Rolling Greens MHP, L.P. v. Comcast SCH Holdings L.L.C.

[PUBLISH]

IN THE UNITED STATES COURT OF APPEALS

FOR THE ELEVENTH CIRCUIT
________________________ FILED
U.S. COURT OF APPEALS
No. 03-15917 ELEVENTH CIRCUIT
June 23, 2004
Non-Argument Calendar
THOMAS K. KAHN
________________________ CLERK

D. C. Docket No. 03-00022-CV-OC-10GRJ

ROLLING GREENS MHP, L.P.,

Plaintiff-Counter-Defendant-Appellant,

versus

COMCAST SCH HOLDINGS L.L.C.,

Defendant-Counter-Claimant-Appellee.

________________________

Appeal from the United States District Court
for the Middle District of Florida
_________________________

(June 23, 2004)

Before BLACK, BARKETT and COX, Circuit Judges.

PER CURIAM:

Rolling Greens MHP, L.P. appeals the summary judgment entered against it

and for Comcast SCH Holdings, L.L.C., in this declaratory judgment action, removed
from a Florida state court to the district court based on the district court’s diversity

jurisdiction. We raised sua sponte the issue of the jurisdiction of the district court

because neither the complaint, the notice of removal, nor anything else in the record

sufficiently alleges the citizenship of the parties, a limited partnership and a limited

liability company. We remand this case to the district court for the limited purpose

of determining whether diversity jurisdiction exists based on the citizenship of each

partner of the limited partnership and on the citizenship of each member of the

limited liability company.

I. BACKGROUND AND PROCEDURAL HISTORY

Rolling Greens, a limited partnership, filed this case in Florida state court.

Comcast, a limited liability company, removed the case to the district court pursuant

to 28 U.S.C. § 1441, alleging diversity jurisdiction under 28 U.S.C. § 1332. In

support of diversity jurisdiction, Comcast alleged that it is a “Delaware limited

liability company with its principal place of business in Philadelphia, Pennsylvania,”

and that Rolling Greens “‘is a California Limited Partnership.’” (R.1-1 at 3.) After

removal, Rolling Greens filed an amended complaint, which also alleged diversity of

citizenship, stating that Rolling Greens “is an Oregon Limited Partnership authorized

to do business in” Florida, and that Comcast “is a Delaware Limited Liability

Company authorized to do business in” Florida. (R.1-16 at 1.)

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The case proceeded with the parties filing cross motions for summary

judgment, and the court entering summary judgment for Comcast. Rolling Greens

appeals.

We raised sua sponte the jurisdictional issue because we “have a responsibility

to examine the subject matter jurisdiction of the district courts in actions that [we]

review,” Williams v. Best Buy Co., Inc., 269 F.3d 1316, 1318 (11th Cir. 2001); we

ordered the parties to brief the issue.

II. JURISDICTIONAL ISSUES AND STANDARD OF REVIEW

We address two jurisdictional questions. First: how are the citizenships of a

limited partnership and a limited liability company established for purposes of

diversity jurisdiction? And second: whether Comcast met its burden of establishing

the citizenships of itself, a limited liability company, and of Rolling Greens, a limited

partnership, for purposes of removing this case to federal court based on diversity

jurisdiction.

These issues present questions of law, which we review de novo. Id. at 1318.

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III. DISCUSSION

A. How Are the Citizenships of a Limited Partnership and a Limited
Liability Company Determined for Purposes of Diversity Jurisdiction?

The Supreme Court has settled the law on how the citizenship of a limited

partnership is determined for purposes of diversity jurisdiction. In Carden v. Arkoma

Assocs., 494 U.S. 185, 195-96, 110 S. Ct. 1015, 1021 (1990), the Supreme Court held

that for purposes of diversity of citizenship, a limited partnership is a citizen of each

state in which any of its partners, limited or general, are citizens. In reaching this

holding, the Court noted the long-standing rule that the citizenship of an artificial,

unincorporated entity generally depends on the citizenship of all the members

composing the organization. 494 U.S. at 195-96, 110 S. Ct. at 1021. In applying this

general rule to a limited partnership, rather than extending to it 28 U.S.C. §

1332(c)(1)’s statutory exception for corporations,1 it reasoned that Congress, if it so

chooses, is capable of adjusting the rules of diversity jurisdiction to account for

unincorporated associations. Carden, 494 U.S. at 196-97, 110 S. Ct. at 1022.

This circuit has not previously addressed the question of how to determine the

citizenship of a limited liability company for diversity jurisdiction purposes. We do

so now. The federal appellate courts that have answered this question have all

1
Rather than taking the citizenship of their members, corporations are citizens in the states
of their incorporation and their principal place of business. 28 U.S.C. § 1332(c)(1).

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answered it in the same way: like a limited partnership, a limited liability company

is a citizen of any state of which a member of the company is a citizen. We join them

in this holding.

We hold that the general rule for unincorporated entities also applies to limited

liability companies, in the absence of Congress’s extending the treatment given to

corporations. See Cosgrove v. Bartolotta, 150 F.3d 729, 731 (7th Cir. 1998) (“Given

the resemblance between an LLC and a limited partnership, and what seems to have

crystallized as a principle that members of associations are citizens for diversity

purposes unless Congress provides otherwise (as it has with respect to corporations,

in 28 U.S.C. § 1332(c)(1)) . . . we conclude that the citizenship of an LLC for

purposes of the diversity jurisdiction is the citizenship of its members.”) (citations

omitted); Handelsman v. Bedford Village Assocs. Ltd. P’ship, 213 F.3d 48, 51-52 (2d

Cir. 2000) (holding that citizenship of a limited liability company was determined by

the citizenship of its members, citing Cosgrove, 150 F.3d at 731); GMAC Commercial

Credit LLC v. Dillard Dept. Stores, Inc., 357 F.3d 827, 829 (8th Cir. 2004) (holding

that based on the similarities between limited liability companies and limited

partnerships, and in the absence of a Congressional mandate, the general rule of

citizenship based on membership applied). See also Homfeld II, L.L.C. v. Comair

Holdings, Inc., 53 Fed. Appx. 731, 732 (6th Cir. 2002) (stating, in an unpublished

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opinion, that citizenship of limited liability company depends on citizenship of its

members); Provident Energy Assocs. of Mont. v. Bullington, 77 Fed. Appx. 427, 428

(9th Cir. 2003) (same).

B. Whether Comcast, in the Notice of Removal, Met Its Burden of
Establishing the Citizenships of the Parties.

A party removing a case to federal court based on diversity of citizenship bears

the burden of establishing the citizenship of the parties. Williams, 269 F.3d at 1319

(“Because this case was originally filed in state court and removed to federal court

by [the Defendant], [the Defendant] bears the burden of proving that federal

jurisdiction exists.”); Ray v. Bird & Son & Asset Realization Co., 519 F.2d 1081,

1082 (5th Cir. 1975) (“The burden of pleading diversity of citizenship is upon the

party invoking federal jurisdiction, and if jurisdiction is properly challenged, that

party also bears the burden of proof.”).

Here, Comcast, the removing party, failed to adequately allege in its notice of

removal the citizenships of itself or of Rolling Greens. And, nothing in the record

establishes their citizenships. To sufficiently allege the citizenships of these

unincorporated business entities, a party must list the citizenships of all the members

of the limited liability company and all the partners of the limited partnership.

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Because Comcast failed to do so, it failed to carry its burden of establishing diversity

of citizenship.

IV. CONCLUSION

Because Comcast failed to adequately allege the citizenships of the members

and partners of the parties, we are unable to determine whether the district court had

diversity jurisdiction over this declaratory judgment action. We therefore remand this

case to the district court for the limited purpose of determining the citizenships of the

parties, consistent with this opinion.2 If Comcast carries its burden with respect to

establishing diversity of citizenship, we retain jurisdiction to consider the merits of

this appeal; if Comcast fails, and there is no diversity of citizenship, then the district

court should remand the case to state court for want of federal jurisdiction. See

Williams, 269 F.3d at 1321 (similar limited remand).

LIMITED REMAND.

2
The parties have offered to stipulate in this court the citizenships of the members of their
organizations. We think that any such stipulation is best submitted to the district court on remand.