The Supreme Court is considering an amendment to Federal Rule of Civil Procedure 7.1 “designed to facilitate an early and accurate determination of jurisdiction” in actions based on diversity jurisdiction (the Proposed Rule). Memorandum From the Comm. on Rules of Practice and Procedure to Scott S. Harris, Clerk, Sup. Ct. of the U.S. (Oct. 18, 2021) (SCOTUS Package), at 126-28. This Proposed Rule aims to resolve questions of diversity before time and resources are wasted litigating claims that have no constitutional basis for being heard in federal court. Beyond the surface of its sensible purpose, however, lies genuine cause for concern for noncorporate entities like limited liability companies (LLCs) and limited partnerships (LPs), which take on the citizenship of each of their partners, members, or owners.
The Proposed Rule would require all parties to an action based on diversity jurisdiction to file a disclosure statement with the names and citizenship of every individual or entity whose citizenship is attributed to that party. SCOTUS Package at 126-27. Consistent with current Rule 7.1, this disclosure statement would be filed with each party’s first appearance, pleading, petition, motion, response, or other request addressed to the court.
