in Walters v. OpenAI, LLCthe plaintiff filed a lawsuit against OpenAI [link fixed] After she hallucinated false statements about the plaintiff (in response to a third party’s inquiry). The plaintiff filed a lawsuit in Georgia state court, and OpenAI transferred the case to federal court, on the theory that this was a lawsuit between citizens of different states and had at least $75,000 USD (so-called “diversity jurisdiction”). But OpenAI, LLC is a “limited liability company,” and under federal law, an LLC is considered a citizen of all states in which its members (i.e., co-owners) are citizens; If the members are LLCs, the LLC is a citizen of all states of which its members are citizens, and so on, indefinitely.
So OpenAI had to run an ad discussing the nationality of its members, which it did. But on Friday to request Judge Michael L. Brown (ND Ga.) It’s not enough:
Defendant has not yet shown that the court has diversity jurisdiction because it has not yet determined the citizenship of OpenAI Holdings, LLC and Aestas Management Company, LLC (both entities in Defendant’s membership structure). Defendant (1) alleges that OpenAI Holdings, LLC has “[m]embers are citizens of California, Michigan, or citizens of other countries” and (2) “members of Aestas Management Company, LLC are citizens of Alaska, Arizona, California, Colorado, Connecticut, the District of Columbia, Delaware, Florida, Illinois, Massachusetts, Maryland, Michigan, North Dakota, New Jersey, Nevada, New York, Oregon, Pennsylvania, Texas, Virginia, Washington, or citizens of other countries, excluding Georgia.” (Dkt. 22, paras. 13c, 14). .) These allegations are insufficient. The defendant must identify by name each member of the LLC and then alleges any specific facts necessary to prove that member’s citizenship. The court will give the defendant a final opportunity to do so. The defendant must file, no later than October 6, 2023, a single consolidated document showing that the court has subject matter jurisdiction over This action. Failure to do so will result in pretrial detention [to state court].
I expect that OpenAI will indeed provide this comprehensive list, and that its lawyers have confirmed that none of the indirect members are citizens of Georgia (where Walters is a citizen), so the case will remain in federal court. However, I expect that some entrepreneurs and journalists will find it interesting to reveal the entire ownership structure in one easy-to-use document.