Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-azd-2_06-cv-03013/USCOURTS-azd-2_06-cv-03013-0/pdf.json

Nature of Suit Code: 290
Nature of Suit: Other Real Property Actions
Cause of Action: 28:1332 Diversity-Declaratory Judgment

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IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF ARIZONA

SMS VanKirk, L.L.C., )) Plaintiff, ) No. CV 06-3013-PHX-PGR ) vs. )) ORDER John Craig Vankirk, et ux., )) Defendants. ) )

The defendants removed this action on December 14, 2006 solely on the

basis of diversity of citizenship jurisdiction. Having reviewed the defendants'

Notice of Removal to determine if subject matter jurisdiction exists in this Court,

the Court finds that the Notice of Removal is facially deficient because it fails to

properly allege the existence of diversity of citizenship jurisdiction.

As the Supreme Court has long since, and repeatedly, made clear,

[t]he established rule is that a plaintiff [or removing defendant], suing

in federal court, must show in his pleading, affirmatively and

distinctly, the existence of whatever is essential to federal

jurisdiction, and, if he does not do so, the court, on having the defect

called to its attention or on discovering the same, must dismiss [or

remand] the case, unless the defect be corrected by amendment.

Smith v. McCullough, 270 U.S. 456, 459, 46 S.Ct. 338, 339 (1926); accord, Rilling

v. Burlington Northern Railroad Co., 909 F.2d 399, 400 (9th Cir. 1990). The

defendants have not met their jurisdictional pleading burden because the Notice

Case 2:06-cv-03013-PGR Document 5 Filed 12/19/06 Page 1 of 3
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of Removal fails to affirmatively set forth the facts necessary for the Court to

determine the citizenship of any party.

First, the citizenship of the plaintiff cannot be determined from the current

record inasmuch as the Notice of Removal inexplicably contains no affirmative

allegations concerning the plaintiff's citizenship and the complaint merely states

that the plaintiff is an Arizona limited liability company with its principal place of

business in Phoenix, Arizona. This latter allegation is insufficient as a matter of

law because a limited liability company is not treated as a corporation for purposes of

determining whether diversity exists for purposes of § 1332. Johnson v. Columbia

Properties Anchorage, LP, 437 F.3d 894, 899 (9th Cir. 2006) ("Notwithstanding LLCs'

corporate traits, ... every circuit that has addressed the question treats them like

partnerships for the purposes of diversity jurisdiction. ... We therefore join our sister

circuits and hold that, like a partnership, an LLC is a citizen of every state of which its

owners/members are citizens.") What is thus required in the Notice of Removal is an

affirmative allegation of the citizenship of each member of the defendant limited liability

company.

Second, the citizenship of the defendants is not properly alleged in the

Notice of Removal, and their citizenship is not apparent from the face of the

complaint, inasmuch as the defendants are merely alleged in both pleadings to

be residents of Kerr County, Texas. Such an allegation of residency is insufficient

as a matter of law under 28 U.S.C. § 1332 because, as the Supreme Court has

also repeatedly made clear,

[i]t has long been settled that residence and citizenship [are] wholly

different things within the meaning of the Constitution and the laws

defining and regulating the jurisdiction of the ... courts of the United

States; and that a mere averment of residence in a particular state is

not an averment of citizenship in that state for the purpose of

jurisdiction.

Steigleder v. McQuesten, 198 U.S. 141, 143, 25 S.Ct. 616, 617 (1905); cf.,

Kanter v. Warner-Lambert Co., 265 F.3d 853, 857-58 (9th Cir. 2001) (Plaintiffs'

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complaint ... state[s] that Plaintiffs were 'residents' of California. But the diversity

jurisdiction statute, 28 U.S.C. § 1332, speaks of citizenship, not of residency. ...

[The] failure to specify Plaintiffs' state of citizenship was fatal to [the] assertion of

diversity jurisdiction.")

In order to cure these pleading deficiencies, the Court will require the defendants

to file an amended notice of removal that affirmatively states the citizenship of each

member of the plaintiff and the citizenship of each defendant. The defendants are

advised that their failure to timely comply with this order shall result in the remand of this

action without further notice for lack of subject matter jurisdiction. Therefore,

IT IS ORDERED that the defendants shall file an amended notice of removal

properly stating a jurisdictional basis for this action no later than January 2, 2007. 

DATED this 18th day of December, 2006.

Case 2:06-cv-03013-PGR Document 5 Filed 12/19/06 Page 3 of 3