Louden, LLC v. Martin et al

Filing 10

ORDER REMANDING CASE., ***Civil Case Terminated.. Signed by Judge ARMSTRONG on 12/3/12. (lrc, COURT STAFF) (Filed on 12/3/2012)

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UNITED STATES DISTRICT COURT
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FOR THE NORTHERN DISTRICT OF CALIFORNIA
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OAKLAND DIVISION
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8 LOUDEN, LLC, a Nevada Limited Liability

Case No: C 12-5972 SBA

Company,
ORDER REMANDING ACTION

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Plaintiff,
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vs.
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BILL MARTIN & MARY MARTIN,
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Defendants.
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On May 23, 2012, Plaintiff Louden, LLC, (“Plaintiff”), a limited liability company

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(“LLC”), filed an unlawful detainer action against Gary Milano and Bill Martin in the

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Superior Court of the State of California, County of Contra Costa. On November 21, 2012,

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Bill Martin and non-party Mary Martin filed pro se a Notice of Removal.1 Though no

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federal claims are alleged in the pleadings, Defendants predicate the removal on the basis

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of diversity jurisdiction. See Notice of Removal at 1, Dkt. 1.

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A district court has “a duty to establish subject matter jurisdiction over the removed

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action sua sponte, whether the parties raised the issue or not.” United Investors Life Ins.

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Co. v. Waddell & Reed, Inc., 360 F.3d 960, 967 (9th Cir. 2004); accord Attorneys Trust v.

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Videotape Computer Prods., Inc., 93 F.3d 593, 594-95 (9th Cir. 1996) (lack of subject

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Gary Milano did not join in the removal, which renders the removal procedurally
defective. See Emrich v. Touche Ross & Co., 846 F.2d 1190, 1193 n.1 (9th Cir. 1988)
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removal petition procedurally defective”). Although Mary Martin is not a party to the
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matter jurisdiction may be raised at any time by either party or by the court sua sponte).

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The federal removal statute permits the removal of an action which could have been

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brought originally in federal court. See 28 U.S.C. § 1441(a). “The burden of establishing

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federal jurisdiction is on the party seeking removal, and the removal statute is strictly

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construed against removal jurisdiction.” Prize Frize Inc. v. Matrix Inc., 167 F.3d 1261,

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1265 (9th Cir.1999). A district court must remand a case to state court “if at any time

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before the final judgment it appears that the district court lacks subject matter jurisdiction.”

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28 U.S.C. § 1447(c); Kelton Arms Condominium Owners Ass’n v. Homestead Ins. Co.,

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346 F.3d 1190, 1192 (9th Cir.2003) (“[W]e have held that the district court must remand if

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it lacks jurisdiction”) (citing Sparta Surgical Corp. v. Nat’l Ass’n Sec. Dealers, Inc., 159

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F.3d 1209, 1211 (9th Cir. 1998)).

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District courts have diversity jurisdiction over all civil actions “where the matter in

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controversy exceeds the sum or value of $75,000, exclusive of interest and costs, and is

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between ... citizens of different States.” 28 U.S.C. § 1332(a). The amount in controversy is

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determined by the amount of damages or the value of the property that is the subject matter

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of the action. Hunt v. Washington State Apple Advertising Comm’n, 432 U.S. 433 (1977).

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The diversity statute is strictly construed, and any doubts are resolved against finding

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jurisdiction. Kantor v. Wellesley Galleries, Ltd., 704 F.2d 1088, 1092 (9th Cir. 1983).

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Because the citizenship of the parties is a jurisdictional fact in diversity actions, the burden

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is on the plaintiff--the party invoking federal jurisdiction--to plead and prove such facts.

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Bautista v. Pan American World Airlines, Inc., 828 F.2d 546, 552 (9th Cir. 1987).

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Here, remand is required for several reasons. First, as citizens of the forum state,

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Defendants cannot remove the action. The removal statute unambiguously precludes

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removal jurisdiction on the basis of diversity where, as here, any defendant is a citizen of

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the State in which the action was brought. See 28 U.S.C. § 1441(b)(2) (“A civil action

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otherwise removable solely on the basis of the jurisdiction under section 1332(a) of this

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title may not be removed if any of the parties in interest properly joined and served as

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defendants is a citizen of the State in which the action is brought.”); see also Lively v. Wild
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Oats Mkts., Inc., 456 F.3d 933, 939 (9th Cir. 2006) (Section “1441(b) confines removal on

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the basis of diversity jurisdiction to instances where no defendant is a citizen of the forum

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state”).

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Second, even if Defendants could remove the action, they have not shown that they

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are completely diverse from Plaintiff. Defendants apparently are under the belief that since

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Plaintiff is an LLC formed in Nevada, it must necessarily be a citizen of Nevada for

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purposes of diversity jurisdiction. Unlike the citizenship of a natural person, however, the

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citizenship of an LLC or other unincorporated entity is the citizenship of its members. See

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Johnson v. Columbia Props. Anchorage, LP, 437 F.3d 894, 899 (9th Cir. 2006) (“We …

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hold that, like a partnership, an LLC is a citizen of every state of which its owners/members

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are citizens.”). Here, neither the Complaint nor the Notice of Removal identifies any of

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Plaintiff’s members or provides any facts regarding their citizenship. As a result,

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Defendants cannot sustain the removal based on complete diversity of citizenship. See

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Harris, 425 F.3d at 694; see also Deckard v. Wachovia Mortg., No. CV 10-2464 PA

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(AGRx), 2010 WL 1444569, at *1 (C.D. Cal. April 7, 2010) (allegation in Notice of

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Removal that the defendant is “[a] Delaware limited liability company headquartered in

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Addison, Texas” failed to meet defendant’s burden of demonstrating removal jurisdiction).

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Finally, Defendants have not alleged facts to establish that the minimum amount is

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in controversy. The Complaint alleges that the amount demanded does not exceed $10,000.

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Thus, even if Defendants were able to establish complete diversity between the parties, they

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cannot show that the requisite amount, i.e., $75,000, is in controversy. Remand is therefore

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warranted. See Gaus v. Miles, Inc., 980 F.2d 564, 567 (9th Cir. 1992) (lack of specific

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facts demonstrating that the amount in controversy at the time of removal met the

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jurisdictional minimum justified remand). Accordingly,

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IT IS HEREBY ORDERED THAT, pursuant to 28 U.S.C. § 1447(c), the instant

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action is REMANDED to Contra Costa County Superior Court. The Clerk shall terminate

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all pending matters and close the file.2

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IT IS SO ORDERED.
Dated: 12-3-12

______________________________
SAUNDRA BROWN ARMSTRONG
United States District Judge

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In light of the Court’s decision above, Defendants’ motions for in forma pauperis
status and Plaintiff’s recently filed motion to remand are denied as moot.
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UNITED STATES DISTRICT COURT
FOR THE
NORTHERN DISTRICT OF CALIFORNIA

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LOUDEN, LLC,
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Plaintiff,

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v.
BILL MARTIN, ET AL. et al,
Defendant.
/

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Case Number: CV12-05972 SBA

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CERTIFICATE OF SERVICE
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I, the undersigned, hereby certify that I am an employee in the Office of the Clerk, U.S. District
Court, Northern District of California.
That on December 3, 2012, I SERVED a true and correct copy(ies) of the attached, by placing said
copy(ies) in a postage paid envelope addressed to the person(s) hereinafter listed, by depositing
said envelope in the U.S. Mail, or by placing said copy(ies) into an inter-office delivery receptacle
located in the Clerk's office.

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Bill Martin
2855 Honeysuckle Circle
Antioch, CA 94531

Mary Martin
2855 Honeysuckle Circlie
Antioch, CA 94531

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Dated: December 3, 2012
Richard W. Wieking, Clerk

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By: Lisa Clark, Deputy Clerk

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