IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF ILLINOIS

EASTERN DIVISION

AUTO-OWNERS INSURANCE CO., )

)

Plaintiff, )

)

v. ) No. 12 C 3732

)

STOCKTON CONSTRUCTION GROUP, )

LLC, et al., )

)

Defendants. )

MEMORANDUM ORDER

Auto-Owners Insurance Co. (“Auto-Owners”) has just filed a

Complaint against Stockton Construction Group, LLC (“Stockton”)

and four individual defendants, seeking to invoke federal 1

jurisdiction on diversity of citizenship grounds. This

memorandum order is issued sua sponte because Auto-Owners’

counsel have failed in their responsibility to establish subject

matter jurisdiction here.

To begin with, Complaint ¶3 speaks only of the Indemnitors’

presumed residence, even though by definition the diversity

required by 28 U.S.C. §1332(a) relates to their states of 2

citizenship. On that score our Court of Appeals has repeatedly

taught in such cases as Adams v. Catrambone, 359 F.3d 858, 861

n.3 (7th Cir. 2004) that “when the parties allege residence but

 Those individual defendants are referred to collectively 1

in the Complaint as “the Indemnitors,” and this memorandum order

will employ the same usage.

 All further references to Title 28’s provisions will 2

simply take the form “Section--.”

Case: 1:12-cv-03732 Document #: 9 Filed: 05/17/12 Page 1 of 3 PageID #:48
not citizenship, the district court must dismiss the suit.”

If that were the only problem posed by the Complaint, this

Court would be disinclined to follow that Draconian “must

dismiss” mandate, opting instead to grant counsel a brief period

to correct the mistake. But the other jurisdictional error--that

relating to Stockton--calls for less permissive treatment. In

that regard, Complaint ¶2 says only this:

Defendant Stockton is a limited liability company

which, on information and belief, was formed under the

laws of the State of Illinois and maintains is

principal place of business in Romeoville, Illinois.

As that language reflects, Complaint ¶2 speaks only of facts

that are jurisdictionally irrelevant where a limited liability

company is involved. Those allegations ignore more than 10 years

of repeated teaching about such situations from our Court of

Appeals (see, e.g., Cosgrove v. Bartolotta, 150 F.3d 729, 731

(7 Cir. 1998) and a whole battery of cases since then, th

exemplified by White Pearl Inversiones S.A. v. Cemusa, Inc., 647

F.3 684, 686 (7th Cir. 2011) and cases cited there).

This Court has a mandated obligation to “police subject

matter jurisdiction sua sponte” (Wernsing v. Thompson, 423 F.3d

732, 743 (7 Cir. 2005)). There is really no excuse for th

counsel’s lack of knowledge of such a firmly established

principle after well over a full decade’s repetition by our Court

of Appeals and others. Hence it seems entirely appropriate to

impose a reasonable cost for such a failing.

2

Case: 1:12-cv-03732 Document #: 9 Filed: 05/17/12 Page 2 of 3 PageID #:49
Accordingly not only Auto-Owners’ Complaint but this action

itself are dismissed (cf. Held v. Held, 137 F.3d 998, 1000 (7th

Cir. 1998)), with Auto-Owners and its counsel jointly obligated

to pay a fine of $350 to the District Court Clerk if an

appropriate Fed. R. Civ. P. 59(e) motion hereafter provides the

missing information that leads to the vacatur of this judgment of

dismissal. Because this dismissal is attributable to Auto- 3

Owners’ lack of establishment of federal subject matter

jurisdiction, by definition it is a dismissal without prejudice.4

________________________________________

Milton I. Shadur

Senior United States District Judge

Date: May 17, 2012

 That fine is equivalent to the cost of a second filing 3

fee, because a new action would have to be brought if the defects

identified here turn out to be curable.

 This memorandum order supersedes an earlier version that 4

was issued inadvertently even though some further editing was

called for.

3

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