Unincorporated Tribal Entities Are “Stateless” for Purposes of Diversity Jurisdiction: Liveious et al. v. Caesars Entertainment, Inc. et al.

A recent decision by the U.S. District Court for the Southern District of Indiana in Liveious et al. v. Caesars Entertainment, Inc. et al., highlights a critical and often overlooked issue in federal civil litigation: the jurisdictional consequences of tribal ownership in limited liability companies.

On March 17, 2024, LilDon Williams was shot and killed in the parking lot of Caesar’s Southern Indiana Hotel and Casino (the Casino) by two individuals who had allegedly followed Williams to the Casino with the intent to kill him.¹ Subsequently, Williams’ wife, Rannisha Liveious, in conjunction with the Estate of LilDon Williams (collectively, the Plaintiffs), filed claims of negligence, wrongful death, and loss of consortium against the several defendants, including EBCI Holdings, LLC (EBCI) and CSI Operating Company, LLC (CSI).² The suit was brought in federal court under diversity jurisdiction pursuant to 28 U.S.C. § 1332.³

However, the presence of a federally recognized tribe as a member of an LLC creates a jurisdictional problem: as a general matter, tribes are not considered citizens of any U.S. state for purposes of § 1332. The Plaintiffs alleged that EBCI (formed under the laws of Delaware and with its principal place of business in North Carolina) and CSI (formed under the laws of and with its principal place of business in Indiana) (collectively, the Tribal Entity Defendants) were of diverse citizenship for the purpose of subject matter jurisdiction.⁴

EBCI’s sole member is the Tribal Government of the Eastern Band of Cherokee Indians, a federally recognized tribe (the Tribe), while the sole member of CSI is EBCI.⁵ The Tribal Entity Defendants argued that they are “unincorporated tribal entities [and] are ‘stateless’ for the purposes of diversity jurisdiction …[and] the presence of a stateless entity precludes complete diversity.”⁶ The Plaintiffs countered that the Seventh Circuit Court of Appeals has held tribal entities to be “citizens”, and that EBCI and CSI were “separate legal entities” from the Tribe. As such, Plaintiffs contended the Tribe was not a Defendant and dismissal was not mandated.⁷

The court was then tasked with determining the citizenship of the Tribal Entity Defendants and clarifying how the Seventh Circuit treats unincorporated tribal entities for purposes of diversity jurisdiction. The court clarified that an unincorporated company, such as a limited liability company (LLC), has the citizenship of its members, for the purposes of diversity jurisdiction, and must be traced through “however many layers of…members there may be.”⁸ Because EBCI is the sole member of CSI and EBCI’s sole member is the Tribe, the Tribal Entity Defendants’ citizenship was equivalent to the citizenship of the Tribe.

The Plaintiffs argued that both the EBCI and CSI LLCs are “corporate entities” and should be treated as corporations.⁹ Corporations’ citizenship is determined by “State of establishment and []principal place of business.”¹⁰ Relying on a previous Seventh Circuit decision involving a tribally chartered corporation, the Plaintiffs argued EBCI should be treated as a citizen of a state for purposes of diversity jurisdiction.¹¹

The Seventh Circuit Court previously held that a tribal corporation — chartered under tribal law but structured as a legal corporation — should be treated the same as any other corporation under 28 U.S.C. § 1332, meaning it is considered a citizen of its place of incorporation and principal place of business.¹²

The Liveious Court clarified that “[c]ontrary to Plaintiffs’ assertion of a clear precedent, the Seventh Circuit has not yet decided the issue of citizenship of an LLC whose sole member is a tribe.”¹³ The court looked to various circuit court decisions concluding tribes are not considered citizens of any U.S. state or foreign nation, but rather are classified as “domestic dependent nations.” On this basis, they lack citizenship as they are “stateless” for purposes of diversity jurisdiction.¹⁴

Finally, the court declined to employ the Plaintiffs’ asserted corporation assumption due to (1) the lack of evidence of incorporation as to the Tribal Entity Defendants, and (2) Supreme Court precedent explicitly declining to treat unincorporated entities, such as LLCs, as corporations for diversity jurisdiction purposes.¹⁵ The court further clarified that the states of the LLCs involved in the instant case allowed LLCs to appoint non-member managers, thus LLC manager citizenship had no bearing on the diversity jurisdiction citizenship analysis in this case.¹⁶

The Plaintiffs then asserted that the membership structure of the Tribal Entity Defendants had “scant information… about the actual ownership” due to an “intricate ownership structure,” and asked for additional discovery on the citizenship determination for diversity.¹⁷ The court admonished the Plaintiffs for initiating action in federal court prior to establishing the existence of subject matter jurisdiction.¹⁸ The district court then dismissed the case for lack of complete diversity, resulting in a lack of subject matter jurisdiction.¹⁹

In line with other precedent, Liveious supports the general principle that the presence of a tribe as a member of an LLC destroys complete diversity. The decision also establishes that unincorporated tribal entities, such as LLCs, whose only members are tribes, are considered “stateless” and thus cannot be hailed into federal court in claims arising out of diversity jurisdiction. Liveious further demonstrates the distinction between tribal corporations and tribal unincorporated entities for purposes of diversity in claims asserting that federal subject matter jurisdiction has been met. Subject matter jurisdiction similarly will fail for lack of diversity where one party is an LLC in a state that requires the manager to be a member of the LLC so long as any member of that LLC is a tribe.

The decision in Liveious may influence practices within both tribal business entity formation and business transactions between tribal business entities and non-tribal business entities. Further, non-tribal business entities who wish to obtain recourse in a state forum may be more likely to request that tribal business entities include waivers of sovereign immunity and consent to specific governing law, jurisdiction, and venue within transactional documents to avoid future jurisdictional disputes.

Footnotes

1. Liveious et al. v. Caesars Ent., Inc., No. 4:24-CV-00145-TWP-KMB at 2 (S.D. Ind. July 18, 2025) (found at: https://www.govinfo.gov/content/pkg/USCOURTS-insd-4_24-cv-00145/pdf/USCOURTS-insd-4_24-cv-00145-0.pdf)(last viewed Aug. 9, 2025).

2. Id. at 1.

3. Id. at 1 & 3.

4. Id. at 1 – 2.

5. Id. at 2 – 3.

6. Id. at 4.

7. Id. at 4 – 5.

8. Id. at 5 (internal citations omitted).

9. Id. at 5 – 6.

10. Id. at 6 (see Americold, 577 U.S. at 384).

11. Id. at 8 (citing United Steelworkers of Am., AFL-CIO v. R. H. Bouligny Inc., 382 U.S. 145, 149–51 (1965)).

12. See Auto-Owners Ins. Co. v. Tribal Ct. of the Spirit Lake Indian Rsrv., 495 F.3d 1017, 1021 (8th Cir. 2007); Ninigret Dev. Corp. v. Narragansett Indian Wetuomuck Hous. Auth., 207 F.3d 21 (1st Cir. 2000).

13. Liveious at 4.

14. Auto-Owners Ins. Co. v. Tribal Ct. of the Spirit Lake Indian Rsrv., 495 F.3d 1017, 1021 (8th Cir. 2007); Ninigret Dev. Corp. v. Narragansett Indian Wetuomuck Hous. Auth., 207 F.3d 21 (1st Cir. 2000); Am. Vantage Cos. v. Table Mountain Rancheria, 292 F.3d 1091, 1098 (9th Cir. 2002); CTGW, LLC v. GSBS, PC, No. 09-cv-667-bbc, 2010 U.S. Dist. LEXIS 69298 (W.D. Wis. July 12, 2010); Page v. Democratic Nat’l Comm., 2 F.4th 630, 636 (7th Cir. 2021).

15. Liveious at 8 – 9.

16. Id. at 7 – 8.

17. Id. at 10.

18. Id. (internal citations omitted).

19. Id. at 11.