Chris L. Jones v. A Buyer s Choice Home Inspections, ltd.

Opinion

1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 CENTRAL DISTRICT OF CALIFORNIA 10 SOUTHERN DIVISION 11 ) 12 CHRIS L. JONES, et al., ) Case No.: SACV 17-00768-CJC (ADSx) ) 13 ) ) Plaintiffs, 14 ) ) v. 15 ) ORDER TO SHOW CAUSE WHY ) THIS ACTION SHOULD NOT BE 16 A BUYER’S CHOICE HOME ) REMANDED FOR LACK OF ) SUBJECT MATTER JURISDICTION 17 INSPECTIONS, LTD., et al., ) ) 18 ) Defendants. ) 19 ) ) 20 21 22 Federal courts have diversity jurisdiction over cases between “citizens of a State 23 and citizens or subjects of a foreign state.” 28 U.S.C. § 1332(a)(2). But “Section 1332 24 has been interpreted to require ‘complete diversity.’” Ruhrgas AG v. Marathon Oil Co., 25 526 U.S. 574, 580 n.2 (1999) (citing Strawbridge v. Curtiss, 3 Cranch 267 (1806)). And 26 “[d]iversity jurisdiction does not encompass foreign plaintiffs suing foreign defendants.” 27 Faysound Ltd. v. United Coconut Chemicals, Inc., 878 F.2d 290, 294 (9th Cir. 1989). “If 1 at any time before final judgment it appears that the district court lacks subject matter 2 jurisdiction, the case shall be remanded.” 28 U.S.C. § 1447(c). 3 4 When Defendants removed this case, they asserted that the Court has diversity 5 jurisdiction. (Dkt. 1.) As a preliminary matter, the Court does not have complete 6 information about the parties’ citizenship. Plaintiffs allege that they are “current 7 residents of Canada and were residents of the State of California.” (Dkt. 1-2 [Complaint] 8 ¶ 1.) But they do not allege, nor do Defendants address in their Notice of Removal, 9 Plaintiffs’ citizenship. See Kanter v. Warner-Lambert Co., 265 F.3d 853, 857 (9th Cir. 10 2001) (“Plaintiffs’ complaint and Pfizer’s notice of removal both state that Plaintiffs were 11 ‘residents’ of California. But the diversity jurisdiction statute, 28 U.S.C. § 1332, speaks 12 of citizenship, not of residency.”). Similarly, Plaintiffs allege that the various Defendant 13 entities are Canadian corporations and Florida limited liability companies. (Id. ¶¶ 2–3.) 14 But they do not allege, nor do Defendants address in their Notice of Removal, the 15 citizenship of the LLC defendants’ members, or the principal place of business of the 16 corporation defendant. See Johnson v. Columbia Properties Anchorage, LP, 437 F.3d 17 894, 899 (9th Cir. 2006) (“[A]n LLC is a citizen of every state of which its 18 owners/members are citizens.”); 28 U.S.C. § 1332(c)(1) (“[A] corporation shall be 19 deemed to be a citizen of every State and foreign state by which it has been incorporated 20 and of the State or foreign state where it has its principal place of business.”). Defendant 21 William Redfern is alleged to be a Canadian citizen and Florida resident. (Id. ¶ 5.) The 22 Complaint does not appear to allege the citizenship of Defendant Arne Trejno. 23 24 This lack of complete information is not all that gives the Court pause. In their 25 Notice of Removal, Defendants asserted that “[c]omplete diversity exists in that Plaintiffs 26 are both citizens of Canada and all Defendants are citizens of Florida or Canada.” (Dkt. 1 27 ¶ 18.) However, diversity is incomplete in cases where, as appears to be the case here, all 1 || Ruhrgas, 526 U.S. at 580 n.2 (explaining that “[t]he foreign citizenship of defendant 2 ||Ruhrgas, a German corporation, and plaintiff Norge, a Norwegian corporation, rendered 3 ||diversity incomplete’); Faysound, 878 F.2d at 295 (“Faysound’s original complaint 4 || asserting that there was federal jurisdiction in a suit between ‘citizens of a foreign state 5 citizens of foreign states and a citizen of a state of the United States’ asserted 6 jurisdiction where none existed.”); In re Toyota Motor Corp. Unintended Acceleration 7 || Mktg., Sales Practices, & Prod. Liab. Litig., 826 F. Supp. 2d 1180, 1197 n.15 (C.D. Cal. 8 ||2011) C‘[T]here is not complete diversity between foreign Plaintiffs and a foreign 9 || Defendant.”’). 10 11 Accordingly, the Court orders Plaintiffs to show cause in writing by Thursday, 12 |} April 2, 2020, at 12 noon, why this action should not be remanded to state court for lack 13 ||}of subject matter jurisdiction. Defendants may submit a response by the same deadline. 14 15 16 DATED: March 26, 2020 Ko Lo

18 CORMAC J. CARNEY 19 UNITED STATES DISTRICT JUDGE 20 21 22 23 24 25 26 27 28