Wieder & Friedman Enterprises, Inc. v. Explorefirst LLC
- Paul Engelmayer
- 1:25-cv-02089
- U.S. District Court · Southern District of New York
- 5
Wieder & Friedman Enterprises v. Explorefirst LLC: Judge Engelmayer dismissed the action without prejudice because complete diversity was lacking.
The petitioners’ action to modify the arbitral award was dismissed without prejudice, and the respondents prevailed on their jurisdictional motion. The petitioners may bring a new action with a proper basis for subject-matter jurisdiction.
What happened
In Wieder & Friedman Enterprises, Inc. v. Explorefirst LLC, the petitioners asked the court to modify an arbitral award arising from a contractual dispute. They relied on diversity jurisdiction, which generally requires opposing parties to be citizens of different states.
The respondents argued that the court lacked jurisdiction because the parties were not completely diverse. The petitioners acknowledged that Razor, a member of Whele, was a Delaware citizen, and the court determined that the respondents were Delaware citizens like petitioner Infinite Generations Inc.
Judge Engelmayer granted the respondents’ motion to dismiss for lack of subject-matter jurisdiction and dismissed the action without prejudice. The court did not decide whether the arbitral award should be modified, and the petitioners may bring a new action with a proper jurisdictional basis.
The detailed version
- Wieder & Friedman Enterprises, Inc. v. Explorefirst LLC · No. 1:25-cv-02089
- Paul Engelmayer
- May 22, 2025
Background
Wieder and Friedman Enterprises Inc., Infinite Generations Inc., Moshe Friedman, and Yakov Wieder petitioned to modify a December 16, 2024 arbitral award arising from a contractual dispute with Explorefirst LLC and Whele LLC. The petitioners invoked diversity jurisdiction under 28 U.S.C. § 1332 and alleged that the parties were diverse and that more than $75,000 was in controversy.
The respondents moved to dismiss under Federal Rule of Civil Procedure 12(b)(1), which permits dismissal for lack of subject-matter jurisdiction. The court directed the parties to provide information and supporting evidence about each party’s citizenship. The petitioners conceded that Razor Group Holdings II, one of Whele’s members, was a Delaware citizen.
Jurisdictional analysis
Federal diversity jurisdiction requires complete diversity: every plaintiff must be a citizen of a different state from every defendant. A corporation is generally a citizen of its state of incorporation and its principal place of business. A limited liability company is a citizen of every state in which any of its members is a citizen.
Whele is a Delaware limited liability company. Its members include Razor, a Delaware corporation, and Perch Acquisition Co 50, LLC. Explorefirst’s successor by merger, WAC3, is also a Delaware limited liability company wholly owned by Whele. Because the respondents therefore included Delaware citizens, and Infinite Generations Inc. was a Delaware corporation with its principal place of business in Delaware, the parties were not completely diverse.
Ruling
The court granted the respondents’ motion to dismiss for lack of subject-matter jurisdiction and dismissed the action without prejudice to the petitioners’ right to bring a new action with a proper basis for subject-matter jurisdiction. The Clerk of Court was directed to close all pending motions and dismiss the action. The court did not reach the petitioners’ request to modify the arbitral award or otherwise decide the underlying contractual dispute.
Read the full 5-page opinion on CourtListener, the free public archive maintained by the Free Law Project.