Jose L. Aceves v. Coach Royal 003 LP

Opinion

Case 8:21-cv-01901-CJC-JDE Document 66 Filed 02/27/23 Page 1 of 4 Page ID #:4824

1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 CENTRAL DISTRICT OF CALIFORNIA 10 SOUTHERN DIVISION 11 ) 12 ) Case No.: SACV 21-01901-CJC (JDEx) JOSE L. ACEVEZ, et al., ) 13 ) ) 14 Plaintiffs, ) SECOND ORDER TO SHOW CAUSE ) WHY THIS ACTION SHOULD NOT 15 v. ) BE REMANDED FOR LACK OF ) SUBJECT MATTER JURISDICTION 16 ) AND DEFENDANTS’ PENDING COACH ROYAL-003-LP; KINGSLEY ) MOTION FOR LEAVE TO AMEND 17 ) THE NOTICE OF REMOVAL IS MANAGEMENT CORP.; and DOES 1 ) DENIED [64] 18 through 50, inclusive, ) ) 19 ) Defendants. ) 20 ) ) 21

22 Over one hundred current and former residents of Coach Royal Mobile Home Park 23 (the “Park”) (collectively, “Plaintiffs”) bring this action against the Park’s owners and 24 managers, Defendants Coach Royal-003-LP (“Coach Royal”) and Kingsley Management 25 Corp. (collectively, “Defendants”). (See Dkt. 4 [Complaint, hereafter “Compl.”].) 26 Plaintiffs brought this action in the Superior Court of California, County of Orange, and 27 28

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1 Defendants subsequently removed to this Court, asserting diversity jurisdiction. (See 2 Dkt. 1 [Notice of Removal].) 3 4 On February 7, 2023, Defendants were ordered to show cause why this action 5 should not be remanded for lack of subject matter jurisdiction due to deficiencies in their 6 notice of removal and to file an appropriate motion for leave to amend the notice of 7 removal. Defendants had alleged in their notice only the state of organization and 8 principal place of business for Coach Royal, but a limited partnership like Coach Royal is 9 a citizen of every state of which each partner—general or limited—is a citizen, see 10 Carden v. Arkoma Assocs., 494 U.S. 185, 195–96 (1990), as noted in the order to show 11 cause, (see Dkt. 61 [Order to Show Cause Why This Action Should Not Be Remanded 12 for Lack of Subject Matter Jurisdiction] at 2 & n.1). 13 14 Defendants have since filed a response to the order to show cause and a motion for 15 leave to amend the notice of removal. (See Dkt. 63 [Defendants’ Response to Order to 16 Show Cause Why This Action Should Not Be Remanded for Lack of Subject Matter 17 Jurisdiction]; Dkt. 64 [Notice of Motion and Motion for Leave to Amend the Notice of 18 Removal; Memorandum of Points and Authorities in Support, hereinafter “Mot.”].) 19 Defendants state that Coach Royal has one general partner, KMC CA Management, LLC 20 (“KMC CA”), a limited liability company consisting of one member, RVG Partners, Ltd. 21 (“RVG Partners”). (See Mot. at 7.) RVG Partners is a limited partnership that has one 22 general partner, “an individual residing in the state of Utah,” and “two Limited Partners, 23 both of which are traditional trusts, with [C. Nate] Nelson as the sole trustee, himself a 24 resident of Provo, Utah.” (Id. at 7.) Defendants further state that Coach Royal has two 25 limited partners: RVG Partners and RVG Holdings #2, LP (“RVG Holdings”), a limited 26 partnership consisting of one general partner—KMC CA—“and three limited partners 27 which are traditional trusts that have an individual Trustee that is a resident of the state of 28 Utah.” (Id.) Thus, the citizenship of Coach Royal is determined by the citizenship of

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1 (1) the individual who is the general partner of RVG Partners, (2) C. Nelson Nate, the 2 trustee of the two traditional trusts that are limited partners of RVG Partners, and (3) the 3 trustee(s) of the three traditional trusts that are limited partners of RVG Holdings.1 4 5 Defendants’ proffered allegations to support subject matter jurisdiction are 6 deficient—again. Defendants only allege the residency of the relevant natural persons. 7 Yet “[i]t is black letter law that, for purposes of diversity, ‘[r]esidence and citizenship are 8 not the same thing.’” Seven Resorts, Inc. v. Cantlen, 57 F.3d 771, 774 (9th Cir. 1995) 9 (second alteration in original) (citation omitted). Citizenship is determined by domicile, 10 and “for adults, domicile is established by physical presence in a place in connection with 11 a certain state of mind concerning one’s intent to remain there.” Miss. Band of Choctaw 12 Indians v. Holyfield, 490 U.S. 30, 48 (1989); see also Kanter v. Warner-Lambert Co., 265 13 F.3d 853, 857 (9th Cir. 2001) (“A person’s domicile is her permanent home, where she 14 resides with the intention to remain or to which she intends to return.”). A pleading that 15 alleges only “residency rather than citizenship” is defective. Carolina Cas. Ins. Co. v. 16 Team Equipment, Inc., 741 F.3d 1082, 1086 (9th Cir. 2014). 17 18 Defendants are, therefore, ORDERED once again to show cause in writing why 19 this action should not be remanded for lack of subject matter jurisdiction by March 6, 20 2023. Defendants shall file a written response to this Order on the citizenship of all 21 persons—natural or otherwise—necessary to determine whether complete diversity exists 22 for purposes of subject matter jurisdiction. Defendants shall submit all declarations and 23 exhibits necessary to support factually the existence of complete diversity. Defendants’ 24 pending motion for leave to amend the notice of removal is DENIED, and Defendants 25 are ORDERED to refile such a motion consistent with the Federal Rules of Civil 26

27 1 It is unclear from the Defendants’ filings whether there is overlap among the individual general 28 partner of RVG Partners, C. Nelson Nate, and the trustees of the three traditional trusts that are the limited partners of RVG Holdings.

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1 || Procedure and the Local Rules, along with a proposed amended notice of removal, by 2 ||March 6, 2023. 4 Further, Defendants shall take care to include in their response to this order all 5 other information necessary to substantiate subject matter jurisdiction, whether or not that 6 ||}information was specifically requested by the Court in this Order or its prior order. The 7 ||requirements of removal are strictly construed, and the burden of establishing the 8 || propriety of removal falls on Defendants. See Gaus v. Miles, Inc., 980 F.2d 564, 566 (9th 9 ||Cir. 1992). If Defendants fail to meet their burden this go-around, they risk sua sponte 10 ||remand of this action. 11 12 13 DATED: _ February 27, 2023 Lo pe 14 ye 7 15 CORMAC J. CARNEY 16 UNITED STATES DISTRICT JUDGE 17 18 19 20 21 22 23 24 25 26 27 28

A.