Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-4_18-cv-00319/USCOURTS-cand-4_18-cv-00319-1/pdf.json

Parties Involved:
Jordan Boreman
Defendant
Bowmar Sports, Inc.
Plaintiff
Cedar Rapids Table Tennis Club
Plaintiff
NB Courts
Defendant
National Basketball Courts
Defendant
Joseph Nelson
Defendant
USA Table Tennis
Plaintiff
Meng-Yu Wang
Plaintiff

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United States District Court

Northern District of California

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

USA TABLE TENNIS, et al.,

Plaintiffs,

v.

NATIONAL BASKETBALL COURTS, et 

al.,

Defendants.

Case No. 18-cv-00319-DMR 

REQUEST FOR REASSIGNMENT; 

REPORT AND RECOMMENDATION 

DENYING MOTION FOR DEFAULT 

JUDGMENT

Re: Dkt. No. 25

Plaintiffs USA Table Tennis (“USATT”), Bowmar Sports, Inc. (“Bowmar”), Meng-Yu 

Wang (“Wang”), and Cedar Rapids Table Tennis Club, LLC (“CRTTC”) filed this case against 

National Basketball Courts, LLC, dba NB Courts (“NB Courts”), Joseph Nelson (“Nelson”), and 

Jordan Boreman (“Boreman”). [Docket No. 1 (Compl.).] Plaintiffs now move for entry of default 

judgment against NB Courts. [Docket No. 25 (MDJ).] The court ordered supplemental briefing on 

the issue of subject matter jurisdiction. [Docket No. 35.]

Not all parties have filed a declination or consent to the jurisdiction of a magistrate judge 

pursuant to 28 U.S.C. § 636(c). Therefore, the court issues this Report and Recommendation and 

reassigns this case to a district judge for final disposition, with the recommendation that Plaintiffs’

motion be DENIED for failure to establish the existence of diversity jurisdiction.

I. BACKGROUND

The four Plaintiffs comprise an organization, a limited liability corporation, an individual, 

and a corporation. USATT, an organization, is the “official sanctioning body for professional table 

tennis in the United States.” Compl. ¶ 17. It is headquartered in Colorado Springs, Colorado. Id. 

Plaintiffs state that USATT has existed for almost 100 years and has a “world-class reputation” 

among international table tennis associations. Id. USATT has organized thousands of major 

international table tennis tournaments. Id. CRTCC is a USATT affiliated club and a limited liability 

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corporation, of which Wang is the sole member. Id. ¶ 4. Bowmar is an incorporated organizer and 

sponsor of table tennis tournaments throughout the United States. Id. ¶ 16. 

Defendants comprise a limited liability corporation and two individuals. NB Courts is an 

LLC conducting business in Livermore, CA and is registered in the state of California. Compl. ¶ 6. 

It has a venue that it rents for various events, and primarily hosts basketball and volleyball 

tournaments. Id. ¶ 28. Nelson is an owner and member of NB Courts, and Boreman is the managing 

member. Id. ¶¶ 7-8.

In November 2016, CRTCC, through Wang, contracted with NB Courts to host the 2017 

Butterfly West Coast Open Table Tennis Championships in Livermore, California on February 18 

and 19, 2017. Compl. ¶ 11. CRTCC paid NB Courts a deposit of $7500, which NB Courts accepted 

and still retains. Id. ¶ 12. Over 225 entrants registered for the tournament. Id. The tournament was

listed on NB Court’s online calendar for the weekend of February 18 and 19, 2017, until it was 

removed sometime during the week the tournament was to occur. Id. at ¶ 14.

On February 16, 2017, Josh Brantley, an employee of Bowmar, flew from North Carolina to 

San Francisco to help set up a truckload of equipment for the tournament. Compl. ¶ 18. He went 

to NB Courts, the expected tournament venue, to ask questions about equipment setup. Id. He 

spoke briefly with Matt Fake, the manager of NB Courts, about parking and timing issues. Id at ¶¶ 

18-19. They agreed that some of the equipment would be brought in later that day. Id. at 19. Fake 

did not disclose to Brantley that the venue was no longer available due to the fact that NB Courts

had double-booked it for a volleyball event. Id.

On February 17, 2017, Brantley went to NB Courts to meet the truck driver and forklift 

company at approximately 10:00 a.m. Brantley spoke to Fake on the telephone, again confirming 

which door they would be using to bring equipment in and the time they would start unloading the 

equipment. Compl. ¶ 20. Around 3:15 p.m. that day, Fake sent an email to Brantley and Wang, 

stating, “We needed [sic] to discuss the weekend at 4pm.” Id. at ¶ 21. Brantley and his assistant 

subsequently met with Fake and learned for the first time that the venue had been double-booked; 

that a volleyball event was scheduled to use the venue that weekend; and that Bowmar would not 

be allowed to set up for the table tennis tournament that was scheduled to start the next day. Id. By 

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February 17, 2017, hundreds of players from the West Coast and Asia had flown and driven to the 

Bay Area and had reserved hotel rooms in order to play in the table tennis tournament. Id. ¶ 24. 

Plaintiffs allege that NB Courts knew “for at least 3-4 days, and perhaps weeks in advance,” 

that the venue would not be available for the table tennis tournament, but “actively concealed these 

material facts from all Plaintiffs.” Compl. ¶¶ 22-27. On January 16, 2018, Plaintiffs filed a 

complaint against all Defendants, alleging claims for relief based on breach of contract, fraud, 

negligence, and unfair business practices. Compl. ¶ 31. They seek compensatory, reputational, and 

punitive damages. Id. ¶¶ 43-46. Defendants failed to respond, and the court entered default as to 

NB Courts but declined default as to Nelson and Boreman. [Docket Nos. 20-21.] Plaintiffs filed a 

motion for default judgment against NB Courts only. The court ordered supplemental briefing, 

which Plaintiffs filed along with supporting declarations. [Docket Nos. 40-42.]

II. LEGAL STANDARDS

Federal Rule of Civil Procedure 55(b)(2) permits a court to enter a final judgment in a case 

following a defendant’s default. Shanghai Automation Instrument Co. v. Kuei, 194 F. Supp. 2d 995, 

999 (N.D. Cal. 2001). Whether to enter a judgment lies within the court’s discretion. Pepsico, Inc. 

v. Cal. Sec. Cans, 238 F. Supp. 2d 1172, 1174 (C.D. Cal. 2002) (“A defendant’s default does not 

automatically entitle the plaintiff to a court-ordered judgment.” (citing Draper v. Coombs, 792 F.2d 

915, 924-25 (9th Cir. 1986))).

Before assessing the merits of a default judgment, a court must ensure the adequacy of 

service on the defendant, as well as confirm that it has subject matter jurisdiction over the case and 

personal jurisdiction over the parties. See In re Tuli, 172 F.3d 707, 712 (9th Cir. 1999). If the court 

finds these elements satisfied, it turns to the following factors (“the Eitel factors”) to determine 

whether it should grant a default judgment:

(1) the possibility of prejudice to the plaintiff, (2) the merits of 

plaintiff’s substantive claim, (3) the sufficiency of the complaint, (4) 

the sum of money at stake in the action[,] (5) the possibility of a 

dispute concerning material facts[,] (6) whether the default was due 

to excusable neglect, and (7) the strong policy underlying the Federal 

Rules of Civil Procedure favoring decision on the merits.

Eitel v. McCool, 782 F.2d 1470, 1471-72 (9th Cir. 1986) (citation omitted). In this analysis, “the 

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well-pleaded allegations of the complaint relating to a defendant’s liability are taken as true.” 

Pepsico, Inc., 238 F. Supp. 2d at 1175 (citing Televideo Sys., Inc. v. Heidenthal, 826 F.2d 915, 917-

18 (9th Cir. 1987)). Nevertheless, default does not compensate for essential facts not within the 

pleadings and those legally insufficient to prove a claim. Cripps v. Life Ins. Co. of N. Am., 980 F.2d 

1261, 1267 (9th Cir. 1992). 

III. ANALYSIS

Federal courts are courts of limited jurisdiction, and a “federal court is presumed to lack 

jurisdiction in a particular case unless the contrary affirmatively appears.” Stock W., Inc. v. 

Confederated Tribes, 873 F.2d 1221, 1225 (9th Cir. 1989) (citations omitted). A federal court may 

exercise either federal question jurisdiction or diversity jurisdiction. Here, Plaintiffs assert state law 

claims; therefore, Plaintiffs may only proceed in federal court if they establish diversity jurisdiction. 

A district court has diversity jurisdiction where the parties are diverse and “the matter in 

controversy exceeds the sum or value of $75,000, exclusive of interests and costs.” 28 U.S.C. § 

1332. Parties are diverse only when “the citizenship of each plaintiff is diverse from the citizenship 

of each defendant.” Caterpillar Inc. v. Lewis, 519 U.S. 61, 62 (1996). “[T]he congressional grant 

of diversity jurisdiction is to be strictly construed.” Kantor v. Wellesley Galleries, Ltd., 704 F.2d 

1088, 1092 (9th Cir. 1983). “Absent unusual circumstances, a party seeking to invoke diversity 

jurisdiction should be able to allege affirmatively the actual citizenship of the relevant parties.” 

Kanter v. Warner-Lambert Co., 265 F.3d 853, 857 (9th Cir. 2001). 

In the present case, Plaintiffs must affirmatively allege that the citizenship of each of the 

four Plaintiffs does not overlap with the citizenship of any of the three Defendants. This can be a 

more complex issue where, as here, some of the parties may have citizenship in more than one state.

The court previously determined that the citizenship of the parties could not be ascertained from the 

complaint, and directed Plaintiffs to file supplemental briefing “establishing, with competent 

evidence, that the requirements of diversity jurisdiction have been met.” [Docket No. 35 at 1.] The 

court specifically requested further briefing on the citizenship of USATT, Bowmar, Wang, and NB 

Courts. Id. at 1-2; see also Harris v. Rand, 682 F.3d 846, 851 (9th Cir. 2012) (“[W]here the district 

court has doubts about whether diversity exists, the district court may ‘insist that the jurisdictional 

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facts be established or the case be dismissed, and for that purpose the court may demand that the 

party alleging jurisdiction justify [its] allegations by a preponderance of evidence.’”) (further 

citations omitted). 

Having reviewed Plaintiffs’ supplemental briefing and declarations, the court determines 

that Plaintiffs have failed to allege facts sufficient to show that diversity jurisdiction exists in this 

case. Plaintiffs allege that Defendants are all citizens of California, but this is open to question for 

the reasons stated below. Even if that contention is true, Plaintiffs have not presented facts sufficient 

to support the allegation that no Plaintiff is a citizen of California, despite Plaintiffs having been 

given the opportunity to supplement the record. 

A. Citizenship of Defendants

Although Plaintiffs allege that all three Defendants—NB Courts, Boreman and Nelson—are 

citizens of California, Plaintiffs’ submissions leave some important questions unanswered.

1. Boreman and Nelson

To show state citizenship for the purposes of diversity jurisdiction, an individual “must (1) 

be a citizen of the United States, and (2) be domiciled in the state.” Kantor, 704 F.2d at 1090. “A 

person’s domicile is her permanent home, where she resides with the intention to remain or to which 

she intends to return.” Kanter, 265 F.3d at 857. Residency alone is not sufficient to determine 

citizenship. Id. (“A person residing in a given state is not necessarily domiciled there, and thus is 

not necessarily a citizen of that state.”).

Plaintiffs’ complaint alleges that Nelson and Boreman are individuals residing in California. 

Compl. ¶¶ 7-8. In their supplemental briefing, Plaintiffs submitted records from the California 

Secretary of State showing that NB Courts is an LLC registered in California; those records list 

Boreman and Nelson as members of that LLC. Supp. Br., Exs. 1-2. Both individual Defendants are 

listed with residency addresses in Livermore, California. Id. The record therefore establishes that 

Nelson and Boreman reside in California. However, residence is not the same as domicile. Plaintiffs 

have not adequately demonstrated that Nelson and Boreman are domiciled in this state and 

permanently reside here with the intention to return. Kanter, 265 F.3d at 857. If either Boreman or 

Nelson is a citizen of a state other than California in which one or more of the Plaintiffs are also 

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citizens, diversity jurisdiction would not exist.

2. NB Courts

For the purposes of diversity jurisdiction, an LLC is a citizen of every state of which its 

owners and members are citizens. Johnson v. Columbia Properties Anchorage, LP, 437 F.3d 894, 

899 (9th Cir. 2006). Where an entity is a citizen of more than one state, diversity jurisdiction does 

not exist if an opposing party is a citizen of any of those states. See Bank of California Nat. Ass’n 

v. Twin Harbors Lumber Co., 465 F.2d 489, 492 (9th Cir. 1972) (finding that the pleadings did not 

adequately establish diversity jurisdiction where the defendant may have dual citizenship with the 

plaintiff’s state of citizenship). 

Plaintiffs submitted records from the California Secretary of State showing that NB Courts 

is an LLC registered in California. Supp. Br., Exs. 1-2. Because it is an LLC, NB Courts is a citizen 

of every state of which its owners and members are citizens. Records from the Secretary of State 

list Boreman and Nelson as members of that LLC, so NB Courts is a citizen of the same state(s) as 

Boreman and Nelson. Id. As explained above, Boreman and Nelson’s citizenship is not adequately 

pleaded. Either or both may be citizens of states where Plaintiffs are citizens, which would also 

make NB Courts a citizen of those state(s). If NB Courts is a citizen of any state(s) in which any 

Plaintiffs are citizens, there is no diversity jurisdiction. 

Moreover, Plaintiffs do not allege that Boreman and Nelson are the only members of NB 

Courts. This leaves open the possibility that there are other LLC members who are citizens of other 

states, including any of the states in which Plaintiffs are citizens. Since NB Courts would also be a 

citizen of those states based on the citizenship of its members, the court cannot definitively 

determine that NB Courts is only a citizen of California.

B. Citizenship of Plaintiffs

Even assuming that all Defendants are citizens of California, Plaintiffs have failed to 

establish the citizenship of the various Plaintiffs, any of whom may also be citizens of California. 

1. USATT

“[A] corporation is a citizen only of (1) the state where its principal place of business is 

located, and (2) the state in which it is incorporated.” Johnson, 437 F.3d at 899 (citing 28 U.S.C. § 

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1332(c)). However, the Supreme Court has consistently refused “to extend the corporate citizenship 

rule to non-corporate entities, including those that share some of the characteristics of corporations.” 

Id.; Carden v. Arkoma Assocs., 494 U.S. 185, 197 (1990) (“We have long since decided that, having 

established special treatment for corporations, we will leave the rest to Congress; we adhere to that 

decision.”). Accordingly, an unincorporated artificial entity is the citizen of every state in which its 

members are citizens. Americold Realty Trust v. Conagra Foods, Inc., 136 S.Ct. 1012, 1015 (2016) 

(finding that artificial entities other than corporations are citizens of each state of which their

members are citizens). 

Here, Plaintiffs allege that USATT is “an organization headquartered in Colorado Springs, 

CO, and conducts business in all 50 States in the United States.” Compl. ¶ 1, Supp. Br. ¶ 2. The 

complaint also states that USATT is the “official sanctioning body for professional table tennis in 

the United States,” organizes major international table tennis tournaments, and has USATT 

affiliated clubs. Compl. ¶ 4, 17. Plaintiffs do not allege nor is it obvious that USATT is a 

corporation. 

In the absence of other evidence or allegations, the court assumes that USATT is an 

unincorporated organization; its citizenship therefore depends on the citizenship of all its members. 

Americold Realty Trust, 136 S.Ct. at 1015 (finding that artificial entities other than corporations are 

citizens of each state of which its members are citizens). As explained above, if an entity is a citizen 

of multiple states, there is no diversity jurisdiction if an opposing party is a citizen of any of those 

states. Bank of California Nat. Ass’n, 465 F.2d at 492. To adequately plead diversity jurisdiction, 

Plaintiffs must allege facts sufficient to show that USATT cannot be considered a citizen of 

California. Here, Plaintiffs make no allegations regarding the citizenship of USATT’s constituent 

members. The court cannot assume that USATT has no members who are citizens of California, 

particularly given Plaintiffs’ allegation that USATT conducts business in all 50 states, has 

“affiliated” clubs located in states other than Colorado, and organizes international table tennis 

tournaments, including in California. If any of USATT’s members are citizens of California, then 

USATT is also a citizen of California and is not diverse from Defendants. 

In sum, Plaintiffs have failed to allege facts sufficient to establish USATT’s citizenship and

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that it is diverse from Defendants.

2. Bowmar

“[A] corporation is deemed a citizen of any state where it is incorporated and the state where 

it has its principal place of business.” Co-Efficient Energy Sys. v. CSL Indus., Inc., 812 F.2d 556, 

557 (9th Cir. 1987) (emphasis added) (citing 28 U.S.C. § 1332(c)). In order to meet the requirements 

for complete diversity, Plaintiffs must allege facts sufficient to show that Bowmar is not a citizen of 

California.

Plaintiffs allege that Bowmar is a corporation organized under the laws of North Carolina. 

Compl. ¶ 2, Supp. Br. ¶ 2. Accordingly, Bowmar is a citizen of North Carolina. However, Plaintiffs 

make no allegation regarding Bowmar’s principal place of business, even though the court 

specifically requested this information in its order for supplemental briefing. [Docket No. 35 at 1-

2.] If Bowmar’s principal place of business is in California, then Bowmar is also a citizen of 

California and the requirements of diversity jurisdiction have not been met.

Plaintiffs have failed to sufficiently allege that Bowmar is diverse from Defendants.

3. CRTCC

As discussed above, an LLC is a citizen of every state of which its owners and members are 

citizens. Johnson, 437 F.3d at 899. 

Here, Plaintiffs allege that CRTCC is an LLC conducting business in the states of Iowa and 

California, and that Wang is the sole member of CRTTC. Compl. ¶ 4, Supp. Br. ¶ 2. Accordingly, 

CRTCC’s citizenship is determined by the citizenship of Wang, which is addressed below.

4. Wang

As explained above, the citizenship of an individual is determined by domicile, which is 

defined as his or her “permanent home, where [he or] she resides with the intention to remain.” 

Kanter, 265 F.3d at 857. Residency alone is not sufficient to determine citizenship. Id. (“A person 

residing in a given state is not necessarily domiciled there, and thus is not necessarily a citizen of 

that state.”). In order to meet the requirements of diversity jurisdiction, Plaintiffs must allege facts 

sufficient to show that Wang is not a citizen of California.

Here, the complaint states that Wang is “an individual residing in the State of Kansas.” 

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Compl. ¶ 3. Plaintiffs’ supplemental brief contains an identical assertion. Supp. Br. ¶ 2. As 

residency is not identical to domicile, these assertions are insufficient to show that Wang is a citizen 

of Kansas. Plaintiffs’ papers contain no allegations regarding Wang’s domicile or citizenship.

Additionally, Wang’s supplemental declaration states that he “recently relocated to Northern 

California,” but does not provide the date(s) that he relocated. [Docket No. 42 ¶ 6.] “Diversity of 

citizenship is determined as of the time of the filing of the complaint.” Co-Efficient Energy Sys., 

812 F.2dat 557. Particularly given that Plaintiffs’ supplemental brief states that Wang resides in 

Kansas, and Wang’s declaration filed on the same date indicates that he has relocated to California, 

it is impossible to determine Wang’s citizenship as of the date that the complaint was filed. Even if 

Wang resided in Kansas at the time the complaint was filed, his recent relocation raises the question 

of whether he intended to remain in Kansas at the time the complaint was filed. Accordingly, 

Plaintiffs have failed to establish that Wang (and by extension, CRTTC) is not a citizen of 

California.

In sum, Plaintiffs have not alleged facts sufficient to show that citizenship is diverse for all 

parties. Given that the court has already afforded Plaintiffs the opportunity to submit supplemental 

briefing on this issue, the court recommends dismissing the complaint for lack of subject matter 

jurisdiction.

IV. CONCLUSION

For the foregoing reasons, the court recommends that Plaintiffs’ motion for default judgment 

be denied and that the complaint be dismissed for lack of subject matter jurisdiction. 

Immediately upon receipt of this order, Plaintiffs shall serve a copy of this order on 

Defendants and file a proof of service with the court. Any party may file objections to this report 

and recommendation with the District Judge within 14 days of being served with a copy. See 28 

U.S.C. § 636(b)(1); Fed. R. Civ. P. 72(a); N.D. Civ. L.R. 72-2.

IT IS SO ORDERED.

Dated: June 5, 2019

______________________________________

Donna M. Ryu

United States Magistrate Judge

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORN

I

A

IT IS SO ORDERED

Judge Donna M. Ryu

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