Court Opinion

ID: 9891161
Source: CourtListenerOpinion
Date Created: 2023-10-17 18:00:26.815406+00
Date Added: 2024-06-11T13:39:40.301945
License: Public Domain

Case: 23-30130         Document: 00516933457             Page: 1      Date Filed: 10/17/2023

              United States Court of Appeals
                   for the Fifth Circuit                                              United States Court of Appeals
                                                                                               Fifth Circuit

                                      ____________                                           FILED
                                                                                      October 17, 2023
                                        No. 23-30130
                                                                                        Lyle W. Cayce
                                      ____________                                           Clerk

   Richard’s Clearview LLC,

                                                                       Plaintiff—Appellee,

                                             versus

   Starr Surplus Lines Insurance Company,

                                               Defendant—Appellant.
                      ______________________________

                      Appeal from the United States District Court
                         for the Eastern District of Louisiana
                               USDC No. 2:22-CV-2326
                      ______________________________

   Before Graves, Higginson, and Ho, Circuit Judges.
   Per Curiam: *
          Richard’s Clearview LLC sued Starr Surplus Lines Insurance
   Company in Louisiana state court over an insurance dispute. Starr removed
   the case to federal court, alleging diversity of citizenship. After the district
   court dismissed the case on other grounds, Clearview presented evidence of
   the lack of diversity of citizenship between the parties and accordingly filed a
   motion for vacatur under Federal Rule of Civil Procedure 60(b)(4). The

          _____________________
          *
              This opinion is not designated for publication. See 5th Cir. R. 47.5.
Case: 23-30130         Document: 00516933457              Page: 2       Date Filed: 10/17/2023

                                          No. 23-30130

   district court granted the motion, denied Starr’s request for jurisdictional
   discovery, and remanded the case to state court.                    Starr appealed the
   judgment. We now affirm for the reasons given by the district court in its
   opinion.
           A judgment issued in a diversity case is a “paradigmatic” void
   judgment under Rule 60(b)(4) if it is later discovered that the parties are in
   fact not diverse. See Mitchell Law Firm, L.P. v. Bessie Jeanne Revocable Trust,
   8 F.4th 417, 420 (5th Cir. 2021). And that is exactly the case here.
           Starr is a corporation incorporated in Texas with its principal place of
   business in New York. 1 This makes it a citizen of Texas and New York for
   diversity purposes. 28 U.S.C. § 1332(c)(1). Clearview is a limited liability
   company, and two of its members turn out to be Texas citizens. A limited
   liability company takes the citizenship of all its members, see MidCap Media
   Fin., L.L.C. v. Pathway Data, Inc., 929 F.3d 310, 314 (5th Cir. 2019), so
   Clearview is a citizen of Texas for diversity purposes. Accordingly, there is
   no diversity jurisdiction in this case under 28 U.S.C. § 1332(a). Once that
   became clear, the district court correctly held that it had a “total want of
   jurisdiction,” Richard’s Clearview LLC v. Starr Surplus Lines Ins. Co., No. 22-
   CV-2326, 2023 WL 1778943 at *2 (E.D. La. Feb. 6, 2023) (quoting Callon
   Petrol. Co. v. Frontier Ins. Co., 351 F.3d 204, 208 (5th Cir. 2003)), and vacated
   its prior order accordingly.
           The district court did not abuse its discretion by denying Starr
   jurisdictional discovery. We will disturb a discovery decision “only if it is

           _____________________
           1
             On appeal, Starr states multiple times that it is incorporated in New York and has
   its principal place of business in Texas. This is at odds with what it alleges in the initial
   notice of removal and what the district court states in its opinion. The discrepancy is
   ultimately immaterial, because the corporation is a citizen of both for diversity purposes.
   See 28 U.S.C. § 1332(c)(1).

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Case: 23-30130      Document: 00516933457           Page: 3   Date Filed: 10/17/2023

                                     No. 23-30130

   arbitrary or clearly unreasonable.” Fielding v. Hubert Burda Media, Inc., 415
   F.3d 419, 428 (5th Cir. 2005) (citing Mayo v. Tri-Bell Inus., Inc., 787 F.2d
   1007, 1012 (5th Cir. 1986)). The district court’s refusal to let Starr conduct
   discovery on Clearview’s members’ citizenship was neither.              Having
   considered evidence of the Texas members’ residence and activities, the
   district court concluded both were Texas citizens. Given this evidence, it
   was reasonable to determine, as the district court did, that further discovery
   was unnecessary.
          Federal courts are courts of limited jurisdiction. Without jurisdiction,
   a court “cannot proceed at all in any cause.” Steel Co. v. Citizens for a Better
   Env’t, 523 U.S. 83, 94 (1998). When a want of jurisdiction becomes apparent,
   the court must dismiss the cause. See id. And when it becomes apparent
   following a judgment that the rendering court lacked jurisdiction to issue it,
   that judgment is void. See Mitchell, 8 F.4th at 420. The district court issued
   a void judgment. It was appropriate to vacate that judgment. Accordingly,
   we affirm.

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