Wall et al v. Moultrie

Filing 3

MEMORANDUM OPINION AND ORDER directing that this case is REMANDED sua sponte to the Circuit Court of Autauga County, Alabama, pursuant to 28 U.S.C. § 1447(c); the Clerk of Court is DIRECTED to take all steps necessary to effectuate said remand; further ORDERED that the court will entertain a motion for costs and attorney's fees incurred as a result of the improper removal, pursuant to § 1447(c), and/or for other appropriate sanctions, if appropriate, if such a motion is filed on or before January 6, 2012. Signed by Chief Judge William Keith Watkins on 12/12/11. (Certified copy of this order sent via mail to CC of Autauga County.) (Attachments: # 1 Civil Appeals Checklist)(scn, )

IN THE UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF ALABAMA
NORTHERN DIVISION
CHARLES O. WALL, II, et al.,
Plaintiffs,
v.
FRANK A. MOULTRIE,
Defendant.

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CASE NO. 2:11-CV-1050-WKW

MEMORANDUM OPINION AND ORDER
On December 9, 2011, at 1:28 p.m., Defendant Frank A. Moultrie filed a Notice
of Removal (Doc. #1), removing the Verified Complaint here from the Circuit Court
of Autauga County, Alabama. Defendant describes this lawsuit, which is brought by
Plaintiff Charles O. Wall and Autauga Automotive LLC, as “relat[ing] to the
ownership interests of [Plaintiff] Wall and [Defendant], in a Ford automobile
dealership valued, according to Plaintiffs, at more than $1,000,000.00.” (Not. of
Removal ¶ 2 (Doc. # 1).) He seeks to invoke this court’s removal jurisdiction
pursuant to 28 U.S.C. §§ 1441(a) and 1332(a), claiming that he and Plaintiffs are
citizens of different states and that complete diversity of citizenship exists between
Plaintiffs and Defendant. (Not. of Removal ¶ 6.)

The removal of this case comes seven days after the state circuit court judge
entered a Temporary Restraining Order (“TRO”) and one business day prior to the
TRO’s expiration, which is tonight at midnight. The TRO enjoined Defendant
from holding a meeting of the Members of [Plaintiff] Autauga
Automotive, LLC and taking the actions as set forth in the Notice of
Special Meeting of Members of Autauga Automotive, LLC to be
conducted on December 5, 2011, and from any additional actions by
Defendant to sell Autauga Automotive, LLC or its assets and to take any
further actions that are detrimental to the best interest of Autauga
Automotive, LLC, the automotive dealership arrangement held by it or
of [Plaintiff] Charles O. Wall, II.
(TRO ¶ 1 (Ex. to Not. of Removal).) The TRO further provides that the order will
expire December 12, 2011, “at midnight,” unless good cause is shown for its
extension or Defendant “consents that it may be extended for a longer period.” (TRO
¶ 4.) In the TRO, the state circuit court judge also sets this case for a preliminary
injunction hearing for today at 1:00 p.m. (TRO ¶ 2.)
In response to the Notice of Removal, Plaintiffs filed a Motion for Temporary
Restraining Order in this court on today’s date, December 12. (Pls.’ Mot. for TRO
(Doc. # 2).) Plaintiffs point out that the state circuit court judge “[o]f course . . .
cannot extend the duration of his order because the case is no longer in his court.”
(Pls.’ Mot. for TRO ¶ 31.) They argue that, “[b]ecause the removal deprives
[Plaintiffs] of their opportunity to obtain the preliminary injunction to which they are

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entitled before the expiration of the protection of the current Temporary Restraining
Order, [Defendant] is using gamesmanship to try to obtain a window of opportunity
in which to take action to irreparably harm [Plaintiffs].” (Pls.’ Mot. for TRO ¶ 32.)
Plaintiffs further assert that they “intend to file a Motion to Remand in this case
as soon as possible” because “[f]rom the face of the Verified Complaint, it is evident
that no diversity of citizenship exists in this matter.” (Pls.’ Mot. for TRO ¶ 37.)
There is no diversity of citizenship, according to Plaintiffs, because Defendant is a
member of Plaintiff Autauga Automotive, LLC, and, thus, “[w]hatever [Defendant’s]
citizenship, it is necessarily shared by Autauga Automotive [LLC].” (Pls.’ Mot. for
TRO ¶ 37 n.2.) Notwithstanding the absence of subject matter jurisdiction, Plaintiffs
assert that they “deserve and require the Court’s protection during the time between
the expiration of the existing Temporary Restraining Order and a hearing on their
pending request for a preliminary injunction.” (Pls.’ Mot. for TRO ¶ 37.) They assert
that Defendant “should not be allowed to use his improper removal to evade that
preliminary injunction hearing.”1 (Pls.’ Mot. for TRO ¶ 37.)
Diversity jurisdiction “requires complete diversity – every plaintiff must be
diverse from every defendant.” Palmer v. Hosp Auth. of Randolph Cnty., 22 F.3d

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Counsel for Plaintiffs represent that they have provided a copy of their Motion for
Temporary Restraining Order to counsel for Defendant on this date, December 12, “via email.”
(Pls.’ Mot. for TRO ¶ 35.)
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1559, 1564 (11th Cir. 1994). Mr. Moultrie is the sole Defendant. He is sued not only
by Plaintiff Wall, an individual, but also by Autauga Automotive, LLC, of which the
removal papers clearly establish Defendant is a member. (See Annamarie W. Jones’s
Aff. 1 (Ex. D to Doc. # 1) (attesting that Defendant Frank A. Moultrie is a member
of Plaintiff Autauga Automotive, LLC; see also Amendment to Articles of
Organization for Autauga Automotive LLC (Ex. C to Doc. # 1).) It matters not
whether Defendant is a citizen of Florida, as he says, or whether he is a citizen of
Alabama, as the Verified Complaint alleges. Because a limited liability company “is
a citizen of any state of which a member of the company is a citizen,” Mallory &
Evans Contractors & Eng’r, LLC v. Tuskegee Univ., No. 11-10940, 2011 WL
6015801 (11th Cir. 2011) (published), there is not complete diversity between
Defendant Moultrie and Plaintiff Autauga Automotive, LLC.
Even though there is not yet a motion to remand pending, “the district court
may – and, indeed, must – remand a removed case sua sponte ‘[i]f at any time before
final judgment it appears that the district court lacks subject matter jurisdiction.’”
Taylor v. Phillips, No. 10-10485, 2011 WL 4445828, at *2 n.3 (11th Cir. Sept. 27,
2011) (quoting 28 U.S.C. § 1447(c)); see also Burr & Forman v. Blair, 470 F.3d
1019, 1035 n.38 (11th Cir. 2006) (“[F]ederal courts are duty bound to consider their
subject matter jurisdiction sua sponte.”). Diversity of citizenship jurisdiction is
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absent, and, thus, the removal was improper. This action must be remanded back to
state court.
It follows that because there is no jurisdiction in federal court, this court has
no authority to enter any order restraining the challenged conduct. Plaintiffs cite no
authority for their argument that a motion for a temporary restraining order can be
entertained when subject matter jurisdiction is plainly lacking in cases where the
improper removal is particularly egregious. The court is sympathetic, however, to
Plaintiffs’ plight. If Plaintiffs’ accusations are correct, i.e., that Defendant removed
this case on the eve of the expiration of the state court’s TRO for the purpose of
ensuring its expiration and averting the scheduled preliminary injunction hearing set
this date in state court, then the court will entertain a motion for costs, attorney’s fees
or other appropriate sanctions. See, e.g., § 1447(c) (“An order remanding the case
may require payment of just costs and any actual expenses, including attorney fees,
incurred as a result of the removal.”). This court, however, plainly lacks subject
matter jurisdiction and, thus, is powerless to grant the interim relief requested by
Plaintiffs. See Bochese v. Town of Ponce Inlet, 405 F.3d 964, 974–75 (11th Cir.
2005) (“Simply put, once a federal court determines that it is without subject matter
jurisdiction, the court is powerless to continue.”) (citation and internal quotation
marks omitted).
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Accordingly, it is ORDERED that this case is REMANDED sua sponte to the
Circuit Court of Autauga County, Alabama, pursuant to 28 U.S.C. § 1447(c).
The Clerk of Court is DIRECTED to take all steps necessary to effectuate said
remand.
It is further ORDERED that the court will entertain a motion for costs and
attorney’s fees incurred as a result of the improper removal, pursuant to § 1447(c),
and/or for other appropriate sanctions, if appropriate, if such a motion is filed on or
before January 6, 2012.
DONE 12th day of December, 2011.
/s/ W. Keith Watkins
CHIEF UNITED STATES DISTRICT JUDGE

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