Syrup Assocs. Inc. v. Coastal Dev. Massachusetts LLC

OPINION AND ORDER Plaintiffs Syrup Associates, Inc. (“Syrup”) and Barn Redevelopment Associates, Inc. (“Barn”) (collectively, “Plaintiffs”) brought this contract action against Defendants Coastal Development Massachusetts, LLC (“Coastal”), Richard T. Fields, and Sterling Racecourse, Inc. (“Sterling”) (collectively, “Defendants”), invoking this Court’s diversity jurisdiction. Although discovery has not yet begun, Plaintiffs have moved for summary judgment against Defendants. (Dkt. No. 20.) Defendants, meanwhile, seek to dismiss this action for lack of subject-matter jurisdiction. (Dkt. No. 35.) For the reasons that follow, Defendants’ motion to dismiss is denied, and Plaintiffs’ motion for summary judgment is granted in part and denied in part.I. BackgroundSyrup and Barn are Nevada corporations with their principal places of business in Connecticut. (Dkt. No. 30 (“FAC”)

2-3.) Coastal is a Delaware limited liability company (“LLC”), whose members, at the time this action was filed, were domiciled in Wyoming and Delaware. (FAC 4.) Fields, too, was domiciled in Wyoming at the time this action was filed. (FAC 5.) And Sterling is a Massachusetts corporation with its principal place of business in New York. (FAC 6.)On June 2, 2014, Syrup and Defendants entered into an agreement (the “Syrup Agreement”) under which Coastal granted Syrup a put option to sell certain conditional payment rights (“CPRs”), at Syrup’s election, to Coastal, with Fields and Sterling (the “Guarantors”) guaranteeing Coastal’s payment obligation. (Dkt. No. 38 (“SUF”) 1.) The put option’s exercise price started at $2.5 million and would increase at a rate of 25 percent per annum from the date of the Syrup Agreement through the date of the closing of the exercise of the put option. (Id.) On June 10, 2014, Barn entered into an agreement (the “Barn Agreement”) (collectively with the Syrup Agreement, “the Agreements”) with Defendants on the same terms as the Syrup Agreement, except that the put option’s exercise price started at $3.0 million. (SUF 2.)In 2015, Syrup and Barn exercised their put options under the Agreements, triggering Coastal’s buyback obligation. (SUF