Indian Gold, LLC v. Amstar Mortgage Corp.

504 F. Supp. 2d 147, 2007 U.S. Dist. LEXIS 61109, 2007 WL 2405281
CourtDistrict Court, S.D. Mississippi
DecidedAugust 20, 2007
DocketCIVA 2:07CV00084 KSM
StatusPublished

This text of 504 F. Supp. 2d 147 (Indian Gold, LLC v. Amstar Mortgage Corp.) is published on Counsel Stack Legal Research, covering District Court, S.D. Mississippi primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Indian Gold, LLC v. Amstar Mortgage Corp., 504 F. Supp. 2d 147, 2007 U.S. Dist. LEXIS 61109, 2007 WL 2405281 (S.D. Miss. 2007).

Opinion

*149 ORDER DENYING REMAND

STARRETT, District Judge.

This matter is before the Court on motion to remand filed on behalf of the plaintiffs. The Court having reviewed the motion, the responses, the briefs of counsel, and the authorities cited, the pleadings and exhibits on file and being fully advised in the premises finds as follows to, wit:

The plaintiffs filed their original case in the Circuit Court for the Second Judicial District of Jones County, Mississippi alleging damages from a failed loan agreement. The foreign defendants removed the case to this Court alleging that non-diverse defendants Magnolia Financial Consultants and Michael Raybourn were wrongfully joined in this matter. The plaintiffs have filed this motion to remand alleging that they have viable claims against the non-diverse defendants.

STANDARD OF REVIEW — REMAND

The Fifth Circuit has consistently held that the party urging jurisdiction upon the district court bears the burden of demonstrating that the case is one which is properly before that Court. See Jernigan v. Ashland Oil, Inc., 989 F.2d 812, 815 (5th Cir.1993); Village Fair Shopping Co. v. Sam Broadhead Trust, 588 F.2d 431 (5th Cir.1979); Ray v. Bird & Son and Asset Realization Co., Inc., 519 F.2d 1081 (5th Cir.1975). Even though this Court has a limited jurisdiction whose scope is defined by the constitution and by statute, “[w]hen a federal court is properly appealed to in a case over which it has, by law, jurisdiction, ‘it has a duty to take such jurisdiction.’ ” England v. Louisiana Medical Examiners, 375 U.S. 411, 84 S.Ct. 461, 11 L.Ed.2d 440, 445 (1964) (other citations omitted). Chief Justice Marshall wrote in Cohens v. Virginia, 19 U.S. 264, 6 Wheat. 264, 5 L.Ed. 257, 291 (1821), “It is true that this court will not take jurisdiction if it should not; but it is equally true, that it must take jurisdiction if it should.”

WRONGFUL JOINDER

“The burden of persuasion placed upon those who cry ‘fraudulent join-der’ is indeed a heavy one.” B., Inc. v. Miller Brewing Co., 663 F.2d 545, 549 (5th Cir.1981). “The removing party must show either that there is no possibility that the plaintiff would be able to establish a cause of action against the in-state defendant in state court; or that there has been outright fraud in the plaintiffs pleadings of jurisdictional facts.” Id. at 549; (emphasis added) (citing Keating v. Shell Chemical Co., 610 F.2d 328 (5th Cir.1980); Tedder v. F.M.C. Corp. et al, 590 F.2d 115 (5th Cir.1979); Bobby Jones Garden Apts. v. Suleski, 391 F.2d 172 (5th Cir.1968); Parks v. New York Times Co., 308 F.2d 474 (5th Cir.1962)(cert. denied, 376 U.S. 949, 84 S.Ct. 964, 11 L.Ed.2d 969 (1964))). This Court must refer to the allegations made in the original pleading to determine whether the plaintiffs can make out a viable claim against the resident defendant. See Tedder v. F.M.C. Corp., 590 F.2d at 116; and Gray v. U.S. Fidelity and Guaranty, 646 F.Supp. 27, 29 (S.D.Miss.1986). Those allegations must be construed most favorably to the plaintiffs as the parties opposing removal, resolving all contested issues of fact and ambiguities in the law in favor of the plaintiffs. B. Inc., 663 F.2d at 549. See also, Bobby Jones Garden Apts., 391 F.2d at 177; and Carriere v. Sears, Roebuck & Co., 893 F.2d 98, 100 (5th Cir.1990). When considering whether a non-diverse defendant has been fraudulently joined to defeat diversity of citizenship jurisdiction, courts may “pierce the pleadings” and consider “summary judgment-type” evidence such as affidavits and deposition testimony. See Cavallini v. State Farm Auto Ins. Co., 44 F.3d 256, 263 (5th *150 Cir.1995). Conclusory or generic allegations of wrongdoing on the part of the non-diverse defendant are not sufficient to show that a defendant was not fraudulently joined. See Badon v. RJR Nabisco, Inc. 224 F.3d 382, 392-93 (5th Cir.2000); and Peters v. Metropolitan Life Ins. Co., 164 F.Supp.2d 830, 834 (S.D.Miss.2001). Removal is proper if the plaintiffs’ pleading is pierced, and it is shown that as a matter of law there is no reasonable basis for predicting that the plaintiffs might establish liability on that claim against the in-state defendant. Badon, 224 F.3d at 390.

THE COMPLAINT

The Complaint alleges ten counts against the defendants: (1) Breach of Duty of Good Faith and Fair Dealing; (2) Tor-tious Interference with Contract and Business Relations; (3) Indemnification; (4) Fraudulent Concealment of Material Facts; (5) Breach of Contract; (6) Fraudulent Inducement; (7) Promissory Fraud; (8)Civil Conspiracy; (9) Gross Negligence and (10) Unjust enrichment.

The plaintiffs allege only that Raybourn and Magnolia Financial consultants introduced them to Amstar Mortgage Corporation and provided a single follow up letter. They do not allege any contractual relationship, nor do they allege that Raybourn or Magnolia Financial Consultants benefitted from the matter.

The plaintiff can not recover under Breach of Duty of Good Faith and Fair Dealing (count I) or Breach of Contract (count V) because these counts rely on the existence of a contract. The plaintiffs have failed to allege the existence of a contract with Raybourn or Magnolia Financial Consultants. Consequently, recovery is not possible for either of these counts.

Fraudulent Concealment (count IV), Fraudulent Inducement (count VI), Promissory Fraud (count VII), and Gross Negligence (count IX) all rely upon the allegation that Raybourn and Magnolia Financial Consultants represented that they could secure financing for Indian Gold by a specific date. This act was a promise for the future conduct of Amstar. The Mississippi courts have stated that claims for misrepresentation cannot be made on a promise of future conduct of another, but instead must be based upon a past or present fact. Moran v. Fairley,

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Related

Jernigan v. Ashland Oil Inc.
989 F.2d 812 (Fifth Circuit, 1993)
Priester v. Lowndes County
354 F.3d 414 (Fifth Circuit, 2004)
Cohens v. Virginia
19 U.S. 264 (Supreme Court, 1821)
B., Inc. v. Miller Brewing Company
663 F.2d 545 (Fifth Circuit, 1981)
Gallagher Bassett Services v. Jeffcoat
887 So. 2d 777 (Mississippi Supreme Court, 2004)
Par Industries, Inc. v. Target Container Co.
708 So. 2d 44 (Mississippi Supreme Court, 1998)
Moran v. Fairley
919 So. 2d 969 (Court of Appeals of Mississippi, 2006)
T & S EXPRESS, INC. v. Liberty Mut. Ins.
847 So. 2d 270 (Court of Appeals of Mississippi, 2003)
Bush v. City of Laurel
215 So. 2d 256 (Mississippi Supreme Court, 1968)
Spragins v. Sunburst Bank
605 So. 2d 777 (Mississippi Supreme Court, 1992)
Gray v. United States Fidelity & Guaranty
646 F. Supp. 27 (S.D. Mississippi, 1986)
Ward v. Life Investors Insurance Co. of America
383 F. Supp. 2d 882 (S.D. Mississippi, 2005)

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504 F. Supp. 2d 147, 2007 U.S. Dist. LEXIS 61109, 2007 WL 2405281, Counsel Stack Legal Research, https://law.counselstack.com/opinion/indian-gold-llc-v-amstar-mortgage-corp-mssd-2007.