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Neubrand v. Andreson Lands Limited LP

United States District Court, Ninth Circuit

December 3, 2013

William Neubrand, co-personal representative of Estate of William H. Andreson; Dolores Neubrand, co-personal representative of Estate of William H. Andreson, Plaintiffs,
v.
Andreson Lands Limited LP, a Kansas limited partnership; Joseph A. Hambright, husband; Jane Doe Hambright, wife; Wilbur Andreson, Dr./husband; and Jane Doe Andreson, wife, Defendants.

ORDER

G. MURRAY SNOW, District Judge.

Pending before the Court is Plaintiffs' Motion to Remand to State Probate Court. (Doc. 8.) For the following reasons, the Motion is granted.

BACKGROUND

This matter arises out of a partnership interest in Defendant Andreson Lands Limited, LP ("Andreson Lands"). Through his estate, representatives of decedent William H. Andreson attempted to convey his partnership interest in Andreson Lands to a trust. (Doc. 1-1 at 5.) That attempted transfer triggered a right of first refusal by the other Andreson Lands partners, Defendants Joseph A. Hambright and Wilbur Andreson. ( Id. at 4-5.) They attempted to exercise their right to purchase the partnership interest, but Plaintiffs allege that the attempt was untimely and the offered payment was inadequate. ( Id. at 4-6.)

William H. Andreson was a resident of Arizona and his probate proceedings are pending in Arizona. (Doc. 1 at 3.) Plaintiffs William and Dolores Neubrand are residents of Texas but appear in this matter as co-personal representatives of the Estate of William H. Andreson. ( Id. ) Defendants Joseph A. Hambright and Wilbur Andreson are residents of Colorado and Oregon respectively. ( Id. ) Defendant Andreson Lands is a Kansas limited partnership. ( Id. )

On May 31, 2013, Plaintiffs William and Dolores Neubrand filed a Petition for Declaratory Judgment in Pinal County Superior Court. (Doc. 1-1.) On July 3, 2013, Defendants filed a Notice of Removal to this Court. (Doc. 1.) Plaintiffs now bring this Motion to Remand, arguing that diversity jurisdiction in this Court is not proper because inter alia there is not complete diversity between the parties nor has the amount in controversy been shown to exceed $75, 000. (Doc. 8.)

DISCUSSION

I. Remand

"[A]ny civil action brought in a State court of which the district courts of the United States have original jurisdiction, may be removed by the defendant or the defendants, to the district court of the United States for the district and division embracing the place where such action is pending." 28 U.S.C. § 1441(a). A party may remove an action from state court only if the action could have been brought in the district court originally. Ramirez v. Fox Television Station, Inc., 998 F.2d 743, 747 (9th Cir. 1993). The Court has diversity jurisdiction over an action in which the parties are not citizens of the same state and "the matter in controversy exceeds the sum or value of $75, 000, exclusive of interest and costs." 28 U.S.C. § 1332(a).

The party asserting federal jurisdiction has the burden of proof on a motion to remand to state court. Gaus v. Miles, Inc., 980 F.2d 564, 566 (9th Cir. 1992). The removal statute is strictly construed against removal jurisdiction. Id. (citing Emrich v. Touche Ross & Co., 846 F.2d 1190, 1195 (9th Cir. 1988)). There is a "strong presumption" against removal jurisdiction, and "[f]ederal jurisdiction must be rejected if there is any doubt as to the right of removal in the first instance." Id.

For purposes of diversity jurisdiction, Plaintiffs William and Delores Neubrand are citizens of Arizona. 28 U.S.C. § 1332(c)(2) provides that "the legal representative of the estate of a decedent shall be deemed to be a citizen only of the same State as the decedent." The Neubrands are the legal representatives of William H. Andreson, and he was a citizen of Arizona at the time of his death. Neither side disputes that both Plaintiffs are only citizens of Arizona for purposes of diversity of citizenship.

Defendant Andreson Lands is also a citizen of Arizona for diversity-jurisdiction purposes, and that is also not in dispute. Unincorporated associations or entities are citizens of each of the states in which their constituent members or partners are citizens. Carden v. Arkoma Assocs., 494 U.S. 185 (1990). William H. Andreson was a partner in Andreson Lands and a citizen of Arizona at the time of his death.

Defendant Andreson Lands shares Arizona citizenship in common with the Plaintiffs and diversity jurisdiction does not exist if both are properly joined parties. Recognizing this, Defendants Joseph A. Hambright and Wilbur Andreson argue that the citizenship of Andreson Lands should be ignored because it is only a party as a result of a fraudulent or collusive joinder.

A court may ignore the presence of a non-diverse defendant if that defendant has been fraudulently or improperly joined. Hunter v. Philip Morris USA, 582 F.3d 1039, 1043 (9th Cir. 2009). "Joinder is fraudulent [i]f the plaintiff fails to state a cause of action against a resident defendant, and the failure is obvious according to the settled rules of the state.'" Id. (quoting Hamilton Materials, Inc. v. Dow Chem. Corp., 494 F.3d 1203, 1206 (9th Cir. 2007)). The removing party bears the heavy burden of proof, and "if there is any possibility that the state law might impose liability on a resident defendant under the circumstances alleged in the complaint, the federal court cannot find that joinder of the resident defendant was fraudulent, and remand is necessary." Id. at 1044 (quoting Florence v. Crescent Res., LLC, 484 F.3d 1293, 1299 (11th Cir. 2007)). A ...


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