Sumners et al v. General Motors, LLC et al

Filing 59

MEMORANDUM OPINION AND ORDER re: (182 in 1:14-md-02543-JMF) MOTION to Remand to State Court filed by Tyson Sumners: that Plaintiffs' motion to remand is DENIED. The Clerk of Court is directed to terminate Docket No. 182 in 14-MD-2543. (Signed by Judge Jesse M. Furman on 9/17/2014) Filed In Associated Cases: 1:14-md-02543-JMF, 1:14-cv-05461-JMF(tn)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
-----------------------------------------------------------------------------x
IN RE:

09/17/2014
14-MD-2543 (JMF)

GENERAL MOTORS LLC IGNITION SWITCH LITIGATION
This Document Relates To
Sumners et al. v. General Motors et al., 14-CV-5461 (JMF)
-----------------------------------------------------------------------------x

MEMORANDUM OPINION
AND ORDER

JESSE M. FURMAN, United States District Judge:
Plaintiffs in Sumners et al. v. General Motors et al., 14-CV-5461 (JMF), which is part of
this multi-district litigation, move to remand their case to the Tennessee state court from which it
was removed by Defendant General Motors LLC (“New GM”). In removing the case, New GM
invoked the federal courts’ diversity jurisdiction. See 28 U.S.C. § 1332. Plaintiffs move to
remand, contending that the federal courts lack subject-matter jurisdiction pursuant to Section
1332 because the parties are not completely diverse. Upon review of the parties’ motion papers
(14-MD-2543, Docket Nos. 182, 183, 184, 268), the motion is DENIED.
Federal jurisdiction in this case turns on whether Plaintiffs, citizens of Tennessee, are
diverse from Defendants New GM and AutoFair Chevrolet LLC (“AutoFair”), both of which are
limited liability companies. It is well established that, for purposes of assessing diversity
jurisdiction, an unincorporated entity such as a partnership or a limited liability company is
deemed to be a citizen of all states of which its partners or members are citizens. See, e.g.,
Handelsman v. Bedford Vill. Assocs. L.P., 213 F.3d 48, 51-52 (2d Cir. 2000) (Sotomayor, J.); see
also Altissima Ltd. v. One Niagara LLC, No. 08-CV-756S(M), 2010 WL 3504798, at *2

1

(W.D.N.Y. Sept. 2, 2010) (noting that every Court of Appeals to have considered the issue has
held that a limited liability company has the citizenship of all of its members). 1
As New GM’s opposition papers make clear, that rule makes New GM a citizen of
Delaware and Michigan, as New GM’s sole member is General Motors Holdings LLC, which, in
turn, has only one member as well: General Motors Company, which is a publicly traded
corporation organized under the laws of Delaware with its principal place of business in
Michigan. (Def. New GM’s Resp. Opp’n Pls.’ Mot. To Remand (14-MD-2543, Docket No. 268)
(“Def.’s Resp.”) 3-4). Although Plaintiffs speculate that one or more shareholders of General
Motors Company are likely Tennessee citizens (Pls.’ Br. Supp. Mot. To Remand (14-MD-2543,
Docket No. 183) 4-5), that possibility is irrelevant to the analysis. See, e.g., Hertz Corp. v.
Friend, 559 U.S. 77, 80 (2010) (“[A] corporation shall be deemed to be a citizen of any State by
which it has been incorporated and of the State where it has its principal place of business.”
(emphasis omitted) (internal quotation marks omitted)); People of Puerto Rico v. Russell & Co.,
Sucesores S. En. C., 288 U.S. 476, 479 (1933) (“[I]n ascertaining whether there is the requisite
diversity of citizenship to confer jurisdiction on the federal courts, we have looked to the
domicile of a corporation, not that of its individual stockholders, as controlling.”).
New GM’s motion papers also confirm that AutoFair is not a citizen of Tennessee.
Putting aside the fact that AutoFair was apparently dissolved in 2009 (see Def.’s Resp., Ex. B

In their motion papers, the parties rely primarily on decisions by and within the Sixth
Circuit. When an action is transferred pursuant to Title 28, United States Code, Section 1407,
however, the transferee court must apply “‘its interpretations of federal law, not the constructions
of federal law of the transferor circuit.’” In re Oxycontin Antitrust Litig., 821 F. Supp. 2d 591,
595 n.1 (S.D.N.Y. 2011) (quoting Menowitz v. Brown, 991 F.2d 36, 40 (2d Cir. 1993)).
Accordingly, the Court applies Second Circuit law in deciding whether to remand this action.
1

2

(Certif. of Tre Hargett, Sec’y of the State of Tenn.)), AutoFair had only two members when it
was a going concern: AutoFair Investors L.P., a limited partnership, and AutoFair Automotive
Management, LLC, a limited liability company. (Def.’s Resp., Ex. A (Decl. of Harry A. Crews)
¶ 6). AutoFair Investors L.P., in turn, has one general partner, a corporation organized under the
laws of Delaware with its principal place of business in New Hampshire. (Id. ¶ 7). The
remaining limited partners of AutoFair Investors L.P., and all members of AutoFair Automotive
Management, LLC, are natural persons, none of whom was a citizen of Tennessee when
Plaintiffs filed their Complaint on May 9, 2014, or when New GM removed the case to federal
court on June 13, 2014. (Id. ¶¶ 8-10).
In short, neither New GM nor AutoFair is a citizen of Tennessee. As there is no dispute
that the other requirements for diversity jurisdiction are met, there is plainly federal jurisdiction. 2
Accordingly, Plaintiffs’ motion to remand is DENIED.
The Clerk of Court is directed to terminate Docket No. 182 in 14-MD-2543.
SO ORDERED.
Dated: September 17, 2014
New York, New York

In light of that conclusion, the Court need not and does not reach New GM’s other
arguments for why jurisdiction is proper.

2

3