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5 RSA-TUMON, LLC, CIVIL CASE NO. 20-00025 6 Plaintiff, 7 vs. 8 PITT COUNTY MEMORIAL HOSPITAL, ORDER 9 INC. and SHERIF ANTOUN PHILIPS, Granting Motion for Remand 10 Defendants. 11 12 Pending before the court is Plaintiff’s Motion for Remand and for Attorney’s Fees and Costs 13 (“Motion for Remand”). See ECF No. 4. The Plaintiff requested that the motion be set for hearing, 14 see id. at 2, but the court finds that oral argument would not aid the court in determining the matter. 15 Having read the motion and the record herein and reviewed relevant caselaw, the court hereby 16 grants the Motion for Remand. 17 BACKGROUND 18 On August 8, 2016, Pitt County Memorial Hospital (“PCMH”) obtained a judgment against 19 Sherif Philips (“Dr. Philips” or “Defendant Philips”) in the amount of $12,781.25 in costs and 20 $444,554.45 in attorneys’ fees, plus post-judgment interest from July 17, 2014, from the General 21 Court of Justice, Superior Court Division, Country of Pitt, States of North Carolina (the “North 22 Carolina Judgment.”). See Notice of Removal,1 ECF No. 1, Compl. for Interpleader at ¶4. 23 On May 21, 2018, PCMH then filed a Complaint for Enforcement of Judgment against 24 Dr. Philips in the Superior Court of Guam. See Pitt Cty. Mem’l Hosp. v. Philips, Superior Court 25 of Guam Civil Case No. 0478-18. Id. at ¶5. On January 24, 2019, the Superior Court of Guam 26 27 1 Defendant Philips captioned the Notice of Removal as a “Motion to Transfer.” The court 28 construes said motion and as Notice of Removal pursuant to 28 U.S.C. §§ 1441 and 1446. 1 entered judgment against Dr. Philips. Id. PCMH then levied on Dr. Philip’s share of RSA-Tumon 2 LLC.2 Id. at ¶7. 3 On July 7, 2020, Plaintiff RSA-Tumon LLC filed a Complaint for Interpleader with the 4 Superior Court of Guam (the “Interpleader Action”). See Notice of Removal,3 ECF No. 1, Compl. 5 for Interpleader. In the Interpleader Action, the Plaintiff asserted that PCMH and Dr. Philips have 6 competing claims over Dr. Philip’s interest in the company and the distributions flowing therefrom. 7 Id. The Plaintiff thus sought to deposit distributions with the Superior Court of Guam and to enjoin 8 any transfer of Dr. Philip’s interest through a sale. Id. 9 On July 13, 2020, Defendant Philips filed a Motion to Transfer, removing the Interpleader 10 Action to this court. Id. According to Defendant Philips, he has “the right to remove his case for 11 Complete Diversity Jurisdiction And the disputed amount is over $75,000.” Id. at 2 (emphasis 12 in original). 13 The Plaintiff’s Motion for Remand was thereafter filed on July 30, 2020. See Mot. Remand, 14 ECF No. 4. 15 To date, Defendant Philips has not file an opposition to the Motion for Remand, though the 16 court notes that he has filed a Motion to Dismiss. See ECF No. 6. On November 10, 2020, the 17 court stayed the Motion to Dismiss pending resolution of the Motion for Remand. See Order, ECF 18 No. 14. 19 LEGAL STANDARD 20 Removal of a state or local court action to federal court is appropriate only if the federal 21 court would have had original subject matter jurisdiction over the suit. See 28 U.S.C. §1441(a). 22 “If at any time before final judgment it appears that the district court lack subject matter jurisdiction, 23 the case shall be remanded.” 28 U.S.C. § 1447(c). 24 The Ninth Circuit has stated that “[a] motion to remand is the proper procedure for 25 challenging removal. The removal statute is strictly construed, and any doubt about the right of 26 27 2 Dr. Philips owns a five percent membership interest in RSA-Tumon LLC. Id. at ¶2. 28 3 Defendant Philips captioned the Notice of Removal as a “Motion to Transfer.” 1 removal requires resolution in favor of remand. The presumption against removal means that the 2 defendant always has the burden of establishing that removal is proper.” Moore-Thomas v. Alaska 3 Airlines, Inc., 553 F.3d 1241, 1244 (9th Cir. 2009) (internal citations and quotations omitted). 4 ANALYSIS 5 1. Whether removal was proper 6 In the Notice of Removal, Defendant Philips asserts that this court has diversity jurisdiction 7 over the action. The Plaintiff contends that complete diversity between the parties is lacking and 8 therefore this court is without jurisdiction. 9 In this case, the Plaintiff asserts it is “a Delaware limited liability company registered to do 10 business in Guam[, with . . .] its principal place of business” located in Guam. Notice of Removal, 11 ECF No. 1, Compl. for Interpleader at ¶1. The Ninth Circuit has held that “an LLC is a citizen of 12 every state of which its owners/members are citizens.” Johnson v. Columbia Properties Anchorage, 13 LP, 437 F.3d 894, 899 (9th Cir. 2006). The Plaintiff also asserts that Dr. Philips “owns a five 14 percent (5%) membership interest” in the Plaintiff LLC. Notice of Removal, ECF No. 1, Compl. 15 for Interpleader at ¶2. Thus, without regard to any other members of the Plaintiff LLC, the Plaintiff 16 is a citizen of whichever state Dr. Philips is a citizen. 17 Generally, a 18 natural person’s state citizenship is . . . determined by determined by her state of domicile, not her state of residence. A person’s domicile is her permanent home, 19 where she resides with the intention to remain or to which she intends to return. A person residing in a given state is not necessarily domiciled there, and thus is not 20 necessarily a citizen of that state. 21 Kanter v. Warner-Lambert Co., 265 F.3d 853, 857 (9th Cir. 2001). 22 Additionally, in Anderson v. Watts, the Supreme Court held that “[t]he place where a person 23 lives is taken to be his domicile until facts adduced establish the contrary[.]” 138 U.S. 694, 706 24 (1891). See also NewGen, LLC v. Safe Cig, LLC, 840 F.3d 606, 614 (9th Cir. 2016) (“It is a 25 longstanding principle that ‘[t]he place where a person lives is taken to be his domicile until facts 26 adduced establish the contrary.’”). 27 The Plaintiff’s Complaint for Interpleader asserts that Dr. Philips is a “resident of Guam.” 28 Id. Dr. Philips has not refuted this assertion, nor has he presented any facts to establish that his 1 domicile is anywhere other than Guam. It appears that the Plaintiff and Defendant Philips are both 2 citizens of Guam, and thus there is a lack of complete diversity in this action. The court finds that 3 removal of this action was improper because this court does not have diversity jurisdiction in this 4 case. 5 Furthermore, even if the court found that complete diversity between the parties existed, 6 Section 1442(b)(2) – often referred to as the “forum defendant rule” – would restrict Defendant 7 Philips’ ability to remove the case to this court. Said statute provides that “[a] civil action otherwise 8 removable solely on the basis of [diversity] jurisdiction . . . may not be removed if any of the parties 9 in interest properly joined and served as defendants is a citizen of the State in which such action is 10 brought.” 28 U.S.C. § 1442
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1 2 3 4 DISTRICT COURT OF GUAM
5 RSA-TUMON, LLC, CIVIL CASE NO. 20-00025 6 Plaintiff, 7 vs. 8 PITT COUNTY MEMORIAL HOSPITAL, ORDER 9 INC. and SHERIF ANTOUN PHILIPS, Granting Motion for Remand 10 Defendants. 11 12 Pending before the court is Plaintiff’s Motion for Remand and for Attorney’s Fees and Costs 13 (“Motion for Remand”). See ECF No. 4. The Plaintiff requested that the motion be set for hearing, 14 see id. at 2, but the court finds that oral argument would not aid the court in determining the matter. 15 Having read the motion and the record herein and reviewed relevant caselaw, the court hereby 16 grants the Motion for Remand. 17 BACKGROUND 18 On August 8, 2016, Pitt County Memorial Hospital (“PCMH”) obtained a judgment against 19 Sherif Philips (“Dr. Philips” or “Defendant Philips”) in the amount of $12,781.25 in costs and 20 $444,554.45 in attorneys’ fees, plus post-judgment interest from July 17, 2014, from the General 21 Court of Justice, Superior Court Division, Country of Pitt, States of North Carolina (the “North 22 Carolina Judgment.”). See Notice of Removal,1 ECF No. 1, Compl. for Interpleader at ¶4. 23 On May 21, 2018, PCMH then filed a Complaint for Enforcement of Judgment against 24 Dr. Philips in the Superior Court of Guam. See Pitt Cty. Mem’l Hosp. v. Philips, Superior Court 25 of Guam Civil Case No. 0478-18. Id. at ¶5. On January 24, 2019, the Superior Court of Guam 26 27 1 Defendant Philips captioned the Notice of Removal as a “Motion to Transfer.” The court 28 construes said motion and as Notice of Removal pursuant to 28 U.S.C. §§ 1441 and 1446. 1 entered judgment against Dr. Philips. Id. PCMH then levied on Dr. Philip’s share of RSA-Tumon 2 LLC.2 Id. at ¶7. 3 On July 7, 2020, Plaintiff RSA-Tumon LLC filed a Complaint for Interpleader with the 4 Superior Court of Guam (the “Interpleader Action”). See Notice of Removal,3 ECF No. 1, Compl. 5 for Interpleader. In the Interpleader Action, the Plaintiff asserted that PCMH and Dr. Philips have 6 competing claims over Dr. Philip’s interest in the company and the distributions flowing therefrom. 7 Id. The Plaintiff thus sought to deposit distributions with the Superior Court of Guam and to enjoin 8 any transfer of Dr. Philip’s interest through a sale. Id. 9 On July 13, 2020, Defendant Philips filed a Motion to Transfer, removing the Interpleader 10 Action to this court. Id. According to Defendant Philips, he has “the right to remove his case for 11 Complete Diversity Jurisdiction And the disputed amount is over $75,000.” Id. at 2 (emphasis 12 in original). 13 The Plaintiff’s Motion for Remand was thereafter filed on July 30, 2020. See Mot. Remand, 14 ECF No. 4. 15 To date, Defendant Philips has not file an opposition to the Motion for Remand, though the 16 court notes that he has filed a Motion to Dismiss. See ECF No. 6. On November 10, 2020, the 17 court stayed the Motion to Dismiss pending resolution of the Motion for Remand. See Order, ECF 18 No. 14. 19 LEGAL STANDARD 20 Removal of a state or local court action to federal court is appropriate only if the federal 21 court would have had original subject matter jurisdiction over the suit. See 28 U.S.C. §1441(a). 22 “If at any time before final judgment it appears that the district court lack subject matter jurisdiction, 23 the case shall be remanded.” 28 U.S.C. § 1447(c). 24 The Ninth Circuit has stated that “[a] motion to remand is the proper procedure for 25 challenging removal. The removal statute is strictly construed, and any doubt about the right of 26 27 2 Dr. Philips owns a five percent membership interest in RSA-Tumon LLC. Id. at ¶2. 28 3 Defendant Philips captioned the Notice of Removal as a “Motion to Transfer.” 1 removal requires resolution in favor of remand. The presumption against removal means that the 2 defendant always has the burden of establishing that removal is proper.” Moore-Thomas v. Alaska 3 Airlines, Inc., 553 F.3d 1241, 1244 (9th Cir. 2009) (internal citations and quotations omitted). 4 ANALYSIS 5 1. Whether removal was proper 6 In the Notice of Removal, Defendant Philips asserts that this court has diversity jurisdiction 7 over the action. The Plaintiff contends that complete diversity between the parties is lacking and 8 therefore this court is without jurisdiction. 9 In this case, the Plaintiff asserts it is “a Delaware limited liability company registered to do 10 business in Guam[, with . . .] its principal place of business” located in Guam. Notice of Removal, 11 ECF No. 1, Compl. for Interpleader at ¶1. The Ninth Circuit has held that “an LLC is a citizen of 12 every state of which its owners/members are citizens.” Johnson v. Columbia Properties Anchorage, 13 LP, 437 F.3d 894, 899 (9th Cir. 2006). The Plaintiff also asserts that Dr. Philips “owns a five 14 percent (5%) membership interest” in the Plaintiff LLC. Notice of Removal, ECF No. 1, Compl. 15 for Interpleader at ¶2. Thus, without regard to any other members of the Plaintiff LLC, the Plaintiff 16 is a citizen of whichever state Dr. Philips is a citizen. 17 Generally, a 18 natural person’s state citizenship is . . . determined by determined by her state of domicile, not her state of residence. A person’s domicile is her permanent home, 19 where she resides with the intention to remain or to which she intends to return. A person residing in a given state is not necessarily domiciled there, and thus is not 20 necessarily a citizen of that state. 21 Kanter v. Warner-Lambert Co., 265 F.3d 853, 857 (9th Cir. 2001). 22 Additionally, in Anderson v. Watts, the Supreme Court held that “[t]he place where a person 23 lives is taken to be his domicile until facts adduced establish the contrary[.]” 138 U.S. 694, 706 24 (1891). See also NewGen, LLC v. Safe Cig, LLC, 840 F.3d 606, 614 (9th Cir. 2016) (“It is a 25 longstanding principle that ‘[t]he place where a person lives is taken to be his domicile until facts 26 adduced establish the contrary.’”). 27 The Plaintiff’s Complaint for Interpleader asserts that Dr. Philips is a “resident of Guam.” 28 Id. Dr. Philips has not refuted this assertion, nor has he presented any facts to establish that his 1 domicile is anywhere other than Guam. It appears that the Plaintiff and Defendant Philips are both 2 citizens of Guam, and thus there is a lack of complete diversity in this action. The court finds that 3 removal of this action was improper because this court does not have diversity jurisdiction in this 4 case. 5 Furthermore, even if the court found that complete diversity between the parties existed, 6 Section 1442(b)(2) – often referred to as the “forum defendant rule” – would restrict Defendant 7 Philips’ ability to remove the case to this court. Said statute provides that “[a] civil action otherwise 8 removable solely on the basis of [diversity] jurisdiction . . . may not be removed if any of the parties 9 in interest properly joined and served as defendants is a citizen of the State in which such action is 10 brought.” 28 U.S.C. § 1442(b)(2) (emphasis added). As discussed above, Defendant Philips is a 11 citizen of Guam, and thus Section 1442(b)(2) would prohibit him from removing the action from 12 the Superior Court of Guam to this court. 13 Finally, the court finds that there is no independent basis for federal question jurisdiction 14 over this action, since the Complaint for Interpleader does not allege any federal claims for relief. 15 Defendant Philips, as the removing party, has failed to establish that removal was proper. 16 Accordingly, the court grants the Plaintiff’s request to remand this action back to the Superior Court 17 of Guam. 18 2. Whether an award of fees and costs is just 19 Having granted the request to remand, the Plaintiff’s motion also asks the court to award 20 it reasonable attorney’s fees and costs pursuant to 28 U.S.C. § 1447(c). “Absent unusual 21 circumstances, courts may award attorney’s fees under § 1447(c) only where the removing party 22 lacked an objectively reasonable basis for seeking removal.” Martin v. Franklin Capital Corp., 546 23 U.S. 132, 141 (2005). 24 Here, while Defendant Philips alleged this court had complete diversity, this was clearly 25 false. As the Plaintiff asserts, had he “done the bare minimum and investigated the LLC’s 26 citizenship, including his own citizenship as a member, he would have discovered the lack of 27 complete diversity present here.” Mem. P.&A. in Supp. Mot. Remand at 7, ECF No. 4-1. 28 Defendant Philips did not file an opposition to the Motion for Remand and has not refuted the RSA-Tumon, LLC v. Pitt Cty. Mem’ Hosp., Inc. and Sherif Antoun Philips, Civil Case No. 20-00025 Order Granting Motion for Remand page 5 of 5 1 || Plaintiffs assertion that there is a lack of complete diversity between the parties. Based on the 2 || record before it, the court finds that Defendant Philips lacked an objectively reasonable basis for 3 || seeking removal. Accordingly, the court grants the Plaintiffs request and orders Defendant Philips 4 || to pay the Plaintiff “just costs and any actual expenses, including attorney fees, incurred as a result 5 || of the removal.” 28 U.S.C. §1447(c). 6 CONCLUSION 7 Based on the above discussion, the court finds that it lacks subject matter jurisdiction over 8 || this action. Accordingly, pursuant to 28 U.S.C. § 1447(c), the court orders that this action be 9 || remanded back to the Superior Court of Guam.* 10 Additionally, the court grants the Plaintiff's request for an award of reasonable attorney’s 11 || fees and costs incurred as a result of the removal. The court orders the Plaintiff and Defendant 12 || Philips to meet and confer about the fees and costs incurred by the Plaintiff in defending against 13 || the removal. If said parties cannot agree on a stipulated amount, Plaintiff shall file a brief of no 14 || more than three pages, accompanied by supporting exhibits and affidavits, setting forth its claim 15 || for fees and costs. Said brief is to be filed no later than 14 days after the issuance of this Order. 16 || Defendant Philips may then file a response brief of no more than three pages within 14 days after 17 || the filing of Plaintiff's brief. The Plaintiff may thereafter file a reply brief of no more than three 18 || pages no later than seven (7) days after the filing of Defendant Philips’ brief. Although the court 19 || is remanding this action to the Superior Court of Guam, the court retains jurisdiction to determine 20 || the amount of fees and costs to be paid should the need arise because “the award of fees pursuant 21 || to section 1447(c) is collarateral to the decision to remand[, and t]he district court retain[s] 22 || jurisdiction after the remand to entertain [Plaintiff's] motion for attorney’s fees.” Moore v. 23 || Permanente Medical Group, Inc., 981 F.2d 443, 445 (9th Cir. 1992). 24 IT IS SO ORDERED. ye oa /s/ cae M. Tydingco-Gatewood Si Dated: Mar 30 2021
* Any pending motion, including Defendant Philips’ Motion to Dismiss, see ECF No. 6, 28 || shall be resolved by the Superior Court of Guam on remand.