Woitovich v. Schoenfeld

Background

Rhonda Woitovich brought the action against Lydia Schoenfeld and Morgan Stanley Smith Barney, LLC, invoking federal jurisdiction based on diversity of citizenship under 28 U.S.C. § 1332. The complaint alleged that Woitovich was a resident of New Jersey. It alleged that Schoenfeld was a resident, but did not state her citizenship. It described Morgan Stanley Smith Barney, LLC, as organized under Delaware law and headquartered in New York County, New York.

Court’s analysis

The court explained that a limited liability company is a citizen of every state where its members are citizens. A complaint relying on diversity jurisdiction therefore must identify the citizenship of each person or entity that makes up the LLC, including the citizenship of members that are themselves LLCs. The complaint did not provide that information. The court also said that alleging residence, rather than citizenship, was insufficient for Woitovich and Schoenfeld.

Order and effect

The court ordered Woitovich to amend the complaint by March 7, 2022, to allege the citizenship of every constituent person or entity of Morgan Stanley Smith Barney, LLC, as well as the citizenship of the individual parties. The court stated that, if she could not truthfully allege complete diversity by that date, the complaint would be dismissed for lack of subject-matter jurisdiction without further notice. The order addressed the adequacy of the jurisdictional allegations and did not decide the underlying claims.