United States District Court, D. Arizona
Honorable John J. Tuchi United States District Judge.
issue are the following Motions: (1) Plaintiff Jason Lou
Peralta's Motion to Amend Order Dated January 22, 2018
(Doc. 64, Mot. to Amend Order), to which Defendants filed a
Response (Doc. 67, Resp. to Mot. to Amend Order); (2)
Plaintiff's Motion to Amend the Complaint (Doc. 70, Mot.
to Amend Compl.), to which Defendant filed an Opposition
(Doc. 73, Opp.), and Plaintiff filed a Reply (Doc. 74); and
(3) Plaintiff's Motion for Hearing (Doc. 79, Mot. for
Hearing), to which Defendants filed a Response (Doc. 80,
Resp. to Mot. for Hearing). Although Plaintiff has requested
oral argument for each brief and by separate Motion, the
Court finds the matters appropriate for resolution without
such argument. See LRCiv 7.2(f). Accordingly, the
Court will deny all of Plaintiff's pending motions.
Further, upon sua sponte review of Plaintiff's
operative Complaint, the Court concludes that Plaintiff's
allegations are insufficient to establish subject matter
jurisdiction. The Court therefore will dismiss
Plaintiff's Complaint (Doc. 1). . . . .
may amend a pleading once as a matter of course within 21
days after serving it, or within 21 days of service of,
inter alia, a Rule 12(b)(6) motion. Fed.R.Civ.P.
15(a). In all other circumstances, absent the opposing
party's written consent, a party must seek leave to amend
from the court. Fed.R.Civ.P. 15(a)(2).
Although the decision to grant or deny a motion to amend is
within the trial court's discretion, “Rule 15(a)
declares that leave to amend shall be freely given when
justice so requires.” Foman v. Davis, 371 U.S.
178, 182 (1962) (citation and internal quotation marks
omitted). “In exercising its discretion with regard to
the amendment of pleadings, a court must be guided by the
underlying purpose of Rule 15-to facilitate a decision on the
merits rather than on the pleadings or technicalities.”
Eldridge v. Block, 832 F.2d 1132, 1135 (9th Cir.
1987) (citation and internal quotation marks omitted).
the policy in favor of allowing amendments is subject to
limitations. After a defendant files a responsive pleading,
leave to amend is not appropriate if the “amendment
would cause prejudice to the opposing party, is sought in bad
faith, is futile, or creates undue delay.” Madeja
v. Olympic Packers, 310 F.3d 628, 636 (9th Cir. 2002)
(citation and internal quotation marks omitted).
“Futility alone can justify the denial of a motion for
leave to amend.” Nunes v. Ashcroft, 375 F.3d
805, 808 (9th Cir. 2003).
proposed amended complaint is futile if it would be
immediately subject to dismissal. Thus, the proper test to be
applied when determining the legal sufficiency of a proposed
amendment is identical to the one used when considering the
sufficiency of a pleading challenged under Rule
12(b)(6).” Nordyke v. King, 644 F.3d 776, 788
n.12 (9th Cir. 2011) (quotations and citations omitted),
aff'd on reh'g en banc on other grounds, 681
F.3d 1041 (9th Cir. 2012). To survive a Rule 12(b)(6) motion,
a complaint must allege “enough facts to state a claim
to relief that is plausible on its face.” Bell
Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007). A
dismissal for failure to state a claim can be based on either
(1) the lack of a cognizable legal theory or (2) insufficient
facts to support a cognizable legal claim. Balistreri v.
Pacifica Police Dep't, 901 F.2d 696, 699 (9th Cir.
Motion to Amend the Complaint
opposition to Plaintiff's Motion to Amend the Complaint,
Defendants raise several arguments, which the Court will
address in turn. However, the Court first addresses the
proposed Amended Complaint's jurisdiction defects, which
Defendants do not address and which alone require denial of
Subject Matter Jurisdiction
state courts, federal courts only have jurisdiction over a
limited number of cases, and those cases typically involve
either a controversy between citizens of different states
(“diversity jurisdiction”) or a question of
federal law (“federal question jurisdiction”).
See 28 U.S.C. §§ 1331, 1332.
“[B]ecause it involves a court's power to hear a
case, ” subject matter jurisdiction “can never be
forfeited or waived.” United States v. Cotton,
535 U.S. 625, 630 (2002). 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, 513-14 (2006). Thus, a federal court is obligated to
inquire into its subject matter jurisdiction in each case and
to dismiss a case when subject matter jurisdiction is
lacking. See Valdez v. Allstate Ins. Co., 372 F.3d
1115, 1116 (9th Cir. 2004); Fed.R.Civ.P. 12(h)(3).
jurisdiction exists in actions between citizens of different
states where the amount in controversy exceeds $75, 000,
exclusive of interest and costs. 28 U.S.C. § 1332(a).
For the purpose of determining diversity of citizenship, a
corporation is a citizen both of its state of incorporation
and the state “where it has its principal place of
business.” 28 U.S.C. § 1332(c)(1). Similarly, a
limited liability company (“LLC”) is a citizen of
every state in which its owners/members are citizens.
Johnson v. Columbia Props. Anchorage, LP, 437 F.3d
894, 899 (9th Cir. 2006). Thus, a plaintiff must
“allege the citizenship of all the members” of an
LLC to properly plead diversity jurisdiction. NewGen, LLC
v. Safe Cig, LLC, 840 F.3d 606, 611 (9th Cir. 2016).
proposed Amended Complaint, Plaintiff names as Defendants
five entities: Bernzomatic, Worthington Industries, Inc.,
Worthington Cylinder Corporation, Worthington Cylinder
Corporation LLC, and Worthington Cylinder Wisconsin LLC. Yet,
Plaintiff's allegations about each entity fail to
establish the Court's diversity jurisdiction over the
matter. First, as to the two LLC Defendants, Plaintiff fails
to allege the citizenship of each member/owner of the LLC.
(See Doc. 70-1, Proposed Am. Compl. ¶¶
6-7.) This alone undermines Plaintiff's assertion of
diversity jurisdiction, renders the proposed Amended
Complaint deficient, and requires that the Court deny the
Motion to Amend. Second, Plaintiff's proposed Amended
Complaint lacks any allegation as to the citizenship of
Bernzomatic. This again renders Plaintiff's assertion of
diversity jurisdiction insufficient and requires denial of
Plaintiff has only alleged the state of incorporation with
regard to the two remaining entities in the proposed Amended
Complaint: Worthington Industries, Inc. and Worthington
Cylinder Corporation. (Proposed Am. Compl. ¶¶ 4-5.)
Because a corporation is a citizen both in its state of
incorporation and in the state where it has its principal
place of business, Plaintiff fails properly plead diversity
jurisdiction when he omits allegations as to a
Defendant's principal place of business. Because of these
three independent inadequacies, Plaintiff fails to
demonstrate that this Court has subject matter jurisdiction
over the Amended Complaint.
closer review, the Court finds that these identical
jurisdictional deficiencies also exist in Plaintiff's
initial Complaint, which remains operative, in part, subject
to the Court's earlier Order. (See Doc. 46, Dec.
4, 2017 Tr. 17:8-24:8.) In his initial Complaint, Plaintiff
alleges only that “Defendant's principle [sic]
place of business is in Ohio.” (Doc. 1, Compl. at 1.)
Just as with the Amended Complaint, this allegation fails to
make clear to which of the four Defendants Plaintiff refers.
Additionally, the Complaint fails to allege the state of
incorporation for each corporate Defendant and the
citizenship of each member/owner of the LLC Defendant.
Because Plaintiff has not adequately pled the citizenship ...