Off White Operating SRL v. Saks & Company LLC

Background

The plaintiffs' complaint asserted federal jurisdiction based on diversity of citizenship. That jurisdiction generally requires all plaintiffs to be citizens of different states or foreign countries from all defendants, and the complaint must allege the relevant citizenship facts clearly.

The complaint described Saks & Company LLC and Saks.com LLC as limited liability companies organized under Delaware law with headquarters in New York. But it did not identify the citizenship of the members of either limited liability company. For a limited liability company, the citizenship inquiry includes the citizenship of its members; if a member is a corporation, the relevant allegations include that corporation's place of incorporation and principal place of business.

The complaint identified Off White Operating SRL and Venice SRL as Italian corporations with registered offices in Milan. The Court stated that, for diversity purposes, the complaint must allege each corporation's principal place of business, meaning the place where its officers direct, control, and coordinate its activities, rather than merely its registered office.

Court's Order

Within 14 days of the order, the plaintiffs may serve one interrogatory on each defendant asking for the citizenship of all natural-person members and, for any corporate member, its jurisdiction of incorporation and principal place of business. Each defendant must respond within 14 days.

Within 45 days of the order, the plaintiffs must amend the complaint to truthfully and accurately allege the citizenship of the defendant limited liability companies and the principal places of business of the plaintiffs. If the amended complaint does not establish complete diversity, the action will be dismissed for lack of subject matter jurisdiction without further notice. The order addressed jurisdictional pleading requirements and did not resolve the underlying claims.