RD Properties of Metairie, LLC v. Scottsdale Insurance Company

Filing 6

ORDER denying 4 Motion to Dismiss for Failure to State a Claim. Defendant shall amend its notice of removal to properly allege the citizenship of the plaintiff LLC within ten (10) days from entry of this Order. Signed by Judge Jay C. Zainey. (jrc, )

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
RD PROPERTIES OF METAIRIE, LLC

CIVIL ACTION

VERSUS

NO: 13-5520

SCOTTSDALE INSURANCE CO.

SECTION: "A" (4)

ORDER AND REASONS
Before the Court is a Motion to Dismiss (Rec. Doc. 4) filed by defendant
Scottsdale Insurance Co. Plaintiff has not filed a response to the motion.1 The motion,
scheduled for submission on September 25, 2013, is before the Court on the briefs without
oral argument.
Plaintiff has filed this lawsuit to recover for property damage sustained during
Hurricane Isaac to several apartment units located in Metairie, Louisiana. Plaintiff seeks
additional policy proceeds, statutory penalties, and attorney’s fees. (Rec. Doc. 1-3, Petition).
Scottsdale removed the suit on August 21, 2013, and filed the instant motion to dismiss just
one week later. Scottsdale contends that the complaint fails to contain sufficient factual
material to satisfy the pleading requirements of Bell Atlantic Corp. v. Twombly, 550, U.S.
544, 555 (2007).
In the context of a motion to dismiss the Court must accept all factual allegations in
the complaint as true and draw all reasonable inferences in the plaintiff’s favor. Lormand v.
US Unwired, Inc., 565 F.3d 228, 232 (5th Cir. 2009) (citing Tellabs, Inc. v. Makor Issues &

The Fifth Circuit has cautioned that district courts must consider the merits of a Rule
12(b)(6) motion to dismiss even where the plaintiff fails to respond to the motion. Webb v.
Morella, 457 Fed. Appx. 448, 452 n.4 (5th Cir. 2012) (unpublished). It is improper for the Court
to ignore the merits and simply grant the dispositive motion as unopposed. See id.
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Rights, Ltd., 551 U.S. 308 (2007); Scheuer v. Rhodes, 416 U.S. 232, 236 (1974); Lovick v.
Ritemoney, Ltd., 378 F.3d 433, 437 (5th Cir. 2004)). However, the foregoing tenet is
inapplicable to legal conclusions. Ashcroft v. Iqbal, 129 S. Ct. 1937, 1949 (2009). Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements,
do not suffice. Id. (citing Bell Atlantic Corp. v. Twombly, 550, U.S. 544, 555 (2007)). The
central issue in a Rule 12(b)(6) motion to dismiss is whether, in the light most favorable to
the plaintiff, the complaint states a valid claim for relief. Gentilello v. Rege, 627 F.3d 540,
544 (5th Cir. 2010) (quoting Doe v. MySpace, Inc., 528 F.3d 413, 418 (5th Cir. 2008)).
Rule 8(a)(2) requires only “a short and plain statement of the claim.” This case does
not present a situation like Twombly so as to require this Court to dismiss the complaint.
The motion is therefore denied.
More problematic than the complaint, however, is Scottsdale’s notice of removal.
Scottsdale has not properly alleged the citizenship of the plaintiff entity2 and therefore has
not properly invoked federal court jurisdiction. The law in this circuit is now clear in that the
citizenship of an LLC is determined by the citizenship of all of its members. Harvey v. Grey
Wolf Drilling Co., 542 F.3d 1077, 10-79-80 (5th Cir. 2008) (joining the numerous other
circuits that determine the citizenship of an LLC by the citizenship of its members). The law
in this circuit has long been clear in that citizenship must be “distinctly and affirmatively”
alleged. Getty Oil Corp. v. Ins. Co. of N. Am., 841 F.2d 1254, 1259 (5th Cir. 1988) (quoting
McGovern v. Am. Airlines, Inc., 511 F.2d 653, 654 (5th Cir. 1975)).
Accordingly, and for the foregoing reasons;

Scottsdale merely recited Plaintiff’s allegations regarding the LLC’s state of
organization from paragraph 1 of the state court petition but those allegations were not pleaded
for the purpose of establishing diversity of citizenship and they are insufficient for that purpose.
(Rec. Doc. 1, Notice of Removal ¶ 7).
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IT IS ORDERED that the Motion to Dismiss (Rec. Doc. 4) filed by defendant
Scottsdale Insurance Co. is DENIED;
IT IS FURTHER ORDERED that Scottsdale shall amend its notice of removal to
properly allege the citizenship of the plaintiff LLC within ten (10) days from entry of this
Order.
September 25, 2013
JAY C. ZAINEY
UNITED STATES DISTRICT JUDGE

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