SourceCode Communications LLC v. In-telligent LLC
- Vernon Broderick
- 1:21-cv-10519
- U.S. District Court · Southern District of New York
- 3
SourceCode Communications v. In-telligent: Judge Broderick ordered an amended complaint because the pleadings did not establish diversity jurisdiction before default judgment.
SourceCode Communications LLC must amend its complaint to establish federal subject-matter jurisdiction before seeking default judgment against In-telligent LLC. In-telligent LLC had not appeared in the action.
What happened
SourceCode Communications LLC sued In-telligent LLC and sought a default judgment after In-telligent failed to appear. The complaint claimed federal jurisdiction because the parties were citizens of different states.
The court said the complaint did not provide enough information to determine the citizenship of the members of either limited liability company. Alleging where the companies were organized and where they conducted business was not enough.
Judge Vernon S. Broderick ordered SourceCode Communications LLC to file an amended complaint establishing subject-matter jurisdiction by March 10, 2022. The plaintiff could use that amended complaint to seek default judgment, but the court did not enter default judgment in this order.
The detailed version
- SourceCode Communications LLC v. In-telligent LLC · No. 1:21-cv-10519
- Vernon Broderick
- Feb. 22, 2022
Background
SourceCode Communications LLC filed the action on December 9, 2021. In-telligent LLC failed to appear, and SourceCode later filed papers seeking entry of a default judgment.
The complaint asserted diversity jurisdiction under 28 U.S.C. § 1332. SourceCode alleged that it was a limited liability company organized under New York law with its principal place of business in New York. It alleged that In-telligent was a limited liability company organized under Illinois law with its principal place of business in Chicago.
Jurisdictional Deficiency
The court explained that diversity jurisdiction requires complete diversity between all plaintiffs and defendants and an amount in controversy exceeding $75,000, excluding interest and costs. For a limited liability company, citizenship is based on the citizenship of its members. A complaint must identify the citizenship of natural-person members and, for corporate members, their places of incorporation and principal places of business.
The court held that the allegations about the companies' organization and principal places of business did not establish the citizenship of their members or show complete diversity. Because the complaint failed to establish subject-matter jurisdiction, the court would not allow the case to proceed to default judgment on the existing pleadings.
Order
The court ordered SourceCode Communications LLC to file an amended complaint containing facts sufficient to establish subject-matter jurisdiction by March 10, 2022. The court stated that failure to do so would likely result in dismissal for failure to prosecute under Federal Rule of Civil Procedure 41(b). The court also stated that SourceCode could use the amended complaint as the basis for seeking default judgment. This order did not grant the requested default judgment.
Read the full 3-page opinion on CourtListener, the free public archive maintained by the Free Law Project.