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Brief Fact Summary.
Zambelli Fireworks Mfg. Co., Inc. (Zambelli) sued Wood and Pyrotecnico F/X LLC (Pyrotecnico) for enforcement of a restrictive covenant under diversity jurisdiction, claiming that Zambelli was a citizen of Pennsylvania, Wood was a citizen of Florida, and Pyrotecnico as a citizen of Nevada.
Synopsis of Rule of Law.
The citizenship of a limited liability company is determined by the citizenship of each of their members for the purposes of diversity of citizenship.
To hold that the plan was constitutional, the district court had relied upon five findings: (1) the ordinance declares itself to be remedial; (2) several proponents of the measure stated their views that there had been past discrimination in the construction industry; (3) minority businesses received .67% of prime contracts from the city while minorities constituted 50% of the city's population; (4) there were very few minority contractors in local and state contractors associations; and (5) in 1977, Congress made a determination that the effects of past discrimination had stifled minority participation in the construction industry generally.
View Full Point of Law
Zambelli Fireworks Mfg. Co., Inc. (Zambelli) is a Pennsylvania Company with its principal place of business in Pennsylvania. Wood, a Florida resident, signed an employment agreement with Zambelli that included a two-year covenant not to compete. Nevertheless, Wood went to work for Pyrotecnico F/X LLC (Pyrotecnico), a limited liability company with its principal place of business in Nevada, shortly after leaving Zambelli. Pyrotecnico’s only member was in Louisiana. Zambelli sued Wood and Pyrotecnico for enforcement of a restrictive covenant under diversity jurisdiction, claiming that Zambelli was a citizen of Pennsylvania, Wood was a citizen of Florida, and Pyrotecnico as a citizen of Nevada. The managing member of Pyrtecnico Louisiana, however, testified that he resided and worked in Pyrotecnico’s Pennsylvania headquarters.
Issue.
Whether the citizenship of a limited liability company is determined by the citizenship of each of their members for the purposes of diversity of citizenship?
Held.
Yes. Pyrotecnico is dismissed as a party within the suit. Pyrotecnico is a Pennsylvania citizen and no diversity exists with Zambelli. Citizenship of Pyrotecnico is traced through Pyrotecnico’s managing member.
Discussion.
The citizenship of a limited liability company is determined by the citizenship of each of their members for the purposes of diversity of citizenship.