Submitted: June 11, 2019
from United States District Court for the Western District of
Missouri - St. Joseph
GRUENDER, ARNOLD, and STRAS, Circuit Judges.
Gruender, Circuit Judge.
Midwest International Co., Ltd. sued Jet Midwest Group, LLC
("JMG") for breaching a loan agreement. The
district court granted summary judgment to Jet Midwest
International, which then moved for the reimbursement of its
attorneys' fees under the agreement. The district court
denied the motion, and Jet Midwest International appeals.
addressing the merits of this appeal, we must first ensure
the existence of subject-matter jurisdiction. We review
subject-matter jurisdiction de novo. Slater v.
Republic-Vanguard Ins. Co., 650 F.3d 1132, 1134 (8th
jurisdiction in this case is based on diversity of
citizenship. Diversity jurisdiction "requires an amount
in controversy greater than $75,000 and complete diversity of
citizenship among the litigants." OnePoint
Solutions, LLC v. Borchert, 486 F.3d 342, 346 (8th Cir.
2007) (citing 28 U.S.C. § 1332(a)). Complete diversity
"exists where no defendant holds citizenship in the same
state where any plaintiff holds citizenship."
Id. For purposes of establishing diversity
jurisdiction, "a corporation shall be deemed to be a
citizen of every State and foreign state by which it has been
incorporated and of the State or foreign state where it has
its principal place of business." 28 U.S.C. §
1332(c)(1). Only corporations are entitled to this treatment
under § 1332. GMAC Commercial Credit LLC v. Dillard
Dep't Stores, Inc., 357 F.3d 827, 828-29 (8th Cir.
2004) (citing Carden v. Arkoma Assocs., 494 U.S.
185, 186, 189, 195-96 (1990)). The citizenship of
non-incorporated entities like limited liability companies
depends on the citizenship of their members. Id.
a limited liability company whose members are citizens of
various U.S. states. Jet Midwest International is a Hong Kong
limited company with a principal place of business in
Beijing. On appeal, JMG contends that Jet Midwest
International's failure to establish the citizenship of
its members means we must dismiss the case for lack of
subject-matter jurisdiction. JMG argues that if a foreign
legal entity like Jet Midwest International is not expressly
called a corporation, it cannot be treated as such under
§ 1332. Jet Midwest International counters that a Hong
Kong limited company is a corporation under § 1332 and
therefore a citizen of China for jurisdictional purposes.
our circuit has not addressed the citizenship of a Hong Kong
limited company, we adopt the approach employed by the
Seventh Circuit for considering the citizenship of foreign
entities. As the Seventh Circuit has noted, deciding whether
a foreign company should be treated as a corporation under
§ 1332 is a difficult task. Fellowes, Inc. v.
Changzhou Xinrui Fellowes Office Equip. Co., 759 F.3d
787, 788 (7th Cir. 2014); White Pearl Inversiones S.A.
(Uruguay) v. Cemusa, Inc., 647 F.3d 684, 686 (7th Cir.
2011). To account for linguistic and other differences
between domestic and foreign business laws and the fact that
other nations do not necessarily call entities that are in
effect corporations by that name, a court examines whether
the foreign entity is "equivalent in all legally
material respects to a corporation under state law."
Lear Corp. v. Johnson Elec. Holdings Ltd., 353 F.3d
580, 583 (7th Cir. 2003). The court treats a foreign legal
entity as a corporation if it has "the standard elements
of 'personhood' (perpetual existence, the right to
contract and do business in its own name, and the right to
sue and be sued)," as well as the ability to
"issue shares to investors who enjoy limited
liability" and which "can be bought and sold,
subject to restrictions that the business declares."
BouMatic, LLC v. Idento Operations, BV, 759 F.3d
790, 791 (7th Cir. 2014).
on several cases that have conducted the necessary analysis
under the Seventh Circuit framework, we conclude that a Hong
Kong limited company is equivalent to a U.S. corporation
under § 1332. See Superl Sequoia Ltd. v. Carlson
Co., 615 F.3d 831, 832 (7th Cir. 2010) (stating that a
Hong Kong business organization "limited by shares"
is "a status in the Commonwealth of Nations that is
equivalent to a corporation in the United States");
Flextronics Int'l USA, Inc. v. Sparkling Drink Sys.
Innovation Ctr. Ltd, 186 F. Supp. 3d 852, 861 (N.D. Ill.
2016) (concluding that Hong Kong limited companies should be
treated as corporations under § 1332); Shanshan Shao
v. Beta Pharma, Inc., No. 3:14-cv-01177(CSH), 2018 WL
1882855, at *4 (D. Conn. Apr. 19, 2018) (reviewing cases). As
a result, there is complete diversity between JMG, whose
members are citizens of U.S. states, and Jet Midwest
International, which is a citizen of China. Thus, the
district court properly exercised subject-matter jurisdiction
under § 1332, and we have appellate jurisdiction under
28 U.S.C. § 1291.
to the merits, we review de novo the interpretation
of an attorneys' fees provision in a contract. John
T. Jones Const. Co. v. Hoot Gen. Const. Co., 613 F.3d
778, 786 (8th Cir. 2010). Section 9.2 of the parties'
loan agreement sets out JMG's obligation to pay Jet
Midwest International's costs and expenses incurred in
preparing and enforcing the loan agreement:
Borrower agrees to pay on demand all costs and expenses in
connection with the preparation, execution, delivery, filing,
recording, and administration of any of the Loan Documents,
including the reasonable fees and out-of-pocket expenses of
counsel for Lender, with respect to the items noted above and
with respect to advising Lender as to its rights and
responsibilities under any of the Loan Documents; provided,
however, that Borrower's payment obligations in this
sentence shall not exceed, and shall be capped at, $20,000.
Borrower agrees to pay on demand all costs and expenses, if
any, in connection with the enforcement of any of the Loan
Section 9.8 provides that Hong Kong law governs the
interpretation of the loan agreement.
denying Jet Midwest International's motion for
attorneys' fees, the district court observed that Section
9.2 expressly mentions "reasonable fees" of counsel
in connection with preparing the agreement but omits
"reasonable fees" of counsel in connection with
enforcing it. The district court reasoned that the
parties therefore did not intend for Jet Midwest
International to recover attorneys' fees incurred in
enforcing the agreement. The district court also rejected Jet
Midwest International's argument that governing Hong Kong
law dictates that costs include attorneys' fees. The
district court followed the American Rule, under which the
parties pay their own fees and expenses, rather than the