Devito Verdi, Inc. v. Legal Sea Foods, Inc.
- Vyskocil
- 1:21-cv-01007
- U.S. District Court · Southern District of New York
- 4
In Devito Verdi v. Legal Sea Foods, Judge Vyskocil denied default judgment, dismissed the complaint without prejudice, and allowed amendment for missing LLC-member citizenship allegations.
Devito Verdi, Inc.’s breach-of-contract case was dismissed without prejudice because it did not plead the citizenship of Legal Sea Foods, LLC’s members. The default-judgment motion against Legal Sea Foods, LLC was denied without prejudice, and Devito Verdi was allowed to amend by May 24, 2021.
What happened
Devito Verdi, Inc. sued Legal Sea Foods, Inc. and Legal Sea Foods, LLC for breach of contract and sought default judgment against the LLC. The complaint claimed federal jurisdiction based on the parties being citizens of different states.
The court found that the complaint did not allege the citizenship of every member of Legal Sea Foods, LLC. Because an LLC’s citizenship depends on the citizenship of all its members, the complaint did not adequately establish diversity jurisdiction.
Judge Mary Kay Vyskocil denied the motion for default judgment without prejudice, dismissed the complaint without prejudice, and allowed Devito Verdi to amend it. The amended complaint was due by May 24, 2021; otherwise, all claims would be dismissed without prejudice and without leave to amend.
The detailed version
- Devito Verdi, Inc. v. Legal Sea Foods, Inc. · No. 1:21-cv-01007
- Vyskocil
- Apr. 23, 2021
Background
Devito Verdi, Inc. brought a breach-of-contract action against Legal Sea Foods, Inc. and Legal Sea Foods, LLC. Devito Verdi moved for default judgment against Legal Sea Foods, LLC.
The complaint invoked diversity jurisdiction under 28 U.S.C. § 1332. It alleged that Devito Verdi was a New York corporation with its principal place of business in New York; that Legal Sea Foods, LLC was a Delaware limited liability company with its principal place of business in Boston, Massachusetts; and that Legal Sea Foods, Inc. was a Delaware corporation with its principal place of business in Boston, Massachusetts. The complaint did not identify the members of Legal Sea Foods, LLC or allege their citizenship.
Jurisdictional Defect
For an LLC to be completely diverse from the opposing party, every member of the LLC must be a citizen of a different state from every opposing party. The court therefore concluded that the complaint failed to plead facts establishing diversity jurisdiction. The court was required to examine subject-matter jurisdiction before entering a default judgment.
Ruling
The court denied Devito Verdi’s motion for default judgment without prejudice, dismissed the complaint without prejudice for failure to plead subject-matter jurisdiction, and granted leave to amend. Devito Verdi was ordered to file an amended complaint by May 24, 2021. The order stated that failing to do so would result in dismissal of all claims without prejudice and without leave to amend. The Clerk was directed to terminate the default-judgment motion from the docket.
Read the full 4-page opinion on CourtListener, the free public archive maintained by the Free Law Project.