Estes, Robert et al v. Razor USA, LLC
ORDER Requiring Amended Complaint and Proof of Diversity Citizenship. Proof of Diversity Citizenship due 5/2/2013. Signed by District Judge William M. Conley on 4/18/2013. (voc)
IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF WISCONSIN
ROBERT ESTES and BECKY L.
TRAVELERS HOME & MARINE
OPINION AND ORDER
RAZOR USA, LLC,
In this civil action premised on this court’s diversity jurisdiction, plaintiffs Robert
and Becky Estes and subrogated plaintiff Travelers Home & Marine Insurance Company
bring state law claims against defendant Razor USA, LLC for recovery of damages due to
a fire allegedly caused by a malfunction of the battery charger of an electric scooter
designed, manufactured and sold by Razor. Because the allegations in the complaint are
insufficient to determine whether diversity jurisdiction actually exists, plaintiffs will be
given an opportunity to file an amended complaint containing the necessary allegations
to establish diversity jurisdiction.
“Federal courts are courts of limited jurisdiction.” Int’l Union of Operating Eng’r,
Local 150, AFL-CIO v. Ward, 563 F.3d 276, 280 (7th Cir. 2009) (citation omitted).
Unless a complaint alleges complete diversity of citizenship among the parties and an
amount in controversy exceeding $75,000, or raises a federal question, the case must be
dismissed for want of jurisdiction. Smart v. Local 702 Int’l Bhd. of Elec. Workers, 562 F.3d
798, 802 (7th Cir. 2009).
Because jurisdiction is limited, federal courts “have an
independent obligation to determine whether subject-matter jurisdiction exists, even
when no party challenges it.”
Hertz Corp. v. Friend, 130 S. Ct. 1181, 1193 (2010).
Further, the party seeking to invoke federal jurisdiction bears the burden of establishing
that jurisdiction is present. Smart, 562 F.3d at 802-03.
Here, plaintiffs contend that diversity jurisdiction exists because: (1) the amount
in controversy exceeds $75,000 and (2) the parties are diverse. (Compl. (dkt. #1) ¶ 4.)
But for the latter to be true there must be complete diversity, meaning plaintiff cannot be
a citizen of the same state as any defendant.
Smart, 562 F.3d at 803.
citizenship of an LLC is the citizenship of each of its members,” plaintiffs not alleged
sufficient information to determine whether complete diversity exists here as to the LLC
defendant. Camico Mut. Ins. Co. v. Citizens Bank, 474 F.3d 989, 992 (7th Cir. 2007).
Instead, plaintiffs allege defendant “Razor USA, LLC is a California corporation
with its principal place of business at 16200 Carmenta Road #A, Cerritos, CA 907032255 and a registered agent of CT Corporation System.” (Compl. (dkt. #1) ¶ 3.) The
Seventh Circuit had advised repeatedly that this information is wholly irrelevant in
deciding the citizenship of a limited liability company. See, e.g., Hukic v. Aurora Loan
Serv., 588 F.3d 420, 429 (7th Cir. 2009).
Before dismissing this action for lack of subject matter jurisdiction, plaintiffs will
be given 14 days to file an amended complaint establishing subject matter jurisdiction by
alleging the names and citizenship of each member of Razor USA, LLC. In alleging each
LLC’s citizenship, plaintiff should keep in mind that if the member or members of LLCs
are themselves a limited liability company, partnership, or other similar entity, then the
citizenship of those members and partners must also be alleged:
“the citizenship of
unincorporated associations must be traced through however many layers of partners or
members there may be.” Meyerson v. Harrah’s E. Chi. Casino, 299 F.3d 616, 617 (7th Cir.
IT IS ORDERED that:
1) Plaintiffs shall have until May 2, 2013, to file and serve an amended
complaint containing good faith allegations sufficient to establish complete
diversity of citizenship for purposes of determining subject matter jurisdiction
under 28 U.S.C. § 1332; and
2) failure to amend timely shall result in prompt dismissal for lack of
subject matter jurisdiction.
Entered this 18th day of April, 2013.
BY THE COURT:
WILLIAM M. CONLEY
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