By: Justin C. Carlin, Esq.

Many Florida business litigation and Fort Lauderdale and Palm Beach commercial litigation lawyers file lawsuits in state court without recognizing that the lawsuit may be filed in federal court. Litigating cases in federal court may sometimes be preferred because, among other things, federal judges generally have fewer cases than state court judges (and, therefore, may have greater resources to devote to the case) and implement scheduling orders (see Fed. R. Civ. P. 16) to ensure that the case will be tried within a reasonable time (e.g., 18 months). On the other hand, in state court, there are often no scheduling orders, and the rules for amending pleadings are more liberal, often making the proceedings more protracted (i.e., at least twice as long). If federal court may be preferred, how does one get into federal court?

There are two ways in which a federal court may have subject matter jurisdiction over a case. The first is so-called “federal question” jurisdiction under 28 U.S.C. § 1331, which provides that “district courts shall have jurisdiction of all civil actions arising under the Constitution, laws, or treaties of the United States.” The other is diversity jurisdiction under 28 U.S.C. § 1332, which permits a federal court to preside over matters where the amount in controversy exceeds $75,000.00 and the dispute is between citizens of different states. Complete diversity is required, meaning that no defendant may be a citizen of the same state as a plaintiff.

A business entity’s “citizenship” is determined by its state of incorporation or where its place of business is located—i.e., its “headquarters” or “nerve center,” where its directors, officers, or managers control the entity. See Hertz Corp. v. Friend, 559 U.S. 77 (2010). For partnerships and limited liability companies, however, citizenship is determined by the individuals who control the entity—namely, its partners and members. Finally, when a decedent’s estate is a party to the litigation, citizenship is determined by the estate in which the decedent was a citizen; the personal representative’s citizenship is irrelevant.

If you’re in need of representation in a federal business dispute, call a Fort Lauderdale and Palm Beach business lawyer at (954) 440-0901 for assistance. The Fort Lauderdale and Palm Beach business lawyers at The Carlin Law Firm, PLLC represent individuals, corporations, limited liability companies, and partnerships with litigating federal business disputes throughout the State of Florida.

By: Justin C. Carlin

Florida LLC Litigation: Theft or Other Misconduct by a Managing Member of an LLC

In the context of Fort Lauderdale business litigation, some members of Florida limited liability companies, also known as “LLCs,” learn that the managers or other members of the LLC have wrongfully taken funds from the company, or have otherwise harmed the company by breaching their fiduciary duties to the company.  When this happens, the members’ ownership interests in the company—which entitles them to distributions of the company’s profit—are usually dramatically reduced or completely eliminated.  Understandably, these members may wish to sue the managers and members whose conduct caused their losses. READ MORE

By: The Carlin Law Firm, PLLC

A limited liability partnership (an “LLP”) offers a major advantage to a common law partnership, in that partners in a LLP are not personally liable for the LLP’s obligations.  A LLP is governed by the rules of the Revised Uniform Partnership Act (“RUPA”), except that, if a limited liability partnership also is a limited partnership, the Uniform Limited Partnership Act (“ULPA”) will govern all issues dealing with the limited partnership. READ MORE

By: The Carlin Law Firm, PLLC

A corporation usually consists of its shareholders, board of directors, and officers.  Shareholders—i.e., those who own the stock of the corporation—generally have no right or power to manage the business directly, although, in limited circumstances, they may be vested with certain management powers in the corporation’s articles of incorporation.  The main way shareholders manage the corporation is by electing the Board of Directors.  The Board, in turn, is responsible for the major decisions that the company takes, such as the hiring and firing of officers, whether to declare dividends, whether to issue stock, and so on.  The board of directors usually delegate much of the day-to-day tasks of running a business to officers and directors whom they hire. READ MORE

By: The Carlin Law Firm, PLLC

As Fort Lauderdale business litigation lawyers, we frequently deal with contracts pertaining to the sale of goods.  Outside of the legal profession, it is a common misconception that a contract for the sale of goods is subject to the same rules that would govern any other contract.  However, unlike a contract for services or for the sale of real estate, which is governed by common law (i.e., case law decided within the court system), contracts that deal with the sale of goods are governed by statutory law, specifically, Article 2 of the Uniform Commercial Code (the “U.C.C.”).  Accordingly, there are several myths about the U.C.C. READ MORE