Rivington's Orchard, LLC v. American Fire and Casualty Company
- James Oetken
- 1:21-cv-01727
- U.S. District Court · Southern District of New York
- 2
In Rivington’s Orchard v. American Fire, Judge Oetken ordered the insurer to explain why the case should not return to state court.
Rivington’s Orchard, LLC and American Fire and Casualty Company are affected. The order required American Fire and Casualty Company to provide information supporting federal diversity jurisdiction or explain why the case should not be returned to New York state court.
What happened
American Fire and Casualty Company removed Rivington’s Orchard, LLC’s case from New York state court to federal court, claiming the parties were citizens of different states. The removal papers described the plaintiff as a corporation and did not identify the citizenship of each LLC member.
The court explained that an LLC’s citizenship depends on the citizenship of all its members, not its registration state, principal place of business, or registered agent’s state. The defendant therefore had to provide enough information to show that the LLC’s members were citizens of states different from the defendant.
In Rivington’s Orchard, LLC v. American Fire and Casualty Company, Judge J. Paul Oetken ordered the defendant to show cause by May 6, 2022, why the case should not be sent back to state court. The order did not itself remand the case.
The detailed version
- Rivington's Orchard, LLC v. American Fire and Casualty Company · No. 1:21-cv-01727
- James Oetken
- Apr. 22, 2022
Background
American Fire and Casualty Company removed the case from the New York Supreme Court for New York County to the U.S. District Court for the Southern District of New York. The defendant relied on diversity jurisdiction under 28 U.S.C. § 1332, which generally requires the parties to be citizens of different states.
Jurisdictional problem
The court found that the notice of removal did not adequately establish subject-matter jurisdiction. Specifically, it did not allege the citizenship of each member of Rivington’s Orchard, LLC. The court explained that an LLC is not treated as a corporation for this purpose. An LLC has the citizenship of each of its members. The LLC’s state of registration, principal place of business, and registered agent’s state of citizenship do not establish its citizenship for diversity jurisdiction.
Order
The court ordered American Fire and Casualty Company to show cause on or before May 6, 2022, why the action should not be remanded to state court. The opinion did not state that the case had already been remanded or finally decide whether federal jurisdiction existed. The court’s ruling addressed the adequacy of the jurisdictional allegations, not the underlying dispute between the parties.
Judge
The order was signed by J. Paul Oetken, United States District Judge.
Read the full 2-page opinion on CourtListener, the free public archive maintained by the Free Law Project.