Emiabata et al vs Hallmark County Mutual Insurance et al
Filing
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ORDER signed by Judge Pamela Pepper on 5/8/2017 DENYING AS MOOT 2 5 Motion for Leave to Proceed Without Prepayment of the Filing Fee and DISMISSING case for lack of jurisdiction. (cc: all counsel; by US Mail to plaintiffs) (pwm)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF WISCONSIN
______________________________________________________________________________
PHILIP EMIABIATA and
SYLVIA EMIABATA, d/b/a
NOVA EXPRESS,
Case No. 16-cv-394-pp
Plaintiffs,
v.
HALLMARK COUNTY MUTUAL
INSURANCE and PMA INSURANCE
GROUP,
Defendants.
______________________________________________________________________________
ORDER DISMISSING CASE FOR LACK OF JURISDICTION, AND DENYING
AS MOOT THE PLAINTIFFS’ MOTIONS TO PROCEED WITHOUT
PREPAYING THE FILING FEE (DKT. NOS. 2 AND 5)
______________________________________________________________________________
The plaintiffs filed their complaint in federal court, alleging that the
defendant insurance companies engaged in bad faith in denying their claims
and misinterpreted their insurance policies. Dkt. No. 1. The court could find no
federal basis for the plaintiff’s claims; they appeared to sound in contract and
tort law. Dkt. No. 8 at 5. That meant that the only other basis for the court to
exercise jurisdiction over the plaintiff claims was if the complaint met the
diversity requirements of 28 U.S.C. §1332. The court, on its own, scheduled an
evidentiary hearing to take testimony from the plaintiffs, because it was
concerned that it did not have diversity jurisdiction over the claims in the
complaint. Dkt. No. 8 at 7-9. Based on the testimony and arguments the
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plaintiffs provided at that hearing, the court will dismissed the case for lack of
diversity jurisdiction.
Plaintiff Philip Emiabata testified at the evidentiary hearing. Dkt. No. 11.
He testified that the couple’s permanent residence was in Texas, and that he
ran a trucking business out of their home. He told the court that the trucks
were licensed in Texas, and that his commercial driver’s license was issued by
the state of Texas. He testified that the couple filed their taxes in Texas, but
noted that the trucking business also owed taxes in other states in which it did
business. The trucking business, the plaintiff testified, is a sole proprietorship
and that he is the sole owner. Id.
The plaintiffs represented in the complaint that they were dual citizens of
Texas and Wisconsin. Dkt. No. 1 at 1. The plaintiff told the court that the
trucking business brought him through Illinois to Wisconsin with some
frequency. During summer, which the plaintiff testified was the company’s
peak season, the plaintiff might be in Wisconsin a few times a week, maybe for
a few days at a time. He indicates that he sometimes would sleep in his truck
while in Wisconsin, or sometimes in a hotel. Dkt. No. 11. The court did not
place Sylvia Emiabata under oath, but she told the court that the company did
a significant amount of business in Wisconsin. Id.
Because the complaint was silent as to the citizenship of the two
defendants, the court looked into that question itself. The court found a case in
the Southern District of Texas in which defendant Hallmark was a party;
pleadings in that case indicated that Hallmark was incorporated in Texas and
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had its principal place of business there. Davis v. Union Pac. R.R. Co., Case
No. 12-cv-212, Dkt. No. 33, Hallmark County Mut. Ins. Co.’s Complaint in
Intervention (S.D. Tex. June 19, 2015). The court found a case from the
Eastern District of Pennsylvania which indicated that defendant PMA was
incorporated in Pennsylvania and had its principal place of business there.
PMA Ins. Group v. Feuer, Case No. 13-cv-371, Dkt. No. 1, Complaint (E.D. Pa.
Jan. 23, 2013).
For a federal district court to exercise jurisdiction on the basis of
diversity citizenship, complete diversity between the parties must exist at the
time the complaint is filed. 28 U.S.C. §1332(a)(1). If the plaintiffs share
citizenship with either of the defendants, the parties are not diverse for
purposes of subject matter jurisdiction.
An individual has citizenship in only one state: the state where the
citizen is domiciled. “An individual who resides in more than one State is
regarded, for purposes of federal subject-matter (diversity) jurisdiction, as a
citizen of but one State.” Wachovia Bank, N.A. v. Schmidt, 546 U.S. 303, 318
(2006). Domicile has two elements: (1) physical presence or residence, and (2)
an intent to remain in the state. Midwest Transit, Inc. v. Hicks, 70 F. App’x
205, 208 (7th Cir. 2003). This is a simple analysis in a case in which a party
resides in and intends to remain in the same state, but it can be more
complicated if a party has multiple residences in different states.
In more complex cases, courts have tried to glean intent from
the following factors: current residence, voting registration
and voting practices, location of personal and real property,
location of financial accounts, membership in unions and
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other associations, place of employment, driver’s license and
automobile registration, and tax payments.
Id. The party seeking to establish jurisdiction bears the burden of proof. Id. A
corporate entity is a citizen of the state where it is incorporated and the state in
which its principal place of business is located. 28 U.S.C. §1332(c)(1); Hertz
Corp. v. Friend, 559 U.S. 77, 80 (2010).
The plaintiffs do not, as they asserted in their complaint, have dual
citizenship. They are citizens of Texas—the same state in which defendant
Hallmark is a citizen. Their residence is in Texas. Mr. Emiabata’s business,
while it requires him to travel to other states, has its headquarters in Texas.
His trucks are licensed in Texas, and his CDL is issued by the state of Texas.
The couple pays income taxes in Texas (although the business has to pay taxes
in other states where Mr. Emiabata travels). The plaintiffs, who have the
burden of showing diversity, have provided the court with no evidence that they
own property in Wisconsin, have a residence in Wisconsin (Mr. Emiabata
sleeping in his truck here notwithstanding), vote here, have bank accounts
here, have jobs here (although Mr. Emiabata travels here with some frequency),
hold Wisconsin licenses, or pay Wisconsin income taxes. Nor have they
provided the court with any evidence that they intend to remain in the state of
Wisconsin permanently.
The plaintiffs are citizens, and residents, of the state of Texas. Because
defendant Hallmark also is a citizen of the state of Texas, diversity does not
exist. Because the parties are not diverse, the court has no jurisdiction, and
must dismiss the case.
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The court ORDERS that this case is DISMISSED for lack of subjectmatter (both federal question and diversity) jurisdiction. The court ORDERS
that the plaintiffs’ motions to proceed without prepaying the filing fee are
DENIED AS MOOT. Dkt. Nos. 2, 5.
Dated in Milwaukee, Wisconsin this 8th day of May, 2017.
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