Court Opinion

ID: 4125928
Source: CourtListenerOpinion
Date Created: 2017-02-14 20:01:09.612296+00
Date Added: 2024-06-11T07:45:56.523930
License: Public Domain

FILED
                                                                      United States Court of Appeals
                      UNITED STATES COURT OF APPEALS                          Tenth Circuit

                             FOR THE TENTH CIRCUIT                         February 14, 2017
                         _________________________________
                                                                          Elisabeth A. Shumaker
                                                                              Clerk of Court
A. KATHLEEN JONES,

      Plaintiff - Appellant,

v.                                                          No. 15-3183
                                                (D.C. No. 6:14-CV-01245-SAC-GEB)
MICHAEL DALRYMPLE; SHARON                                     (D. Kan.)
MCCAFFREY; CAROL KLATASKE,

      Defendants - Appellees,

and

LEE DALRYMPLE SPECIAL NEEDS
TRUST,

      Defendant.
                         _________________________________

                             ORDER AND JUDGMENT*
                         _________________________________

Before BACHARACH, PHILLIPS, and McHUGH, Circuit Judges.**
                 _________________________________

      *
         This order and judgment is not binding precedent, except under the doctrines
of law of the case, res judicata, and collateral estoppel. It may be cited, however, for
its persuasive value consistent with Fed. R. App. P. 32.1 and 10th Cir. R. 32.1.
      **
         After examining the briefs, the appellate record, and the parties’ responses
to our order dated January 25, 2017, this panel has determined the oral argument
scheduled for March 21, 2017 would not materially assist in the determination of this
appeal. See Fed. R. App. P. 34(a)(2); 10th Cir. R. 34.1(G). Consequently, that
hearing is vacated, counsel are excused, and the appeal will be submitted without oral
argument.
                               I.     INTRODUCTION
      Kathleen Jones filed this breach of contract action against her siblings,

Michael Dalrymple, Sharon McCaffrey, and Carol Klataske, and the Lee Dalrymple

Special Needs Trust (collectively, Defendants), in the United States District Court for

the District of Kansas. The district court dismissed the action as barred by the

doctrines of claim and issue preclusion based on a prior lawsuit brought by Ms. Jones

against Defendants in Kansas state court.

      At the time of the prior action, all parties were citizens of the State of Kansas.

Subsequently, Ms. Jones relocated to Ecuador. She then brought the present action,

asserting federal subject matter jurisdiction based on diversity under 28 U.S.C.

§ 1332(a)(2), which governs suits between United States citizens and citizens or

subjects of a foreign country. Because we conclude that Ms. Jones has failed to

establish complete diversity, we must vacate the district court’s order and remand

with instructions to dismiss the action for lack of subject matter jurisdiction.

                                II.    BACKGROUND

      Federal courts “have an independent obligation to determine whether subject

matter jurisdiction exists, even in the absence of a challenge from any party.”

Arbaugh v. Y & H Corp., 546 U.S. 500, 514 (2006). The issue of subject matter

jurisdiction may not be forfeited or waived. Id. A court must dismiss a case if it finds

subject matter jurisdiction lacking at any point in the proceedings. Fed. R. Civ. P.

12(h)(3). There is a presumption against jurisdiction, which the party asserting

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jurisdiction must overcome. Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S.
375, 377 (1994).

       Diversity jurisdiction presents questions of both law and fact. While circuit

courts review diversity jurisdiction de novo, we review the district court’s findings of

domicile for clear error. We will reverse only if the district court’s finding lacks

factual support in the record. Middleton v. Stephenson, 749 F.3d 1197, 1201 (10th

Cir. 2014).

                                  III.   DISCUSSION

       Ms. Jones asserted that she “resides in Ecuador,” that the amount in

controversy exceeds $75,000, and that these facts satisfy the requirements of

§ 1332(a)(2). {Compl. 1-2, Aug. 8, 2014.} But at the time of the state court

proceedings, Ms. Jones and the defendants in this case were all citizens of Kansas.

{Appellee’s Br. at 4.} Even accepting that she has moved to Ecuador, Ms. Jones has

failed to establish federal subject matter jurisdiction.

       A United States citizen domiciled in a foreign country is not a “citizen[] or

subject[] of a foreign state,” but is stateless and unable to assert jurisdiction under 28

U.S.C. § 1332(a)(2) or § 1332(a)(1), which governs suits between citizens of

different States. See Newman-Green, Inc. v. Alfonzo-Larrain, 490 U.S. 826, 828–29

(1989). A United States citizen living abroad may only invoke diversity jurisdiction

if the party is domiciled in a particular State and satisfies the diversity requirements

of 28 U.S.C. § 1332(a)(1). Frett-Smith v. Vanterpool, 511 F.3d 396, 400 (3d Cir.

2008). Courts have increasingly found that even when the United States citizen

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possesses dual citizenship, only the American citizenship is relevant to finding

diversity under 28 U.S.C. § 1332(a)(2). Id. at 399–400 (citing Coury v. Prot, 85 F.3d
244, 250 (5th Cir. 1996); Action S.A. v. Marc Rich & Co., 951 F.2d 504 (2d Cir.

1991); Sadat v. Mertes, 615 F.2d 1176 (7th Cir. 1980); Mutuelles Unies v. Kroll &

Linstrom, 957 F.2d 707 (9th Cir. 1992); Las Vistas Villas, S.A. v. Petersen, 778 F.

Supp. 1202 (M.D. Fla. 1991), aff'd, 13 F.3d 409 (11th Cir. 1994)).

       In the district court, Ms. Jones failed to put forth any evidence that she satisfied 28

U.S.C. § 1332(a)(2) by having renounced her United States citizenship. As a result, we

were unable to ascertain whether we had subject matter jurisdiction over this appeal. We

therefore entered an Order on January 25, 2017, directing the parties to file separate

written responses to show cause why the appeal should not be dismissed for lack of

subject matter jurisdiction. Within fourteen days of the Order, each party was ordered to

address:

       whether diversity jurisdiction is proper under 28 U.S.C. §1332(a)(2) when
       it appears all parties are citizens of Kansas. See Newman Green Inc. v.
       Alfonzo-Larrain, 490 U.S. 826, 828-29 (1989); See also Louisiana
       Municipal Police Employees’ Retirement System v. Wynn, 829 F.3d 1048,
       1056-57 (9th Cir. 2016)(discussing when a party is a citizen for purposes of
       establishing diversity); Molinos Valle Del Cibao, C. por A. v. Lama, 633
F.3d 1330, 1341 (11th Cir. 2011)(discussing difference between domicile
       and residence). In filing the responses, the parties should also address with
       particularity whether diversity exists given Ms. Jones’ domicile in Ecuador
       but apparent citizenship in Kansas. See Frett-Smith v. Vanterpool, 511 F.3d
396, 400 (3rd Cir. 2008)(concluding “that for purposes of diversity
       jurisdiction, only the American nationality of a dual national is
       recognized”).

       Defendants responded and concede that Ms. Jones failed to establish federal

subject matter jurisdiction. They argue that Ms. Jones should be required to file an

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affidavit resolving the question of her citizenship, or that this appeal and the district

court action should be dismissed. Ms. Jones also filed a response to the Order.

Although she concedes that she does not fall within § 1332(a)(2), she asks us to

exercise jurisdiction despite that deficiency so that she will not be deemed stateless

for purposes of federal jurisdiction. We decline Ms. Jones’s invitation and instead

follow the Supreme Court’s direction in Newman-Green, and that of every federal

circuit to have considered the issue. Newman-Green, 490 U.S. at 828–29.

       Defendants are all citizens of Kansas. Ms. Jones was a citizen of Kansas and

now resides in Ecuador. She has provided no evidence from which we could conclude

that she has relinquished her United States citizenship and is now a citizen or subject

of a foreign country as required for jurisdiction under § 1332(a)(2). Accordingly, the

district court lacked subject matter jurisdiction over this action and it must be

dismissed.

                                  IV.   CONCLUSION

              Ms. Jones has failed to establish that she is a citizen or subject of a

foreign country, as required under 28 U.S.C. § 1332(a)(2). We therefore vacate the

district court’s judgment and remand with instructions to dismiss the action for lack

of subject matter jurisdiction.

                                             ENTERED FOR THE COURT

                                             Carolyn B. McHugh
                                             Circuit Judge

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