KMS LLC v. Major League Trucking Inc

UNITED STATES DISTRICT COURT WESTERN DISTRICT OF WASHINGTON 9 AT SEATTLE 11 KMS LLC, CASE NO. 2:23-cv-01119-TL 12 Plaintiff, v. ORDER MAJOR LEAGUE TRUCKING INC, Defendant 16 MAJOR LEAGUE TRUCKING INC, 17 Third-Party Plaintiff, 18 v. 19 FORSLA LLC, 20 Third-Party Defendant

22 This case is a third-party complaint asserting indemnity claims arising out of an ongoing contract dispute in the Central District of California, Case No. 2:22-cv-06245. This matter comes before the Court sua sponte, on its review of the record. For the reasons below, the Parties are DIRECTED to brief the issue of subject matter jurisdiction in this matter.

3 Subject matter jurisdiction, which involves a court’s power to hear a case, can never be forfeited or waived. Arbaugh v. Y&H Corp., 546 U.S. 500, 514 (2006) (quoting United States v. Cotton, 535 U.S. 625, 630 (2002)). Federal courts have an independent obligation to determine whether subject matter jurisdiction exists, even if no party challenges jurisdiction. Id. If a court determines at any time that it lacks subject matter jurisdiction, the court must dismiss the action.

8 Fed. R. Civ. P. 12(h)(3); Arbaugh, 546 U.S. at 506 (citing Fed. R. Civ. P. 12(h)(3)).

9 This action was commenced in the Central District of California by Plaintiff KMS LLC against Defendant Major League Trucking Inc. on grounds of diversity jurisdiction. Dkt. No. 1 at 1–2. Major League Trucking, in turn, brought a third-party indemnity claim (and other related claims) against Third-Party Defendant Forsla LLC on grounds of supplemental jurisdiction. Dkt.

13 No. 47 at 2 (third-party complaint). The third-party complaint was transferred to the Western District of Washington on grounds of forum non conveniens, pursuant to a forum-selection clause between Major League Trucking and Forsla. Dkt. No.73 at 3, 8. While Forsla, a limited liability company (“LLC”), is alleged to be a company formed and existing under the laws of Washington (see Dkt. No. 47 ¶ 2), the citizenship of its members or owners is unknown.

18 The burden of establishing federal jurisdiction rests upon the party asserting jurisdiction.

19 E.g., Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 377 (1994). Here, the burden rests on Major League Trucking, who brings the third-party complaint against Forsla.

21 In order to assure itself that it has subject matter jurisdiction over this matter, the Court must answer at least these questions: 23 (1) Assuming that the Central District of California properly exercised supplemental 24 jurisdiction over the third-party complaint, see, e.g., Robert E. Blake Inc. v. Excel 1 Env’t, 104 F.3d 1158, 1162 (9th Cir. 1997) (finding supplemental jurisdiction 2 over third-party complaint alleging indemnity claim arising out of same 3 transaction or occurrence as original complaint); Underwriters at Lloyd’s 4 Subscribing to Cover Note B1526MACAR1800089 v. Abaxis, Inc., 491 5 F. Supp. 3d 506, 515–16 (N.D. Cal. 2020) (finding supplemental jurisdiction over 6 defendants’ third-party indemnity claims), does supplemental jurisdiction extend 7 to this action now severed and transferred to this District? Or does this now 8 require independent grounds of subject matter jurisdiction between Major League 9 Trucking and Forsla (namely, diversity jurisdiction)?

10 (2) If independent grounds of subject matter jurisdiction are required, what are the 11 states in which the owners or members of Forsla are citizens?1 See Johnson v. 12 Columbia Props. Anchorage, LP, 437 F.3d 894, 899 (9th Cir. 2006) (“[A]n LLC 13 is a citizen of every state of which its owners/members are citizens.”); see also 14 Local Civil Rule 7.1 (requiring LLC party to file corporate disclosure statement 15 identifying members and owners as well as their citizenship in diversity 16 jurisdiction case).

17 Accordingly, the Court ORDERS the following: 18 (1) Third-Party Plaintiff Major League Trucking and Third-Party Defendant Forsla 19 are DIRECTED to file a corporate disclosure statement pursuant to Federal Rule of 20 Civil Procedure 7.1 and Local Civil Rule 7.1 within five (5) days of this Order.

21 Forsla must include each of its members or owners and their citizenship.

1 Major League Trucking appears to be a citizen of California. See Dkt. No. 1 ¶ 2 (identifying Major League Trucking as a California corporation with its primary place of business in Pico Rivera, CA); Dkt. No. 46 ¶ 2 (admitting this information as true).

1 (2) Major League Trucking is DIRECTED to file an opening brief, no more than ten 2 (10) pages in length and within fourteen (14) days of this Order, explaining 3 whether and how this Court has subject matter jurisdiction over this matter.

4 (3) Forsla MAY file a response brief, no more than ten (10) pages in length, within 5 fourteen (14) days of the opening brief.

6 (4) Major League Trucking MAY file a reply brief that is no more than five (5) pages 7 in length within seven (7) days of the response brief.

8 Dated this 16th day of August 2023.

A Tana Lin United States District Judge