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Underwriters at Lloyd's v. Osting-Schwinn, No. 08-15809

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By FindLaw Staff on August 11, 2010 11:28 AM

In Underwriters at Lloyd's v. Osting-Schwinn, No. 08-15809, a negligence action by Lloyd's syndicates against a policyholder, the court reversed summary judgment for plaintiff on the ground that the syndicates, as unincorporated associations, must plead the citizenship of each of their members for diversity jurisdiction purposes.

As the court wrote:  "At issue in this appeal is whether syndicates of insurance underwriters who do business in the international insurance marketplace known as Lloyd's of London ("Lloyd's") must plead the citizenship of each of their underwriting members to establish diversity jurisdiction pursuant to 28 U.S.C. § 1332. Faced with a state court negligence suit against one of their policy-holders, the Lloyd's syndicates filed the diversity action underlying this appeal, seeking a declaratory judgment that the lawsuit was barred by a prior settlement. Although the syndicates disclosed only the "lead underwriter's" citizenship, the district court denied the defendant's motion to dismiss for lack of subject matter jurisdiction. It then granted summary judgment for the plaintiff Underwriters on the settlement issue. The defendant challenges both rulings here, but the jurisdictional issue is dispositive. A wealth of Supreme Court precedent yields the conclusion that the Lloyd's syndicates, as unincorporated associations, must plead the citizenship of each of their members. Because the syndicates did not do so, they failed to establish diversity jurisdiction. We, therefore, reverse the judgment of the district court and remand the case for further proceedings consistent with this opinion."

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