Talon Professional Services, LLC v. Centerlight Health System Inc.
- Paul Engelmayer
- 1:20-cv-00078
- U.S. District Court · Southern District of New York
- 2
In Talon Professional Services v. Centerlight Health System, Judge Engelmayer ordered more jurisdictional details before deciding whether the case could proceed in federal court.
Talon Professional Services, LLC must amend its complaint to provide the citizenship information required to establish diversity jurisdiction. The court’s order also affects the defendants because the case cannot proceed in federal court unless complete diversity is adequately alleged.
What happened
Talon Professional Services, LLC sued Centerlight Health System Inc. and others, relying on the parties’ different citizenships as the basis for federal jurisdiction.
The court said the complaint did not identify the citizenship of the members of Talon or Squillion Systems, both limited liability companies. That information is required to determine whether the parties are completely diverse.
Judge Engelmayer granted Talon permission to amend its complaint by January 20, 2020, to provide the required citizenship information. The court warned that it would dismiss the complaint without prejudice for lack of subject-matter jurisdiction if Talon could not truthfully allege complete diversity.
The detailed version
- Talon Professional Services, LLC v. Centerlight Health System Inc. · No. 1:20-cv-00078
- Paul Engelmayer
- Jan. 7, 2020
Background
Talon Professional Services, LLC filed a complaint against Centerlight Health System Inc., Squillion Systems, LLC, Okaya, Inc., John Does 1–10, and ABC Corps. A–J. The complaint identified diversity of citizenship as the sole basis for federal subject-matter jurisdiction, meaning jurisdiction based on the parties’ citizenships.
The complaint alleged that Talon was organized under New Jersey law and had its principal place of business in New Jersey. It alleged that Squillion Systems was organized under New Hampshire law and had its principal place of business in New Hampshire. The court noted, however, that Talon and Squillion Systems are limited liability companies. For diversity purposes, an LLC has the citizenship of each of its members, not merely the state where it was organized or maintains its principal place of business.
Court’s Analysis
The complaint did not allege the citizenship of the members of either LLC. The court therefore could not determine whether complete diversity existed among the parties. For natural-person members, the amended complaint must allege their citizenships. For corporate members, it must allege the entity’s place of incorporation and principal place of business.
Ruling
The court granted Talon leave to amend the complaint under Federal Rule of Civil Procedure 15(a)(2) by January 20, 2020. The amendment must allege the citizenships of all members of the LLCs in the case. The court stated that if Talon could not truthfully allege complete diversity based on those citizenships, the complaint would be dismissed, without prejudice, for lack of subject-matter jurisdiction. Judge Paul A. Engelmayer did not decide the underlying dispute between the parties.
Read the full 2-page opinion on CourtListener, the free public archive maintained by the Free Law Project.