ESKENDER BERHE v. AMERICAN SECURITY INSURANCE COMPANY (2025)

ORDER

Eskender Berhe sued American Security Insurance Company and OneForce Construction, LLC, in state court. Dkt. 4. American Security removed the case to this court based on diversity jurisdiction. Dkt. 1. Berhe moved to remand, arguing that he and OneForce, LLC, are both Texas citizens. Dkt. 12; see Dkt. 14 (American Security's response in opposition). The court will withhold a ruling on the motion until Berhe complies with this order's requirements.

DISCUSSION

I. Proposed Amended Complaint

After filing its removal notice, American Security filed a motion to dismiss. Dkt. 3. Forty-eight days later, Berhe filed a proposed amended complaint that was not accompanied by a motion for leave to amend. Dkt. 9.

Federal Rule of Civil Procedure 15(a)(1) permits a plaintiff to amend his complaint “once as a matter of course no later than: (A) 21 days after serving it, or (B) if the pleading is one to which a responsive pleading is required ․ 21 days after service of a motion under Rule 12(b), (e), or (f).” After that, the plaintiff may amend his complaint “only with the opposing party's written consent or the court's leave.” Fed. R. Civ. P. 15(a)(2).

Because Berhe filed his proposed amended complaint more than 21 days after being served with American Security's motion to dismiss, he was required to seek the opposing parties' written consent or the court's leave. He did neither, so the proposed amended complaint will be struck. Any motion for leave to file a document must be filed separately and immediately before the document for which leave to file is sought. Loc. R. CV-7(k).

II. Facts to Support Remand

Berhe's motion to remand argues that he and OneForce are both Texas citizens, so removal is not available under 28 U.S.C. § 1441(b)(2). American Security's response argues that OneForce has not been served, so removal was proper. Two issues need to be resolved before the court rules on the motion.

A. OneForce's citizenship

Although the parties apparently agree that OneForce is a Texas citizen, neither party has properly alleged its citizenship. American Security asks the court to disregard OneForce's citizenship. Dkt. 1 at 3. And Berhe asserts that OneForce is “a resident of Texas, ․ does business in Texas,” Dkt. 4 at 2, and is a “Texas limited liability company located in the State of Texas and doing business in this state,” Dkt. 12 at 1.

“Because federal courts have limited jurisdiction, parties 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)). The requisite allegations differ based on the type of party.

The citizenship of a limited liability company, a limited partnership, or any other unincorporated association or entity is determined based on the citizenship of all of its members. Americold Realty Tr. v. Conagra Foods, Inc., 577 U.S. 378, 381 (2016); Carden v. Arkoma Assocs., 494 U.S. 185, 195 (1990); Harvey v. Grey Wolf Drilling, Co., 542 F.3d 1077, 1080 (5th Cir. 2008); see Settlement Funding, L.L.C. v. Rapid Settlements, Ltd., 851 F.3d 530, 536 (5th Cir. 2017). Each member's citizenship must be alleged “distinctly and affirmatively”; an allegation that a member is not a citizen of a certain State will not suffice. Getty Oil, 841 F.2d at 1259. And the required jurisdictional facts differ depending on whether the member is a natural person or an entity. See Alphonse v. Arch Bay Holdings, L.L.C., 618 F. App'x 765, 768 (5th Cir. 2015) (per curiam) (explaining that, when an unincorporated entity is comprised of additional entities, the “appropriate tests for citizenship involve tracing entities' citizenships down the various organizational layers where necessary”) (cleaned up); see also Thomason v. Outback Steakhouse of Fla., L.L.C., No. 1:17-CV-01541, 2019 WL 3526839, at *1 n.1 (W.D. La. May 14, 2019) (stating that, where a defendant LLC's sole member was itself an LLC, and the member LLC's sole member was a Delaware corporation with its principal place of business in Florida, the defendant LLC's citizenship was both Delaware and Florida).

A corporation is “a citizen of every State and foreign state by which it has been incorporated and of the State or foreign state where it has its principal place of business.” 28 U.S.C. § 1332(c)(1). For that reason, “allegations regarding the citizenship of a corporation must set out the principal place of business of the corporation as well as the state [or states] of its incorporation.” Neeley v. Bankers Tr. Co. of Tex., 757 F.2d 621, 634 n.18 (5th Cir. 1985); see Coal City Cob Co., Inc. v. Palm Enters., Inc., No. 3:18-CV-0123-N, 2018 WL 3475594, at *3 (N.D. Tex. July 18, 2018) (discussing the 2011 amendment to 28 U.S.C. § 1332(c)(1) and the demise of the forum doctrine).

A natural person is domiciled, and therefore a citizen, where he or she has his or her true, fixed, and permanent home. Stine v. Moore, 213 F.2d 446, 448 (5th Cir. 1954). “[A]n allegation of residency alone ‘does not satisfy the requirement of an allegation of citizenship.’ ” MidCap, 929 F.3d at 313 (quoting Strain v. Harrelson Rubber Co., 742 F.2d 888, 889 (5th Cir. 1984) (per curiam)); see Texas v. Florida, 306 U.S. 398, 424 (1939) (explaining that citizenship of a natural person requires not only “[r]esidence in fact” but also “the purpose to make the place of residence one's home”).

Because Berhe has not identified the members of OneForce Construction, LLC or their citizenships, the court's jurisdiction remains in doubt.

B. Service on OneForce

The parties dispute whether OneForce has been “properly joined and served.” 28 U.S.C. § 1441(b)(2). American Security argues that OneForce has not been served and points to the state-court docket, which describes OneForce as “unserved.” Dkt. 1-3 at 2. American Security also notes that the state-court docket shows that Berhe requested only one citation from that court, which was served on American Security. Dkt. 1-5 at 3. Because the only citation issued by the state court was served on American Security, there was no citation with which OneForce could have been served.

Berhe insists that OneForce has been served and provides an affidavit sworn by his attorney stating that “OneForce Construction LLC, was served with citation, but has not answered.” Dkt. 12-1. That affidavit does not describe when or how OneForce was served or explain the discrepancy between Berhe's assertion and the state-court docket.

Because § 1441(b)(2) prevents removal only if “any of the parties in interest properly joined and served as defendants is a citizen” of the forum state, the court cannot determine its applicability without resolving whether OneForce was served before American Security filed its notice of removal.

* * *

It is ORDERED that the proposed amended complaint, Dkt. 9, is STRUCK and the motion to dismiss it, Dkt. 13, is DISMISSED AS MOOT.

It is further ORDERED that, within 14 days of the docketing of this order, Berhe file an amended complaint that properly alleges OneForce's citizenship. If he wants to amend his original complaint in any other respect, he must seek leave to do so by filing a motion that complies with all applicable rules.

It is further ORDERED that, within 14 days of the docketing of this order, Berhe establish proper service on OneForce by filing the executed citation or an affidavit sworn by the person who served OneForce that explains the date and method of service.

So ORDERED and SIGNED this 17th day of February, 2025.

Bill Davis United States Magistrate Judge