Progressive Casualty Insurance Company v. Sandhu Transport Inc.

• Court: District Court, N.D. Indiana
• Decided: March 26, 2025
• Docket: 1:25-cv-00087
• Status: Unknown

Opinion

UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF INDIANA FORT WAYNE DIVISION

PROGRESSIVE CASUALTY ) INSURANCE COMPANY, ) ) Plaintiff, ) ) v. ) Cause No. 1:25-cv-00087-CCB-SLC ) SANDHU TRANSPORT INC., et al., ) ) Defendants. )

OPINION AND ORDER

Plaintiff Progressive Casualty Insurance Company filed a complaint in this Court on February 27, 2025, alleging diversity of citizenship as the basis for jurisdiction under 28 U.S.C. § 1332. (ECF 1 at 2).1 Subject matter jurisdiction is the first issue that must be addressed, Baker v. IBP, Inc., 357 F.3d 685, 687 (7th Cir. 2004), and thus, the Court raises the issue sua sponte, pursuant to Federal Rule of Civil Procedure 12(h)(3). Plaintiff’s allegations in the Complaint are deficient with respect to the citizenship of King of Freight LLC, such that the Court cannot verify whether diversity of citizenship exists. (See ECF 3 at 2). Plaintiff states that King of Freight LLC “is a Kansas corporation” having a principal place of business of “Wichita, KS”. (Id.). Plaintiff further asserts that “[a]ccording to the entity documents filed with the Kansas Secretary of State’s office, King of Freight’s sole member is Michael Ricklefs, a Kansas citizen residing in Wichita, KS.” (Id.). First, Plaintiff’s attestations are incongruent because a “[limited liability company (LLC)] is not a corporation.” Calchi v. TopCo Assocs., LLC, 676 F. Supp. 3d 604, 610 (N.D. Ill. 2023). In this circuit, the determination of diversity jurisdiction for an LLC is different than a corporation

1 Plaintiff filed an amended complaint on the same day. (See ECF 3). as “the citizenship of an LLC for purposes of the diversity jurisdiction is the citizenship of its members.” Cosgrove v. Bartolotta, 150 F.3d 729, 731 (7th Cir. 1998). “Unlike a corporation, which is a citizen of one or two states, an LLC can be a citizen of lots of states. It all depends on how many members it has, and where they are citizens.” Calchi, 676 F. Supp. 3d at 610 (citation

omitted). Plaintiff must trace each member’s citizenship through all applicable layers of ownership to ensure that no member shares a common citizenship with Defendants. See Mut. Assignment & Indem. Co. v. Lind-Waldock & Co., LLC, 364 F.3d 858, 861 (7th Cir. 2004). And to the extent any members are individuals, the citizenship of any individual members “corresponds to the place where the individual is domiciled.” 3BTech, Inc. v. Wang, 534 F. Supp. 3d 973, 980 (N.D. Ind. 2021) (citing Am’s Best Inns, Inc. v. Best Inns. of Abilene, L.P., 980 F2d 1072, 1074 (7th Cir. 1992)). Consequently, the attestation, as to King of Freight LLC, that Michael Ricklefs resides in Wichita, Kansas, is insufficient for diversity jurisdiction purposes. See id.; see also Heinen v. Northrop Grumman Corp., 671 F.3d 669, 670 (7th Cir. 2012) (collecting cases) (“[R]esidence may or may not demonstrate citizenship, which depends on

domicile—that is to say, the state in which a person intends to live over the long run. An allegation of ‘residence’ is deficient.”). Likewise, the attestation that “MetalX [LLC] has no members who are Ohio citizens” is insufficient. (ECF 3 at 2); see Thomas v. Guardsmark, LLC, 487 F.3d 531, 533 (7th Cir. 2007) (“[A] naked declaration that there is diversity of citizenship is never sufficient.”). The Court must be advised of the name and citizenship of each member of MetalX LLC, for purposes of diversity jurisdiction, and Plaintiff must trace each member’s citizenship through all applicable layers of ownership to ensure that no member shares a common citizenship with Plaintiff. See Mut. Assignment & Indem. Co., 364 F.3d at 861. Accordingly, because Plaintiff bears the burden of demonstrating that complete diversity has been met, see Chase v. Shop ‘N Save Warehouse Foods, Inc., 110 F.3d 424, 427 (7th Cir. 1997), Plaintiff is AFFORDED to and including April 2, 2025, to file a supplemental jurisdiction statement that adequately alleges each party’s citizenship.

SO ORDERED. Entered this 26th day of March 2025.

/s/ Susan Collins Susan Collins United States Magistrate Judge