Vigilant Ins. Co. v. OSA Heating & Cooling LLC, 3:10-CV-00981 (CSH)

• Decision Date: 16 July 2013
• Docket Number: 3:10-CV-00981 (CSH)
• Citation: Vigilant Ins. Co. v. OSA Heating & Cooling LLC, 3:10-CV-00981 (CSH) (D. Conn. Jul 16, 2013)
• Parties: VIGILANT INSURANCE COMPANY, as subrogee of SANFORD REDMOND, Plaintiff, v. OSA HEATING & COOLING LLC, Defendant.
• Court: U.S. District Court — District of Connecticut

VIGILANT INSURANCE COMPANY as subrogee of SANFORD REDMOND, Plaintiff, v. OSA HEATING & COOLING LLC, Defendant.

3:10-CV-00981 (CSH)

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF CONNECTICUT

July 16, 2013

MEMORANDUM AND ORDER

HAIGHT, Senior District Judge:

I. INTRODUCTION

Plaintiff Vigilant Insurance Company (hereafter, "Plaintiff"), as subrogee of Sanford Redmond has brought this action against Defendant OSA Heating & Cooling LLC (hereafter, "Defendant") for negligence, breach of contract, and breach of warranty. Familiarity with the underlying factual allegations contained within Plaintiff's Complaint is assumed.

Plaintiff has asserted that this Court has subject matter jurisdiction based on diversity of citizenship, alleging that this Court "has diversity of jurisdiction over this matter pursuant to 28 U.S.C. § 1332, because Plaintiff is a New York corporation and ... Defendant is a Connecticut limited liability company[,] and the matter in controversy exceeds the value of" $75,000. [Doc. 1]at ¶5. Under 28 U.S.C. § 1332(a)(1), "[t]he district courts shall have original jurisdiction of all civil actions where the matter in controversy exceeds the sum or value of $75,000, exclusive of interest and costs, and is between - (1) citizens of different States."¹

Despite Plaintiff's assertion of diversity, however, Plaintiff has failed to sufficiently allege that subject matter jurisdiction exists in the case at bar.

II. SUBJECT MATTER JURISDICTION

In general, if subject matter jurisdiction is lacking in an action before a court, the action must be dismissed. Fed. R. Civ. P. 12(h)(3) ("If the court determines at any time that it lacks subject-matter jurisdiction, the court must dismiss the action."). As the Second Circuit recently noted, "[w]here jurisdiction is lacking, ... dismissal is mandatory." Lovejoy v. Watson, 475 F. App'x 792, 792 (2d Cir. 2012) (internal quotations and citation omitted).

Consequently a federal court must determine with certainty whether it has subject matter jurisdiction over a case pending before it. If necessary, the court has an obligation to consider its subject matter jurisdiction sua sponte. Joseph v. Leavitt, 465 F.3d 87, 89 (2d Cir.2006) ("Although neither party has suggested that we lack appellate jurisdiction, we have an independent obligation to consider the presence or absence of subject matter jurisdiction sua sponte."), cert. denied, 549 U.S. 1282 (2007); see also, e.g., Univ. of South Alabama v. American Tobacco Co., 168 F.3d 405, 410 (11th Cir. 1999) ("a federal court is obligated to inquire into subject matter jurisdiction sua sponte whenever it may be lacking"); Transatlantic Marine Claims Agency, Inc. v. Ace ShippingCorp., 109 F.3d 105, 107-08 (2d Cir. 1997) (holding that district court may raise issue of subject matter jurisdiction sua sponte at any time)). It is, in fact, "common ground that in our federal system of limited jurisdiction any party or the court sua sponte, at any stage of the proceedings, may raise the question of whether the court has subject matter jurisdiction; and, if it does not, dismissal is mandatory." Manway Constr. Co. v. Housing Auth. of Hartford, 711 F.2d 501, 503 (2d Cir. 1983). In order for requisite diversity of citizenship to exist under 28 U.S.C. § 1332(a)(1), a plaintiff's citizenship(s) must be diverse from the citizenship(s) of all defendants. See, e.g., St. Paul Fire and Marine Ins. Co. v. Universal Builders Supply, 409 F.3d 73, 80 (2d Cir. 2005) ("Diversity is not complete if any plaintiff is a citizen of the same state as any defendant.") (citing Owen Equipment & Erection Co. v. Kroger, 437 U.S. 365, 373-74 (1978)). Such complete diversity "must exist at the time the action is commenced," Universal Licensing Corp. v. Lungo, 293 F.3d 579, 581 (2d Cir. 2002) (emphasis added), which in the case at bar is July 11, 2013.

Plaintiff has alleged that it is "a duly organized corporation existing under the laws of the State of New York with its principal place of business located" in New York. [Doc. 1] at ¶2. Pursuant to 28 U.S.C. § 1332(c)(1), "a corporation shall be deemed to be a citizen of any State by which it has been incorporated and of the State where it has its principal place of business." (emphasis added). Plaintiff has failed to specify whether New York is its sole state of incorporation and, as a result, this Court cannot determine whether for diversity purposes New York is the only state of which Plaintiff is a citizen.²

Furthermore, Plaintiff has averred that Defendant "is a Connecticut limited liability company with a principal place of business located" in Connecticut. [Doc. 1] at ¶3. This information is insufficient for a determination of Defendant's citizenship(s) and, consequentially, for a determination of diversity in the present action. Unlike the case of a corporation, the "citizenship for diversity purposes of a limited liability company ... is the citizenship of each of its members."Wise v. Wachovia Securities, LLC, 450 F.3d 265, 267 (7th Cir. 2006) (emphasis added), cert. denied, 549 U.S. 1047 (2006). Accordingly the "citizenship of a limited liability company is not the state in which it is organized or has its principal place of business, but rather, each of the states in which it has members." Lewis v. Allied Bronze LLC, No. 07 Civ. 1621(BMC), 2007 WL 1299251, at *1-2 (E.D.N.Y. May 2, 2007) (emphasis added) (citing Handelsman v. Bedford Village Associates Ltd. Partnership, 213 F.3d 48, [51-52] (2d Cir.2000) and remanding removed action for lack of diversity jurisdiction).³ Plaintiff has failed to provide the identities and citizenship of each of Defendant's members. Citizenship of each member must be known to establish that complete diversity exists in this action.

III. CONCLUSION

In order to determine whether it has subject matter jurisdiction in this action, the Court hereby ORDERS Plaintiff to establish, by affidavit, its and Defendant's citizenship(s) for diversity purposes as of the date this action was commenced, July 11, 2013.

Plaintiff shall file and serve such affidavit regarding citizenship on or before Tuesday, August 6, 2013. All case deadlines shall be stayed pending the Court's review of this affidavit. If, upon review, the Court determines that it possesses subject matter jurisdiction, the action may proceed. Otherwise, in the absence of such jurisdiction, the Court shall dismiss the action without prejudice.

It is SO ORDERED.

Dated: New Haven, Connecticut

July 16, 2013

_________________

Charles S. Haight, Jr.

Senior United States District Judge

1. The element of jurisdictional amount is satisfied, as Plaintiff seeks damages in excess of $75,000.

2. The Court notes that Plaintiff brings this lawsuit as subrogee for insured Sanford Redmond, whose citizenship has not been alleged, for losses incurred as a result of fire damage "at the Redmond residence located at 746 Riverbank Road, Stamford, CT 06903." [Doc. 1] at ¶1. As this Circuit noted eighty years ago, "[i]t is quite true that in determining the jurisdiction of the District Court under its diversity jurisdiction, it has been held that it is the citizenship of the subrogate, not of the principal, which counts." U.S. Merchants' & Shippers' Ins. Co. v. A/S Den Norske Afrika Og Australie Line, 65 F.2d 392, 393 (2d Cir. 1933); cf. St. Paul Fire and Marine Ins. Co. v. Universal Builders Supply, 409 F.3d 73, 82 (2d Cir. 2005) (stating that "in a diversity case in which both the insurer as subrogee and the insured are plaintiffs" and certain conditions are met, "if the presence of either the insurer or the insured destroys diversity, both the district court and the court of appeals have the authority ... to drop the nondiverse party ... in order to preserve subject matter...