United States District Court, E.D. Michigan, Southern Division
TGINN JETS, LLC, J.R. SLAVIK & ASSOCIATES II, and LOCKWOOD FAMILY INVESTMENT LP, Plaintiffs,
CULLAN MEATHE, and HAMPTON RIDGE PROPERTIES, LLC, Defendants.
ORDER SETTING EVIDENTIARY HEARING ON JURISDICTIONAL
G. Edmunds United States District Judge
filed their complaint in the Oakland County Circuit Court
based exclusively on Michigan state law, but Defendants
removed this matter to this Court based on diversity
jurisdiction. On January 15, 2019, the Court issued an order
to show cause, ordering both parties to address the
allegations of fraudulent joinder set forth by Defendants in
their Notice of Removal. (Dkt. 2.) The Court also ordered
Defendants to properly assert the citizenship of all parties.
Defendants filed an answer to the Court's order, and
Plaintiffs responded to Defendants. (Dkts. 3, 4.)
must be established as a threshold matter. Steel Co. v.
Citizens for a Better Env't, 523 U.S. 83, 94-95
(1998). To establish jurisdiction based on diversity, the
amount in controversy must exceed $75, 000, and diversity of
citizenship must exist. 28 U.S.C. § 1332(a). Complete
diversity requires all parties on one side of the controversy
to be of diverse citizenship from all parties on the other
side. See Newman-Green, Inc. v. Alfonzo-Larrain, 490
U.S. 826, 828-29 (1989). Defendants, as the removing parties,
bear the burden of showing that federal jurisdiction exists
at the time of removal. See Eastman v. Marine Mech.
Corp., 438 F.3d 544, 549 (6th Cir. 2006).
initially asserted that Plaintiffs are residents of Michigan
and Defendant Meathe is a resident of Florida. (Dkt. 1, Pg ID
2.) They argued that the citizenship of Defendant Hampton
Ridge Properties, LLC (“Hampton Ridge”), a
Michigan limited liability company, did not defeat diversity
because Hampton Ridge was fraudulently joined. However, as
noted in the Court's order to show cause, a limited
liability company has the citizenship of its members. See
V&M Star, LP v. Centimark Corp., 596 F.3d 354, 356
(6th Cir. 2010). Defendants now assert that the sole member
of Hampton Ridge is co-defendant Meathe, so it too is a
citizen of Florida. (See dkt. 3, Pg ID 28.) Thus,
even if there was no fraudulent joinder and Hampton Ridge is
a proper party to this suit, they argue, there is complete
diversity in this case. Defendants also reassert their
allegations that Hampton Ridge was fraudulently joined in
this case. (Id. at Pg ID 28-30.) Plaintiffs take the
exact opposite position. They argue that Hampton Ridge is a
proper party in this suit, but even if was fraudulently
joined and should therefore be dismissed from this suit,
there is still no diversity in this case. (Dkt. 4.) They
dispute that Plaintiffs are only citizens of Michigan.
Court will first address Defendants' allegations of
fraudulent joinder. “Fraudulent joinder is a judicially
created doctrine that provides an exception to the
requirement of complete diversity.” Casias v.
Wal-Mart Stores, Inc., 695 F.3d 428, 432-33 (6th Cir.
2012) (internal quotation marks and citation omitted). The
relevant inquiry in determining whether a non-diverse party
has been fraudulently joined is whether there is a colorable
basis for predicting that the plaintiff may recover against
that party. Id. When a non-diverse party has been
shown to be fraudulently joined, the proper procedure is to
dismiss that party from the suit. Probus v. Charter
Commc'ns, LLC, 234 Fed.Appx. 404, 407 (6th Cir.
light of Defendants' assertion that Hampton Ridge has the
same citizenship as Defendant Meathe (and Plaintiff does not
dispute this point), fraudulent joinder has become a
non-issue in this case. Either both Meathe and Hampton Ridge
are non-diverse (and remand is appropriate) or they are both
diverse (and this case is appropriately before the Court). In
either case, whether liability can be imposed on Hampton
Ridge in this suit is not determinative of whether the Court
has jurisdiction. Thus, there is no need for the Court to
resolve the fraudulent joinder issue.
also argue that if Defendants are citizens of Florida as they
claim to be, complete diversity is lacking in this case
because some of the plaintiffs are citizens of Florida as
well. Plaintiffs first assert that either one or both of the
defendants are members of Plaintiff TGINN Jets, LLC
(“TGINN”), and thus it too is a citizen of
Florida on that basis. (Dkt. 4, Pg ID 41.) This fact alone,
if proven, would defeat diversity. However, the only evidence
Plaintiffs have provided in support of this assertion is an
operating agreement for TGINN allegedly signed by Defendant
Meathe. (See dkt. 4-5, Pg ID 81.)
also assert that one of Plaintiff Slavik &
Associates' members, Joseph Ronald Slavik, is a citizen
of Florida. (Dkt. 4, Pg ID 39.) Slavik & Associates, in
turn, they assert, is a member of TGINN, so the citizenship
of Mr. Slavik impacts both Plaintiffs TGINN and Slavik &
Associates. (Id. at Pg ID 40.) To prove that Mr.
Slavik is a citizen of Florida, and not a citizen of Michigan
as Defendants had stated he was, Plaintiffs have provided his
sworn affidavit. (Dkt. 4-7.) The affidavit of Mr. Slavik
states that he resides in Florida. He has also provided a
copy of his current Florida driver's license dated
January 18, 2018. However, state citizenship is not based
solely on residence. Rather, for purposes of diversity, state
citizenship is equated with domicile. Von Dunser v.
Aronoff, 915 F.2d 1071, 1072 (6th Cir. 1990) (citations
omitted). “A person's previous domicile is not lost
until a new one is acquired. Establishment of a new domicile
is determined by two factors: residence in the new domicile,
and the intention to remain there.” Id. Mr.
Slavik's affidavit implies that he recently moved to
Florida and does not indicate whether he intends to remain
there. Thus, it is unclear whether he has lost his previous
domicile (presumably Michigan) and acquired a new domicile in
Florida. Because the Court does not have before it sufficient
evidence to establish the citizenship of Plaintiffs,
the Court will convene an evidentiary hearing on
April 24, 2019 at 10:00 a.m. on the issue of whether
this Court has diversity jurisdiction over this case.
 Plaintiffs question whether Defendants
are indeed citizens of Florida. (See dkt. 4, Pg ID
40.) Defendants, however, have submitted the sworn affidavit
of Defendant Meathe, attesting that he has lived in the state
of Florida since 2002 and has no connection to Michigan,
other than to visit his mother once a year. (Dkt. 3, Pg ...