Document: 494 U.S. 185 110 S.Ct. 1015 108 L.Ed.2d 157 C.T. CARDEN, et al., Petitionersv.ARKOMA ASSOCIATES. No. 88-1476. Argued Nov. 7, 1989. Decided Feb. 27, 1990. Syllabus Respondent Arkoma Associates, a limited partnership organized under Arizona law, sued petitioners Carden and Limes on contract dispute in the District Court, relying diversity of citizenship for federal jurisdiction. Limes, Louisiana citizens, moved to dismiss ground that one Arkoma's partners was also citizen. The court denied motion, finding requisite "complete diversity." After petitioner Magee Drilling Co. intervened counterclaimed against Arkoma, awarded judgment Arkoma. Court Appeals affirmed, finding, with respect jurisdictional challenge, complete existed because should be determined by reference its general, but not limited, partners. Held: 1. Complete is lacking Limes. Pp. 187-197. (a) A own right "citizen" State created it within meaning statute. This has firmly resisted extending well-established rule treating corporations as "citizens" other artificial entities. Chapman v. Barney, 129 677, 682, 9 426, 427, 32 L.Ed. 800; Great Southern Fire Proof Hotel Jones, 177 449, 456, 457, 20 690, 693, 44 842; Steelworkers R.H. Bouligny, Inc., 382 145, 151, 86 272, 275, 15 217. Puerto Rico Russell & Co., 288 476, 53 447, 77 903; Navarro Savings Assn. Lee, 446 458, 100 1779, 64 425, distinguished. 187-192. (b) must look partnership's well determine whether there diversity. That only general have exclusive control over operations litigation irrelevant. Court's decisions never held an entity can invoke jurisdiction based some all members. Bank United States Deveaux, 5 Cranch 61, 90-91, 3 38; Marshall Baltimore Ohio R. 16 How. 314, 328-329, 14 953; Navarro, supra, 192-196. (c) Whether, which, entities than are entitled considered purposes complex questions best left Congress decide. 196-197. 2. question exists between Appeals, this will decide first instance. P. 197. 874 F.2d 226 (CA5, 1988), reversed remanded. SCALIA, J., delivered opinion which REHNQUIST, C.J., WHITE, STEVENS, KENNEDY, JJ., joined. O'CONNOR, filed dissenting opinion, BRENNAN, MARSHALL, BLACKMUN, joined, post, p. 198. Richard K. Ingolia, New Orleans, La., petitioners. Mitchell J. Hoffman, respondent. Justice SCALIA Court. 1 presented case whether, suit brought partnership, taken into account among parties. 2 * Associates (Arkoma), laws Arizona, Eastern Louisiana, upon defendants, C. Tom Leonard L. citizens dismiss, contending citizen Louisiana. motion certified interlocutory appeal, Fifth Circuit declined. Thereafter Company and, together original Texas law. Following bench trial, money plus interest attorney's fees; dismissed Limes' counterclaim Magee's intervention counterclaim. Carden, (petitioners here) appealed, affirmed. (CA 1988). With petitioners' found diversity, reasoning We granted certiorari. 490 1045, 109 1952, 104 421 (1989). II Article III Constitution provides, pertinent part, "[t]he judicial Power shall extend . Controversies Citizens different States." authorized courts exercise Judiciary Act 1789, ch. 20, § 11, Stat. 78. In current form, statute provides district civil actions where matter controversy exceeds $50,000 ., States. ." 28 U.S.C.A. 1332(a). Since enactment, we interpreted require diversity" citizenship. See Strawbridge Curtiss, 267, 435 (1806). erred unless (1) may it, or (2) consider these turn. A. 4 often had status state law insofar bears existence precise posed terms such whose created.1 corporation thepar adigmatic "person," proper characterization more occasion—not always reaching same conclusion. Initially, "is certainly citizen," so "look character individuals who compose [it]." 86, 91-92, 38 (1809). overruled Deveaux 35 years later Louisville, C.R. Letson, 497, 558, 11 353 (1844), "capable being treated [the it], much natural person." Ten later, reaffirmed result though somewhat theory "those use corporate name, faculties conferred it," presumed conclusively corporation's incorporation. 329, 953 (1854). While regarding treatment become established, (with exception discussed presently) just For example, 800 (1889), involving unincorporated "joint stock company," raised our lacking: 6 "On looking record find no satisfactory showing plaintiff. allegation amended petition is, Express joint company York, State. But express cannot statutes regulating jurisdiction, corporation. York fact corporation, mere partnership." Id., at S.Ct., 428. 7 Similarly, 842 (1900), "limited association"—although possessing "some characteristics corporation" deemed creating it—may established corporations. 693. "That extended." As recently 1965, unanimous 217 reiterated "the doctrinal wall Barney," id., U.S., would breached. 8 admirable consistency jurisprudence 903 (1933), known sociedad en comandita, Rico, could determining federal-court juridical personality, said, contemplation see adequate reason holding law." 482, 449. fairly argues language, outcome case, "reflec[t] Supreme willingness beyond incorporated/unincorporated dichotomy study internal organization, requirements, management structure, capacity lack thereof act and/or sue, citizenship." Brief 14. problem argument lies logic, approach espouses proposed specifically rejected Bouligny. There, reaffirming explained resolving distinctive "of fitting exotic creation scheme knew not." 275. There doubt, after least common-law (and likely Rican comandita ) pursuant what called tradition common law," "to treat legal persons incorporated groups assimilate others partnerships." 480, 448.2 claims another 425 (1980). however, did involve party State, quite separate parties were undoubted (viz., persons) real controversy. plaintiffs eight individual trustees Massachusetts business trust, suing their names. defendant, Association, disputed claiming trust beneficiaries rather controversy, former latter therefore control. course rejecting claim, indeed discuss trust—not all, purpose attributes making "citizen," establishing respondents "active assets names substantial," thereby bringing them rule, "more 150 years" old, permits sue right, without regard beneficiaries." 465-466, 1784. short, nothing do question, except makes available respondent analogy that, reality trustee put mildly, less compelling. B 10 alternative asserts correctly solely partners, Only points out, "manage assets, litigation, bear risk liability debts," broadly, "have 30, 36. members finds even support precedent organization (for point ). entity, No doubt Chapman, labor union association exercised greater respective considerations played part decisions. To approach, seeks press service once again, arguing looked here powers, partnership. already explained, "trust," since 12 dissent supports point, though, described, rubric supposedly before parties, n. 1, supra. approach," 201—by means looks "control conduct ability initiate litigation," 204—"has been implemented both oldest most recent cases examining associations." Post, 201. Not single discusses, either old new, assertion. any event seems applying "real controversy" test, principle substance, merely "represents" shareholders, Cranch, 90-91; if regarded deems test met shareholders operation business." Marshall, rerationalized Letson contains language clearly adopting arguably "control" status. ("[T]he behind collective name representatives, curators, How., 328-329 (emphasis added). "The presumption arising from habitat place [is] conclusive residence those 329 added).) discussed, last quotation shows, analysis fiction; (or controlling shareholders) consulted all.3 From fictional leap almost century third discusses "control." irrelevant, involved person institution trustees. 13 position supported, contradicted, trilogy Southern, Bouligny—cases apply analysis, criterion cases, explains, each equivalent power association's business, litigation." 202. It establish factual matter, text opinions (where slightest discussion appears) but, citation scholarly commentary dealing agreements, (because does contain) particular agreement issue 202-203; Pennsylvania associations, statutes, 203; observation "[t]here indication union's member, therefore, decide" issue, 204. do. requirement, "called it. said itself: "[T]he failure urge objections [to citizenship] relieve duty ascertaining properly take suit. 'The inflexible exception, requires court, deny appellate power, States, affirmatively appear act.' " 453, 691 (quoting Mansfield, L.M.R. Swan, 111 379, 382, 510, 511, 462 (1884)). If, contends, three governed control, inconceivable equivalency, absence suspect nonequivalency, mentioned opinions. Given 180 done, opposed they might difficult understand how characterize "newly formulated" "rule will, count every member jurisdiction." 199. sum, reject contention determine, purposes, consult entity's adhere oft-repeated depends "all members," several composing association," "each 146, 273. C 17 resolutions reached above validly characterized technical, precedent-bound, unresponsive policy changing realities organization. But, evident earlier discussion, field Letson. Currie, Federal Courts American Law Institute, 36 U.Chi.L.Rev. (1968). undoubtedly correct partnerships functionally similar "other types organizations access courts," perhaps "[c]onsiderations basic fairness substance form receive treatment." 33. Similar arguments made upheld removal divine 'no sense national differently corporation,' 273, recognized "considerable merit," 150, 274. concluded, "[w]hether unions ought assimilated purposes," 153, 276, "properly legislative consideration adequately appropriately dealt Court," 147, words, having entered forcefully) further adjustments Congress. 18 idle. 1958 revised providing incorporation principal 1332(c). provision corporations, although many post-Letson forms commercial enterprises, including sort obvious. 19 Thus, today disregard accommodating honors important leaving people's elected representatives. Such accommodation performed legitimately courts, intelligently legislation interpretation statutory word "citizen." 50 created, continue create, wide assortment powers characteristics, composed various classes varying degrees Which members' consulted, readily resolved prescription reasoning, complexity particularly unwelcome threshold stage long decided special leave rest Congress; decision. nonetheless affirm indisputably Appeals. decline instance, remand. 21 reversed, remanded proceedings consistent opinion. 22 ordered. 23 whom BLACKMUN join, dissenting. 24 potentially nondiverse partner. All itself, assuming citizen, diverse. question—whether partner counted addresses I hold still required any, i.e., subject 328, Application leads me conclude 25 "[w]e decided" associations 'citizen' reasoning." Ante, assertion insupportable light (1980) (determination jurisdic tion), (1965) according settled law; change result), relies. 196. Indeed, Congress, decides then invokes deference justify newly formulated my view, tackles "application situations anticipated legislature pre-eminently function." (1968); 87, (1809) ("The duties [C]ourt, conferred, usurp equal obligation. constitution, expounded, leaning way other, principles usually govern construction fundamental laws"). 26 starting (1806), constitutionally mandated. Farm Casualty Tashire, 386 523, 530-531, 87 1199, 1203-04, 270 (1967) (statutory interpleader need satisfy requirement two claimants); Study Division Jurisdiction Between 1301(b)(2), Supporting Memorandum A, pp. 426-436 (1969). class action Rule Civil Procedure 23, named representatives considered, destroy stake Snyder Harris, 394 332, 340, 89 1053, 1058, 319 (1969); Wright, 484 (4th ed. 1983); Owen Equipment Erection Kroger, 437 365, 375, 18, 98 2396, 2403, 57 274 (1978) (citizenship joined ancillary jurisdiction); (same). 27 early 19th century, benchmarks interest" or, party" Wright Miller, Practice 1556, 711 (1971) (well "citizenship testing grounded notions federalism"). generally Note, Diversity Unincorporated Business Entities: Real Party Interest Jurisdictional Rule, 56 L.Rev. 243, 247-250 (1978). Wormley Wormley, Wheat. 421, 651 (1823), stated: "This suffer ousted joinder non-joinder formal parties; proceed them, merits interests whenever done prejudice rights others." 451 (footnote omitted). 29 Wood Davis, 467, 469, 460 (1856) ("It repeatedly nominal interest, united oust ."). 30 associations. examination invoked concluded shareholder 91-92. "corporeal qualities," 89, actual come name." 91. By 1854, longer "juridical person," stronger recognizing 328; 558-559, (1844) (corporation person; shareholders' counted). 31 determination signal end inquiry. 328. Rather, engaged two-part inquiry: person" serve 327-329; initiation representative body itself power. not. "[F]or acting, contracting, remedy, [shareholders] speak, act, plead, through curators. represented attorney, appointed constitutional organs. [T]hey really controversy." Ibid. 33 Having 328-329. plain necessary prerequisite fiction 34 series considering following themselves litigation. addressed company, now historical anomaly, Bromberg, Crane Bromberg Partnership 178, (1968), features e.g., centralized transferability shares, like personally liable Comment, Limited Partnerships Jurisdiction, 45 384, 389, Each "partner" virtue his elect company's managers. 179, 19. "mere partnership" sufficiently designating 427. Hence, owner Because owners similarly situated possessed applied when examined association. Quite unlike modern very few U.Chi.L.Rev., 36, species annually electing managers See, 1874 Pa. Laws, Act. §§ 2, 5; surprisingly, viewed F. Burdick, 361-362 (1899) (limited respects, partnership). inquire who, (1965), Mesa Operating Intrastate Gas Corp., 797 238, 240-241 (CA5 1986) (union Bouligny failed meet test). 37 next application appropriate, unanimously 460, 464-465, 1781, 1783-84; 475, 1786, 1789 (BLACKMUN, dissenting). beneficiaries' trust. 1780. lacked counted. 1783-84. clear, nature settle fact, us correct, ante, 187-188, seriously 464-466, 1783-84, 39 attempts distinguish person, "distinctive trustees." 194. view consonant new announced fails Navarro. If sufficient answer wholly superfluous. certiorari counted, 40 yields conclusion Like beneficiary "can neither disposition nor intervene affairs extraordinary situations." Uniform 26, U.L.A. 614 (1969) object enforce partner's partnership"); 1001, 371 (Supp.1989) (derivative actions); Ariz.Rev.Stat.Ann. 29-324 (1989) (general obligations partnership); 29-209 agent 29-356 derivative Agreement, Art. VI, 6.1 "exclusive operations"); 7.1 "shall Partnership"). And "for [limited partners] [others]." retain[s] measure voting while restricted role restraint [of management] refusal concur certain acts consent Standing Partners Sue Derivatively, 65 Colum.L.Rev. 1463, 1478 (1965). Without assets" 465, 1784, majority adopted Act, uniform 172, 220 (Supp.1989). 41 commentators appropriate 418 Who Are Parties Purposes Determining Partnerships?, 61 Wash.U.L.Q. 1051, 1066-1067 (1984) (same); L.Rev., 250-251 (real diversity); Colonial Realty Corp. Bache 358 183 (1966) (Friendly, J.) declares "proper partnership"). 42 concern implicit expand time overburdened. illusory context For, despite today, gain defending action, considered. Jurisdiction—Citizenship Associations, Vand.L.Rev. 984, 991-992 (1966). little depart practice test. 43 (assuming citizen) fully Even directly relate us, takes pains address (1933). 189-190. removed Insular side domiciled Rico. 478, 447. None precluded. tells about members, unlimited event, flawed. Russell, version delineated factors 481, Ironically, endorses virtually listed equally applicable acknowledge sociedad, origins originated Europe middle ages, appearing France "[u]nder la Societe comandite, mention ancient records, mercantile regulations Marseilles Montpelier." Ames Downing, Bradf. Surr. 321, (N.Y.1850). acceptance Kingdom creature 384-385 (2d 1906). introduced country York. Colum.L.Rev., 1464. Although 'creation law,' hardly 'exotic.' 190 275). yet descended French country. Ames, 329-330 (American "partnership novelty, considerable antiquity, known, understood regulated"). history abroad assert appears 190-191, "admirable jurisprudence," 189, blemished distinguishing partnerships. severely marred continental afforded identical counterpart. 191, ("operative 'citizens' "). decision endorsing refusing stateside counterpart, justified precedents realities. 46 foregoing reasons, respectfully dissent. reaches ours primarily poses, answers, entirely question. "do[es] consider" "whether 'citizen,' simply "assum[es] "we Furthermore, partner" "[a]ll diverse." central fallacy dissent's logically follows. citizenship, answered not, assumes, multiple one: turn raises (like corporation) possess so, cite describes. infra, 192-195. observes "Russell 207. discussing instead Part below, (according respondent) something right. Rico," 207, affect arguable relevance operative "citizens." goes criticize "seriously flawed," 208, attempt connection address, complaint prevent confusion, criticism gratuitous, inasmuch announcing outset 'citizen.' evidence bearing pedigree comes attention too late. reasons stated text, facts. abandoned. Later revert formulation (1900) ("[F]or it") (citing ); (1889) (" [E]xpress corporation").

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