Stelly v. Wal-Mart Stores Inc et al

Filing 9

ORDER that, with the assistance and cooperation of the defendants, not later than 21 days after the date of this order, the plaintiff, shall file a memorandum setting forth specific facts that support a finding that the parties are diverse in citizenship. Defendants will be allowed 7 days to respond. Signed by Magistrate Judge Patrick J Hanna on 6/10/16. (crt,FinnSld, P)

UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF LOUISIANA
JUDY L. STELLY

*CIVIL NO. 6:16-0436

VERSUS

*JUDGE DOHERTY

WALMART STORES, INC., ET AL.

*MAGISTRATE JUDGE HANNA

ORDER
Federal courts are courts of limited jurisdiction1 and are obligated to examine the
basis for the exercise of federal subject-matter jurisdiction.2 A lack of subject-matter
jurisdiction may be raised at any time, and a court may raise the issue sua sponte.3 The
burden of establishing jurisdiction rests on the party invoking the federal forum.4 In this
case, the plaintiff must bear that burden. When jurisdiction depends on citizenship,
citizenship must be distinctly and affirmatively alleged.5 For exercise of this Court's
diversity jurisdiction, it is axiomatic that complete diversity is required. Thus, the presence

1

2

Smith v. Texas Children's Hospital, 172 F.3d 923, 925 (5th Cir. 1999).

3

Giles v. Nylcare Health Plans, Inc., 172 F.3d 332, 336 (5th Cir. 1999).

4

St. Paul Reinsurance Co., Ltd. v. Greenburg, 134 F.3d 1250, 1253 (5th Cir.1998).

5

1988).

Howery v. Allstate Ins. Co., 243 F.3d 912, 916 (5th Cir. 2001).

Getty Oil, Div. Of Texaco v. Ins. Co. of North America, 841 F.2d 1254, 1259 (5th Cir.

in the action of a single plaintiff from the same State as a single defendant deprives the
district court of original diversity jurisdiction over the entire action.6
In her Complaint, the plaintiff alleges that the basis of this Court's jurisdiction is 28
U.S.C. § 1332, which is jurisdiction based upon the parties being diverse in citizenship and
the amount in controversy exceeding $75,000.
The plaintiff alleges that she is a Louisiana citizen. The defendants named in the
complaint, Wal-Mart Stores, Inc. and Walmart Louisiana, LLC, are allegedly"foreign
corporations. . . authorized to do and . . . doing business in Louisiana". [rec. doc. 1, ¶ 4(a)
and (b)].
Under 28 U.S.C. § 1332(c)(1), a corporation is deemed to be a citizen of any state
in which it is incorporated and any state where it has its principal place of business.
Therefore, a party invoking diversity jurisdiction must allege both the state of
incorporation and the principal place of business of each corporate party.7 In this case,
however, no such allegations have been made with regard to Wal-Mart Stores, Inc., which
apparently is a corporate entity. Wal-Mart Stores, Inc.'s answer provides no additional
clarification, although, it's corporate disclosure states that Wal-Mart Stores, Inc. is a

6

Exxon v. Allapattah, 545 U.S. 546, 553, 125 S.Ct. 2611, 2617 (2005) citing Strawbridge
v. Curtiss, 3 Cranch 267, 2 L.Ed. 435 (1806) and Owen Equipment & Erection Co. v. Kroger, 437 U.S. 365,
375, 98 S.Ct. 2396, 57 L.Ed.2d 274 (1978).
7

Illinois Central Gulf Railroad Co. v. Pargas, Inc., 706 F.2d 633, 637 (5th Cir. 1983).

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Delaware corporation. [rec. docs 5, ¶4 and 7]. However, there are no allegations or
evidence in the record establishing Wal-Mart Stores, Inc.'s principal place of business,
which is necessary to establish diversity.
The undersigned also suspects that Wal-Mart Louisiana, LLC is not a corporation
but a limited liability company, since the letters “LLC” appear in its name. The citizenship
of a limited liability company is determined by the citizenship of all of its members.8
When a member of an LLC is itself an LLC or a partnership, its members and their
citizenship must be identified and traced up the chain of ownership until one reaches only
individuals and/or corporations.9 If any one of the members is not diverse, the company
is not diverse. The plaintiff has not identified the members of Wal-Mart Louisiana, LLC,
nor provided evidence of any member’s citizenship. Neither Wal-Mart Louisiana, LLC's
answer nor its corporate disclosure provide additional clarification. Instead of identifying
the members of Wal-Mart Louisiana, LLC, it states that Wal-Mart Louisiana, LLC is an
"indirectly wholly-owned subsidiary of Wal-Mart Stores, Inc."10 Thus, Wal-Mart Stores,

8

Harvey v. Grey Wolf Drilling Co., 542 F.3d 1077, 1080 (5th Cir. 2008).

9

See Mullins v. TestAmerica, Inc., 564 F.3d 386, 397 (5th Cir. 2009).

10

Even more confusing is the statement that Wal-Mart Stores East, LP is the "direct parent"
of Walmart Louisiana, LLC and that the general and limited partner of that entity are WSE Management,
LLC and WSE Investment, LLC, the sole member of both being Wal-Mart Stores East, LLC (formerly known
as Walmart Stores East, Inc) whose parent is Wal-Mart Stores, Inc. To the extent that any of these entities
is a member of Wal-Mart Louisiana, LLC, the citizenship of each of their members (and the members of any
member LLC) must be stated, including the state of incorporation and principal place of business of any
corporate member.

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Inc. may or may not be a member – or the sole member – of Wal-Mart Louisiana, LLC.
Until the members of Wal-Mart Louisiana, LLC are identified and their citizenship
established, however, the undersigned magistrate judge cannot determine the citizenship
of Wal-Mart Louisiana, LLC or determine whether the plaintiff is diverse in citizenship
from the defendants.
The plaintiffs have not complied with the requirement that each party’s citizenship
be distinctly and affirmatively alleged, and the undersigned cannot determine whether the
parties are diverse in citizenship from the record before this Court.
Although the plaintiff bears the burden of establishing jurisdiction, because the facts
establishing jurisdiction are well known to the defendants, the Court expects the
defendants to assist the plaintiff in providing this Court with the required jurisdictional
facts, as Wal-Mart entities have previously responded to this same inquiry in cases which
were removed to this federal court. See e.g. Marks v. Wal-Mart Louisiana, LLC, 6:16-cv419, rec. doc. 10-1 (W.D. La. 2016).
Accordingly,
IT IS ORDERED that, with the assistance and cooperation of the defendants, not
later than twenty-one days after the date of this order, the plaintiff, shall file a
memorandum setting forth specific facts that support a finding that the parties are
diverse in citizenship. These facts should be supported with summary-judgment-type
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evidence. The defendants will be allowed seven days to respond to the plaintiffs’
submission.
Signed at Lafayette, Louisiana on June 10, 2016.

____________________________________
PATRICK J. HANNA
UNITED STATES MAGISTRATE JUDGE

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