The situation is familiar: You represent a LLC or LP and file suit in state court to avoid disclosing the identity of your members/partners. But then the identity of those members/partners becomes an issue when the defendant removes your state court case to federal court claiming diversity jurisdiction. The contentions of the removal petition may allege diversity of the parties “upon information and belief” and then you are left to admit or refute the allegations and/or address the issue in the jurisdictional statement of your counterclaim. For privacy reasons though, your LLC or LP may not want to divulge the identity of its members/partners.
In this situation, the best way to protect the identity of your entity’s owners may be through a motion to remand. When an LLC or an LP is a party to a case, here are some common defects with removal petitions that may get your case remanded back to state court where the ownership of your LLC or LP may not be an issue (or at least a public one):
Practice Pointer: If you file a motion to remand based upon an incomplete or defective jurisdictional analysis, seek fees. Under the statutory removal provisions, a federal judge may award costs, including attorneys’ fees, involved with filing a motion to remand. 28 USC 1447(c); Circle Centre Mall, LLC v. Zurich Am. Ins. Co., 2014 WL 4539983, 4-6 (S.D. Ind. Sept. 11, 2014).
For additional strategies, please see Part II of this article: Protecting the Identity of Your LLC Members & LP Partners in Litigation, Part II: Strategies for Discovery
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