Akeem et al v. Dasmen Residential, LLC et al

Filing 239

ORDER & REASONS: ORDERED that the Plaintiffs' second 235 motion to remand is DENIED. Signed by Judge Barry W Ashe on 11/18/2021. (Reference: All Cases)(clc)

Case 2:19-cv-13650-BWA-DMD Document 239 Filed 11/18/21 Page 1 of 9

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA

JOSHUA AKEEM, et. al.

CIVIL ACTION

VERSUS

NO. 19-13650 c/w 19-13673;
19-13705; 19-14634; 19-636;
19-14637; 20-187

DASMEN RESIDENTIAL, LLC, et. al.

SECTION M (3)
Pertains to all cases
ORDER & REASONS
Before the Court is plaintiffs’ second motion to remand.1 The RH Defendants,2 the
Eastlake Defendants,3 Dasmen Residential Management, LLC (“Dasmen”), the Triangle
Defendants,4 and Wilshire Insurance Company respond in opposition.5 Having considered the
parties’ memoranda, the record, and the applicable law, the Court issues this Order & Reasons
denying plaintiffs’ second motion to remand.
I.

BACKGROUND
These consolidated matters involve a putative class action brought by current and former

tenants and maintenance workers of five apartment complexes (“Plaintiffs”) against the current
and former owners and property managers of the apartment complexes (“Defendants”) for
damages allegedly caused by hazardous conditions. Plaintiffs originally filed these putative class

1

R. Doc. 235.
The “RH Defendants” are defendants RH East Lake, LLC (“RH East Lake”), RH Chenault Creek, LLC
(“Chenault Creek”), RH Lakewind East, LLC (“Lakewind East”), RH Copper Creek, LLC (“Copper Creek”), RH
Windrun, LLC (“Windrun”), and RH New Orleans Holdings, LLC.
3
The “Eastlake Defendants” are defendants Eastlake Development L.L.C. (“Eastlake”), KFK Group, Inc.
(“KFK Group”), and KFK Development, L.L.C. (“KFK Development”).
4
The “Triangle Defendants” are Triangle Real Estate of Gastoina, Inc. (“Triangle”), Southwood Realty
Company (“Southwood”), and Lakewind East Apartments, LLC (“Lakewind”).
5
R. Doc. 237.
2

Case 2:19-cv-13650-BWA-DMD Document 239 Filed 11/18/21 Page 2 of 9

action cases in the Civil District Court, Parish of Orleans, State of Louisiana.6 In November 2019,
Defendants began removing them to this Court alleging subject-matter jurisdiction pursuant to the
Class Action Fairness Act (“CAFA”), 28 U.S.C. § 1332(d).7 Shortly after the above-captioned
lead case was removed (Civil Action No. 19-13650), Plaintiffs filed a motion to remand arguing
that CAFA’s local controversy exception precluded this Court from exercising jurisdiction over
this case.8 This Court denied the motion, holding that Plaintiffs did not demonstrate that the local
defendants’ alleged conduct forms a “significant basis” of the claims asserted or that Plaintiffs
seek “significant relief” from the local defendants. In particular, Plaintiffs did not carry their
burden of proof because the operative complaint lacked allegations as would provide a basis for
both (1) a comparison of the relief sought from the local defendants and that sought against the
non-local defendants, demonstrating that the former was not “small change” in comparison to the
later; and (2) a comparison of the local defendants’ conduct in relation to all the claims asserted in
the litigation and to the conduct of the out-of-state defendants, demonstrating that the local
defendants played a significant role in the alleged harm in relation to the out-of-state defendants.9
After the cases were consolidated, Plaintiffs filed a master amended complaint, which
combines the allegations of the six consolidated actions. Plaintiffs allege that the apartment
complexes’ current and former owners and property managers “allowed deteriorating structural
components of buildings such as roofs, plumbing, gutters, slabs, siding, stairwells, etc. to cause
persistent water-intrusion spurring widespread mold-infestation.”10 Plaintiffs also allege that
Defendants provided inadequate security, failed to properly dispose of trash, failed to address

6

R. Doc. 1.
Id.
8
R. Doc. 23.
9
R. Doc. 58.
10
R. Doc. 165 at 4.
7

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Case 2:19-cv-13650-BWA-DMD Document 239 Filed 11/18/21 Page 3 of 9

insect, rodent, and reptile infestations, and failed to adhere to fire and safety codes, all of which
created hazardous conditions.11 Plaintiffs sought to represent a class defined as follows:
All persons who sustained damage through hazardous conditions, including, but
not limited to, exposure to water intrusion and/or exposure to fungal substances
such as mold and mold spores which were growing on building materials and were
released into the air of the following apartment complexes in New Orleans: Hidden
Lakes/Laguna Run, Lakewind East/Laguna Reserve, Copper Creek/Laguna Creek,
Chenault Creek/Carmel Brooks and Wind Run/Carmel Springs,12 and who meet
any one of the following criteria:
1. You currently and/or formerly resided and/or had an employment
relationship with (meaning reported to work at) the apartment complexes
known as Hidden Lakes/Laguna Run, Lakewind East/Laguna Reserve,
Copper Creek/Laguna Creek, Chenault Creek/Carmel Brooks; and Wind
Run/Carmel Springs, before December 13, 2017, and you allege damages
from hazardous conditions, including, but not limited to, water intrusion
and/or exposure to fungal substances such as mold and mold spores which
were growing on building materials and were released into the air.
2. You currently and/or formerly resided and/or had an employment
relationship with (meaning reported to work at) the apartment complexes
known as Hidden Lakes/Laguna Run, Lakewind East/Laguna Reserve,
Copper Creek/Laguna Creek, Chenault Creek/Carmel Brooks, and Wind
Run/Carmel Springs, after December 13, 2017 to the present, and you allege
damages from hazardous conditions including, but not limited to, water
intrusion and/or exposure to fungal substances such as mold and mold
spores which were growing on building materials and were released into the
air.13
The ownership of the buildings changed on December 13, 2017. Prior to that date, the
Triangle Defendants, which are related entities, owned four of the apartment complexes.14
Specifically, Triangle owned Carmel Brooks, Lakewind owned Laguna Reserve, and Southwood
owned Laguna Creek.15 While the Triangle Defendants owned these buildings, Southwood served

11

Id.
The first name is the apartment complex’s former name, and the second is its current name. After this
block quote, each apartment complex will be referenced only by its current name.
13
Id. at 2 (emphasis in original).
14
Id. at 9-10.
15
R. Doc. 169-1 at 2. Wind Run Apartments, LLC (“Wind Run”), another entity that is related to the Triangle
Defendants but was not named in this suit, owned Carmel Springs. Id.
12

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as the property management company.16 On December 13, 2017, the Triangle Defendants sold
their respective properties to Chenault Creek (Carmel Brooks), Lakewind East (Laguna Reserve),
and Copper Creek (Laguna Creek).17 Eastlake, which was wholly owned by KFK Group and KFK
Development, owned Laguna Run from December 11, 2012, until December 14, 2017, when it
sold the property to RH East Lake.18 Latter & Blum Management, Inc. (“Latter & Blum”) was
Laguna Run’s property manager from April 25, 2016, through December 14, 2017.19 After the
sales, Dasmen and the Lynd Company managed the various properties.20
Plaintiffs’ master amended complaint alleges that all the owners and property managers
knew about the water, mold, and numerous other issues with the properties and failed to properly
fix them.21 They further allege that the property managers did not provide to the maintenance
workers personal protective equipment or adequate training on mold remediation, but rather simply
instructed them to spray the affected areas with Kilz or bleach and paint over them.22 Plaintiffs
also allege that Eastlake and the Triangle Defendants misrepresented that the properties were in
good condition and free of vices, ruin, and defects when the properties were sold in December
2017.23 Moreover, Plaintiffs allege that all owner defendants breached the lease agreements in
various ways, including failing to tender apartment units that were clean, safe, and in good working
condition, and that the RH Defendants breached their contracts with the United States Department
of Housing and Urban Development to provide low-income housing that complied with federal

16

Id. Southwood is sued only in its capacity as an owner, and not as a property manager. See R. Doc. 165

at 9-11.
17

R. Doc. 169-1 at 2. Wind Run sold Carmel Springs to Windrun. Id.
R. Doc. 174-1 at 3.
19
Id. All of Plaintiffs’ claims against Latter & Blum have been dismissed. R. Docs. 199; 215.
20
R. Doc. 165 at 10-11.
21
Id. at 12-107.
22
Id. at 16, 17, 23, 25, 27, 29-30, 103-07.
23
Id. at 13, 21-22, 24, 26, 28.
18

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regulations.24 Plaintiffs assert several theories of liability including strict liability, negligence,
fraud, negligent misrepresentation, and breach of contract as to all Plaintiffs, and intentional tort
as to the employee Plaintiffs.25
Defendants filed various motions to dismiss resulting in the dismissal of several of
Plaintiffs’ claims.26 At this juncture, the tenant plaintiffs retain claims against: the RH Defendants
for negligence and breach of contract related to the lease agreements; the Eastlake and Triangle
Defendants for breach of contract related to the lease agreements; and Dasmen for negligence.27
All of the maintenance-worker plaintiffs’ claims have been dismissed.
On October 14, 2021, this Court denied Plaintiffs’ motion for class certification.28 Two
weeks later, Plaintiffs filed the instant motion to remand – their second one – arguing that this
Court should abstain from exercising subject-matter jurisdiction pursuant to CAFA’s home state
and local controversy exceptions.29 In their opposition memorandum, Defendants argue that this
Court should treat Plaintiffs’ second motion to remand as a motion to reconsider its denial of
Plaintiffs’ first motion to remand, and also that Plaintiffs cannot prevail on the merits of the
exceptions.30
II.

LAW & ANALYSIS
Plaintiffs second motion to remand is not styled as, and does not specifically request,

reconsideration of this Court’s Order & Reasons denying their first motion to remand. The present
motion again raises the local controversy exception and asserts for the first time the home state
exception, which could have been presented in the first motion to remand. The Court will consider
24

Id. at 33-103.
Id. at 108-13.
26
R. Docs. 169; 174; 179; 199; 208; 210; 213; 215; 230.
27
R. Docs. 165; 199; 213; 215; 230.
28
R. Doc. 234.
29
R. Doc. 235.
30
R. Doc. 236.
25

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Plaintiffs’ second motion to remand as a motion for reconsideration, at least in part. Rule 54(b) of
the Federal Rules of Civil Procedure, which governs motions for reconsideration of interlocutory
orders, provides in pertinent part:
[A]ny order or other decision, however designated, that adjudicates fewer than all
the claims or the rights and liabilities of fewer than all the parties does not end the
action as to any of the claims or parties and may be revised at any time before the
entry of a judgment adjudicating all the claims and all the parties’ rights and
liabilities.
Under Rule 54(b), a district court “is free to reconsider and reverse its decision for any reason it
deems sufficient, even in the absence of new evidence or an intervening change in or clarification
of the substantive law.” Austin v. Kroger Tex., L.P., 864 F.3d 326, 336 (5th Cir. 2017). Unlike
motions to alter or amend a judgment under Rule 59(e), “Rule 54(b)’s approach to the interlocutory
presentation of new arguments as the case evolves can be more flexible, reflecting ‘the inherent
power of the rendering district court to afford such relief from interlocutory judgments as justice
requires.’” Id. at 337 (quoting Cobell v. Jewell, 802 F.3d 12, 25-26 (D.C. Cir. 2015)) (internal
citations and quotations omitted). However, the district court must exercise this broad discretion
sparingly to forestall the perpetual reexamination of orders and the resulting burdens and delays.
See Calpecto 1981 v. Marshall Expl., Inc., 989 F.2d 1408, 1414-15 (5th Cir. 1993) (“if the district
court was required to reconsider [an interlocutory order] simply because [the losing party]
belatedly came forward with evidence not submitted prior to the ruling[,] … the cycle of
reconsideration would be never-ending”); Domain Protection, LLC v. Sea Wasp, LLC, 2019 WL
3933614, at *5 (E.D. Tex. Aug. 20, 2019) (“although a district court may revisit an interlocutory
order on any ground it sees fit, it may also use its discretion to prevent parties from, without
justification, raising new arguments for the first time”) (emphasis in original; alterations, internal

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quotation marks, and citation omitted); 18B CHARLES A. WRIGHT, ARTHUR R. MILLER, & EDWARD
H. COOPER, FEDERAL PRACTICE AND PROCEDURE § 4478.1 (3d ed. 2019).
The Court is not persuaded that reconsideration is warranted. Plaintiffs have not pointed
to any jurisprudence or evidence that undercuts this Court’s prior analysis and holding regarding
the local controversy exception. Plaintiffs essentially reassert their prior arguments concerning
the local controversy exception, although they do expand their citation and discussion of
authorities – all of which could have been raised in their first motion to remand, and which present
no new law, in any event. “‘When there exists no independent reason for reconsideration other
than mere disagreement with a prior order, reconsideration is a waste of judicial time and resources
and should not be granted.’” In re Taxotere, 2020 WL 2473772, at *1 (E. D. La. May 13, 2020)
(quoting Hightower v. Group 1 Automotive, Inc., 2016 WL 3430569, at *3 (E.D. La. June 22,
2010)).
Nor have Plaintiffs convinced the Court that it should consider the newly raised home state
exception at this late juncture. Motions to remand premised on CAFA’s abstention doctrines –
including the local controversy and home state exceptions – must be brought within a reasonable
amount of time after removal. Watson v. City of Allen, 821 F.3d 634, 640 (5th Cir. 2016). The
present motion was filed almost two years after removal. In the interim, this Court has considered
and ruled upon one motion to remand, several motions to dismiss, and Plaintiffs’ motion for class
certification. This Court and the parties have collectively spent hundreds of hours working on this
case. Under these circumstances, two years is too long to have waited. See Fulgenzi v. Smith,
2014 WL 11497836, at *2 (D.N.M. Nov. 13, 2014) (holding plaintiff waived CAFA’s local
controversy exception by waiting 19 months after removal before seeking remand on that basis);
Barfield v. Sho-Me Power Elec. Co-op., 2014 WL 1343092, at *2 (W.D. Mo. Apr. 4, 2014)

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(holding 26-month delay in seeking remand on basis of CAFA exceptions was unreasonable where
discovery was extensive and parties had “invested hundreds of hours on motions to dismiss, a
motion to sever, issues of class certification, and motions for summary judgment, as well as many
ongoing procedural details”); Yem, Inc. v. Gilbarco, Inc., 2011 WL 13220409, at *3 (C.D. Cal.
Nov. 15, 2011) (holding four-month delay in seeking remand on basis of local controversy
exception was unreasonable); Calingo v. Meridian Res. Co., 2011 WL 3611319, at *6 (S.D.N.Y.
Aug. 16, 2011) (holding that waiting 87 days was too long to seek remand on basis of CAFA
exceptions); see also Myers v. Blue Cross & Blue Shield of Miss., 368 F. Supp. 3d 1002, 1009-10
(S.D. Miss. 2019) (denying as untimely a non-procedural-defect, non-jurisdictional motion to
remand as unreasonably late where plaintiff was aware of forum selection clause upon which
motion was based for three months before filing it). But see Watson, 821 F.3d at 640 (holding that
plaintiff’s delay of 52 days after removal before filing a motion to remand was reasonable); Lopez
v. Progressive Cty. Mut. Ins. Co., 2019 WL 4876960, at *4 (W.D. Tex. Oct. 2, 2019) (holding that
plaintiff’s delay of 67 days after removal before filing motion to remand was reasonable), adopted,
2019 WL 9197836 (W.D. Tex. Dec. 11, 2019); cf. Mock v. St. David’s Healthcare P’ship, L.P.,
2021 WL 75699, at *4 (W.D. Tex. Jan. 8, 2021) (observing in dicta that plaintiff’s 19-month delay
after removal before filing motion to remand was reasonable because of unavoidable procedural
delays and status of case as “still in its very initial stages”).
It is certainly not reasonable for Plaintiffs to raise the home state exception at this stage of
the litigation when they could, and should, have done so in their first motion to remand which was
filed within a month of removal. Diversity jurisdiction, including under CAFA, “is based on the
claims in the state court petition as they existed at the time of removal.” Rivers v. Chalmette Med.
Ctr., Inc., 805 F. Supp. 2d 291, 294 (E.D. La. 2011) (citing Cavallini v. State Farm Mut. Auto. Ins.

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Co., 44 F.3d 256, 264 (5th Cir.1995)). Nothing has changed in this case in terms of CAFA
jurisdiction or the application of its abstention doctrines since the day this matter was removed.31
It is simply too late for Plaintiffs to raise abstention doctrines. Indeed, Plaintiffs’ second attempt
at remand wreaks of forum shopping since it comes on the heels of this Court’s rulings on
Defendants’ multiple motions to dismiss and Plaintiffs’ motion for class certification. Such
litigation tactics should not be encouraged by entertaining a second motion to remand in the wake
of adverse rulings, however unwelcome.32
III.

CONCLUSION
Accordingly, for the forgoing reasons,
IT IS ORDERED that the Plaintiffs’ second motion to remand (R. Doc. 235) is DENIED.
New Orleans, Louisiana, this 18th day of November, 2021.

________________________________
BARRY W. ASHE
UNITED STATES DISTRICT JUDGE

31

The Court’s denial of class certification did not undermine CAFA jurisdiction. If the requirements of
CAFA are met at the time of removal, a court retains CAFA jurisdiction even if class certification is later denied.
Slocum v. Int’l Paper Co., 2016 WL 6543301, at *4 (E.D. La. Nov. 4, 2016) (collecting cases).
32
Moreover, Plaintiffs cannot prevail on the merits of the home state exception. The home state exception
requires federal district courts to decline jurisdiction when more than two-thirds of the proposed class members and
all the “primary defendants” are citizens of the forum state. 28 U.S.C. § 1332(d)(4)(B). Here, the primary defendants
are the current owners, the RH Defendants, and the former property manager, Dasmen, because most of the Plaintiffs’
tort claims were brought against these defendants. And the RH Defendants and Dasmen are not Louisiana citizens.

9