Norman Meyerson v. Harrah's East Chicago Casino, et al.

The plaintiff brought this suit, pro se, against his former
employer, Harrah's East Chicago Casino, and three of the
casino's employees, charging defamation and basing federal
jurisdiction, necessarily, on diversity. His complaint alleged
that he "resides in the State of Michigan," but residence and
citizenship are not synonyms and it is the latter that matters
for purposes of the diversity jurisdiction. McMahon v. Bunn-
O-Matic Corp., 150 F.3d 651, 653 (7th Cir. 1998). In addition,
the complaint does not indicate the citizenship of any of the
defendants. It does identify Harrah's as an unincorporated
business licensed by the State of Indiana to conduct riverboat
gambling in the state, but of course the fact that a firm
is licensed to do business in a state does not mean that it is
a citizen of that state. Moreover, in the case of a firm that
is not a corporation, its citizenship is the citizenship of its
owners, partners, or other principals. And even if none of
them is (and if the plaintiff is) a Michigander, if any of the
other defendants are, that would defeat the complete diversity
that is required for diversity jurisdiction. But that is
completely obvious to anyone with the slightest familiarity
with federal jurisdiction, and the subtler point, though not
so subtle that it should have escaped the attention of the
defendants' lawyers, is that the citizenship of unincorporated
associations must be traced through however many
layers of partners or members there may be. E.g., Carden v.
Arkoma Associates, 494 U.S. 185 (1990); Wild v. Subscription
Plus, Inc., supra, at *1; Indiana Gas Co. v. Home Insurance Co.,
141 F.3d 314 (7th Cir. 1998), rehearing denied, 141 F.3d 320
(1998). Failure to go through all the layers can result in dismissal
for want of jurisdiction. E.g., Guaranty National Title
Co. v. J.E.G. Associates, 101 F.3d 57 (7th Cir. 1996).

The defendants' filings in the district court did not fill
any of the gaps in the plaintiff's jurisdictional allegations.
Harrah's did indicate that its correct legal name is not as
alleged but instead is "Showboat Marina Casino Partnership,"
but it did not indicate the citizenship of the partners.

Despite the gross inadequacy of the jurisdictional allegations,
the district judge proceeded to the merits and granted
summary judgment for the defendants, precipitating this
appeal. The appellant's opening brief contains no jurisdictional
statement and should therefore not have been accepted
for filing at all. The appellees' brief does contain a
jurisdictional statement, but so far as bears on the existence
of diversity jurisdiction states only that the district court
"had diversity jurisdiction over this action." This is a gross
violation of our Rule 28(a)(1). There is no reply brief.

We are vacating the judgment and remanding the case to
the district court for further proceedings consistent with this
opinion. That court may decide to give the plaintiff an opportunity
to file an amended complaint showing that there
is diversity jurisdiction after all. Otherwise the suit must be
dismissed without prejudice to its being refiled in state
court.

The egregious violation of Rule 28(a)(1) by the defendants,
who unlike the plaintiff are represented by counsel, is sanctionable,
and we shall therefore order the defendants to
show cause why they should not be punished. We have repeatedly
warned litigants that violation of the rule is sanctionable,
see, e.g., Professional Services Network, Inc. v. American
Alliance Holding Co., 238 F.3d 897, 903 (7th Cir. 2001),
and have on occasion imposed sanctions. See Wild v. Subscription
Plus, Inc., supra, at *1; Cincinnati Ins. Co. v. Eastern
Atlantic Ins. Co., supra, 260 F.3d at 747-48; Blockley v. The
Work Center, Inc., No. 99-1421, 2000 WL 973625 (7th Cir. Jul. 11, 2000) (unpublished order). This may be an appropriate
occasion.

* * *

Click the case caption above for the full text of the Court's opinion.

VACATED AND REMANDED, AND
ORDER TO SHOW CAUSE ISSUED.

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