Seventh Circuit Becomes the First to Hold That an EU “Societas Europaea” (SE) Is a “Corporation” for Diversity Jurisdiction Purposes

In Starstone Ins SE v City of Chicago, No. 23-2712 (7th Cir. Apr. 2, 2025), the Seventh Circuit holds that the plaintiff – a “Societas Europaea” (SE) organized under the rules of the European Union – is a citizen of a foreign state under the federal diversity statute, 28 U.S.C. § 1332(c)(1).

Under section 1332(a)(2), there is diversity jurisdiction in a matter between “citizens of a State and citizens or subjects of a foreign state.” While corporations are “citizens” of wherever they are incorporated or have their principal place of business (section 1332(c)(1)), other kinds of business organizations that are not corporations – such as partnerships and associations – are not covered by this provision. They are instead governed by the citizenship of their constitutent members.

Thus the issue sometimes arises whether a new foreign or other variety of business organization counts as a corporation for diversity purposes.

In this case, an insurance dispute, the Seventh Circuit applies these principles to an Societas Europaea based in Liechtenstein and holds that an SE is enough like a U.S. corporation to be a corporation for diversity purposes.

“The ‘SE’ in its name stands for ‘Societas Europaea’. In Liechtenstein this form of organization is known as a Europäische Gesellschaft; Societas Europaea is a translation into Latin. (In English it would be ‘European Company’.) But names are not dispositive. Nor is the body of law under which the form was created. The Societas Europaea form was created, not by Liechtenstein, but by the European Union’s European Company Statute.”

“What matters to the definition in § 1332(c)(1) is whether the entity, no matter what it is called and no matter where it is located, has the attributes of a ‘corporation’ as understood in the law of the United States. We have identified these attributes as perpetual existence with a legal personality distinct from that of investors, shares that are tradeable (in principle, at least), and limited liability . . . . We have never considered whether a Societas Europaea qualifies as a ‘corporation’ or has any other court of appeals—but from what we can see it has the essential attributes of one.”