Court Opinion

ID: 4879858
Source: CourtListenerOpinion
Date Created: 2021-08-28 00:00:36.261722+00
Date Added: 2024-06-11T08:12:43.309299
License: Public Domain

Case: 21-30056     Document: 00515998552            Page: 1   Date Filed: 08/27/2021

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

                                                                             FILED
                                   No. 21-30056                        August 27, 2021
                                                                        Lyle W. Cayce
                                                                             Clerk
   BlueTarp Financial, Incorporated,

                                                              Plaintiff—Appellee,

                                       versus

   Robertson Development, L.L.C.,

                                                          Defendant—Appellant.

                  Appeal from the United States District Court
                     for the Eastern District of Louisiana
                           USDC No. 2:19-CV-13006

   Before Elrod, Southwick, and Costa, Circuit Judges.
   Per Curiam:*
          This case arises out of a dispute over an unpaid line of credit between
   the parties. Because it is unclear whether the district court had diversity
   jurisdiction over the case, we issue a limited remand to the district court to
   make this determination in the first instance.

          *
            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   opinion should not be published and is not precedent except under the limited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: 21-30056     Document: 00515998552          Page: 2   Date Filed: 08/27/2021

                                   No. 21-30056

                                        I.
         BlueTarp Financial, Inc. provides lines of credit to businesses so that
   those businesses can purchase building materials. Robertson Development,
   LLC, took out a line of credit to purchase supplies from Morrison
   Terrebonne Lumber Center. Robertson Development failed to make its
   payments to BlueTarp on that line of credit. At that point, Robertson
   Development executed a promissory note promising to pay back the account
   balance of $290,694.10 to BlueTarp. Robertson Development also failed to
   pay that amount according to the terms of the promissory note.
         The parties next entered a settlement agreement wherein Robertson
   Development pledged to pay $75,000 over several monthly installments to
   satisfy its debt to BlueTarp. That agreement provided that if Robertson
   Development failed to make two consecutive payments at any time, then
   “the balance [would] revert back to the original amount.” After Robertson
   Development missed its payments, and after BlueTarp had sent a final
   demand letter to try to prompt more consistent payments, BlueTarp filed the
   present action in federal court to enforce the settlement agreement.
          BlueTarp filed for summary judgment, which the district court
   granted in part.   Later, BlueTarp filed a second motion for summary
   judgment, which was also granted in part. Robertson Development now
   appeals both partial grants of summary judgment.
                                        II.
         For the first time on appeal, Robertson Development argues that the
   district court lacked subject matter jurisdiction over this case. Of course,
   objections to subject matter jurisdiction “may be resurrected at any point in
   the litigation” because “[s]ubject-matter jurisdiction can never be waived or
   forfeited.” Gonzalez v. Thaler, 565 U.S. 134, 141 (2012). We address

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Case: 21-30056         Document: 00515998552               Page: 3      Date Filed: 08/27/2021

                                          No. 21-30056

   questions of subject matter jurisdiction de novo.1 Goodrich v. United States, 3
   F.4th 776, 779 (5th Cir. 2021). “[P]arties must make ‘clear, distinct, and
   precise affirmative jurisdictional allegations’ in their pleadings.” MidCap
   Media Fin., L.L.C. v. Pathway Data, Inc., 929 F.3d 310, 313 (5th Cir. 2019)
   (quoting Getty Oil Corp. v. Ins. Co. of N. Am., 841 F.2d 1254, 1259 (5th Cir.
   1988)). For diversity cases under 28 U.S.C. § 1332, this means that the
   complaint must allege complete diversity of citizenship between the parties.
   See id.
             BlueTarp failed to allege complete diversity even though it relied on
   § 1332 as the basis for federal jurisdiction. According to the complaint,
   BlueTarp is a Maine corporation with its principal place of business in Maine
   and Robertson Development is a “Louisiana corporation whose principal
   place of business” is in Louisiana.
             But according to Robertson Development’s filings with the Louisiana
   Secretary of State,2 Robertson Development, LLC is, as its name suggests, a
   limited liability company, not a corporation. Whereas the citizenship of a
   corporation is determined by its place of incorporation and its principal place
   of business, “the citizenship of a[n] LLC is determined by the citizenship of
   all of its members.” Id. at 314 (quoting Harvey v. Grey Wolf Drilling Co., 542
   F.3d 1077, 1080 (5th Cir. 2008)). BlueTarp did not allege the citizenship of
   Robertson’s members in its initial complaint. It therefore failed to properly
   allege complete diversity of citizenship.

             1
             Even if the district court lacked jurisdiction, “we have jurisdiction on appeal, not
   on the merits but for the purpose of addressing the lower court’s jurisdiction to entertain
   the suit.” Griffin v. Lee, 621 F.3d 380, 384 (5th Cir. 2010).
             2
            We are permitted to take judicial notice of a “fact that is not subject to reasonable
   dispute,” such as facts contained in public filings. Fed. R. Evid. 201(b); MidCap, 929 F.3d
   at 315.

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Case: 21-30056         Document: 00515998552               Page: 4       Date Filed: 08/27/2021

                                           No. 21-30056

           Under 28 U.S.C. § 1653, “[d]efective allegations of jurisdiction may
   be amended, upon terms, in the trial or appellate courts.”                         We have
   interpreted this to mean that in cases “[w]here jurisdiction is clear from the
   record,” we may allow “direct amendments to the pleadings without a
   remand.” Molett v. Penrod Drilling Co., 872 F.2d 1221, 1228 (5th Cir. 1989).
   And if “jurisdiction is not clear from the record, but there is some reason to
   believe that jurisdiction exists, the Court may remand the case to the district
   court for amendment of the allegations and for the record to be
   supplemented.” Id. However, “if there is no evidence of diversity on the
   record, we cannot find diversity jurisdiction, and we must dismiss the action
   for lack of jurisdiction.” Howery v. Allstate Ins. Co., 243 F.3d 912, 920 (5th
   Cir. 2001).
           It is unclear on this record who the members of Robertson
   Development are or what their citizenship may be.3 It is, however, possible
   that jurisdiction exists. We therefore issue a limited remand to the district
   court to determine whether it has diversity jurisdiction. If jurisdiction does
   not exist, then the district court must dismiss the case. If there is subject
   matter jurisdiction, then the record on appeal should be supplemented
   accordingly.

           3
             Robertson Development has also argued on appeal that Morrison Lumber is a
   necessary party to this litigation, yet its citizenship has not been alleged either. On remand,
   the district court should determine: (1) whether Morrison Lumber is indeed a necessary
   party to this case; and (2) if so, whether diversity jurisdiction still exists after accounting
   for Morrison Lumber’s citizenship.

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