Gravity Group PB LLC v. TAVA Capital I, LLC
- Proceeding
- district
- Area
- civil
- Panel
- Gonzalo P. Curiel (author)
Analysis
The court reviewed Defendants' response to an order to show cause regarding subject matter jurisdiction and found that they failed to establish the citizenship of the Plaintiff, a limited liability company. The court ordered Defendants to file a supplemental declaration demonstrating complete diversity of citizenship by October 13, 2020.
| What the court decided | The model |
|---|---|
Order directing Defendants to submit a supplemental declaration demonstrating diversity of citizenship“Here, because Defendants have not provided an affidavit demonstrating complete diversity between the parties, they must file a response on or before October 13, 2020 demonstrating diversity of citizenship to support subject matter jurisdiction.” | agree with court The court correctly applied the legal principle that the party invoking removal bears the burden of establishing subject matter jurisdiction. Because the Defendants failed to provide evidence of the Plaintiff's citizenship (specifically, the citizenship of its members), the court was correct to require further proof before ruling on the jurisdictional issue. This is a procedural step to allow the party with the burden to meet it. |
The order itself: sound — The order is procedurally sound. It correctly identifies the legal standard for LLC citizenship and the burden of proof for removal. It accurately notes the deficiency in the Defendants' current filing (lack of Plaintiff's citizenship evidence) and provides a specific deadline to cure the defect. It does not dismiss the case immediately, which is appropriate given the curable nature of the evidentiary gap.
Opinion
1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA 10 11 GRAVITY GROUP PB LLC, a Delaware Case No.: 20cv1869 GPC(KSC) limited liability company, 12 ORDER DIRECTING DEFENDANTS Plaintiff, 13 TO SUBMIT SUPPLEMENTAL v. DECLARATION 14 TAVA CAPITAL I, LLC, a Wyoming 15 limited liability company; TREVOR 16 WELCH, an individual and DOES 1 through 20, inclusive, 17 Defendants. 18 19 On September 22, 2020, the Court issued an order to show cause why the case 20 should be not remanded for lack of subject matter jurisdiction based on the diversity of 21 the parties. (Dkt. No. 2.) In response, on October 2, 2020, Defendant Trevor Welch filed 22 an affidavit stating that he is a resident of Utah and as the Managing Principal for TAVA 23 Capital I, LLC, he states that TAVA Capital I, LLC is a Wyoming limited liability 24 company (“LLC”) and he is the sole member of the LLC. (Dkt. No. 3, Welch Decl. ¶¶ 3, 25 4.) Defendants also explained that the amount in controversy exceeds $75,000. (Id. ¶ 5.) 26 However, Defendants do not explain the citizenship of Plaintiff Gravity Group PB LLC 27 which is also a limited liability company to demonstrate that diversity jurisdiction exists. 28 1 As the Court explained in the order to show case, for purposes of diversity, a 2 || limited liability company “is a citizen of every state of which its owners/members are 3 || citizens.” Johnson v. Columbia Props. Anchorage, LP, 437 F.3d 894, 899 (9th Cir. 2006), 4 ||and the party invoking the removal statute bears the burden of establishing that federal 5 || subject-matter jurisdiction exists. Emrich v. Touche Ross & Co., 846 F.2d 1190, 1195 6 || (9th Cir. 1988). 7 Here, because Defendants have not provided an affidavit demonstrating complete 8 || diversity between the parties, they must file a response on or before October 13, 2020 9 demonstrating diversity of citizenship to support subject matter jurisdiction. 10 IT IS SO ORDERED. 11 Dated: October 6, 2020 <= 13 United States District Judge 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28