Aligned Bayshore Holdings, LLC v. Westchester Surplus Lines Insurance Company

Filing 168

Order to Show Cause Why This Case Should Not Be Dismissed for Lack of Subject Matter Jurisdiction. Show Cause Response due by 5/15/2020. Signed by Judge Robert N. Scola, Jr on 5/8/2020. See attached document for full details. (kpe)

Case 1:18-cv-21692-RNS Document 168 Entered on FLSD Docket 05/08/2020 Page 1 of 2

United States District Court
for the
Southern District of Florida
Aligned Bayshore Holdings, LLC,
Plaintiff,

)
)
)
v.
) Civil Action No. 18-21692-Civ-Scola
)
Westchester Surplus Lines
)
Insurance Company, Defendant.
)
Order to Show Cause W hy This Case Should Not Be Dismissed
for Lack of Subject Matter Jurisdiction
This matter is before the Court upon an independent review of the
record. “As federal courts, we are courts of limited jurisdiction, deriving our
power solely from Article III of the Constitution and from the legislative acts of
Congress,” and “we are bound to assure ourselves of jurisdiction even if the
parties fail to raise the issue.” Harris v. United States, 149 F.3d 1304, 1308
(11th Cir. 1998). In addition, “a jurisdictional defect cannot be waived by the
parties and may be raised at any point during litigation.” Allen v. Toyota Motor
Sales, U.S.A., Inc., 155 F. App’x 480, 481 (11th Cir. 2005). Plaintiff Aligned
Bayshore Holdings, LLC, sued Defendant Westchester Surplus Lines Insurance
Company, in federal court on the basis of diversity jurisdiction. (Am. Compl.,
ECF No. 6 at ¶ 2.) For the reasons stated below, it is unclear whether the Court
has subject matter jurisdiction.
District courts “ha[ve] diversity jurisdiction when the parties are citize ns
of different states and the amount in controversy exceeds $75,000.” Shanyfelt
v. Wachovia Mortg. FSB, 439 F. App’x 793, 793 (11th Cir. 2011) (citing 28
U.S.C. § 1332(a)). “The burden for establishing federal subject matter
jurisdiction rests with the party bringing the claim.” Sweet Pea Marine, Ltd. v.
APJ Marine, Inc., 411 F.3d 1242, 1247 (11th Cir. 2005). According to the
complaint, the Defendant is a citizen of Georgia and Pennsylvania. (ECF No. 6
at ¶ 4.) However, the allegations concerning the multiple citizenships of the
Plaintiff indicate that the Court lacks subject matter jurisdiction.
“To sufficiently allege the citizenships of . . . unincorporated business
entities, a party must list the citizenships of all the members of the limited
liability company . . . .” Rolling Greens MHP, L.P. v. Comcast SCH Holdings
L.L.C., 374 F.3d 1020, 1022 (11th Cir. 2004). Here, one of the members of the
Plaintiff is Luma Properties Marina, LLC, and Luma Properties Marina, LLC,
has various members. One of Luma Properties Marina, LLC’s members “is a
United State[s] citizen presently residing in Switzerland,” and anothe r of Luna

Case 1:18-cv-21692-RNS Document 168 Entered on FLSD Docket 05/08/2020 Page 2 of 2

Properties Marina LLC’s members is Schwieger Family Naples, LLC, whose
members also include “a United State[s] citizen presently residing in
Switzerland.” (ECF No. 6 at ¶ 5.c.) As a result, it appears that the Plaintiff’s
citizenship status runs afoul of the rule that “U.S. citizens domiciled abroad
are neither ‘citizens of a State’ under § 1332(a) nor ‘citizens or subjects of a
foreign state’ and therefore are not proper parties to a diversity action in federal
court.” Molinos Valle Del Cibao, C. por A. v. Lama, 633 F.3d 1330, 1341 (11th
Cir. 2011). As courts in the Eleventh Circuit have held, “American citizens
domiciled abroad are considered ‘stateless,’ meaning that they are not a ‘citizen
of a State’ because they are not domiciled within a state.” Foisie v. Biss, No. 1914143-CIV, 2019 WL 5260252, at *2 (S.D. Fla. July 30, 2019) (Maynard, Mag.
J) (quoting Newman-Green, Inc. v. Alfonzo-Larrain, 109 S.Ct. 2218, 2221
(1989)), report and recommendation adopted, No. 2:19-CV-14143, 2019 WL
5260125 (S.D. Fla. Aug. 26, 2019) (Rosenberg, J.). Additionally, because the
Court must consider the citizenship (or lack thereof) of all of the Plainti ff’s
members, the citizenship of some of the Plaintiff’s members does not negate the
apparent statelessness of another one of the Plaintiff’s members. See Orchid
Quay, LLC v. Suncor Bristol Bay, LLC, 178 F. Supp. 3d 1300, 1307 (S.D. Fla.
2016) (Marra, J.) (explaining that a limited liability company can be “just as
‘stateless’ as it is ‘stateful’”) (citation omitted).
Accordingly, it is hereby ordered that by May 15, 2020, the Plaintiff
shall show cause by memorandum why this matter should not be dismissed for
lack of subject matter jurisdiction. The memorandum shall not exceed seven
pages. If the Plaintiff fails to show that this Court has subject matter
jurisdiction, this case may be dismissed without prejudice.
Done and ordered, at Miami, Florida, on May 8, 2020.
________________________________
Robert N. Scola, Jr.
United States District Judge