Court Opinion

ID: 4709195
Source: CourtListenerOpinion
Date Created: 2021-08-05 00:00:34.509165+00
Date Added: 2024-06-11T08:06:54.837284
License: Public Domain

Case: 20-10882     Document: 00515965433         Page: 1     Date Filed: 08/04/2021

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

                                                                             FILED
                                                                        August 4, 2021
                                  No. 20-10882                          Lyle W. Cayce
                                                                             Clerk

   Lee Marvin Sanders; Matthew Sodrok,

                                                           Plaintiffs—Appellants,

                                       versus

   The Boeing Company; Jamco America, Incorporated;
   Kidde Technologies, Incorporated,

                                                         Defendants—Appellees.

                  Appeal from the United States District Court
                      for the Northern District of Texas
                            USDC No. 3:18-CV-3165

   Before Smith, Stewart, and Willett, Circuit Judges.
   Per Curiam:*
          Plaintiffs-Appellants Lee Marvin Sanders and Matthew Sodrok, flight
   attendants, have sued Defendants-Appellees The Boeing Co. (“Boeing”),
   Jamco America, Inc. (“Jamco”), and Kidde Technologies, Inc. (“Kidde”)
   under Texas tort law for injuries sustained when a smoke detector

          *
            Pursuant to 5th Circuit Rule 47.5, the court has determined that this
   opinion should not be published and is not precedent except under the limited
   circumstances set forth in 5th Circuit Rule 47.5.4.
Case: 20-10882      Document: 00515965433              Page: 2   Date Filed: 08/04/2021

                                        No. 20-10882

   malfunctioned on one of the Plaintiffs’ flights. The district court sua sponte
   dismissed Plaintiffs’ suit for lack of subject-matter jurisdiction and for failing
   to follow a court order. Plaintiffs appealed.
          For the reasons that follow, we AFFIRM.
                        I. FACTS & PROCEDURAL HISTORY
          Plaintiffs serviced a United Airlines flight from Denver to Houston in
   January 2017. Plaintiffs alleged that during the flight, a smoke alarm
   accidentally went off, causing an “ear-splitting sound” to fill the cabin. They
   further averred that the “excessively loud and unnecessary alarm [was] a
   malfunction of the smoke/fire detection system” and that “this malfunction
   resulted in Plaintiffs’ ears’ [sic] drums bursting and bleeding, and permanent
   hearing loss to Plaintiffs’ ears.”
          Plaintiffs—who are represented by counsel—sued, claiming that
   Boeing, as manufacturer of the plane carrying the defective smoke detector,
   was culpable under Texas law for products liability, negligence, and breach
   of implied warranties. Plaintiffs then amended their complaint twice, adding
   and removing defendants along the away. For our purposes, Boeing, Jamco,
   and Kidde remain as defendants in this lawsuit. Kidde moved to dismiss
   Plaintiffs’ claims under Federal Rule of Civil Procedure 12(b)(2) and (b)(6)
   for lack of personal jurisdiction and for failure to state a claim upon which
   relief can be granted, respectively. While that motion was pending, the
   district court sua sponte ordered Plaintiffs to file another amended complaint
   addressing certain jurisdictional deficiencies in the operative pleading. In
   response, Plaintiffs filed a third amended complaint, which mooted Kidde’s
   motion to dismiss. Concluding that Plaintiffs had failed to follow its
   instructions on how to remedy the inadequacy of their pleading, the district
   court dismissed their action without prejudice under Federal Rules of Civil
   Procedure 12(h)(3) and 41(b). Rule 12(h)(3) directs a court to dismiss a case

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   if it “determines at any time that it lacks subject-matter jurisdiction,” Fed.
   R. Civ. P. 12(h)(3), while Rule 41(b) allows a court to dismiss a lawsuit if
   the plaintiff has failed “to comply with . . . a court order,” Fed. R. Civ. P.
   41(b).
            After the district court dismissed their action, Plaintiffs moved for
   reconsideration under Federal Rule of Civil Procedure 60(b)(1) and for leave
   to file a fourth amended complaint under Federal Rule of Civil Procedure
   15(a)(2). While those motions were pending, Plaintiffs prematurely filed a
   notice of appeal. The district court then denied Plaintiffs’ motions, which
   allowed Plaintiffs to proceed with their appeal per Federal Rule of Appellate
   Procedure 4(a)(4)(B)(i). Plaintiffs did not file an amended notice, which, if
   timely filed, would have permitted them to additionally appeal the district
   court’s denial of their Rule 60 and Rule 15 motions.
                             II. STANDARD OF REVIEW
            We review de novo the district court’s sua sponte dismissal for lack of
   subject-matter jurisdiction. Brainerd v. Sawyer, 54 F. App’x 406 (5th Cir.
   2002) (per curiam) (citing Fed R. Civ. P. 12(h)(3) and Musslewhite v. State
   Bar of Tex., 32 F.3d 942, 945 (5th Cir. 1994)).
                                   III. DISCUSSION
            “[F]ederal courts are courts of limited jurisdiction. They are
   empowered to hear only those cases that are within the constitutional grant
   of judicial power, and that have been entrusted to them by a jurisdictional
   grant enacted by Congress.” Sarmiento v. Tex. Bd. of Veterinary Med. Exam’rs
   By and through Avery, 939 F.2d 1242, 1245 (5th Cir. 1991). “The parties can
   never consent to federal subject matter jurisdiction, and lack of such
   jurisdiction is a defense which cannot be waived.” Coury v. Prot, 85 F.3d 244,
   248 (5th Cir. 1996). “If jurisdiction could be waived or created by the parties,
   litigants would be able to expand federal jurisdiction by action, agreement, or

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   their failure to perceive a jurisdictional defect[,]” in contravention of “the
   concept of limited jurisdiction.” Giannakos v. M/V Bravo Trader, 762 F.2d
   1295, 1297 (5th Cir. 1985). “Therefore, United States District Courts and
   Courts of Appeals have the responsibility to consider the question of subject
   matter jurisdiction sua sponte if it is not raised by the parties and to dismiss
   any action if such jurisdiction is lacking.” Id.
           Where, as here, a plaintiff brings a purely state-law claim, a federal
   court may exercise jurisdiction over that claim if citizenship is diverse among
   the parties and the amount in controversy is greater than $75,000. See 28
   U.S.C. § 1332. As the parties invoking a federal court’s subject-matter
   jurisdiction, Plaintiffs have the burden of establishing diversity of citizenship.
   See Hertz Corp. v. Friend, 559 U.S. 77, 96 (2010).
           In Plaintiffs’ Second Amended Complaint, the district court
   identified two jurisdictional deficiencies pertaining to their diversity
   allegations.1 The first was that “Plaintiffs only allege[d] that they—
   individuals—reside in Harris County, Texas[.]” The district court correctly
   concluded that Plaintiffs had not properly alleged their own citizenship since
   “an allegation of residency alone does not satisfy the requirement of an
   allegation of citizenship.” MidCap Media Fin., L.L.C. v. Pathway Data, Inc.,
   929 F.3d 310, 313 (5th Cir. 2019) (citation and internal quotation marks
   omitted).2 Rather, Plaintiffs had to aver where they were domiciled. Preston
   v. Tenet Healthsystem Mem’l Med. Ctr., Inc., 485 F.3d 793, 797 (5th Cir. 2007).

           1
             The district court also determined that Plaintiffs had not adequately alleged venue
   per 28 U.S.C. § 1391(b). As will soon become apparent, we need not reach the propriety of
   this determination to resolve this appeal.
           2
             Plaintiffs suggest we should not “trouble[]” ourselves with MidCap because “the
   case seems very unique.” To the extent Plaintiffs are contending that MidCap is somehow
   limited to its facts, we do not see any indication that the decision warrants such a narrow
   reading.

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   The second issue was that Plaintiffs had pled that “Boeing is a domestic
   corporation doing business in Texas, [Kidde] is a foreign corporation doing
   business in Texas, and that Jamco is a corporation doing business in the
   United States.” Once again the district court properly concluded that
   Plaintiffs had inadequately averred citizenship for the purposes of diversity
   jurisdiction because “allegations regarding the citizenship of a corporation
   must set out the principal place of business of the corporation as well as the
   state of its incorporation.” MidCap, 929 F.3d at 314 (citation omitted).
          The district court then told the Plaintiffs how to fix the defects in their
   pleading: (1) aver where Plaintiffs are domiciled and (2) allege the principal
   places of business and states of incorporation for each defendant. It provided
   Plaintiffs with an opportunity to remedy those deficiencies by filing yet
   another amended complaint. But Plaintiffs squandered the opportunity.
   First, Plaintiffs once again alleged that they were residents of Harris County.
   They also pled Boeing’s and Jamco’s states of incorporation but not their
   principal places of business, while they alleged Kidde’s principal place of
   business but not its state of incorporation. Without averring their own
   domiciles and the principal places of business and states of incorporation for
   each of the defendants, Plaintiffs’ jurisdictional allegations remained
   insufficient. Thus, the district court did not err in dismissing Plaintiffs’
   claims under Rule 12(h)(3). See id. at 313 (“Because federal courts have
   limited jurisdiction, parties must make clear, distinct, and precise affirmative
   jurisdictional allegations in their pleadings.” (citation and internal quotation
   marks omitted)).
          Nevertheless, Plaintiffs raise several arguments in favor of reversal, all
   of which lack merit. First, Plaintiffs assert that this court should take judicial
   notice of the “substantial record evidence” and “publicly available
   documents[,]” all of which establish diversity of citizenship. More
   specifically, Plaintiffs point to admissions that Defendants made as to both

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                                          No. 20-10882

   their principal places of business and states of incorporation, which in turn
   show diversity of citizenship. While that may be true for Boeing and Kidde,
   it is not true for Jamco, which has admitted only that it “is a corporation
   doing business in the United States and has made an appearance herein.”
   Demonstrating citizenship for some parties and not others is insufficient. See
   McLaughlin v. Miss. Power Co., 376 F.3d 344, 353 (5th Cir. 2004). Plaintiffs
   also cite to the Civil Cover Sheet that they filed at the initiation of the action.
   Assuming arguendo that the Cover Sheet is even evidence of jurisdiction that
   the district court could have considered, it does not identify the principal
   places of business and states of incorporation for any of the defendants.
           Although the facts discussed above do not establish diversity of
   citizenship, they do suggest that it exists. “Where, as here, jurisdiction is not
   clear from the record, but there is some reason to believe that jurisdiction
   exists, the [c]ourt may remand the case to the district court for amendment
   of the allegations and for the record to be supplemented.” Molett v. Penrod
   Drilling Co., 872 F.2d 1221, 1228 (5th Cir. 1989); see also 28 U.S.C. § 1653
   (“Defective allegations of jurisdiction may be amended, upon terms, in the
   trial or appellate courts.”). Relying on Molett and § 1653, Plaintiffs contend
   that we should remand accordingly if we conclude that the record does not
   already establish diversity of citizenship.3 “May,” however, does not mean
   “must” (even if “§ 1653 is to be construed liberally”). Molett, 872 F.2d at
   1228. Key to this court’s decision to remand in Molett, which did so pursuant
   to § 1653, was that the party “had no notice, nor should it be charged with
   any notice, of a defect in jurisdiction prior to this second appeal.” Id. That is

           3
             Puzzlingly, Plaintiffs rely upon Stafford v. Mobil Oil Corp., 945 F.2d 803, 806 (5th
   Cir. 1991) for the same proposition. In that case, though, this court denied the plaintiffs’
   request to correct jurisdictional defects in their pleading. Id. at 805–06. At the very least,
   Stafford does not support remand.

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                                         No. 20-10882

   not the situation here, where Plaintiffs were given an opportunity to amend
   their pleading with instructions on how to properly plead diversity of
   citizenship. And Plaintiffs were permitted to conduct third-party discovery
   into the manufacturer of the smoke detector. Presumably, they could have
   utilized that time to also determine the citizenship of the relevant
   defendant(s) if they were unable to otherwise locate that information.
           Leigh v. Nat’l Aeronautics & Space Admin., 860 F.2d 652, 653–54 (5th
   Cir. 1988), upon which Plaintiffs also rely in support of their request for
   remand, is arguably more on point than Molett. In that case, this court
   remanded so that the plaintiff could have an opportunity “to make a more
   complete statement of the court’s diversity jurisdiction over his claim” since
   “diversity jurisdiction was not questioned by the parties and there is no
   suggestion in the record that it does not in fact exist.” Id. Here, like in Leigh,
   no party contested jurisdiction (at least until the district court’s sua sponte
   dismissal) and neither Defendants nor the district court have provided an
   indication that diversity of citizenship does not exist (just that Plaintiffs have
   not met their burden to establish it). But, as with Molett, Leigh may be
   distinguished on the ground that the plaintiff there did not previously have
   the occasion to reallege facts supporting jurisdiction (nor a roadmap, for that
   matter, on how to do so). As Plaintiffs acknowledge, Molett and Leigh are
   premised on the principle that a court should be “much more lenient in
   allowing . . . amendment to resolve any diversity issues” when “attacks on
   diversity do constitute surprise[.]”As a corollary, with no surprise comes less
   leniency.4

           4
              For this reason, MidCap does not compel remand of this action. Relying on the
   above-quoted language from Molett, MidCap remanded the case to the district court for
   jurisdictional fact finding. 929 F.3d at 316. But, as Boeing asserts, “[i]n MidCap, neither

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           Finally, Plaintiffs argue that this court, “rather than remand, could
   invite an amendment on appeal to remedy any questions concerning
   diversity.” But we should do so only “[w]here jurisdiction is clear from the
   record[.]” Molett, 872 F.2d at 1228. As noted above, that is not the situation
   here.
           In sum, Plaintiffs have not convinced us that the district erred in
   dismissing this case for lack of subject-matter jurisdiction.5
                                      IV. CONCLUSION
           For the foregoing reasons, the judgment of the district court is
   AFFIRMED.

   the district court nor the parties had made an adequate record of the court’s subject-matter
   jurisdiction.” As discussed, that is not the case here.
           5
              The parties spill much ink over whether the district court also properly dismissed
   Plaintiffs’ case pursuant to Rule 41(b). Because “this court may affirm on any basis
   supported by the record,” CBE Grp., Inc. v. Lexington L. Firm, 993 F.3d 346, 352 n.1 (5th
   Cir. 2021) (citation and internal quotation marks omitted), we decline to reach those
   arguments. And since we affirm the district court’s ruling, we need not consider Plaintiffs’
   request for reassignment upon remand (assuming Plaintiffs even adequately requested that
   relief in their opening brief).
            Finally, we emphasize that the scope of our review is limited to the district court’s
   dismissal of Plaintiffs’ claims; it does not include the lower court’s denial of Plaintiffs’
   motions for reconsideration and leave to amend. Perhaps had Plaintiffs also appealed those
   rulings, the outcome of this appeal may have been different. Indeed, at least one of the
   defendants—Boeing—admits that Plaintiffs’ proposed Fourth Amended Complaint
   “would have established complete diversity among the parties.” But we may only consider
   what the appellant asks of us, no more, no less.

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