NY Stone Manhattan, LLC v. Cowan Logistics, LLC

Background

NY Stone Manhattan, LLC asserted a breach-of-contract claim against Cowan Logistics, LLC and negligence claims against Cowan and 5 Star Logistics, Inc. Cowan had moved to dismiss the negligence claim based on federal preemption, meaning Cowan argued that federal law displaced that claim. The court had also asked the parties to address subject-matter jurisdiction, including whether the Carmack Amendment completely preempted the negligence claims and created federal-question jurisdiction.

Jurisdiction Issue

The complaint invoked diversity jurisdiction under 28 U.S.C. § 1332. The court explained that an LLC’s citizenship depends on the citizenship of its members. If an LLC’s members include other business entities, the analysis may require examining the citizenship of those entities and the persons holding interests in them. The court determined that the complaint did not adequately allege Cowan’s citizenship.

Order

The court ordered Cowan to submit an updated Rule 7.1 corporate disclosure statement by May 8, 2025, identifying the citizenship of each member. After that disclosure, the parties were ordered to meet and confer and file a status report by May 16, 2025. The report must state whether the parties agree that the court has diversity jurisdiction without resolving the separate federal-question-jurisdiction issues, and must propose a schedule for Cowan’s pending motion to dismiss, any additional motions to dismiss the amended complaint or 5 Star’s crossclaims, or, alternatively, a schedule for an amendment to the complaint by consent. The order did not rule on the pending motion to dismiss, decide jurisdiction, or resolve any claim.