Federal Case Dismissed Because Third-Party Tribe is not Citizen for Diversity Purposes

Interesting case, in that the parties were diverse citizens, but the other party to the relevant contract (not a party to the case, however) was a tribe (Confederated Tribes of the Chehalis Reservation), so that defeated diversity jurisdiction.

CTGW v GSBS

An excerpt:

This civil action for monetary relief brought by plaintiff CTGW, LLC against defendants GSBS, PC, Colvin Engineering Associates, Inc. and Spectrum Engineers, Inc. arises out of a dispute regarding the design and construction of Great Wolf Lodge resort and water park in Grand Mound, Washington. Plaintiff alleges that this court has subject matter jurisdiction under 28 U.S.C. § 1332(a)(1), which applies to actions in which the plaintiff and the defendants are “citizens of different States” and the amount in controversy is more than $ 75,000. Plaintiff alleges that the parties are completely diverse and the matter in controversy exceeds $ 75,000. However, I conclude that because one of the members of plaintiff CTGW, LLC is an Indian tribe, diversity is destroyed. Therefore, I am dismissing this case for lack of subject matter jurisdiction.

One thought on “Federal Case Dismissed Because Third-Party Tribe is not Citizen for Diversity Purposes

  1. Brent Leonhard July 14, 2010 / 4:41 pm

    Thanks for this one. The result isn’t what I would have expected. But, apparently LLCs are not treated the same as corporations for diversity jurisdiciton purposes (Carden v. Arkoma Associates, 494 US 185, 195 (1990) ). So, even though tribally chartered corporations are separate citizens for diversity purposes ala Stock West and Cook v. Avi, LLCs with tribal members are not – even if the LLC was created under a state law.

    I wonder how many contracts are floating around out there involving tribal LLCs with enforcement/jurisdiction/venue provisions that assume federal diversity jurisdiction exists under a Stock West/Avi analysis.

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