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Ferrell v. Express Check Advance of SC LLC

Ferrell v. Express Check Advance of SC LLC

United States Court of Appeals for the Fourth Circuit

October 27, 2009, Argued; January 8, 2010, Decided; January 12, 2010, Filed

No. 09-2401

Opinion

 [*699]  NIEMEYER, Circuit Judge:

In this appeal, ] we hold that, for purposes of determining subject matter jurisdiction under the Class Action Fairness [*700]  Act of 2005 ("CAFA"), Pub. L. No. 109-2, 119 Stat. 4 (codified in scattered sections of Title 28, United States Code), a limited liability company is an "unincorporated association" as that term is used in 28 U.S.C. § 1332(d)(10) and therefore is a citizen of the State under whose laws it is organized and the State where  [**2] it has its principal place of business.

After Carl Ferrell, a citizen of South Carolina, commenced this class action in South Carolina state court against Express Check Advance of South Carolina, LLC, and others, alleging that their "payday loans" violated South Carolina law, Express Check removed the action to federal court under CAFA, 28 U.S.C. § 1453(b), alleging minimal diversity, as specified in 28 U.S.C. § 1332(d)(2)(A), as the basis for federal jurisdiction. Express Check contended that the minimal diversity requirement of CAFA was satisfied because all other parties are South Carolina citizens, while it, as a limited liability company, is a citizen of Missouri and Kansas based on the citizenship of its sole member, a Missouri corporation with its principal place of business in Overland, Kansas. Alternatively, it argued that if it was deemed an "unincorporated association" within the meaning of § 1332(d)(10), it is nonetheless a citizen of Tennessee, under whose laws it is organized, and of Kansas, where it has its principal place of business.

On Ferrell's motion to remand, the district court concluded that Express Check, as a limited liability company, is an "unincorporated association"  [**3] under § 1332(d)(10) and that its principal place of business is in South Carolina, not Kansas. The court accordingly remanded the case to state court for lack of subject matter jurisdiction.

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591 F.3d 698 *; 2010 U.S. App. LEXIS 424 **

CARL G. FERRELL, individually and on behalf of all others similarly situated, Plaintiff-Appellee, v. EXPRESS CHECK ADVANCE OF SC LLC, Defendant-Appellant, and ADVANCE AMERICA CASH ADVANCE CENTERS OF SOUTH CAROLINA, INCORPORATED; LOCAL CASH ADVANCE OF SC III LLC; PAYDAY USA OF SC LLC, Defendants.

Subsequent History: As Amended January 12, 2010.

Prior History:  [**1] Appeal from the United States District Court for the District of South Carolina, at Columbia. (3:08-cv-03996-MJP). Matthew J. Perry, Jr., Senior District Judge.

Ferrell v. Advance Am., 2009 U.S. Dist. LEXIS 151960 (D.S.C., May 27, 2009)

Disposition:  The district court's order remanding the case to state court was affirmed.

CORE TERMS

unincorporated association, citizenship, principal place of business, business enterprise, diversity, entities, purposes, limited liability company, diversity jurisdiction, class action, unincorporated, non-corporate, argues, payday, traditional rule, federal court, loans, subject matter jurisdiction, citizens of the state, business entity, sole member, collections, contends, tests

Civil Procedure, Diversity Jurisdiction, Citizenship, Business Entities, Special Proceedings, Class Actions, Class Action Fairness Act, Governments, Legislation, Interpretation, Business & Corporate Law, Piercing the Corporate Veil, Alter Ego, General Overview