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ARTICLE · 26 OCTOBER 2022

LLCs Are Treated Like Corporations When Determining Jurisdiction Under CAFA

A recent Sixth Circuit opinion reiterated that, for purposes of evaluating diversity jurisdiction, the citizenship of a limited liability company is determined by the citizenship of its members.

United StatesLitigation, Mediation & Arbitration

A recent Sixth Circuit opinion reiterated that, for purposes of evaluating diversity jurisdiction, the citizenship of a limited liability company is determined by the citizenship of its members. E.g., Akno 1010 Mkt. Street St. Louis Missouri LLC v. Pourtaghi, 43 F.4th 624, 626 (6th Cir. 2022). An LLC's state of organization and principal place of business are irrelevant to that analysis because 28 U.S.C. § 1332(c) refers specifically to "corporation[s]," while LLCs, like partnerships, are treated as unincorporated associations. Id.; Delay v. Rosenthal Collins Grp., LLC, 585 F.3d 1003, 1005 (6th Cir. 2009) ("The general rule is that all unincorporated entities — of which a limited liability company is one — have the citizenship of each partner or member."). But a different jurisdictional test applies when a plaintiff's complaint falls within the Class Action Fairness Act (CAFA).

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