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Brief Fact Summary.
Plaintiff sued Defendant, an LLC, in federal court based on diversity of citizenship, alleging that Defendant was a citizen of Delaware and Illinois. The district court accepted Plaintiff’s allegations and heard the case. Plaintiff appeals the decision in favor of Defendant.
Synopsis of Rule of Law.
An LLC is a citizen of every state in which an LLC member is a citizen because it is not a corporation.
Limited liability companies are citizens of every state of which any member is a citizen.
View Full Point of Law
Belleville Catering Co. (Plaintiff) sued Champaign Market Place, LLC (Defendant) in federal court, alleging subject matter jurisdiction based on diversity of citizenship. Plaintiff’s complaint alleged that Defendant was a citizen of Delaware and Illinois as Defendant was organized under the laws of Delaware and maintained its principal place of business in Illinois. Defendant was a limited liability company (LLC) and not a corporation. Defendant’s members failed to disclose their residency.
Issue.
Whether an LLC’s citizenship is determined in the same manner as a corporation.
Held.
No. The district court lacked jurisdiction. An LLC is a citizen of every state in which an LLC member is a citizen because it is not a corporation.
Discussion.
Plaintiff cannot demonstrate complete diversity because it cannot allege that its citizenship is diverse from Defendant’s citizenship.An LLC is not a corporation.An LLC’s citizenship is determined in the same manner as a partnership; an LLC is a citizen of every state in which an LLC member is a citizen. Therefore, looking to the place of organization and the principal place of business is inappropriate. Defendant is an LLC, and the members will not disclose their residency. Defendant’s citizenship cannot be determined.