Kowall Ventures, LLC v. Vincent Mehdizadeh
2:20-cv-03012-FMO-JEM
| C.D. Cal. | Apr 14, 2020Background
- Kowall Ventures, LLC sued Vincent Mehdizadeh, Jaime Ortega, and Pineapple Ventures, Inc. in federal court; federal jurisdiction asserted solely under diversity.
- Complaint alleges Kowall is "an Arizona limited liability company" and a citizen of Arizona; defendants alleged citizens of California.
- Federal diversity jurisdiction requires complete diversity between every plaintiff and every defendant and the party invoking jurisdiction bears the burden to both plead and prove it.
- For an LLC, diversity citizenship depends on the citizenship of all of its members; an LLC is a citizen of every state of which its members are citizens.
- The Complaint contained only bare, conclusory allegations about Kowall’s citizenship and did not identify the citizenship of Kowall’s members.
- The court ordered Kowall to file a First Amended Complaint by April 22, 2020 addressing the pleading deficiency, warning that failure to comply would lead to dismissal without prejudice for lack of subject-matter jurisdiction or failure to obey a court order.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the complaint adequately pleads diversity jurisdiction for an LLC | Kowall alleges it is an Arizona LLC and a citizen of Arizona | Defendants alleged to be California citizens (no meaningful contest recorded) | Complaint inadequate: plaintiff must plead citizenship of all LLC members; ordered to amend or face dismissal |
Key Cases Cited
- Caterpillar Inc. v. Lewis, 519 U.S. 61 (1996) (diversity jurisdiction requires complete diversity between all plaintiffs and all defendants)
- Rainero v. Archon Corp., 844 F.3d 832 (9th Cir. 2016) (party invoking diversity jurisdiction must both plead and prove it)
- NewGen, LLC v. Safe Cig, LLC, 840 F.3d 606 (9th Cir. 2016) (pleading requirements for diversity jurisdiction as applied to entities)
- Johnson v. Columbia Props. Anchorage, LP, 437 F.3d 894 (9th Cir. 2006) (an LLC is a citizen of every state of which its members are citizens)
- Carden v. Arkoma Assocs., 494 U.S. 185 (1990) (entity citizenship depends on citizenship of all members)
- Baeza v. Baca, [citation="700 F. App'x 657"] (9th Cir. 2017) (upholding dismissal for failure to prosecute)
- Link v. Wabash R.R. Co., 370 U.S. 626 (1962) (courts have inherent power to dismiss for failure to prosecute)