United States Court of Appeals 

for the Fifth Circuit 

No. 21-20657 

Arig, Incorporated, 

Plaintiff—Appellant, 

versus

Wilmington Savings Fund Society, FSB, as Trustee of

Stanwich Mortgage Loan Trust F; Carrington 

Mortgage Services, L.L.C.; JP Morgan Chase Bank, N.A.; 

Mortgage Electronic Registration Systems, 

Incorporated, 

Defendants—Appellees. 

Appeal from the United States District Court 

for the Southern District of Texas 

USDC No. 4:20-CV-2857 

Before Richman, Chief Judge, and Elrod and Oldham, Circuit Judges.

Per Curiam:*

 Plaintiff-Appellant, Arig Inc., appeals the district court’s denial of its 

motion to remand. It alleges that, upon removal to federal court, Defendants-

*

 This opinion is not designated for publication. See 5th Cir. R. 47.5. Judge 

Oldham concurs only in the judgment. 

United States Court of Appeals 

Fifth Circuit 

FILED 

March 27, 2023 

Lyle W. Cayce 

Clerk 

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2 

Appellees never established complete diversity of citizenship. Because we 

hold that the district court had subject matter jurisdiction over the case based 

on complete diversity of the parties, we AFFIRM. 

I 

In 2008, a non-party to this case obtained a loan to purchase real 

property. He secured his obligation to repay his loan by executing a deed of 

trust granting a lien to Mortgage Electronic Registration Systems, Inc., as 

nominee for SecurityNational and its successors and assigns. MERS 

assigned the deed of trust to JPMorgan Chase Bank, N.A. JPMorgan then 

assigned the deed of trust to Wilmington Savings Fund Society, FSB, as 

trustee of the Stanwich Mortgage Loan Trust F. Carrington Mortgage 

Services, LLC services the loan. 

In 2012, the homeowners’ association of the non-party’s property 

sued for past-due assessments, obtained a default judgment, and ultimately 

sold the property at a constable’s sale. Arig Inc. purchased the property, 

foreclosing the judgment on March 3, 2020. Arig Inc. subsequently sued 

Defendants-Appellees in state court on July 10, 2020.1

 Arig Inc. sought to 

quiet title to the property in its name and declare the security instrument void 

and unenforceable. 

Thereafter, JPMorgan and MERS filed notices of removal to the 

Southern District of Texas, Houston Division, asserting diversity 

jurisdiction. The remaining defendants at the time of removal (Wilmington 

Savings, SecurityNational, and Carrington Mortgage Services) consented to 

1

 Arig Inc. named MERS, SecurityNational, JPMorgan Chase Bank, Carrington 

Mortgage Services, and Wilmington Savings Fund Society as defendants. The district 

court voluntarily dismissed SecurityNational by agreement of the parties, and it is not part 

of this appeal. 

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removal. JPMorgan and MERS amended their removal notice to include 

additional information regarding Wilmington Savings’s interest in the 

Stanwich Trust. Defendants-Appellees asserted that Wilmington Savings’s 

citizenship, as trustee for the Stanwich Trust, controls for diversity purposes. 

Arig Inc. moved to remand, disputing that the Stanwich Trust’s citizenship 

was properly established. 

The district court denied Arig Inc.’s motion to remand, denied 

Arig Inc.’s amended motion to remand, and granted the DefendantsAppellees’ motion to dismiss with prejudice. The district court also denied 

Arig Inc.’s request for leave to amend its second amended complaint. Arig 

Inc. appeals the district court’s order denying its amended motion to 

remand.2

 

II 

We review a denial of a motion to remand de novo. SGK Props., 

L.L.C. v. U.S. Bank Nat’l Ass’n, 881 F.3d 933, 939 (5th Cir. 2018). “Under 

28 U.S.C. § 1332(a), diversity jurisdiction exists when there is complete 

diversity of citizenship among the parties and the amount in controversy 

exceeds $75,000.” Bynane v. Bank of N.Y. Mellon, 866 F.3d 351, 355 

(5th Cir. 2017). “Complete diversity requires that all persons on one side of 

the controversy be citizens of different states than all persons on the other 

side.” Settlement Funding, L.L.C. v. Rapid Settlements, Ltd., 851 F.3d 530, 

536 (5th Cir. 2017) (alteration omitted) (quoting McLaughlin v. Miss. Power 

Co., 376 F.3d 344, 353 (5th Cir. 2004)). The party seeking the federal forum 

has the burden of establishing diversity jurisdiction. Id. 

2

 Arig Inc. also appeals the grant of Defendants-Appellees’ motion to dismiss and 

the denial of its motion for leave to amend its second amended complaint. Arig Inc.’s brief, 

however, assigns no error to the latter two actions. Accordingly, we do not address them.

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Arig Inc. claims that the district court should have required the 

Defendants-Appellees to establish the citizenships of the Stanwich Trust’s 

shareholders before determining that it had jurisdiction. Arig Inc. alleges that 

“Wilmington is not an active trustee.” Put differently, despite naming 

Wilmington Savings as the sole defendant, Arig Inc. alleges that Wilmington 

Savings is a nominal or formal party and that the beneficial shareholders 

destroy diversity jurisdiction. Arig Inc. is correct that “[i]n determining 

diversity jurisdiction, ‘a federal court must disregard nominal or formal 

parties and rest jurisdiction only upon the citizenship of real parties to the 

controversy.’” Bynane, 866 F.3d at 356 (quoting Navarro Sav. Ass’n v. Lee, 

446 U.S. 458, 461 (1980)). However, relying on Navarro and our cases 

applying it, we determine that the district court did not err in concluding that 

diversity existed. 

“Where a trustee has been sued or files suit in her own name, the only 

preliminary question a court must answer is whether the party is an active 

trustee whose control over the assets held in its name is real and substantial.” 

Id. at 357 (internal quotation marks, alteration, and citation omitted). In 

Navarro, the seminal case on this topic, the Supreme Court determined that 

a group of trustees had the requisite degree of control because they held legal 

title to trust assets, were authorized to invest those assets for the benefit of 

shareholders and could sue and be sued in their capacity as trustees. 446 U.S. 

at 464. But there was nothing talismanic about that combination. In Bynane, 

we determined that a trustee had sufficient control citing only the facts that 

the trustee held legal title to trust assets and certificate holders had limited 

power over trust operations. 866 F.3d at 357. Similarly, in SGK Props., it was 

enough that a trustee was “assignee of the trust’s assets” and “holder of the 

Note and all rights due under it.” 881 F.3d at 940. 

The case law demonstrates, moreover, that limits on a trustee’s 

authority do not necessarily disqualify the trustee from real party status. The 

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trustees in Navarro could be fired by shareholders and had to secure 

shareholders’ permission before disposing of more than half the trust’s 

assets. 466 U.S. at 465 n.14 (explaining that “these limited powers of 

intervention” do “not strip the trustees of the powers that make them real 

parties to the controversy for purposes of diversity jurisdiction”). And the 

trustee in Bynane was subject to certificateholders’ “limited rights to vote or 

otherwise control the operation of the trust.” 866 F.3d at 357. 

We have little trouble determining that Wilmington Savings wields 

the necessary degree of control for real party status. The governing trust 

agreement expressly vests legal title to trust assets in the trustee.3

 

Wilmington Savings is also empowered to convey and transfer mortgage 

assets with the consent of certificateholders or the trust manager; is assigned 

various recordkeeping responsibilities; is designated to serve as the 

mortgagee of record and to pay premiums on HUD mortgage assets; is 

authorized to perform duties in connection with finance transactions using 

trust assets, selling trust assets, and making liquidation distributions; and is 

responsible to establish accounts and receive, maintain, invest and disburse 

funds. Wilmington Savings is also empowered to bind the trust without the 

certificateholders’ involvement, subject to a few enumerated exceptions. Yet 

these exceptions are analogous to the Navarro agreement’s requirement that 

3

 The trust agreement initially appears to limit Wilmington Savings’s legal title to 

Mortgage Loans and REO property. Nevertheless, there is good reason to think that legal 

title to all assets is held by the trustee because this provision contains the caveat that all 

assets shall be vested in the trustee where required by law. And “for a trust to be a trust” 

in Texas, “the legal title must immediately pass to the trustee, and beneficial or equitable 

interest to the beneficiaries.” Bank One Tex. v. United States, 157 F.3d 397, 400 (5th Cir. 

1998) (quoting Cutrer v. Cutrer, 334 S.W.2d 599, 605 (Tex.Civ.App.—San Antonio 1960), 

aff’d, 345 S.W.2d 513 (Tex. 1961)). 

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trustees secure the permission of shareholders before disposing of more than 

half of the trust’s assets in that they implicate the very existence of the trust.4

 

To be sure, the trust agreement does not cede unfettered control over 

trust assets to the trustee. It provides that Wilmington Savings may not 

convey or transfer certain categories of assets without the consent of the 

certificateholders or the trust manager, must often take direction from the 

trust manager, and can be removed by the certificateholders. All the same—

as with shareholders’ “limited powers of intervention” in Navarro and 

certificateholders’ “limited rights to vote or otherwise control the operation 

of the trust” in Bynane—we hold that the various checks on Wilmington 

Savings’s authority leave it with sufficiently significant control that the 

district court was correct to deem it the real party in interest. 

* * * 

For the foregoing reasons, we AFFIRM the district court’s 

judgment. 

4

 Wilmington Savings does not have unilateral decision-making authority over: (1) 

amending or dissolving the trust, (2) declaring bankruptcy on certificates, (3) merging the 

trust with other entities, (4) creating liens not permitted by the trust, (5) incurring debt not 

permitted by the trust, or (6) issuing new certificates not permitted by the trust.

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