Northsight Management LLC v. US Home Rentals LLC ( 2022 )

1 WO 2 3 4 5 6 IN THE UNITED STATES DISTRICT COURT 7 FOR THE DISTRICT OF ARIZONA 8 9 Northsight Management LLC, No. CV-21-01345-PHX-DJH 10 Plaintiff, ORDER 11 v. 12 US Home Rentals LLC, 13 Defendant. 14 15 Pending before the Court is Plaintiff Northsight Management LLC’s (“Plaintiff”) 16 Motion for Entry of Default Judgment against Defendant US Home Rentals LLC 17 (“USHR”) (Doc. 14). The Motion is unopposed, and the time in which to file a response 18 has passed. See LRCiv 7.2(c). 19 I. Background 20 Plaintiff filed its Complaint on August 3, 2021, against USHR for breach of 21 contract. (Doc. 1). Plaintiff’s Complaint alleges as a basis for subject matter jurisdiction 22 a complete diversity of citizenship between the parties. (Id. at ¶ 3). Specifically, Plaintiff 23 states that it “is a Texas limited liability company with offices in Maricopa County, Arizona 24 [and] [t]he Plaintiff’s Members are citizens of Arizona; none of them are citizens of New 25 York.” (Id. at ¶ 1). Plaintiff also states that “[t]he Defendant is a Delaware limited liability 26 company that upon information and belief, including publicly available information, is a 27 wholly owned subsidiary of FTE Networks, Inc., a Delaware corporation with its principal 28 place of business located in New York.” (Id. at ¶ 2). Plaintiff thus concludes, “[t]his Court 1 has subject matter jurisdiction under 28 U.S.C. § 1332(a)(1) because the amount in 2 controversy exceeds $75,000 and the suit is between citizens of different states (the 3 Plaintiff a citizen of Arizona and the Defendant a citizen of New York).” (Id. at ¶ 3). 4 Notwithstanding these allegations, the Court finds clarification on subject matter 5 jurisdiction is required because Plaintiff’s Complaint does not sufficiently allege complete 6 diversity of citizenship. 7 II. Subject Matter Jurisdiction 8 28 U.S.C. § 1332(a)(1) grants federal courts diversity jurisdiction in cases between 9 “citizens of different States.” For complete diversity of citizenship to exist under 28 U.S.C. 10 § 1332(a), a plaintiff’s citizenship must be diverse from the citizenship of all defendants to 11 an action. See Weeping Hollow Ave. Tr. v. Spencer, 831 F.3d 1110, 1112 (9th Cir. 2016). 12 “The party seeking to invoke the district court’s diversity jurisdiction always bears the 13 burden of both pleading and proving diversity jurisdiction.” NewGen, LLC v. Safe Cig, 14 LLC, 840 F.3d 606, 613 (9th Cir. 2016) (citation omitted). 15 Relevant here is the citizenship of USHR’s members. A limited liability company 16 “is a citizen of every state of which its owners/members are citizens,” not the state in which 17 it was formed or does business. See Johnson v. Columbia Props. Anchorage, LP, 437 F.3d 18 894, 899 (9th Cir. 2006). Plaintiff’s Complaint asserts diversity jurisdiction under 28 19 U.S.C. § 1332 but does not allege the citizenship of USHR’s members or confirm none of 20 them are citizens of Arizona. See Weeping Hollow Ave. Tr., 831 F.3d at 1112 (a federal 21 court may exercise diversity jurisdiction “only if there is no plaintiff and no defendant who 22 are citizens of the same State”). Plaintiff states that USHR “is a Delaware limited liability 23 company” that “is a wholly owned subsidiary of FTE Networks, Inc., a Delaware 24 corporation with its principal place of business in New York.” (Doc. 1 at ¶ 2). As alleged, 25 Plaintiff’s Complaint concerning the citizenship of USHR’s members falls short of 26 demonstrating that the Court has subject matter jurisdiction. 27 Thus, to determine whether it has subject matter jurisdiction in this action, the Court 28 orders Plaintiff to establish, by affidavit, the citizenship of USHR’s members to this action || for diversity purposes. Plaintiff shall file its affidavit regarding the citizenship of USHR’s || members on or before February 23, 2022. If, upon review, the Court determines that it || possesses subject matter jurisdiction, the action may proceed. In the absence of such 4|| jurisdiction, however, the Court will dismiss the action without prejudice. The Court will || accordingly defer a decision on the pending motion for Default Judgment until the 6 || existence of the Court’s subject matter jurisdiction is confirmed. 7 Accordingly, 8 IT IS HEREBY ORDERED that the Application for Default Judgment (Doc. 14) 9|| is stayed. 10 IT IS FURTHER ORDERED that Plaintiff shall file its affidavit regarding the citizenship of USHR’s members on or before February 23, 2022. 12 Dated this 9th day of February, 2022. 13 14 fe — □□ 15 norable'Diang/4. Hunfetewa 16 United States District Fudge 17 18 19 20 21 22 23 24 25 26 27 28 -3-