Green Capital Funding LLC v. ESJ Towers, Inc.
- John Cronan
- 1:21-cv-01655
- U.S. District Court · Southern District of New York
- 2
In Green Capital Funding v. ESJ Towers, Judge Cronan ordered plaintiffs to amend jurisdictional allegations or face dismissal.
The order affected Green Capital Funding LLC and High Speed Capital LLC, which were required to provide additional citizenship allegations concerning the members of the plaintiff and defendant LLCs. It also concerned the court’s ability to exercise diversity jurisdiction over the action.
What happened
Green Capital Funding LLC v. ESJ Towers, Inc. involved plaintiffs who asked the federal court to hear their case based on the parties’ citizenship. The complaint identified where the limited liability companies were organized and had offices, but did not identify their members’ citizenship.
The court explained that a limited liability company has the citizenship of each of its members. Therefore, allegations about an LLC’s organization or business address are not enough to establish diversity jurisdiction.
Judge John P. Cronan ordered the plaintiffs to amend the complaint by March 5, 2021, to allege the citizenship of the members of the plaintiff and defendant LLCs or otherwise properly establish jurisdiction. The court stated that it would dismiss the action for lack of subject-matter jurisdiction without further notice if they failed to do so.
The detailed version
- Green Capital Funding LLC v. ESJ Towers, Inc. · No. 1:21-cv-01655
- John Cronan
- Feb. 26, 2021
Background
Green Capital Funding LLC and High Speed Capital LLC filed a complaint invoking diversity jurisdiction under 28 U.S.C. § 1332. The complaint alleged that both plaintiff LLCs were organized under New York law and had offices in New York. It alleged that ESJ Towers, Inc., doing business as Mare St. Clair, was a Puerto Rico corporation with offices in Puerto Rico; that Around The World Holdings, LLC, also known as ATWH, LLC and doing business as Around The World Holdings, was a Puerto Rico LLC with offices in Puerto Rico; and that Keith Robert St. Clair resided in Florida.
Jurisdictional Deficiency
The court explained that an LLC takes the citizenship of its members. A complaint relying on diversity jurisdiction therefore must identify the citizenship of the natural-person members of an LLC and the relevant incorporation and principal-business information for any corporate members. The complaint alleged organization locations and business addresses for the plaintiff LLCs and defendant ATWH, but did not allege the citizenship of those LLCs’ members.
Order
The court ordered the plaintiffs to amend the complaint by March 5, 2021, to allege the citizenship of each member of the plaintiff and defendant LLCs. The court also allowed them to otherwise properly establish jurisdiction under 28 U.S.C. § 1332(a)(2). It stated that if the plaintiffs failed to amend by the deadline or otherwise establish jurisdiction, it would dismiss the action for lack of subject-matter jurisdiction without further notice. The order did not decide the underlying claims.
Name-Reference Note
The opinion refers once to plaintiff High Speed Capital LLC as “HFC,” although the caption and earlier text identify it as High Speed Capital LLC (“HSC”).
Read the full 2-page opinion on CourtListener, the free public archive maintained by the Free Law Project.