PHH Mortgage Corporation v. 21 Asset Management Holding LLC
- P. Castel
- 1:20-cv-02561
- U.S. District Court · Southern District of New York
- 2
In PHH Mortgage v. 21 Asset Management, Judge Castel ordered information about the LLC’s members before deciding whether diversity jurisdiction exists.
PHH Mortgage Corporation must obtain and plead the required citizenship information; 21 Asset Management Holding LLC must respond to the limited interrogatory. The action may be dismissed for lack of subject matter jurisdiction if the complaint is not amended within 45 days.
What happened
In PHH Mortgage Corporation v. 21 Asset Management Holding LLC, the court identified a problem with the complaint’s showing of diversity jurisdiction, which allows a federal court to hear certain disputes involving citizens of different states.
PHH Mortgage alleged that it was a New Jersey corporation with its principal place of business in New Jersey. But the complaint did not identify the members of 21 Asset Management Holding LLC or their citizenship, information needed to determine the LLC’s citizenship.
Judge P. Revin Castel allowed PHH Mortgage to serve a limited interrogatory seeking that information within 14 days, and required the LLC to respond within 14 days. The court required PHH Mortgage to amend its complaint within 45 days to allege the citizenship of the relevant members, or the action will be dismissed for lack of subject matter jurisdiction.
The detailed version
- PHH Mortgage Corporation v. 21 Asset Management Holding LLC · No. 1:20-cv-02561
- P. Castel
- Mar. 26, 2020
Background
PHH Mortgage Corporation filed an action against 21 Asset Management Holding LLC. The opinion addresses only whether the complaint adequately alleges diversity jurisdiction under 28 U.S.C. § 1332(a)(1). That statute provides federal jurisdiction over civil actions involving citizens of different states when the amount in controversy exceeds $75,000, excluding interest and costs.
PHH Mortgage alleged that it is a corporation organized under New Jersey law with its principal place of business in New Jersey. The complaint identified 21 Asset Management Holding LLC as a limited liability company but did not allege the citizenship of its members.
Jurisdictional Rule
For diversity-jurisdiction purposes, a limited liability company has the citizenship of each of its members. The complaint therefore needed to identify the LLC’s members, the citizenship of any individual members, and, for any corporate members, the state of incorporation and principal place of business.
Court’s Action
The court allowed PHH Mortgage, within 14 days of the order, to serve 21 Asset Management Holding LLC with an interrogatory limited to identifying the LLC’s members and the required citizenship information. The LLC was required to respond within 14 days.
The court also required PHH Mortgage, within 45 days of the order, to amend its complaint to allege the citizenship of its own constituent members and each member of the defendant LLC. The court stated that the action will be dismissed for lack of subject matter jurisdiction if the complaint is not amended as required. The order 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.