Opinion
Civil No. 3:04-CV-1627-H.
January 14, 2005
MEMORANDUM OPINION AND ORDER
Before the Court is Plaintiffs' Motion to Remand, filed December 20, 2004. Defendants have filed no Response.
On July 13, 2004, Plaintiffs filed the instant case in state court. On July 27, 2004, Defendants removed the case to this Court on the basis of diversity jurisdiction. 28 U.S.C. §§ 1332, 1441. Plaintiffs now move to remand the case to state court alleging incomplete diversity.
Diversity jurisdiction requires complete diversity of citizenship. 28 U.S.C. § 1332(a)(1). "The party seeking removal bears a heavy burden" of establishing facts supporting federal jurisdiction. Smallwood v. Ill. Central R.R. Co., 385 F.3d 568, 568 (5th Cir. 2004); Estate of Martineau v. ARCO Chem. Co., 203 F.3d 904, 910 (5th Cir. 2000).
Plaintiffs assert that incomplete diversity of citizenship exists between Metalogic, LLC ("Metalogic"), and Logistic Solutions, Inc., because one of Metalogic's members is a resident of New Jersey. (Limaye Aff. at 1; Bhatia Aff. at 1.) District courts sitting in diversity jurisdiction look to state law to see who has the substantive right which is being asserted. See Farrell Constr. Co. v. Jefferson Parish, La., 896 F.2d 136, 140 (5th Cir. 1990). The Court finds that Metalogic is not merely nominal or formal party, but has colorable claims under Texas law for, inter alia, breach of fiduciary duty and unfair competition. See 7547 Corp. v. Parker Parsley Dev't Partners, 38 F.3d 211, 222 (5th Cir. 1994); UICI v. Gray, No. Civ.A. 3:01-CV-0921-L, 2002 WL 356753, at *5 (N.D. Tex. Mar. 1, 2002); TEX. BUS. ORG. CODE § 101.463(b) (Vernon 2004). ( See Orig. Pet. at 8-12.)
Because the Court finds that Metalogic is a real party in interest, complete diversity is required between all plaintiffs, including Metalogic, and defendants. Unincorporated artificial entities such as Metalogic assume the citizenship of each of their members. See Carden v. Arkoma Assocs., 494 U.S. 185, 195-96 (1990). Because Metalogic has a New Jersey member and Logistic Solutions, Inc. is a New Jersey resident, complete diversity does not exist. Therefore, Defendants have failed to meet their "heavy burden" to establish diversity jurisdiction.
Accordingly, the Court REMANDS the case to the 160th District Court of Dallas County, Texas, for further proceedings. See Smallwood, 385 F.3d at 572.
SO ORDERED.