United States District Court, C.D. Illinois, Springfield Division
RICHARD MILLS, District Judge.
Pending is Defendant Simon Property Group Inc.'s Motion to Dismiss for Lack of Jurisdiction. Pending also is the Defendant's Motion for Sanctions.
I. MOTION TO DISMISS
Plaintiff John Zapata, an individual and as assignee, filed a Pro Se Second Amended Complaint wherein he invoked the Court's jurisdiction under 28 U.S.C. § 1332.
The Plaintiff alleges he is a citizen residing in the State of Nebraska. MWE Services, Inc., ("MWE") is a corporation incorporated under the laws of Nebraska with its principal place of business in Nebraska. MWE is authorized to conduct business in the State of Illinois. MWE has assigned its rights and assets to Plaintiff John Zapata.
The Plaintiff further alleges that Defendant Simon Property Group, Inc. ("Simon"), is a corporation incorporated under the laws of the State of Illinois with its principal place of business in Illinois. According to the Complaint, Defendant Laborers International Union of North American, Local 447 ("the Union") is a Labor Union group with its principal place of business in Springfield, Illinois. The Plaintiff further alleges that the amount in controversy exceeds $75, 000 and, therefore, the Court has jurisdiction over the subject matter.
This case concerns a contract for work to be performed at White Oaks Mall and Theater in Springfield, Illinois. In Count I, the Plaintiff asserts a claim for tortious interference with a business relationship against the Union. Count II alleges a claim for interference with a business relationship as to Simon.
Pursuant to Rule 12(b)(1) of the Federal Rules of Civil Procedure, Simon moves to dismiss on the basis that Plaintiff has not established that the Court has jurisdiction based on the Union's citizenship. In the Complaint, the Plaintiff alleges: "Laborers International Union of North America, Local 447 (hereinafter Local 447') is a Labor Union group with its principal place of business in Springfield, Illinois." See Doc. No. 29, at 2 ¶5.
Citing United Steelworkers of Am., AFL-CIO v. R.H. Bouligny, Inc., 382 U.S. 145 (1965), Simon notes it is well-settled that for purposes of diversity of citizenship jurisdiction, the citizenship for an unincorporated association, such as the Union, is determined by the citizenship of each member. See id. at 147. "Membership associations such as labor unions, joint stock companies, and joint ventures take the citizenship of each member." Indiana Gas Co., Inc. v. Home Ins. Co., 141 F.3d 314, 316 (7th Cir. 1998) (citing Bouligny, 382 U.S. 145 and Great Southern Fire Proof Hotel Co. v. Jones, 177 U.S. 449 (1900)). Dismissal is warranted if the plaintiff fails to identify the citizenship of an entity's members. See Thomas v. Guardsmark, LLC, 487 F.3d 531, 533-34 (7th Cir. 2007).
Following Simon's Motion, the Plaintiff filed a Notice of Voluntary Dismissal as to the Union and the Union was dismissed without prejudice. Therefore, Count I will be dismissed.
The dismissal of the Union essentially serves to moot Simon's Motion to Dismiss because it was based entirely on a lack of complete diversity between the parties. Simon's Motion to Dismiss does not address whether the amount in controversy has been met.
There does not appear to be any question that the remaining parties are of diverse citizenship. The Plaintiff claims to be a citizen of Nebraska and Simon is a corporate citizen of Illinois. Accordingly, Simon's Motion to Dismiss for Lack of Jurisdiction will be Denied.
II. MOTION FOR SANCTIONS
Defendant Simon has also filed a Motion for Sanctions. In addition to dismissal, Simon seeks an award of its attorney's fees against the Plaintiff for violation of Rule 11(b), of the Federal Rules of Civil Procedure. Simon contends that some of the Plaintiff's allegations in the Second Amended Complaint are false and violate Rule 11(b). These allegations primarily concern an arbitration award entered by Arbitrator J. Michael Grier, Esq., in American Arbitration Association Case No. 57-110-E000066-12, which was styled: MWE ...