St Paul Fire & Marine Insurance Company v. Future Energy Services LLC et al

Filing 15

ORDER directing FES,LLC to file and amended disclosure statement no later than 9/20/2016 to identify its members and their citizenship re 11 Disclosure Statement - LLC filed by Future Energy Services LLC. Signed by Honorable Timothy D. DeGiusti on 9/6/2016. (mb)

IN THE UNITED STATES DISTRICT COURT FOR THE
WESTERN DISTRICT OF OKLAHOMA
ST. PAUL FIRE & MARINE
INSURANCE CO., as subrogee
of CHARTER OAK PRODUCTION
CO., LLC,
Plaintiff,
v.
FUTURE ENERGY SERVICES, LLC,
an Oklahoma limited liability company;
FUTURE ENERGY SERVICES OF
OKLAHOMA, INC., an Oklahoma
Corporation, and QUASAR ENERGY
SERVICES, INC., a Texas corporation,
Defendants.

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Case No. CIV-16-741-D

ORDER
The Court has reviewed Defendant Future Energy Services, LLC’s (FES,
LLC) Disclosure Statement Identifying Constituents of LLC [Doc. No. 11] and
finds it is insufficient. Jurisdiction in this case is predicated on diversity
jurisdiction. Compl., ¶ 5 [Doc. No. 1]. Notwithstanding this assertion, the Court
has an independent obligation to ensure that it has subject matter jurisdiction.
Henderson ex rel. Henderson v. Shinseki, 562 U.S. 428, 434 (2011) (“[F]ederal
courts have an independent obligation to ensure that they do not exceed the scope
of their jurisdiction, and therefore they must raise and decide jurisdictional
questions that the parties either overlook or elect not to press.”) (citation omitted);

Devon Energy Prod. Co. v. Mosaic Potash Carlsbad, Inc., 693 F.3d 1195, 1208 n.
10 (10th Cir. 2012). “[N]o action of the parties can confer subject-matter
jurisdiction upon a federal court.” Ins. Corp. of Ireland, Ltd. v. Compagnie des
Bauxites de Guinee, 456 U.S. 694, 702 (1982).
The Complaint states FES, LLC is an Oklahoma limited liability company.
Compl., ¶ 2. According to its statement, FES, LLC “is a non-governmental party
organized as a limited liability company.” Disclosure Statement, ¶ 1. FES, LLC
identifies its sole shareholder as FES Holdings, LLC and states “[n]either FES,
LLC nor FES Holdings, LLC is a citizen of Minnesota.” Id. ¶ 2. For purposes of
diversity jurisdiction, an LLC’s citizenship is determined by reference to the
citizenship of each and every one of its members. Siloam Springs Hotel, L.L.C. v.
Century Sur. Co., 781 F.3d 1233, 1235-36 (10th Cir. 2015). For each member of an
LLC that is itself an LLC or partnership, its citizenship must be traced through
however many layers of members or partners there may be, and failure to do so can
result in dismissal for want of jurisdiction. See Hicklin Engineering, LLC v.
Bartell, 439 F.3d 346, 348 (7th Cir. 2006) (“A federal court thus needs to know
each member’s citizenship, and if necessary each member’s members’
citizenships.”). To this end, FES, LLC fails to sufficiently identify the citizenship
of FES Holdings, LLC’s member(s) so as to enable the Court to properly

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determine whether subject matter jurisdiction exists, and the Court finds that an
amendment is necessary.
The Court recognizes that as the party invoking the Court’s jurisdiction,
Plaintiff bears the burden of proving it, Marcus v. Kan. Dept. of Revenue, 170 F.3d
1305, 1309 (10th Cir. 1999); however, the information needed is more readily
available to FES, LLC. Accordingly, FES, LLC is directed to file an amended
disclosure statement by September 20, 2016 that sets forth with specificity the
identity of its members and their citizenship, through all necessary layers/levels of
ownership.
IT IS SO ORDERED this 6th day of September, 2016.

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