MCP Trucking, LLC v. Speedy Heavy Hauling, Inc.

Filing 23

ORDER. ORDERED that this case is remanded pursuant to 28 U.S.C. § 1447(c) to the District Court of Weld County, Colorado where it was filed as Civil Case No. 2014 CV 30660 by Judge Philip A. Brimmer on 10/06/14. (jhawk, )

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLORADO
Judge Philip A. Brimmer
Civil Action No. 14-cv-02427-PAB
MCP TRUCKING, LLC, a Colorado limited liability company,
Plaintiff,
v.
SPEEDY HEAVY HAULING, INC., a Foreign Corporation, d/b/a Hemp Hill Trucking,
Inc., d/b/a Hemp Hill Speedy Heavy Hauling Services, d/b/a T Force Energy Services,
Inc., d/b/a Transforce, Inc.,
Defendant.

ORDER

This matter is before the Court on the September 29, 2014 Response to Court’s
Order to Show Cause [Docket No. 22] filed by defendant TForce Energy Services, Inc.
The Court ordered defendant to show cause why this case should not be dismissed for
lack of subject matter jurisdiction. Docket No. 13.
Defendant’s notice of removal alleges that this Court has subject matter
jurisdiction over this case based on diversity jurisdiction pursuant to 28 U.S.C. § 1332.
See Docket No. 1 at 3, ¶ 11. W ith respect to the citizenship of plaintiff MCP Trucking,
LLC, defendant alleges, in pertinent part, that: “Plaintiff is a Colorado corporation with
its principal place of business in Weld County, Colorado.” Id. at 3, ¶ 9. However, the
complaint indicates that plaintiff is a limited liability company (“LLC”). Docket No. 1-1 at
1, ¶ 1. The Court issued its Order to Show Cause on September 5, 2014, ordering
defendant to show cause why this case should not be dismissed for lack of subject

matter jurisdiction due to defendant’s failure to adequately allege the citizenship of
plaintiff’s constituent members. Docket No. 13. On September 15, 2014, defendant
requested an extension of time to respond to the order to show cause and leave to
conduct limited jurisdictional discovery. Docket No. 19. On September 17, 2014, the
Court granted defendant until September 29, 2014 to respond to the order to show
cause and the Court declined to exercise its discretion to permit jurisdictional discovery.
Docket No. 20 at 3.
Section 1332(a)(1) states: “The district courts shall have original jurisdiction of
all civil actions where the matter in controversy exceeds the sum or value of $75,000,
exclusive of interest and costs, and is between . . . citizens of different States.” In every
case and at every stage of the proceeding, a federal court must satisfy itself as to its
own jurisdiction, even if doing so requires sua sponte action. Citizens Concerned for
Separation of Church & State v. City & County of Denver , 628 F.2d 1289, 1297, 1301
(10th Cir. 1980). Absent an assurance that jurisdiction exists, a court may not proceed
in a case. See Cunningham v. BHP Petroleum Great Britain PLC, 427 F.3d 1238, 1245
(10th Cir. 2005).
As stated in the Order to Show Cause, although the Supreme Court and the
Tenth Circuit have not spoken specifically on the issue of citizenship of LLCs, the
consensus throughout the circuits is that an LLC, much like a partnership, is deemed to
be a citizen of all of the states of which its members are citizens. See D.B. Zwirn
Special Opportunities Fund, L.P. v. Mehrotra, 661 F.3d 124, 125 (1st Cir. 2011);
Bayerische Landesbank, New York Branch v. Aladdin Capital Management LLC, 692

2

F.3d 42, 49 (2d Cir. 2012); Zambelli Fireworks Mfg. Co., Inc. v. Wood, 592 F.3d 412,
420 (3d Cir. 2010); Central West Virginia Energy Co., Inc. v. Mountain State Carbon,
LLC, 636 F.3d 101, 103 (4th Cir. 2011); Arena v. Graybar Elec. Co., Inc., 669 F.3d 214,
224 (5th Cir. 2012); V&M Star, LP v. Centimark Corp., 596 F.3d 354, 356 (6th Cir.
2010); IP of A West 86th Street 1, LLC v. Morgan Stanley Mortg. Capital Holdings, LLC,
686 F.3d 361, 363 (7th Cir. 2012); Buffets, Inc. v. Leischow, 732 F.3d 889, 897 n.6 (8th
Cir. 2013); Carolina Cas. Ins. Co. v. Team Equipment, Inc., --- F.3d ----, 2014 WL
407389, at *2 (9th Cir. Feb. 4, 2014); Flintlock Constr. Servs., LLC v. Well-Come
Holdings, LLC, 710 F.3d 1221, 1224 (11th Cir. 2013).
In response to the order to show cause, defendant states:
Plaintiff is a Colorado LLC with its principal place of business in Colorado.
Plaintiff was formed in 2005 by Mark and Connie Peterman. Mark and
Connie Peterman indicated a [Colorado] personal mailing address . . . at the
time of organization. Since 2005, plaintiff has filed eight annual or periodic
reports with the Colorado Secretary of State. Each report was filed by Mark
Peterman and indicates that Mr. Peterman is Plaintiff’s registered agent.
Each report indicates that Mark Peterman’s personal and service address is
the same address as Plaintiff’s principal office.
Docket No. 22 at 2-3 (citations and footnote omitted). In support of these statements,
defendant attaches documents obtained from the Colorado Secretary of State. See
Docket No. 22-1.
It is well established that “[t]he party invoking federal jurisdiction bears the
burden of establishing such jurisdiction as a threshold matter.” Radil v. Sanborn W.
Camps, Inc., 384 F.3d 1220, 1224 (10th Cir. 2004). Def endant admits that it has not
met its burden with respect to establishing plaintiff’s citizenship and the Court finds no
basis for concluding otherwise. Docket No. 22 at 5. The articles of organization from
3

the Colorado Secretary of State indicate that Mark and Connie Peterman formed
plaintiff as an LLC in 2005 and the Petermans listed Colorado mailing addresses on the
document. Docket No. 22-1 at 4-5. However, defendant does not identify evidence
that establishes whether any other persons or entities have subsequently become
constituent members of plaintiff. Moreover, for purposes of diversity jurisdiction, an
individual is a citizen of the state in which he or she is domiciled. Crowley v. Glaze, 710
F.2d 676, 678 (10th Cir. 1983). Domicile, in turn, is determined by the combination of
physical presence in a location and an intent to rem ain there indefinitely – it is not
necessarily synonymous with an individual’s residence. Miss. Band of Choctaw Indians
v. Holyfield, 490 U.S. 30, 48 (1989). Even if the Court were to assume that the
Petermans remain plaintiff’s only constituent members, the fact that the Petermans list
a Colorado mailing address does not establish their citizenship for jurisdictional
purposes.
Defendant states that it has communicated with plaintiff’s counsel, who believes
that plaintiff’s only members are citizens of Colorado and that “[b]y all accounts and
public records, Plaintiff is a family owned business run by a husband and wife who have
lived in Colorado since forming MCP Trucking, LLC.” Docket No. 22 at 3. However,
defendant provides no evidentiary support for such statements and an unsworn
statement in a brief is, by itself, insufficient to cure a jurisdictional pleading deficiency.
Travaglio v. Am. Express Co., 735 F.3d 1266, 1270 (11th Cir. 2013). Althoug h
defendant points to a lack of evidence suggesting that plaintiff has members or related
entities that are residents of any state other than Colorado, a removing defendant may
not invoke the Court’s jurisdiction by negative inference. See Meyn Am., LLC v. Omtron
4

USA LLC, 856 F. Supp. 2d 728, 733 (M.D.N.C. 2012) (f inding defendant LLC’s notice of
removal deficient where notice stated only that LLC’s sole member “is a foreign
corporation with a principal place of business in Cyprus; it is not a resident of North
Carolina”). Defendants have therefore failed to resolve the uncertainties surrounding
the identity and citizenship of plaintiff’s constituent members.
Defendant again seeks leave to conduct limited jurisdictional discovery, arguing
that if the case is remanded and “discovery later reveals that diversity exists, . . . the
matter will then have to be removed a second time.” Docket No. 22 at 4. Defendant
appears to suggest that remand without permitting such discovery will prejudice it due
to “further delay and redundancy.” Id. As the Court has previously stated, it is not the
practice of this Court to permit parties to conduct jurisdictional discovery. See Abrego
Abrego v. The Dow Chem. Co., 443 F.3d 676, 691 (9th Cir. 2006) (holding that it is “well
within the court’s discretion to remand to state court rather than ordering jurisdictional
discovery, with the knowledge that later-discovered facts may prompt a second attempt
at removal”). Moreover, no motions have been filed and no scheduling order has been
entered in this case. Defendant fails to explain how any inconvenience it may suffer as
a result of remand at this stage of litigation warrants granting leave to conduct
jurisdictional discovery.
Removal statutes are construed narrowly and, as such, the uncertainties
surrounding the citizenship of plaintiff’s constituent members must be resolved in favor
of remand. See Martin v. Franklin Capital Corp., 251 F.3d 1284, 1290 (10th Cir. 2001).
It is therefore

5

ORDERED that this case is remanded pursuant to 28 U.S.C. § 1447(c) to the
District Court of Weld County, Colorado where it was filed as Civil Case No. 2014 CV
30660.

DATED October 6, 2014.
BY THE COURT:

s/Philip A. Brimmer
PHILIP A. BRIMMER
United States District Judge

6