Reverse Mortgage Funding, LLC. v. The Estate of Angel Rafael Antonini Nazario et al

Filing 56

OPINION AND ORDER. In light of the fact that the Court is unable to determine that complete diversity exists between the parties, the Court hereby DISMISSES without prejudice the amended complaint for lack of subject matter jurisdiction, as no alter native ground for jurisdiction has been brought by plaintiff. The Motion for Default Entry at ECF No. 52 is MOOT. Clerk of Court is to enter judgment accordingly. Signed by Judge Aida M. Delgado-Colon on 2/20/2020.(wm) Modified document type on 2/21/2020 (idg).

THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF PUERTO RICO

REVERSE MORTGAGE FUNDING, LLC,
Plaintiff,
v.
Civil No. 16-3092 (ADC)
THE ESTATE OF ANGEL RAFAEL
ANTONINI-NAZARIO, et al,
Defendants.

OPINION AND ORDER
I.

Procedural Background
Plaintiff, through counsel, brought this foreclosure action under 28 U.S.C. § 1332 alleging

that complete diversity exists among the parties and that the amount in controversy exceeds the
statutory threshold amount. ECF No. 1 at 1. The original complaint filed in December 2016
asserted that plaintiff was a “corporation with its principal place of business located at 3900
Capital City Blvd., Lansing, MI 48906.” Id., at 2 (emphasis added). Plaintiff did not include any
information regarding its place of incorporation. Id.
Two months later, plaintiff filed an amended complaint. ECF No. 15. Plaintiff again
asserted that the action was brought under the diversity statute. Id. Nonetheless, the amended
complaint’s only showing of complete diversity hinged on the assertion that plaintiff is a
“corporation with its principal place of business located at 3900 Capital City Blvd., Lansing,

Civil No. 16-3092 (ADC)

Page 2

MI 48906.” ECF No. 15 at 2 (emphasis added). Once again, plaintiff failed to proffer its place of
incorporation. Id.
Pursuant to this Court’s sua sponte obligation to inquire into its own subject matter
jurisdiction and noticing the unprecedented increase in foreclosure litigation in this District, the
Court ordered plaintiff to clarify whether it is a corporation or a limited liability company
(“LLC”). ECF No. 49 at 2. The Court also explained the diversity statute requirements for both
corporations and LLC’s pursuant to the applicable case law and pointed out that the amended
complaint failed to establish plaintiff’s place of incorporation.
On December 16, 2019, plaintiff filed a two-page motion “in compliance” with the Order
stating that plaintiff:
clarifies that [plaintiff] is a limited liability corporation incorporated in
Delaware, which sole member is Reverse Mortgage Investment Trust Inc.
(RMIT), incorporated in Maryland and Reverse Mortgage Funding, LLC’s
principal place of business is in Bloomfield, NJ. ECF No. 50.
After a careful review of plaintiff’s motion at ECF No. 50, the Court entered an Order
granting plaintiff yet another opportunity to meet its burden. ECF No. 53. Furthermore, the
Court underscored the fact that after all these years plaintiff now avers that its principal place
of business was not in Michigan but instead in New Jersey. Id. Moreover, the Court also noted
that the motion in compliance missed its mark as it did not proffer sufficient information to
ascertain jurisdiction. Id. The Court noted that plaintiff:
failed to properly identify what type of legal entity its ‘sole member’ is.
Considering plaintiff’s track record in this case, the Court cannot be certain
if plaintiff’s ‘sole member’ is a corporation or not. But more importantly,

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even if the Court assumed that plaintiff’s ‘sole member’ was a corporation,
the Court would still not be able to determine that complete diversity exists
as plaintiff did not proffer Reverse Mortgage Investment Trust Inc.’s
principal place of business. Id., at 3.
Considering all loose ends regarding plaintiff’s citizenship, the Court granted plaintiff a
second opportunity to establish diversity and instructed plaintiff to file an affidavit of
jurisdictional facts with all the relevant information. ECF No. 53. The Court explicitly warned
plaintiff that “failure to comply with this order may result in sanctions, including the dismissal
without prejudice of the action.” Id. Finally, the Court granted plaintiff until February 18, 2020
to comply. Id.
On February 13, 2020, plaintiff’s co-counsel, Valerie Hernández-Hernández, filed a
motion to withdraw as plaintiff’s legal representative leaving attorney Joel Figueroa-Rivera,
from GLS Legal Services, LLC, as plaintiff’s attorney of record. ECF No. 54. The motion to
withdraw at ECF No. 54 was signed by attorney Valerie Hernández-Hernández and attorney
Charline M. Jiménez-Echevarría, also from GLS Legal Services, LLC. Id.
Plaintiff failed to comply with the Order at ECF No. 53.
II.

Analysis
Here, the Court cannot ascertain that diversity exists among the parties. Rule 11(b) of the

Federal Rules of Civil Procedure holds attorneys responsible for “assur[ing] that all pleadings,
motions and papers filed with the court are factually well-grounded, legally tenable and not
interposed for any improper purpose.” Mariani v. Doctors Associates, Inc., 983 F.2d 5, 7 (1st Cir.
1993) (citing Cooter & Gell v. Hartmarx Corp., 496 U.S. 384, 393 (1990). Despite Rule 11’s mandate,

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the Court finds significant inconsistencies among plaintiff’s representations, which to this date
remain unclear. As noted at ECF No. 53, plaintiff has repeatedly failed to explain why its alleged
principal place of business is in New Jersey instead of Michigan. To make matters worse,
plaintiff now claims to be a “limited liability corporation” 1 under Delaware law. ECF No. 50.
But even if the Court disregards all the discrepancies, the available information is
insufficient to ascertain that complete diversity exists among the parties and, thus, that the Court
has subject matter jurisdiction over this action. In this District Court, citizenship of a limited
liability company or LLC is determined by the citizenship of all of its members. Pramco, LLC v.
San Juan Bay Marina, Inc., 435 F.3d 51, 54 (1st Cir. 2006). A sheer statement asserting that the
plaintiff’s members are not of the same citizenship as defendant fails to meet plaintiff’s burden
to show complete diversity. See D.B. Zwirn Spec. Opportunities Fund, L.P. v. Mehrotra, 661 F.3d
124, 125-26 (1st Cir. 2011).
Plaintiff asserts that it is a limited liability company “which sole member is Reverse
Mortgage Investment Trust Inc. (RMIT), incorporated in Maryland.” ECF No. 50. However,
plaintiff did not proffer Reverse Mortgage Investment Trust Inc.’s principal place of business. It
is well settled that under 28 U.S.C. § 1332 a corporation “shall be deemed to be a citizen of every
State and foreign state by which it has been incorporated and of the State or foreign state where
it has its principal place of business.” 28 U.S.C. § 1332(c)(1). Notably, with regard to a
corporation, diversity must be satisfied at its principal place of business and its place of

1

Plaintiff confuses the legal term “company” with “corporation” in its filings.

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incorporation. ACCO Brands USA LLC v. Piñeyro y Lara Comercial S.A., 27 F. Supp.3d 256, 260
(D.P.R. 2014). Here, it is impossible for the Court to determine plaintiff’s sole member’s
citizenship.
In light of the fact that the Court is unable to determine that complete diversity exists
between the parties, the Court hereby DISMISSES without prejudice the amended complaint
for lack of subject matter jurisdiction, as no alternative ground for jurisdiction has been brought
by plaintiff. The Motion for Default Entry at ECF No. 52 is MOOT.
Clerk of Court is to enter judgment accordingly.
SO ORDERED.
At San Juan, Puerto Rico, on this 20th day of February, 2020.
S/AIDA M. DELGADO-COLÓN
United States District Judge