Dunning et al v. GHS Interactive Security, LLC et al
MEMORANDUM OPINION AND ORDER GRANTING 7 MOTION to Remand and the Court hereby REMANDS this case to the Circuit Court of Jefferson County, Alabama. Signed by Chief Judge Karon O Bowdre on 11/7/2018. (JLC)
2018 Nov-07 PM 05:13
U.S. DISTRICT COURT
N.D. OF ALABAMA
IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ALABAMA
FREDDIE DUNNING, JR. and
GHS INTERACTIVE SECURITY, LLC;
And PRESTON BURNETT,
Case No. 2:18-CV-1156- KOB
MEMORANDUM OPINION AND ORDER
This matter is before the court on Plaintiffs’ Motion to Remand. (Doc. 7). Plaintiffs
Freddie and Paulethea Dunning filed this lawsuit against Defendants GHS Interactive Security,
LLC (“GHS”) and Preston Burnett in the Circuit Court of Jefferson County, Alabama. GHS filed
a Notice of Removal to this court on July 25, 2018, asserting diversity jurisdiction. (Doc. 1).
For the reasons stated below, this court concludes that Defendant GHS has not met its
burden of establishing its own citizenship and so has not met its burden of establishing complete
diversity of citizenship. Thus, this court GRANTS Plaintiffs’ Motion to Remand and
REMANDS this case to the Circuit Court of Jefferson County, Alabama.
I. Standard of Review
Consistent with the limited nature of federal jurisdiction, the party seeking a federal
venue must establish federal jurisdictional requirements. See Lujan v. Defenders of Wildlife, 504
U.S. 555, 561 (1992). In the removal context, the removing defendant must establish the court’s
jurisdiction. Miedema v. Maytag Corp., 450 F.3d 1322, 1328 (11th Cir. 2006). Because removal
statutes are strictly construed against removal, Shamrock Oil & Gas Corp. v. Sheets, 313 U.S.
100, 108 (1941), doubts about jurisdiction are generally resolved in favor of remand. See Univ.
of S. Ala. v. Am. Tobacco Co., 168 F.3d 405, 411 (11th Cir.1999) (“A presumption in favor of
remand is necessary because if a federal court reaches the merits of . . . a removed case where
subject matter jurisdiction may be lacking it deprives a state court of its right under the
Constitution to resolve controversies in its own courts.”).
II. Factual Background
The Dunnings brought this claim against GHS, a limited liability company, alleging
breach of contract, fraud, negligence, and wantonness related to the sale and installation of a fire
and burglary alarm system. The Dunnings have also joined one named natural person, Preston
Burnett, as well as eight fictitious parties.1 GHS’s membership is comprised of ten members: six
natural persons; two corporations; and two “entities.” (Doc. 12-5, at 2).
GHS removed this case on the basis of diversity jurisdiction. Plaintiffs have not disputed
that the claim value exceeds $75,000; so, the sole question before the court is whether Defendant
has sufficiently established complete diversity.
For diversity purposes, a limited liability company is a citizen of any state of which a
member of the limited liability company is a citizen. Rolling Green MHP, L.P. v. Comcast SCH
Holdings L.L.C., 374 F.3d 1020, 1022 (11th Cir.). When a member is itself an entity, the limited
liability company is a citizen of any state in which its entity-member is a citizen. See Purchasing
Power, LLC v. Bluestem Brand, Inc., 851 F.3d 1218, 1221 (11th Cir. 2017). A corporation is a
citizen of its state of incorporation as well as the state where it has its principal place of business.
28 U.S.C. § 1332(c)(1).
Of course, fictitious parties play no role in determining whether a civil action is removable on the basis of diversity
jurisdiction. 28 U.S.C. § 1441(b)(1).
In Defendant’s notice of removal, it asserted only that “Defendant is a Limited Liability
Company organized under the laws of the State of Delaware, maintaining its principal place of
business in Woodland Hills, California.” (Doc. 1, at ¶ 13). Plaintiff’s Motion to Remand
correctly noted that Defendant failed to allege the citizenship of its members. (Doc. 7, at 4).
Defendant responded by identifying its ten members, which included several individuals and
corporations. (Doc. 12-5, at 2). But Defendant also identified two members as “entities”:
2. Addington Square OID is an entity organized under the laws of the Cayman Islands
and has no place of business of any kind, principal or otherwise, located in the State of
3. AB PCI Middle Market OID is an entity organized under the laws of the State of
Delaware and has no place of business of any kind, principal or otherwise, located in the
State of Alabama.
(Doc. 12-5, at 2).
By failing to identify the entity type for two of its members, GHS has failed to establish
these members’ citizenship. See Smart Alabama, LLC v. Sompo Japan Ins. Co. of Am., No. 2:18cv-141-MHT, 2018 WL 1321040, at *1 (M.D. Ala. March 14, 2018). Delaware and the Cayman
Islands recognize several different types of entities. Knowing the entity type helps establish
citizenship, as different rules for citizenship apply to different entity types, and this court cannot
guess which type of entity Defendant GHS’s members are. If the two unclassified entities are of
a type whose citizenship is not based on place of organization and principal place of business,
Defendant has not satisfactorily established the citizenship of its members. Thus, without
identifying the entity types of two of its members, Defendant has not met its burden of
establishing the citizenship of those two members. Failing to establish the citizenship of all ten of
its members, GHS fails to sufficiently establish its own citizenship and therefore fails to meet its
burden to show complete diversity.
For the reasons discussed above, this court GRANTS Plaintiff’s Motion to Remand and
REMANDS this case to the Circuit Court of Jefferson County, Alabama. Because the reasons
discussed above are adequate grounds to remand this case, the court expresses no opinion on the
other issues Plaintiff’s Motion to Remand raises.
DONE and ORDERED this 7th day of November, 2018.
KARON OWEN BOWDRE
CHIEF UNITED STATES DISTRICT JUDGE
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