Continental Indemnity Company v. Bulson Management, LLC
- Jesse Furman
- 1:20-cv-03479-JMF
- U.S. District Court · Southern District of New York
- 2
In Continental Indemnity v. Bulson Management, Judge Furman ordered corrected citizenship allegations for diversity jurisdiction.
Continental Indemnity Company must amend its complaint to properly allege citizenship; Bulson Management, LLC and Ri Xian Wang are affected because the court may dismiss the complaint if complete diversity cannot be truthfully established.
What happened
In Continental Indemnity Company v. Bulson Management, LLC, Continental Indemnity sued Bulson Management, LLC, and Ri Xian Wang, relying on diversity of citizenship for federal jurisdiction.
The court found that the complaint did not properly allege the citizenship of the LLC’s members or the citizenship of the individual parties. It ordered Continental Indemnity to amend the complaint by May 19, 2020.
Judge Furman warned that if Continental Indemnity could not truthfully allege complete diversity, the complaint would be dismissed for lack of subject-matter jurisdiction.
The detailed version
- Continental Indemnity Company v. Bulson Management, LLC · No. 1:20-cv-03479-JMF
- Jesse Furman
- May 5, 2020
Background
Continental Indemnity Company sued Bulson Management, LLC, and Ri Xian Wang. The complaint invoked diversity jurisdiction under 28 U.S.C. § 1332, alleging that Continental Indemnity was a citizen of Iowa and Nebraska and that the defendants were citizens of New York.
Jurisdictional problem
The court explained that an LLC is a citizen of every state where each of its members is a citizen. A complaint relying on diversity jurisdiction therefore must identify the citizenship of every person or entity that makes up an LLC, including the members of any LLC that is itself a member. The complaint did not provide that information for Bulson Management, LLC. It also alleged only business and residential addresses for the parties, rather than their states of citizenship.
Order and effect
The court ordered Continental Indemnity to amend its complaint by May 19, 2020, to allege the citizenship of every person or entity comprising Bulson Management, LLC and the citizenship of all individual parties. Judge Furman stated that if Continental Indemnity could not truthfully allege complete diversity of citizenship by that date, the complaint would be dismissed for lack of subject-matter jurisdiction without further notice. The opinion does not state that a dismissal had already occurred.
Read the full 2-page opinion on CourtListener, the free public archive maintained by the Free Law Project.