The North Carolina State Bar v. McDaniel

Filing 27

ORDER - The court DENIES defendant's motion to recuse 3 , GRANTS plaintiff's motion to remand 10 , DISMISSES WITHOUT PREJUDICE as moot plaintiff's motion to dismiss 17 and defendant's motion to join 21 , and REMANDS the action to Wake County Superior Court. The clerk shall close the case. Signed by District Judge James C. Dever III on 8/29/2024. (Mann, Stephanie)

IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF NORTH CAROLINA
WESTERN DMSION
No. 5:24-CV-321-D

THE NORTH CAROLINA STATE BAR,
Plaintiff,

.v.
TIGRESS SYDNEY ACUTE MCDANIEL,
Defendant.

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ORDER

On May 22, 2024, the North Carolina State Bar ("State Bar" or ''plaintiff") filed a
complaint in Wake County Superior Court against Tigress Sydney Acute McDaniel (''McDaniel"
or "defendant") seeking to enjoin McDaniel from engaging in unauthorized practice of law [D.E.
1-4] 7. On June 6, 2024, McDaniel removed the action to this court [D.E. 1]. On June 17, 2024,
McDaniel moved to recuse the undersigned from this action [D.E. 3]. On June 21, 2024, McDaniel
answered the complaint and filed counterclaims against the State Bar [D.E. 5].
On July 2, 2024, the State Bar moved to remand [D.E. 10] and filed a memorandum in
support [D.E. 11]. On July 12, 2024, the State Bar moved to dismiss McDaniel's counterclaims
for lack of subject-matter jurisdiction and for failure to state a claim for which relief may be
granted [D.E. 17] and filed a memorandum in support [D.E. 18]. See Fed. R. Civ. P. 12(b)(l), (6).
On July 29, 2024, McDaniel moved to join Probetur Association, LLC [D.E. 21]. On August 1,
2024, McDaniel responded in opposition to the State Bar's motion to remand [D.E. 23]. On August
16, 2024, the State Bar responded in opposition to McDaniel's motion to join Probetur Association,
LLC [D.E. 25]. On August 29, 2024, McDaniel responded in opposition to the State Bar's
memorandum in opposition to join Probetur Association, LLC. [D.E. 26]. As explained below,

the court denies McDaniel's motion to recuse, grants the State Bar's motion to remand, dismisses
without prejudice as moot the State Bar's motion to dismiss and McDaniel's motion to join
Probetur Association, LLC, and remands the action to Wake County Superior Court.
I.
The State Bar alleges that McDaniel engaged in the unauthorized practice of the law in
violation ofN.C. Gen. Stat. §§ 84-2.1, 84-4, 84-5. See [D.E. 1-4] 7-13. The State Bar seeks to
enjoin McDaniel from engaging in such unauthorized practice of the law under N.C. Gen. Stat. §
84-37 and Rule 65 of the North Carolina Rules of Civil Procedure. See id.
"Judicial recusals are governed by a framework of interlocking statutes." Belue v.
Leventhal, 640 F.3d S67, 572 (4th Cir. 2011). Under 28 U.S.C. § 455(a), all '~udge[s] of the
United States" have a general duty to "disqualify [themselves] in any proceeding in which [their]
impartiality might reasonably be questioned." 28 U.S.C. § 455(a). In turn, 28 U.S.C. § 4SS(b)
lists other situations requiring recusal, including where a judge "has a personal bias or prejudice
concerning a party, or personal knowledge of disputed evidentiary facts concerning the
proceeding." 28 U.S.C. § 455(b)(l).
In Litek:y v. United States, 510 U.S. 540 (1994), ''the Court confronted a situation where
defendants moved to disqualify the district judge in their criminal trial based on his comments and
actions as the judge in a prior trial involving one of the same defendants." Belue, 640 F.3d at S72.
In holding that the judge did not have to recuse, the Court concluded that sections 45S(a) and
. 455(b)(1) carry an "extrajudicial source" limitation, under which bias or prejudice must, as a
general matter, stem from "a source outside the Judicial proceeding at hand" in order to disqualify
a judge. Litek:y, 510 U.S. at S45. Put differently, the bias or prejudice must ''result in an opinion
on the merits [of a case] on some basis other than what the judge learned from his participation in

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the case." Id at 545 n.1 (quotation omitted);~ Belue, 640 F.3d at 572-73; Bartko v. Wheeler,
No. 5:14-CT-3043, 2014 WL 3563359, at *6 (E.D.N.C. July 18, 2014) (unpublished), aff'd, 589
F. App'x 181 (4th Cir. 2015) (per curiam) (unpublished). "[W]bile recusal motions serve as an
important safeguard against truly egregious conduct, they cannot become a form of brushback
pitch for litigants to hurl at judges who do not rule in their favor." Belue, 640 F.3d at 574.
"[O]pinions held by judges as a result of what they learned in earlier proceedings" are not
ordinarily a basis for recusal. Litek;y. 510 U.S. at 551; ~ United States v. Morris, 988 F.2d 1335,
1337 (4th Cir.1993); United States v. Parker, 742 F.2d 127, 128-29 (4th Cir. 1984)..
McDaniel's motion to recuse arises from this court's orders in other cases that McDaniel
lost. This court's knowledge of McDaniel's litigation history stems from judicial proceedings that
McDaniel initiated. Accordingly, the court denies as meritless McDaniel's motion to recuse. See
Litek;y, 510 U.S. at 545; Belue, 640 F.3d at 572.;_73.
As for the State Bar's motion to remand, "federal courts, unlike most state courts, are courts
of limited jurisdiction," that Congress created ''with specified jurisdictional requirements and
limitations." Strawn v. AT&T Mobility LLC, 530 F.3d 293,296 (4th Cir. 2008); ~ Kokkonen
v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 377 (1994). Removal from state court requires
the federal district court to have original jurisdiction over the removed action. See 28 U.S.C. §
1441(a); Lontz v. Tharp. 413 F.3d 435,439 (4th Cir. 2005). A defendant generally may remove
an action to federal court only if the face of the complaint demonstrates diversity jurisdiction or
federal question jurisdiction. See 28 U.S.C. § ·1441(b); Beneficial Nat Bank v. Anderson, 539
U.S. 1, 6 (2003).
In a case removed from state court, "[i]f at any time before final judgment it appears that
the district court lacks subject matter jurisdiction, the case shall be remanded" 28 U.S.C. §

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1447(c).

The party seeking removal has the ''burden of establishing federal jurisdiction."

Mulcahey v. Columbia Organic Chems. Co., 29 F.3d 148,_ 151 (4th Cir. 1994). "If diversity
jurisdiction is challenged, the burden of proof remains on the party invoking federal court
jurisdiction, and the citizenship of each real party in interest must be established by a
preponderance of the evidence." Roche v. Lincoln Prop. Co., 373 F.3d 610, 616 (4th Cir. 2004),
rev'd on other grounds. 546 U.S. 81 (2005). "Because removal jurisdiction raises significant
federalism concerns, [the court] must strictly construe removal jurisdiction." Mulcahey, 29 F.3d
at 151; see Shamrock Oil & Gas Coq,. v. Sheets, 313 U.S. 100, 108--09 (1941). "If federal

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jurisdiction is doubtful, remand is necessary." Mulcahey, 29 F.3d at 151; see Comm~n Cause

v.

Lewis, 956 F.3d 246,252 (4th Cir. 2020); Palisades Collections LLC v. Shorts, 552 F.3d 327,336
(4th Cir. 2008). In a case removed based on diversity jurisdiction, the civil action must be between
"citizens of different States" and the amount in controversy must exceed $75,000. 28 U.S.C. §
1332(a)(l). Furthermore, a counterclaim cannot serve as the basis for removal jurisdiction on
federal question grounds. See Home De.pot U.S.A., Inc. v. Jackson, 587 U.S. 435, 441--42 (2019);
Vaden v. Discover Bank, 556 U.S. 49, 60 (2009); Holmes Gr,p., Inc. v. Vornado Air Circulation
Sys., Inc., 535 U.S. 826, 83~3 l (2002).
To determine whether a claim arises under the Constitution or laws of the United States,
the court "examines the well pleaded allegations of the complaint and ignores potential defenses.
A suit arises under the Constitution and laws of the United States only when the plaintiff's
statement of his own cause of action shows that it is based on those laws or that Constitution."
Beneficial Nat. Bank, 539 U.S. at 6 (cleaned up).
The State Bar's complaint presents no federal question. See [D.E. 1-4] 7-13. The court
rejects McDaniel's arguments that federal doctrines concerning "organization and associational

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standing" create subject-matter jurisdiction for this court. .Cf. [D.E. 23-1] 3-5. Even if the court
construes these arguments to mean that McDaniel intends to present a federal defense to the State
Bar's claims, a federal defense provides no basis for removal. See Vaden, 556 U.S. at 60;
Cateq,~ar. Inc., v. Williams, 482 U.S. 386, 393 (1987); Franchise Tax Bd. v. Constr. Laborers
Vacation Tr., 463 U.S. 1, 14 (1983); Louisville & Nashville R.R. v. Mottley, 211 U.S. 149, 152
(1908); Matter of Crump. 631 F. Supp. 3d 345, 348 (M.D.N.C. 2022); Grievance Adm'r v. Fieger,
409 F. Supp. 2d 858, 866 (E.D. Mich. 2005). Furthermore, ''the vindication of [a] defendant's
federal rights is left to the state courts except in rare situations where it can be clearly predicted by
reason of the operation of a pervasive and explicit state or federal law that those rights will
inevitably be denied by the very act of bringing the defendant to trial in the state court." City of
Greenwood v. Peacock, 384 U.S. 808, 828 (1966); Middlesex Cnty. Ethics Comm'n v. Garden
State Bar Ass'n, 457 U.S. 423, 435-36 (1982). Assuming without deciding that McDaniel has a
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federal defense to the underlying State Bar action, she fails ''to demonstrate that [her] federal civil
rights cannot be protected in State Court." N.C. State Bar v. Crump. No; 5:22-CV-371, 2022 WL
17176839, at *2 (E.D.N.C. Nov. 23, 2022) (unpublished) (quotation omitted).

Moreover,

McDaniel's counterclaims cannot create federal question subject-matter jurisdiction for this court.
See Home De_pot U.S.A., Inc., 587 U.S. at 441-42; Vaden, 556 U.S. at 60; Holmes Qm., 535 U.S.
at 830-31. Thus, McDaniel fails to demonstrate federal question jurisdiction.
McDaniel concedes that diversity jurisdiction does not exist because both parties are
domiciled in North Carolina. See [D.E. 23-1] 9. Thus, McDaniel fails to demonstrate subjectmatter jurisdiction for removal. Accordingly, the court grants the State Bar's motion to remand
the action to Wake County Superior Court. See,~ Crump. 2022 WL 17176839, at *1-2. The

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court dismisses without prejudice as moot the State Bar's motion to dismiss and McDaniel's
motion to join Probetur Association, LLC.

II.
In sum, the court DENIES· defendant's motion to recuse [D.E. 3], GRANTS plaintiff's
motion to remand [D.E. 10], DISMISSES WITHOUT PREJUDICE as moot plaintiff's motion to
dismiss [D.E. 17] and defendant's motion to join [D.E. 21], and REMANDS the action to Wake
County Superior Court. The clerk shall close the case.
SO ORDERED. This _1j_ day of August, 2024.

J~sc~JNE'im'
United States District Judge

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