United States District Court, M.D. Alabama, Eastern Division
MEMORANDUM OPINION AND ORDER 
RUSS WALKER UNITED STATES MAGISTRATE JUDGE.
matter is before the court on the plaintiffs' motion to
remand, two motions to take jurisdictional discovery, and
motion to enforce an October 2017 settlement agreement.
See Doc. 31; Doc. 54; Doc. 63. Also before the court
are plaintiffs' motion to strike portions of
defendant's response in opposition to plaintiffs'
motion to enforce settlement agreement,  see Doc.
37, and defendants' motion for leave to file a sur-reply
in response to a March 23, 2018 show cause order regarding
the existence of subject matter jurisdiction at the time of
removal. See Doc. 56. Defendants oppose the
plaintiffs' motions. Plaintiffs have taken no position on
defendants' motion for leave to file a sur-reply. The
motions have been briefed and are ready for review.
consideration, all pending motions will be denied for the
reasons discussed herein. Also, defendants will be ordered to
file an answer to plaintiffs' complaint, and the parties
will be directed to confer and file a report of parties'
planning meeting in accordance with Federal Rule of Civil
Plaintiffs' Motion to Remand
reasons set out in the court's March 23, 2018, order to
show cause, complete diversity appears not to have been
present at the time of the removal of this action.
See Doc. 46. In a brief filed on April 10, 2018,
plaintiffs moved to remand this cause to the Circuit Court of
Lee County, Alabama, on the basis of lack of diversity.
See Doc. 54.
March 23 show cause order, the undersigned set out the
following, inter alia:
Federal courts are courts of limited jurisdiction. See
Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375,
377 (1994); see also Burns v. Windsor Ins. Co., 31
F.3d 1092, 1095 (11th Cir. 1994). A federal district court is
“‘empowered to hear only those cases within the
judicial power of the United States as defined by Article III
of the Constitution, ' and which have been entrusted to
them by a jurisdictional grant authorized by Congress.”
Univ. of S. Ala. v. Am. Tobacco Co., 168 F.3d 405,
409 (11th Cir. 1999) (quoting Taylor v. Appleton, 30
F.3d 1365, 1367 (11th Cir. 1994)). Therefore, a federal court
is obligated to inquire sua sponte into subject
matter jurisdiction “at the earliest possible stage in
the proceedings.” Id. at 410.
When, as here, the purported statutory basis for federal
jurisdiction is 28 U.S.C. § 1332(a)(1) - a civil action
satisfying the amount-in-controversy requirement and between
“citizens of different States” - there must be
“complete diversity of citizenship. That is, diversity
jurisdiction does not exist unless each defendant is a
citizen of a different State from each plaintiff.”
Owen Equip. & Erection Co. v. Kroger, 437 U.S.
365, 373 (1978). See also Hernandez v. Ferris, 917
F.Supp.2d 1224, 1226-27 (M.D. Fla. 2012) (“Federal
courts have diversity jurisdiction over civil actions when
the amount in controversy exceeds $75, 000 and the action is
between citizens of different states. 28 U.S.C. §
1332(a). Diversity jurisdiction requires complete diversity;
every plaintiff must be diverse from every
defendant.”). The court is concerned that the parties
are not completely diverse based on a recent filing by the
plaintiffs, see Doc. 31; Doc. 31-15, and the
court's subject matter jurisdiction must be confirmed
before this case can proceed any further.
On June 27, 2016, defendants Brent Gladden and University
Real Estate Group, LLC, removed this cause to this court from
the Circuit Court of Lee County, Alabama, on the basis of
diversity jurisdiction. See Doc. 1. In the notice of
removal, the defendants represented that the parties are
completely diverse because the plaintiffs are citizens of
Georgia and the defendants are citizens of Alabama. See
Id. at 5. In support of the notice of removal, Mr.
Gladden submitted an affidavit in which he testified that he
is a resident of Alabama, and that he is the sole member of
University Real Estate Group, LLC. See Doc. 1-3 at 2
(“I am the President and sole member of University Real
Estate Group, LLC ... an Alabama limited liability company
with its principal place of business in Auburn,
Alabama.”). After removal, the plaintiffs did not seek
remand due to a lack of complete diversity. Also, as it must,
the court assured itself of subject matter jurisdiction at
the time of removal and concluded that the parties were
completely diverse based on the defendants'
representations in the notice of removal and Mr.
Gladden's affidavit testimony. See Univ. of S.
Ala., 168 F.3d at 409-10.
However, in the motion to enforce a settlement agreement
filed on February 12, 2018, the plaintiffs represent that Mr.
Gladden is not the sole member of University Real Estate
Group, LLC. See Doc. 31 at 6-8. An exhibit to that
motion is an email sent by Mr. Gladden on January 11, 2018,
that states, in relevant part, “I did not originally
realize that all members [of University Real Estate Group,
LLC] had not executed the document to transfer all interest
in [University Real Estate Group, LLC] to me, this was done
in 2014. The one remaining member ... is now residing in
Atlanta.” Doc. 31-15 at 1-2. That omission potentially
has jurisdictional significance. “A limited liability
company, unlike a corporation, is a citizen of any state of
which one of its members is a citizen, not of the state where
the company was formed or has it principal office.”
Dasan USA, Inc. v. Weapon Enhancement Solutions LLC,
2016 WL 3996242, at *1 (N.D.Ga. 2016) (citing Rolling
Greens MHP, L.P. v. Comcast SCH Holdings L.L.C., 374
F.3d 1020, 1022 (11th Cir. 2004)). “And, therefore
…a limited liability company could be deemed a citizen
of more than one state ….” Guthrie v. U.S.
Government, 2014 WL 12742190 at *2 (S.D. Fla. 2014).
Thus, the fact that a member of University Real Estate Group,
LLC, resides in Atlanta, Georgia, materially contradicts the
defendants' representation in the notice of removal that
University Real Estate Group, LLC, is a citizen of Alabama
for purposes of diversity jurisdiction.
Based on the new information of record - i.e., that
a member of University Real Estate Group, LLC, resides in
Atlanta - it appears that University Real Estate Group, LLC
is a citizen of Alabama and Georgia. See Guthrie,
supra. It is undisputed that the plaintiffs are
citizens of Georgia. “[B]ecause federal courts are of
limited jurisdiction ‘there is a presumption against
the exercise of federal jurisdiction, such that all
uncertainties as to removal jurisdiction are to be resolved
in favor of remand.'” Hernandez, 917
F.Supp.2d at 1226 (quoting Russell Corp. v. Am. Home
Assur. Co., 264 F.3d 1040, 1050 (11th Cir. 2001));
see also Scimone v. Carnival Corp., 720 F.3d 876,
882 (11th Cir. 2013); Upper Chattahoochee Riverkeeper
Fund, Inc. v. City of Atlanta, 701 F.3d 669, 680 (11th
Cir. 2012). Thus, construing all doubts against the exercise
of federal jurisdiction, complete diversity does not exist
among the parties on the record now before this court, and
the court lacks subject matter jurisdiction.
The defendants did not alert the court that Mr. Gladden's
affidavit testimony in support of the notice of removal was
inaccurate based on his recent recollection that he is not
the sole member of University Real Estate Group, LLC, and
that one of the members of University Real Estate Group, LLC,
resides in Atlanta. As to this material change of fact
regarding the parties' citizenship, defendants also have
not attempted to explain whether there was subject matter
jurisdiction at the time of removal or whether it exists at
present, given that the plaintiffs and a defendant appear to
be citizens of Georgia. “The party seeking to invoke a
federal forum traditionally bears the burden of persuasion on
jurisdictional issues such as establishing the citizenship of
the parties.” Life of the S. Ins. Co. v.
Carzell, 851 F.3d 1341, 1344 (11th Cir. 2017) (citing
McNutt v. Gen. Motors Acceptance Corp. of Ind., 298
U.S. 178, 189, 56 S.Ct. 780, 80 L.Ed. 1135 (1936);
Burns, 31 F.3d at 1094 (“The defendant can
remove to federal court if he can show, by a preponderance of
the evidence, facts supporting jurisdiction.”)).
See also Kokkonen, 511 U.S. at 377 (“It is to
be presumed that a cause lies outside [a federal court's]
limited jurisdiction, and the burden of establishing the
contrary rests upon the party asserting
jurisdiction.”); Williams v. Best Buy Co.,
Inc., 269 F.3d 1316, 1319 (11th Cir. 2001) (the party
who removes a case to federal court must demonstrate subject
matter jurisdiction). Therefore, to remain in federal court,
the defendants must establish that the parties are completely
diverse in light of the evidence that a member of University
Real Estate Group, LLC, resides in Atlanta, Georgia.
Doc. 46 at 1-5.
response to the show cause order, the plaintiffs argued that
other non-diverse members of University Real Estate Group,
LLC, had not transferred their interests in the LLC to Mr.
Gladden in 2014 because the members failed to comply with the
unanimity requirement of the LLC's operating agreement.
See Doc. 36. After the defendants responded to the
show cause order, however, defendants filed evidence showing
that the non-diverse members of University Real Estate Group,
LLC unequivocally waived the unanimity requirement of the
operating agreement as of April 2, 2018 - the last date a
member of the LLC acknowledged the transfer of interest to
Gladden and waived the unanimity requirement. See
Doc. 50 at 4; Doc. 50-8. See also Doc. 54 at 15
(Plaintiffs assert that “[i]t was not until early 2018
that the parties reflected unanimity to transfer their
membership interests.”). Plaintiffs argue that the 2018
waiver is not an unequivocal reflection that the members of
the LLC intended to waive the unanimity requirement.
See Doc. 54 at 15. The court cannot agree.
the waiver of rights under a contract generally …
‘[a] waiver will not be implied from slight
circumstances, but must be evidenced by an unequivocal and
decisive act, clearly proved.'” Ex parte
Textron, Inc., 67 So.3d 61, 66 (Ala. 2011) (quoting
Isom v. Johnson, 205 Ala. 157, 159-60, 87 So. 543,
545 (Ala. 1920)). The April 2, 2018 acknowledgement
constitutes clear evidence of “an unequivocal and
decisive act” by the members of University Real Estate
Group, LLC, to waive the unanimity requirement and to affirm
that all interest in the LLC has been transferred to Gladden.
The evidence of record establishes that Gladden is the sole
member of University Real Estate Group, LLC. Gladden is a
citizen of Alabama, and, because he is the sole member of the