citizenship of plaintiffs.
Further, defendant improperly requests that the Court look to the states of
incorporation and principal places of business of the pertinent limited liability

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companies in determining defendants’ citizenship. The Seventh Circuit has made
abundantly clear that parties must allege the citizenship of all the members of a
limited liability company through all the layers of ownership until the Court
reaches only individual human beings and corporations to adequately allege
citizenship of such entities.
In Cosgrove v. Bartolotta, 150 F.3d 729, 731 (7th Cir. 1998), the Seventh
Circuit held courts should treat a limited liability company like a partnership for
purposes of diversity jurisdiction. Accordingly, the citizenship of each of a limited
liability company’s members establishes whether complete diversity exists among
the parties. See id; see also Hart v. Terminex Int’l, 336 F.3d 541, 543 (7th Cir.
2003) (stating, “[t]hus. we have explained that the ‘citizenship of unincorporated
associations must be traced through however many layers of partners or
members there may be’”) (quoting Meyerson v. Harrah’s East Chicago Casino,
299 F.3d 616, 617 (7th Cir. 2002)).

Thus, a federal court must know each

member’s citizenship, and if necessary, each member’s members’ citizenship.
Therefore, defendant is ORDERED to correct the aforementioned deficiencies by
July 31, 2012, or the Court shall REMAND this action.

David R.
Herndon
2012.07.17
12:17:34 -05'00'

IT IS SO ORDERED.
Signed this 17th day of July, 2012.

Chief Judge
United States District Court
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