Cases & Deals

Midwest Generation obtains dismissal of two class action suits alleging damages from two Illinois coal-fired electrical generation facilities

Client(s) Midwest Generation, LLC and Edison Mission Energy, Ltd.

On May 25, 2011, two groups of putative class plaintiffs filed separate lawsuits against Jones Day client Midwest Generation, LLC on behalf of themselves and others similarly situated alleging that client's operation, maintenance, and control of two of its Illinois coal-fired electrical generation facilities caused property and other damages. After successfully obtaining a ruling that the two cases were related and having them assigned to the same district court judge, Jones Day obtained dismissal of both cases under Federal Rule of Civil Procedure 12(b)(1) for lack of subject matter jurisdiction. Notably, the jurisdictional analysis involved application of the "nerve center" test in the unique context of a limited liability company whose sole member is a holding company. The court, adopting the arguments presented by Jones Day, concluded that there was no diversity jurisdiction because plaintiffs and Midwest Generation are both citizens of Illinois, rejecting plaintiffs' attempts to ascend the corporate chain and rely on the citizenship of twice-removed and ultimate parent corporations.

Hodul et al. v. Midwest Generation, LLC, Case No. 1:11-cv-03524 (N.D. Ill.); Rosas et al. v. Midwest Generation, LLC, Case No. 1:11-cv-3520 (N.D. Ill.)