Bart Turner & Associates et al v. Krenke et al

Filing 14

Memorandum Opinion and Order: As Defendants have the burden of establishing jurisdiction, they are directed to provide the missing information by 11/12/2013. Failure to provide the requested information will result in remand to state court for lack of subject matter jurisdiction. (Ordered by Judge Sam A Lindsay on 10/29/2013) (cea)

IN THE UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF TEXAS
DALLAS DIVISION
BART TURNER & ASSOCIATES,
CENTRAL TEXAS SOLUTIONS, and
INTERIOR SOLUTIONS, INC.
Plaintiffs,
v.
BRIAN KRENKE, RICHARD BUTRYM,
DAVID FAIRBURN, KRUEGER
INTERNATIONAL, INC., and
MICHELLE GIBSON,
Defendants.

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Civil Action No. 3:13-CV-2921-L

MEMORANDUM OPINION AND ORDER
This action was removed to this court on July 26, 2013. The court questions whether it
has jurisdiction, as the citizenship of all parties is not adequately set forth in Plaintiffs’ state
pleadings or Defendants’ Notice of Removal.
A federal court has subject matter jurisdiction over civil cases “arising under the
Constitution, laws, or treaties of the United States,” or over civil cases in which the amount in
controversy exceeds $75,000, exclusive of interest and costs, and in which diversity of
citizenship exists between the parties. 28 U.S.C. §§ 1331, 1332. Federal courts are courts of
limited jurisdiction and must have statutory or constitutional power to adjudicate a claim. See
Home Builders Ass’n of Miss., Inc. v. City of Madison, 143 F.3d 1006, 1010 (5th Cir. 1998).
Absent jurisdiction conferred by statute or the Constitution, they lack the power to adjudicate
claims and must dismiss an action if subject matter jurisdiction is lacking. Id.; Stockman v.
Federal Election Comm’n, 138 F.3d 144, 151 (5th Cir. 1998) (citing Veldhoen v. United States

Memorandum Opinion and Order – Page 1

Coast Guard, 35 F.3d 222, 225 (5th Cir. 1994)). “[S]ubject-matter jurisdiction cannot be created
by waiver or consent.” Howery v. Allstate Ins. Co., 243 F.3d 912, 919 (5th Cir. 2001). A federal
court has an independent duty, at any level of the proceedings, to determine whether it properly
has subject matter jurisdiction over a case. Ruhgras AG v. Marathon Oil Co., 526 U.S. 574, 583
(1999) (“[S]ubject-matter delineations must be policed by the courts on their own initiative even
at the highest level.”); McDonal v. Abbott Labs., 408 F.3d 177, 182 n.5 (5th Cir. 2005) (A
“federal court may raise subject matter jurisdiction sua sponte.”).
Diversity of citizenship exists between the parties only if each plaintiff has a different
citizenship from each defendant. Getty Oil Corp. v. Insurance Co. of North America, 841 F.2d
1254, 1258 (5th Cir. 1988). Otherwise stated, 28 U.S.C. § 1332 requires complete diversity of
citizenship; that is, a district court cannot exercise jurisdiction if any plaintiff shares the same
citizenship as any defendant. See Corfield v. Dallas Glen Hills LP, 355 F.3d 853, 857 (5th Cir.
2003) (citation omitted).

“[T]he basis upon which jurisdiction depends must be alleged

affirmatively and distinctly and cannot be established argumentatively or by mere inference.”
Getty, 841 F.2d at 1259 (citing Illinois Cent. Gulf R.R. Co. v. Pargas, Inc., 706 F.2d 633, 636 n.2
(5th Cir. 1983)).

Failure to allege adequately the basis of diversity mandates remand or

dismissal of the action. See Stafford v. Mobil Oil Corp., 945 F.2d 803, 805 (5th Cir. 1991).
A natural person is considered a citizen of the state where that person is domiciled, that
is, where the person has a fixed residence with the intent to remain there indefinitely. See
Freeman v. Northwest Acceptance Corp., 754 F.2d 553, 555-56 (5th Cir. 1985). “‘Citizenship’
and ‘residency’ are not synonymous.” Parker v. Overman, 59 U.S. 137, 141 (1855). “For
diversity purposes, citizenship means domicile; mere residence in [a] [s]tate is not sufficient.”
Preston v. Tenet Healthsystem Mem’l Med. Ctr., Inc., 485 F.3d 793, 799 (5th Cir. 2007) (citation
Memorandum Opinion and Order – Page 2

and quotation marks omitted). “Domicile requires residence in [a] state and an intent to remain
in the state.” Id. at 798 (citing Mississippi Band of Choctaw Indians v. Holyfield, 490 U.S. 30,
48 (1989)).
A partnership or unincorporated association’s citizenship is determined by the citizenship
of each of its partners. Carden v. Arkoma Assocs., 494 U.S. 185, 195-96 (1990). The citizenship
of a limited liability company “is determined by the citizenship of all of its members.” Harvey v.
Grey Wolf Drilling Co., 542 F.3d 1077, 1080 (5th Cir. 2008). A corporation is a “citizen of
every State . . . by which it has been incorporated and of the State . . . where it has its principal
place of business[.]” 28 U.S.C. § 1332(c)(1).
Any doubts as to the propriety of the removal are to be construed strictly in favor of
remand. Manguno v. Prudential Prop. & Cas. Ins. Co., 276 F.3d 720, 723 (5th Cir. 2002). “The
burden of establishing subject matter jurisdiction in federal court rests on the party seeking to
invoke it.” St. Paul Reinsurance, 134 F.3d 1250, 1253 (5th Cir. 1998) (footnote omitted).
Accordingly, if a case is removed to federal court, the defendant has the burden of establishing
subject matter jurisdiction; if a case is initially filed in federal court, the burden rests with the
plaintiff to establish that the case “arises under” federal law, or that diversity exists and that the
amount in controversy exceeds the jurisdictional threshold.
Defendants state that Plaintiffs Bart Turner & Associates and Texas Central Solutions are
Texas limited liability companies. Notice of Removal 4, ¶ 13. This information is insufficient
because a limited liability company’s citizenship “is determined by the citizenship of all of its
members.” Harvey, 542 F.3d at 1080. Neither the Notice of Removal nor Plaintiffs’ pleadings
provide this information. Further, the Notice of Removal and state pleadings are silent as to the
principal place of business of Interior Solutions, Inc. Without this information, the court cannot
Memorandum Opinion and Order – Page 3

determine whether complete diversity exists between the parties. As Defendants have the burden
of establishing jurisdiction, they are directed to provide the missing information by November
12, 2013. Failure to provide the requested information will result in remand to state court for
lack of subject matter jurisdiction.
It is so ordered this 29th day October, 2013.

_________________________________
Sam A. Lindsay
United States District Judge

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