Lincoln Benefit Life Co. v. AEI Life, LLC, 800 F.3d 99 (3d Cir. 2015). For a single judge on a three-judge Third Circuit panel to issue a concurring opinion is not unusual, as in this recent example. Occasionally, two out of three judges join in a concurrence, as recently happened here. But it is extraordinary, if not unprecedented (I haven’t tried to check) that all three judges who joined a unanimous panel opinion also join in a separate concurring opinion. That happened today in this case. Judge Fuentes wrote the panel opinion, which spoke for himself and Judges Ambro and Roth. Judge Ambro, with whom Judges Fuentes and Roth joined, also authored a concurring opinion.
The issue in the case involved subject matter jurisdiction, an issue as to which the panel exercised plenary, de novo review. In determining the citizenship of a defendant limited liability company, such as defendant here, what matters is the citizenship 0f the members of the LLC. “The citizenship of partnerships and other unincorporated associations is determined by the citizenship of [their] partners or members. The state of organization and the principal place of business of an unincorporated association are legally irrelevant.”
The question here was whether plaintiff had adequately alleged the citizenship of the LLC, even though plaintiff had not alleged the citizenship of the LLC (because doing so would have “entail[ed] a difficult investigation prior to filing”). Relying in part on a Ninth Circuit case, Judge Fuentes concluded that it was not necessary to allege affirmatively the citizenship of each member of the LLC in order to establish diversity. Rather, all that was required was a negative– a well-founded allegation that the LLC was not of the same citizenship as plaintiff. Judge Fuentes ruled that plaintiff had done that.
The concurring opinion consisted of a plea to the Supreme Court to treat the citizenship of LLC’s in the same fashion as the citizenship of corporations is handled. Judge Ambro observed that “[t]he law of citizenship for unincorporated associations receives frequent criticism,” and some Circuits have treated professional corporations, “which function much like LLCs, as traditional corporations.” The concurrence urged that the Supreme Court “return to the path it started to mark for unincorporated business organizations in Puerto Rico v. Russell & Co., 288 U.S. 476, 480 (1983),” and treat LLC’s no differently than ordinary corporations in determining citizenship.