Dist. Ct. lacked subject-matter jurisdiction over plaintiff’s state-law defamation claims emanating from news stories published in fall of 2016. One named defendant was limited liability partnership, which citizenship status was based on citizenship of each individual partner. However, while none of said partners were citizens of plaintiff’s state, three partners were living in Shanghai or Beijing, China. As such, such partners were “stateless citizens” that could not be sued in diversity, and partnership made up of at least one stateless citizen is itself stateless. Accordingly, instant limited liability partnership cannot be sued in diversity, and its presence in case destroyed complete diversity and precluded Dist. Ct. from having authority to hear case. Ct. rejected plaintiff’s claim that stateless partners should be ignored, and that diversity determination should be based on remaining partners who have state citizenship. Moreover, while Dist. Ct. found that dismissal was appropriate on ground of lack of personal jurisdiction, instant dismissal on ground of lack of diversity must be without prejudice.
Federal 7th Circuit Court
Civil Court
Diversity Jurisdiction