Hoefing, Matthew v. Rally Appraisal, L.L.C.

Filing 4

ORDER re 1 Notice of Removal, filed by Rally Appraisal, L.L.C. Defendant shall have until May 27, 2016 to file and serve an amended notice of removal containing good faith allegations sufficient to establish complete diversity of citizenship for purposes of determining subject matter jurisdiction under 28 U.S.C. § 1332. Failure to amended timely shall result in prompt dismissal. Signed by District Judge William M. Conley on 5/13/2016. (jls)

IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF WISCONSIN

MATTHEW HOEFING,
Plaintiff,

OPINION AND ORDER
16-cv-314-wmc

v.
RALLY APPRAISAL, L.L.C.,
Defendant.

In this civil action, plaintiff Matthew Hoefing seeks a declaratory judgment that
an employment agreement with his former employer defendant Rally Appraisal, L.L.C. is
void under Wisconsin state law. (Compl. (dkt. #1-2).) Invoking this court’s diversity
jurisdiction, defendant Rally Appraisal has removed this action pursuant to 28 U.S.C. §§
1332 and 1441. (Not. of Removal (dkt. #1) ¶ 1.) Because the allegations in the notice
of removal and complaint are insufficient to determine whether diversity jurisdiction
actually exists, Rally Appraisal will be given an opportunity to file an amended notice of
removal containing the necessary allegations.

OPINION
“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

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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, 559 U.S. 77, 94 (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, defendant contends in its notice of removal that diversity jurisdiction exists
because (1) the amount in controversy exceeds $75,000 and (2) the parties are diverse.
(Not. of Removal (dkt. #1) ¶¶ 11, 22, 23.) Defendant’s allegations, however, as to its
own citizenship prevent this court from determining if the latter requirement is met.
“[T]he citizenship of an LLC is the citizenship of each of its members,” yet
defendant has not alleged sufficient information to determine whether complete diversity
exists here. Camico Mut. Ins. Co. v. Citizens Bank, 474 F.3d 989, 992 (7th Cir. 2007).
Indeed, the notice of removal lacks any allegations regarding the names or the citizenship
of any defendant Rally Appraisal’s members. Instead, defendant alleges it is “a limited
liability company organized under Iowa law, with its principal place of business in West
Des Moines, Iowa.” (Not. of Removal (dkt. #1) ¶ 10.) The Seventh Circuit instructs,
however, that this information is wholly irrelevant in deciding the citizenship of a limited
liability company. Hukic v. Aurora Loan Serv., 588 F.3d 420, 429 (7th Cir. 2009).
Before dismissing this action for lack of subject matter jurisdiction, Rally Appraisal
will be given leave to file and serve within 14 days an amended notice or removal which
establishes subject matter jurisdiction by alleging the names and citizenship of each
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member of its LLC. In alleging the LLC’s citizenship, defendant should be aware that if
any members of the LLCs are themselves a limited liability company, partnership, or
other similar entity, then the individual citizenship of each of those members and
partners must also be alleged as well: “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. 2002).

ORDER
IT IS ORDERED that:
1) defendant Rally Appraisals, LLC shall have until May 27, 2016, to file and
serve an amended notice of removal 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 of this matter for lack
of subject matter jurisdiction.
Entered this 13th day of May, 2016.
BY THE COURT:
/s/
__________________________________
WILLIAM M. CONLEY
District Judge

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