UNITED STATES DISTRICT COURT 

NORTHERN DISTRICT OF INDIANA 

HAMMOND DIVISION 

WALSH CONSTRUCTION CO., ) 

) 

Plaintiff, ) 

) 

vs. ) No. 2:14-CV-084 

) 

CHICAGO EXPLOSIVE ) 

SERVICES, LLC, and ) 

PMG INDUSTRIAL, LLC, ) 

) 

Defendants. ) 

OPINION AND ORDER 

This matter is before the Court on Defendant Chicago Explosive 

Services, LLC’s Motion to Dismiss Plaintiff’s Complaint for Lack 

of Subject Matter Jurisdiction, filed by Defendant, Chicago 

Explosive Services, LLC, on May 27, 2016 (DE #66). For the reasons 

set forth below, the motion is GRANTED. This case is DISMISSED 

WITHOUT PREJUDICE for lack of subject matter jurisdiction. 

BACKGROUND 

Plaintiff, Walsh Construction Company (“Walsh”), filed its 

Complaint on March 17, 2014. (DE #1.) The Complaint lists the 

following claims: Count I, Breach of Contract against Chicago 

Explosive Services, LLC (“CES”); Count II, Breach of Contract for 

Failure to Indemnify against CES; Count III, Breach of Contract 

for Failure to Properly Procure Insurance against CES; Count IV, 

Negligence against CES; Count V, Negligence against PMG 
2 

Industrial, LLC (“PMG”); Count VI, Strict Liability against CES; 

and Count VII, Strict Liability against PMG. (DE #1.) CES filed 

a Motion for Enlargement of Time in which to Answer or Otherwise 

Respond to Complaint on May 30, 2014. (DE #11.) CES then filed 

its Answer to Complaint along with a Motion to Dismiss Count II 

and III of Plaintiff’s Complaint on June 11, 2014. (DE’s #13 & 

#15.) The Court denied the Motion to Dismiss Count II and III of 

Plaintiff=s Complaint on October 20, 2014. (DE #27.)1 

A protracted discovery period ensued during which several 

requests for extensions of time related to discovery matters were 

granted. On May 27, 2016, the instant motion to dismiss was filed. 

(DE #66.) In response to the motion, Walsh requested an 

enlargement of time to respond so that it could conduct discovery 

on the issue raised in the motion to dismiss -- lack of subject 

matter jurisdiction. (DE #69.) On June 28, 2016, Magistrate 

Judge Paul R. Cherry ordered all discovery not related to subject 

matter jurisdiction stayed, and he vacated the discovery schedule 

providing new deadlines for specific, jurisdictionally based 

discovery matters. (DE #73.) On November 7, 2016, Walsh filed 

its response to the instant motion to dismiss. (DE #83.) CES 

 

1 The initial Motion to Dismiss Count II and III of Plaintiff’s Complaint 

was premised upon Federal Rule of Civil Procedure 12(b)(6) for failure to 

state a claim, and the Court decided it on those grounds. 
3 

filed its reply on November 18, 2016. (DE #86.) The motion is 

ripe for adjudication. 

 

DISCUSSION 

Facts

Walsh, an Illinois corporation with its principal place of 

business in the state of Illinois, was hired by the Indiana 

Department of Transportation (“INDOT”) pursuant to INDOT Contract 

IB-30997-A to demolish the Cline Avenue Bridge (“Bridge”) in East 

Chicago, Indiana. (DE #1, pp. 1-2.) Walsh retained CES, a 

limited liability company with its principal place of business in 

Indiana, pursuant to a subcontract agreement (“Subcontract”) to 

perform certain “blasting” tasks associated with the Bridge 

demolition. (Id.; see also Subcontract, DE #1-1.) CES was 

assisted by PMG in completing the blasting work. (DE #1, p. 3.) 

Walsh alleges that some of the blasting work was performed in an 

improper and negligent manner, which ultimately led to Walsh 

incurring significant monetary damages. (Id. at 3-11.) Walsh 

filed the instant Complaint bringing claims of breach of contract, 

negligence, and strict liability. (Id.) The Complaint alleges 

that jurisdiction is proper under 28 U.S.C. § 1332 because the 

amount in controversy exceeds $75,000 and because diversity exists 

between the parties. Id. at 1-2. Specifically, Walsh alleges 
4 

that it is a citizen of Illinois while, “[u]pon information and 

belief,” CES and PMG are citizens of Indiana for purposes of 

diversity jurisdiction.2 Id. at 1. 

CES’s Limited Liability Company Operating Agreement defines 

its initial members as Richard N. Flores, Patrick L. Carney, and 

Brant Flores. (DE #66-2.) It is not disputed that both Richard 

N. Flores and Brant Flores are citizens of Indiana as is alleged 

in the Complaint. However, during the course of discovery, it was 

discovered that Carney has never been a citizen of Indiana.3 (DE 

#66-3, p. 2.) While the parties agree that Carney was never a 

citizen of Indiana, they dispute the actual state of his 

citizenship as of March 17, 2014, the date of the filing of the 

Complaint. The following is a summary of the evidence as provided 

by both parties. 

In the “Declaration of Patrick L. Carney in Support of 

Defendant Chicago Explosive Services, LLC’s Motion to Dismiss” 

(the “Declaration” or “Carney’s Declaration”), Carney states that: 

(1) he maintained citizenship in Illinois at all relevant times; 

(2) he currently (as well as during previous relevant time periods) 

 

2 It is undisputed that PMG is considered a citizen of the state of Indiana 

and that Walsh is considered a citizen of Illinois. 

 

3 Carney initially advised counsel that he was not a member of CES during 

the relevant time period, but this was later determined to be false. (DE 

#66-3, p. 1; see also DE #66, p. 5, n. 1.) 
5 

maintains residency at 10343 South Oakley Street, Chicago, 

Illinois 60643 (“10343 Oakley Street”); (3) he maintains a Driver’s 

License issued by the State of Illinois with an expiration date of 

August 12, 2016; (4) his Illinois and Federal tax returns identify 

his address as 10343 Oakley Street; (5) he maintains a vacation 

home at 1209 Varela Street, Key West, Florida 33040 (“1209 Varela 

Street”); and (6) he is not a citizen of Florida or Indiana. (DE 

#66-3.) CES has provided copies of Carney’s 2013 and 2014 Illinois 

and Federal tax returns, which identify his address as 10343 Oakley 

Street (DE ##86-4 through 86-7), an Illinois Driver’s License 

issued on August 18, 2012, that has an expiration date of August 

12, 2016, and lists Carney’s address as 10343 Oakley Street (DE 

#86-8), a certificate of an Illinois vehicle title dated June 9, 

2008 (DE #86-9), and a money market account statement dated 

February 28, 2014, with an address of 10343 Oakley Street (DE #86-

10). Carney also testified that he was a registered voter in the 

State of Illinois as of March 17, 2014, and that he voted in the 

Illinois primary as late as 2016. (DE #86-11, pp. 2-3.) 

In 2010, Carney purchased the properties located at 1209 

Varela Street and 1207 Varela Street in Key West, Florida. (DE 

#83-5, pp. 4-5.) When asked about the purpose of the property at 

his deposition on October 4, 2016 (the “Deposition”), Carney 

initially testified as follows: 
6 

Q: And I understand these properties were initially 

purchased as a vacation home, correct? 

A: Correct. One of the -- yeah, correct. 

Q: I mean, it it’s not correct, then please feel free 

to correct me, because I don’t want to put words in your 

mouth. 

A: It wasn’t purchased for a vacation home. I knew 

eventually I would move down here full time. That’s why 

I bought the house. I didn’t figure I’d come down two 

weeks out of the year, or anything like that. I bought 

the house because of the change in business, obviously, 

getting out of the blasting business, the pits at the 

Board of Trade that you are familiar with -- well, 

probably, you know what I’m talking about. Those are 

all going -- I was in the pit back in the day. They are 

all pretty much – for 2007 you could see the handwriting 

on the walls, all going computerized; hence, there was 

really no reason for me to remain in Chicago. So, it 

wasn’t purchased just as an occasional – it was purchased 

as a final destination. 

. . . 

Q: When you purchased it in 2010, approximately what 

percentage of the year did you spend in Key West? 

. . . 

A: 2010? All total, probably maybe three months.4 

 

4 In its response brief, Walsh states that Carney’s “percentage of time 

spent living in the Florida home increased following completion of the 

project at issue in the Complaint, which concluded in 2013.” (DE #83, p. 5.) 

However, several of the pages of the Deposition that Walsh cites to in 

support of that assertion have not been included in the record. (See Id. 

citing to pages 54, 55, 73, and 74 of the Deposition). Of those pages, only 

page 54 of the Deposition was submitted to the Court with Exhibit 5. (See DE 

#83-5, p. 6.) The Court “need not credit [a party’s] version of the facts 

when the materials supporting those asserted facts are not part of the 

record.” Stevens v. Hous. Auth. of S. Bend, Ind., 663 F.3d 300, 311 (7th 

Cir. 2011). Nor is the Court required to hunt through the record to make a 

party’s case for him. See Gross v. Town of Cicero, Ill., 619 F.3d 697, 702-

03 (7th Cir. 2010) (collecting cases). Thus, any factual assertions that 

lack direct citation to easily identifiable support in the record will not be 

considered by the Court. 
7 

(Id. at 5-6.) Later in that same Deposition, Carney expanded upon 

his position when asked again about the property: 

Q: Looking back at Exhibit 17, No. 7 states that, ‘I 

maintain a vacation home at 1209 Varela Street, Key West, 

Florida, 33040’; that’s what it states, right? 

A: Yes. 

Q: But we have already talked about today, and it is 

your position that that property is not -- was never a 

vacation home? 

A: I didn’t say that at all. I said that it was a 

destination home eventually. I mean, obviously when I 

first bought it it was for a vacation home. And there 

is probably an overriding reason I bought it to begin 

with. Has nothing to do with what we are talking about 

here at all. So it is just a whole different reason 

that I purchased it as opposed to a vacation home. 

Q: So, just so that I’m clear, the home at 1207 to 1209 

Varela Street as of May 19th 2016, was maintained as a 

vacation home, or it was not maintained as a vacation 

home? 

A: There is two addresses there. 

MR. ANDERSON: I’m going to object to relevance. The 

question is where he was a citizen at the time this 

complaint was filed. So any questions about anything 

after that are totally irrelevant. I have a standing 

objection to that. You can answer. 

MR. CARNEY:5 And I think, you know, we haven’t even 

defined what a vacation home is versus what he thinks 

vacation home means versus -- 

THE WITNESS: My idea of a vacation home may be totally 

different than yours. 

BY MS. GILBERT: 

Q: Well, it’s your affidavit. So why don’t you tell 

me in No. 7 the statement that, ‘I maintain a vacation 

home at 1209 Varela Street, Key West, Florida, 33040,’ 

what did you mean by that when you signed the affidavit? 

MR. CARNEY: You can answer that. 

THE WITNESS: (inaudible) 

THE COURT REPORTER: I’m sorry? 

 

5 The Court has some question as to who is speaking in this section of the 

transcript, but for purposes of accuracy, the transcript has been quoted 

verbatim. 
8 

THE WITNESS: We will call it a vacation home then. 

(DE #86-1, pp. 2-3.) 

 When asked at the Deposition whether he earned any income 

from work performed in Florida between 2013 and 2014, Carney 

testified as follows: 

THE WITNESS: It’s a tough question to answer, because 

it’s -- it’s -- it’s -- it’s -- if I’m trading, where 

does that money -- you know, if you are trading 

commodities, for example, you know, that all goes 

through Chicago, no matter where you are at. So I don’t 

know that you can call -- so I’m confused . . . .6 

(DE #83-5, p. 11.) Carney testified that he did have a personal 

bank account with the First State Bank of the Florida Keys for the 

period of February through June of 2014 but that he did not have 

any business accounts at that bank in the beginning of 2014. (Id. 

at 3.) Carney was also asked about additional business dealings 

in Florida: 

Q: What about in 2014? As you sit here today, do you 

recall whether you were involved in any Florida business 

enterprises as a sole proprietorship, partnership, 

corporation, or LLC? 

 

6 The rest of Carney’s answer is not included in the record. Walsh states 

in its response brief that “[b]y the time of the filing of the Complaint, 

[Carney] was engaging in business in Florida, including engaging in futures 

trading from Florida through Skype, which is a combination of video and 

telephone transmissions.” (DE #83, p. 5.) Again, several of the pages of 

the Deposition that Walsh cites to in support of that assertion have not been 

included in the record. (See Id. citing to pages 70 through 72 of the 

Deposition.) Of those pages, only page 70 was submitted to the Court with 

Exhibit 5. (See DE #83-5, p. 11.) For the reasons set forth in footnote 4, 

supra, the factual assertions lacking support will not be considered. 

 
9 

. . . 

THE WITNESS: There was a company, White Street Capital, 

that never got going. It was intended to be a 

partnership with me and another broker, and then he died. 

It was a partnership between they and another. 

THE COURT REPORTER: Did you say, ‘Wash U’? 

MS. GILBERT: White Street Capital. 

THE WITNESS: I formed that as it was going to be a 

partnership, and then the thing blew up immediately, you 

know. And so it never was actually -- I don’t think it 

actually was ever registered with the State of Florida. 

And you will see -- there is someplace around here you 

will see that White Street Capital. It’s on the NFA 

form, I think, actually. You can take a look at that. 

(DE #86-3, p. 2-3.) A document entitled Electronic Articles of 

Organization for a Florida Limited Liability Company (“Articles of 

Organization”) was filed with the State of Florida on May 7, 2013, 

for White Street Capital, LLC (“White Street Capital”). (DE #83-

6.) White Street Capital’s street address and mailing address was 

listed as 1207 Varela Street, Key West, Florida 33040 (“1207 Varela 

Street”). (Id.) The Articles of Organization describe Carney as 

a managing member and also as the registered agent of White Street 

Capital, both with an address of 1207 Varela Street. (Id.) As 

the registered agent, Carney agreed to “accept service of process” 

for White Street Capital at 1207 Varela Street, and he also agreed 

to “comply with the provisions of all statutes relating to the 

proper and complete performance of [his] duties.” (Id.) The 

electronic signature of John Kiely, Carney’s “old tax attorney,” 

appears on that document. (Id.; see also DE #86-2, p. 2.) On 
10 

June 2, 2014, a Florida Limited Liability Company Annual Report 

(“Annual Report”) was filed with the state listing Carney as the 

managing member and registered agent for White Street Capital with 

an address of 1207 Varela Street. (DE #83-6, p. 4.) Finally, on 

January 30, 2015, a separate Articles of Organization was filed 

for 923-931 Toppino Drive Associates, LLC (“TDA”). (DE #83-7.) 

The street address of TDA’s principal office was listed as 1209 

Varela Street, the mailing address was listed as 377 14th Street 

Ste. 2F, Brooklyn, New York 11215, and the registered agent was 

listed as White Street Capital at 1207 Varela Street with Carney’s 

name at the registered agent signature line. (Id.) The document 

was electronically signed by TDA’s managing member, Michael Robert 

Carney. (Id.) At the Deposition, Carney testified that, with the 

exception of White Street Capital, he was not a registered agent 

for any other Florida LLC between 2013 and 2014. (DE #83-5, p. 

9.) He further testified that he did not recall White Street 

Capital acting as the registered agent for TDA in 2015 and 2016. 

(Id. at 9-11.) 

Standard 

Federal Rule of Civil Procedure 12(b)(1) governs dismissal 

for lack of subject matter jurisdiction. Jurisdiction is the 

“power to decide” and must be conferred upon a federal court. In 
11 

re Chicago, Rock Island & Pacific R.R. Co., 794 F.2d 1182, 1188 

(7th Cir. 1986). Normally, at the motion to dismiss stage, a 

court must accept all of the plaintiff’s well-pled factual 

allegations as true and draw all reasonable inferences derived 

from those allegations in the plaintiff’s favor. United Transp. 

Union v. Gateway Western R.R. Co., 78 F.3d 1208, 1210 (7th Cir. 

1996). The court may look beyond the complaint and review any 

extraneous evidence submitted by the parties to determine whether 

subject matter jurisdiction exists. Id. If a defendant proffers 

evidence calling the court’s jurisdiction into question, the 

“presumption of correctness that we accord to a complaint’s 

allegations falls away on the jurisdictional issue.” Sapperstein 

v. Hager, 188 F.3d 852, 855–56 (7th Cir. 1999). At that point, 

the plaintiff must establish the facts supporting federal 

jurisdiction by a preponderance of the evidence. Muscarello v. 

Ogle County Bd. of Comm’rs, 610 F.3d 416, 424 (7th Cir. 2010); see 

also Hart v. FedEx Ground Package System Inc., 457 F.3d 675, 679 

(7th Cir. 2006) (the party asserting that jurisdiction exists has 

the burden of establishing that the cause lies within the federal 

court’s limited jurisdiction). Furthermore, the Seventh Circuit 

has noted that “a defect in subject-matter jurisdiction requires 

a suit’s dismissal, no matter how much the parties have spent and 

no matter how late in the proceedings the defect comes to light.” 
12 

RTP LLC v. ORIX Real Est. Capital, Inc., 827 F.3d 689, 693 (7th 

Cir. 2016). 

Under 28 U.S.C. § 1332(a)(1), a federal district court has 

“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 citizens of different States.” 

(emphasis added). When a district court’s jurisdiction is based 

on 28 U.S.C. § 1332, there must be complete diversity between the 

opposing parties. Schur v. L.A. Weight Loss Centers, Inc., 577 

F.3d 752, 758 (7th Cir. 2009). In other words, the citizenship 

of each plaintiff must be diverse from the citizenship of each 

defendant. Caterpillar Inc. v. Lewis, 519 U.S. 61, 68 (1996). 

When the suit involves a limited liability company as a party, the 

court must look to the citizenship of each of its members to 

determine whether diversity exists. Muscarello, 610 F.3d at 424 

(citing Wise v. Wachovia Sec., LLC, 450 F.3d 265, 267 (7th Cir. 

2006)). Citizenship is contingent upon a party’s domicile; an 

allegation of residence is not sufficient for purposes of 

establishing diversity jurisdiction. Heinen v. Northrop Grumman 

Corp., 671 F.3d 669, 670 (7th Cir. 2012). Domicile consists of 

two elements – (1) a physical presence in a state, and (2) an 

intent to remain there. Denlinger v. Brennan, 87 F.3d 214, 216 

(7th Cir. 1996); see also Sadat v. Mertes, 615 F.2d 1176, 1181 
13 

(7th Cir. 1980) (citing Restatement (Second) of Conflict of Laws 

§§ 15, 16, 18 (1971)) (“To establish a domicile of choice a person 

generally must be physically present at the location and intend to 

make that place his home for the time at least.”). Because intent 

is a state of mind, the court must evaluate it “through the 

circumstantial evidence of a person’s manifested conduct,” and 

declarations of intent are given little weight when they conflict 

with the facts. Sadat, 615 F.2d at 1181 (citations omitted). The 

Seventh Circuit Court of Appeals has recognized that picking one 

state to be a person’s domicile can be difficult and even arbitrary 

in light of the fact that transportation is now so efficient and 

many individuals have second homes in different states. Galva 

Foundry, Co. v. Heiden, 924 F.2d 729, 730 (1991). In such cases, 

the court must evaluate the totality of the circumstances 

surrounding the jurisdictional issue, and no single factor decides 

citizenship. Id.; see also Ner Tamid Congregation of N. Town v. 

Krivoruchko, 620 F. Supp. 2d 924, 931–32 (N.D. Ill. 2009). Factors 

to be considered include: 

the party’s current residence; voter registration and 

voting practices; situs of personal and real property; 

location of brokerage and bank accounts; membership in 

unions, fraternal organizations, churches, clubs, and 

other associations; place of employment or business; 

driver’s license and automobile registration; payment of 

taxes; as well as several other aspects of human life 

and activity. 
14 

13E Charles Alan Wright, Arthur R. Miller & Edward H. Cooper, 

Federal Practice and Procedure § 3612 (3d ed. 2017). Once a 

domicile is established, it continues until it is superseded by a 

new domicile. Sadat, 615 F.2d at 1181; Wright, Miller, & Cooper 

at § 3612 (“a domicile once established continues unless and until 

a new one is shown by clear and convincing evidence to have been 

acquired”). There is a presumption that an individual’s old, 

established domicile is favored over a new one when there is a 

question between the two. See 24 Hour Fitness USA, Inc. v. Bally 

Total Fitness Holding Corp., 08 CV 3853, 2008 WL 4671748, at *4 

(N.D. Ill. Oct. 21, 2008) (collecting cases); see also Wright, 

Miller, & Cooper at § 3612 (“Another important and widely accepted 

presumption is that of favoring the continuation of an established 

domicile against an allegedly newly acquired one.”). 

As a rule, when the court’s jurisdiction is premised on 28 

U.S.C. § 1332, complete diversity must be established at the 

beginning of the action and subsequent events do not affect the 

court’s diversity jurisdiction. Johnson v. Wattenbarger, 361 F.3d 

991, 993 (7th Cir. 2004); see also Thomas v. Guardsmark, LLC, 487 

F.3d 531, 534 (7th Cir. 2007) (“[A]n LLC’s jurisdictional statement 

must identify the citizenship of each of its members as of the 

date the complaint or notice of removal was filed.”) 
15 

Analysis 

Here, a consideration of all of the relevant factors 

establishes that Carney was a citizen of Illinois at the time the 

complaint was filed. The following facts are undisputed and 

supported by competent evidence as described above: (1) Carney 

maintained a residence in Illinois at 10343 Oakley Street on March 

17, 2014, and that, as of the date of his Declaration in May of 

2016, he still maintained a residence at that address; (2) Carney 

filed his 2013 and 2014 individual income tax returns with the 

State of Illinois and identified his address as 10343 Oakley 

Street; (3) Carney filed his 2013 and 2014 Federal individual 

income tax returns and identified his address as 10343 Oakley 

Street; (4) Carney maintained a valid Illinois Driver’s License on 

March 17, 2014, that listed his address as 10343 Oakley Street and 

remained valid as of the date of his Declaration in May of 2016; 

(5) Carney’s vehicle was titled with the State of Illinois; (6) 

Carney’s money market account lists an address of 10343 Oakley 

Street as of February 28, 2014; and (6) Carney was a registered 

voter with the State of Illinois from at least 2013 through 

September of 2016, and he voted in the Illinois primary in 2016. 

These significant contacts with Illinois show that Carney was 

domiciled there because he maintained a physical presence in the 

state and intended to make that place his home, for the relevant 
16 

time at least. See Sadat, 615 F.2d at 1181. 

It is true that Carney also purchased property in Florida in 

2010 and retained that property throughout the period in question; 

however, the Court finds that Walsh’s characterization of Carney’s 

Deposition testimony places more weight on that factor than is 

due. A careful reading of the testimony as a whole shows that he 

purchased 1207 and 1209 Vaerla Street in 2010 as a vacation 

property to which he “eventually” intended to relocate to. When 

asked whether it was his position that the property was never a 

vacation home, he emphatically denied that and clarified, “[I]t 

was a destination home eventually. I mean, obviously when I first 

bought it it was for a vacation home. And there is probably an 

overriding reason that I bought it to begin with. Has nothing to 

do with what we are talking about here at all.” The fact that 

Carney owned a second home in Florida that he eventually intended 

to make his “final destination” does not replace his established 

domicile in Illinois with one in Florida unless Walsh can point to 

additional clear and convincing evidence that Carney had intended 

it to as of the date the complaint was filed. Sadat, 615 F.2d at 

1181; Wright, Miller, & Cooper at § 3612; see also Galva, 924 F.2d 

at 730 (desire to retire to his Florida vacation home eventually 

did not supersede the fact that the defendant intended to remain 

in Illinois for the foreseeable future). 
17 

Walsh argues that such evidence exists. First, Walsh asserts 

that the percentage of time Carney spent living in the Florida 

home increased following completion of the project at issue in the 

Complaint, which concluded in 2013. However, as noted above in 

footnote four, several of the pages that Walsh cites in support of 

that assertion have not been included in the record. The testimony 

that is included in the record establishes only that Carney spent 

a total of approximately three months at the Florida residence in 

2010; this does little to weigh in favor of a change in domicile. 

Next, Walsh argues that Carney was “engaging in business” in 

Florida through futures trading via Skype at the time the Complaint 

was filed. However, as described in footnote six, several pages 

cited by Walsh are again missing from the record. The Deposition 

testimony that is provided shows that, when asked whether he earned 

any income from work performed in Florida between 2013 and 2014, 

Carney responded that it was a “tough question to answer” because 

all commodities trading eventually goes through Chicago. Carney 

also testified that he had no business banking accounts in Florida 

at the beginning of 2014.7 The argument that Carney was domiciled 

 

7 Carney did testify that he had a personal bank account with the First 

State Bank of the Florida Keys for the period in question. However, CES 

produced Carney’s money market account statement dated February 28, 2014, 

that lists 10343 Oakley Street as Carney’s address. Because these pieces of 

evidence are of a similar vein, they tend to not shift the balance in either 

direction. 

 
18 

in Florida because he engaged in some kind of electronic trading 

there is not especially persuasive, and it becomes even less so 

when viewed in light of the undisputed fact that Carney actually 

filed his 2013 and 2014 individual income tax returns with the 

State of Illinois. 

Finally, Walsh argues that Carney’s ties to White Street 

Capital provide definitive proof of his domicile. Walsh points 

out that Carney’s address on the Articles of Organization for White 

Street Capital is listed as 1207 Varela Street and that he affirmed 

through his electronic signature that he would comply with the 

provisions of all statutes relating to the proper performance of 

his duties as a registered agent. Walsh cites to the Florida 

Revised Limited Liability Company Act in which a registered agent 

is defined as “[a]n individual who resides in this state and whose 

business address is identical to the address of the registered 

office.” § 605.0113(1)(b)(1) Fla. Stat. (2014). According to 

Walsh, because Carney affirmed via the Articles of Organization 

that he resided in the state, his status as the registered agent 

for White Street Capital is prima facie evidence that he was 

domiciled in Florida. As an initial matter, the Court notes that 

the case cited by Walsh for the proposition that a person’s 

residence is prima facie evidence of his or her domicile is not 
19 

binding on this Court. State Farm Mut. Auto. Ins. Co. v. Dyer, 

19 F.3d 514, 520 (10th Cir. 1994).8 In the Seventh Circuit, while 

residence is certainly important to a determination of domicile 

that has been challenged, no single factor decides citizenship; 

rather, all relevant circumstances must be evaluated. See Galva, 

924 F.2d at 730. In Galva, the defendant, who was sixty-eight 

years old at the time the suit was filed in 1989, had lived in 

Illinois his whole life. Id. In 1966, he purchased a second home 

in Florida that was continually used as a vacation home by him and 

his wife. Id. In 1988, the defendant registered to vote in 

Florida, took out a Florida Driver’s license, declared permanent 

residency in Florida, and listed Florida as his permanent address 

on his State of Illinois and Federal tax returns. Id. In 1989, 

the defendant spent several months in Florida; however, he retained 

his home in Illinois and spent the balance of the year between 

there and Europe. Id. The court found that, despite the numerous 

affirmative steps that were taken with regard to establishing 

residency in Florida for tax purposes in 1988, his domicile was 

 

8 Walsh also cites to Lundquist v. Precision Valley Aviation, Inc., 946 F.2d 

8, 12 (1st Cir. 1991) for the proposition that representations on corporate 

reports are “weighty” in the domicile analysis; however, the Court notes that 

that opinion places equal weight on voting registration and voting behavior. 

Lundquist, 946 F.2d at 12. As noted above, Carney was registered to vote in 

Illinois as of the date the Complaint was filed and actually did vote in 

Illinois as recently as the 2016 primary. As such, this case does not help 

Walsh. 
20 

not converted. Id. at 730-31. The court recognized that a desire 

to retire to Florida eventually did not supersede the fact that he 

intended to remain in Illinois most of the year for the foreseeable 

future. Id. at 730. The court also acknowledged that even the 

defendant’s (seemingly fraudulent) representations on official 

government documents were not dispositive in relation to 

determining his true domicile for diversity jurisdiction purposes. 

Id. at 730-31.9 

Thus, although Walsh states that Carney “certified under 

oath”10 via the Articles of Organization that he resided at 1207 

Varela Street in 2013 and 2014, this affirmation is not prima facie

evidence that he was domiciled in Florida. Rather, the Court must 

look to the multitude of other factors surrounding the domicile 

issue to correctly determine Carney’s citizenship. Here, Carney 

testified that White Street Capital “never got going” and “blew 

up” quickly after the death of his other business partner. While 

Walsh argues that the Annual Report filed on June 2, 2014, cuts 

 

9 Said another way by the Seventh Circuit Court of Appeals in an unpublished 

opinion, “[t]his is true even when it is criminal to misrepresent one’s 

residency . . . because residency is determined differently in regard to 

voting or paying taxes or registering automobiles than is citizenship for the 

purposes of federal diversity jurisdiction.” Mader v. Motorola, Inc., No. 

98-3040, 175 F.3d 1020 (7th Cir. April 9, 1999). 

10 The Court notes that the Articles of Organization are actually signed by 

John Kiely, Carney’s old tax attorney, and that John Kiely was the individual 

to affirm that the “facts stated herein are true” and that false information 

submitted constituted a felony. (See DE #83-6, p. 3.) 
21 

against Carney’s assertion that White Street Capital was not really 

operating at the time the Complaint was filed on March 17, 2014, 

the most that can be gleaned from that document standing alone is 

that White Street Capital remained in existence as a limited 

liability company as of June 2, 2014, and that a certificate of 

continuing status was desired. The same is true of the fact that 

TDA listed White Street Capital as its registered agent in the 

Articles of Organization filed on January 30, 2015, and later in 

its Annual Report filed on March 3, 2016. These documents do 

little to establish that White Street Capital conducted any 

corporate/business activity or that Carney actually performed any 

actions as the registered agent for the company in Florida. Had 

Walsh provided additional evidence that White Street Capital was 

transacting business during 2013 and 2014 (i.e. financial reports, 

tax statements, etc.) or that Carney had performed duties as its 

registered agent (i.e. copies of certified letters, service of 

process notices, correspondence from state governmental entities, 

notice of lawsuits, etc.), the Court might be inclined to give 

more weight to White Street Capital as a factor pointing towards 

Carney’s domicile being Florida. As it stands, the bulk of the 

evidence described above weighs in favor of Illinois citizenship. 

Walsh has failed to meet its burden of establishing, by a 

preponderance, that Carney had acquired a new domicile in Florida 
22 

as of the date the Complaint was filed. See Muscarello, 610 F.3d 

at 424; see also Sadat, 615 F.2d at 1181. Because Walsh is an 

Illinois corporation with its principal place of business in 

Illinois and Carney, a member of CES, is also a citizen of 

Illinois, the Court lacks jurisdiction over this diversity action, 

and the case must be dismissed without prejudice. See e.g. Murray 

v. Conseco, Inc., 467 F.3d 602, 605 (7th Cir. 2006) (A dismissal 

based on a lack of subject matter jurisdiction is not a decision 

on the merits, so the case must be dismissed without prejudice.). 

CONCLUSION 

For the aforementioned reasons, the Motion to Dismiss 

Plaintiff’s Complaint for Lack of Subject Matter Jurisdiction (DE 

#66) is GRANTED. This case is DISMISSED WITHOUT PREJUDICE for 

lack of subject matter jurisdiction. 

DATED: September 25, 2017 /s/ RUDY LOZANO, Judge 

 United States District Court