United States District Court, D. Kansas
CU CAPITAL MARKET SOLUTIONS, LLC and LEWIS N. LESTER, SR., Plaintiffs,
OLDEN LANE SECURITIES, LLC, et al., Defendants.
MEMORANDUM AND ORDER TO SHOW CAUSE
D. Crabtree, United States District Judge.
CU Capital Market Solutions, LLC (“CU Capital”),
a limited liability company, and Lewis N. Lester, Sr., an
individual, filed a First Amended Complaint in this case on
December 5, 2018. Doc. 14. Plaintiffs have filed suit against
three limited liability companies and an individual: Olden
Lane Securities, LLC; Olden Lane Advisors, LLC; Olden Lane,
LLC; and Jeremy Christopher Colvin. Id. at 1. On
March 7, 2019, plaintiffs filed a Motion for Temporary
Restraining Order and Preliminary Injunction. Doc. 22. But,
before the court proceeds with plaintiffs' Motion, it
first must address an issue of subject matter jurisdiction.
Specifically, the court directs plaintiffs to show cause why
the court should not dismiss plaintiffs' First Amended
Complaint (Doc. 14) without prejudice for lack of subject
matter jurisdiction under 28 U.S.C. § 1332 for the
reasons explained, below.
First Amended Complaint invokes federal subject matter
jurisdiction under 28 U.S.C. § 1332. Doc. 14 at 3 (First
Am. Compl. ¶ 8). In support, the First Amended Complaint
alleges the following jurisdictional facts:
● CU Capital is a limited liability company authorized
to conduct business in Kansas. CU Capital has an office in
Overland Park, Kansas. Id. (First Am. Compl. ¶
● Mr. Lester is the CEO of CU Capital. Mr. Lester is an
individual who maintains an office in Overland Park, Kansas.
Id. (First Am. Compl. ¶ 2).
● Olden Lane Securities, LLC, Olden Lane Advisors, LLC,
and Olden Lane, LLC are limited liability companies. All
three companies are incorporated in Delaware, and they have
their principal places of business in New Jersey.
Id. at 2 (First Am. Compl. ¶¶ 3-5).
● Mr. Colvin is an individual who resides in New
Jersey. Id. at 3 (First Am. Compl. ¶ 7).
court maintains “‘an independent obligation to
determine whether subject-matter jurisdiction exists, even in
the absence of a challenge from any party.'”
Spring Creek Expl. & Prod. Co., LLC v. Hess Bakken
Inv., II, LLC, 887 F.3d 1003, 1013 (10th Cir. 2018)
(quoting Arbaugh v. Y&H Corp., 546 U.S. 500, 514
(2006)). Plaintiffs bear the burden of establishing that
federal jurisdiction is proper. Kinney v. Blue Dot Servs.
of Kan., 505 Fed.Appx. 812, 814 (10th Cir. 2012). Under
28 U.S.C. § 1332-the federal diversity jurisdiction
statute-federal jurisdiction is proper if “the matter
in controversy exceeds the sum or value of $75, 000 . . . and
is between . . . citizens of different states.” 28
U.S.C. § 1332(a)(1).
diversity jurisdiction purposes, a limited liability company
“takes the citizenship of all its members.”
Siloam Springs Hotel, L.L.C v. Century Sur. Co., 781
F.3d 1233, 1234 (10th Cir. 2015); cf. Newsome v.
Gallacher, 722 F.3d 1257, 1267 (10th Cir. 2013)
(“[W]hen evaluating diversity jurisdiction, a
corporation is considered domiciled where it is incorporated
and where it has its ‘principal place of
business'” (quoting 28 U.S.C. § 1332(c)(1)).
The governing standard requires complete diversity of
citizenship, and so plaintiffs' First Amended Complaint
must contain facts showing that no individual or LLC member
on one side of the case caption is a citizen of the same
state as any individual or LLC member on the other side of
the caption. See Middleton v. Stephenson, 749 F.3d
1197, 1200 (10th Cir. 2014).
plaintiffs have not carried their burden. The First Amended
Complaint identifies Olden Lane Securities, Olden Lane
Advisors, and Olden Lane's organizational structure as
limited liability companies. But plaintiffs have not
identified the citizenship of the members of any of the LLCs.
The allegations thus fail to establish the citizenship for
the jurisdictional defects related to the LLCs, the court
also cannot discern the citizenship of the two individuals in
the case: Mr. Lester and Mr. Colvin. As for Mr. Lester, the
First Amended Complaint merely alleges, in passing, that he
is “an individual who maintains an office in Overland
Park, Kansas.” Doc. 14 at 1 (First Am. Compl. ¶
2). In short, plaintiffs have not pleaded Mr. Lester's
citizenship to satisfy diversity citizenship.
First Amended Complaint's jurisdictional allegations for
Mr. Colvin fare no better. It alleges, “Jeremy Colvin
is an individual who resides at 14 Lake Road, Chatham, New
Jersey 07928.” Id. at 3 (First Am. Compl.
¶ 7). “An individual's residence is not
equivalent to his domicile and it is domicile that is
relevant for determining citizenship.” Siloam
Springs Hotel, 781 F.3d at 1238 (citing Whitelock v.
Leatherman, 460 F.2d 507, 514 n.14 (10th Cir. 1972)).
So, plaintiffs' First Amended Complaint also fails to
allege Mr. Colvin's citizenship adequately.
court thus orders plaintiffs to show cause, within 10 days of
this Order, why the court should not dismiss this case