United States District Court, D. Nevada
M. NAVARRO, CHIEF JUDGE UNITED STATES DISTRICT JUDGE
before the Court is the Motion to Dismiss, (ECF No. 38),
filed by Defendant St. Paul Fire and Marine Insurance Company
(“St. Paul”). Defendant Federal Insurance Company
(“Federal Insurance”) joined the Motion, (ECF No.
40). Plaintiff Centex Homes (“Plaintiff) filed a
Response, (ECF No. 48), and St. Paul filed a Reply, (ECF No.
53). For the reasons discussed below, the Court
GRANTS St. Paul's Motion.
case arises out of a separate lawsuit in which homeowners
from developments built by Plaintiff filed a construction
defect action against Plaintiff in state court. See
Christopher & Phyllis Kachnik, et al. v. Centex Homes, et
al., District Court, Clark County, Nevada, Case No.
A-15-726385-D (the “Kachnik case”).
Specifically, the Kachnik case alleges that
Plaintiff, a homebuilder, built homes in various developments
that contained “defective and negligent engineering and
construction” for which the homeowners want to hold
Plaintiff liable. (Compl. ¶ 60, ECF No. 1). Plaintiff
asserts that due to the Kachnik case, Plaintiff
“has incurred and will continue to incur significant
costs, including, but not limited to, forensic,
investigative, and repair costs, attorneys' fees and
other expenses.” (Id. ¶ 62).
of the Kachnik case, Plaintiff filed the present
action on August 17, 2016, against Defendants Navigators
Specialty Insurance Company, Everest National Insurance
Company, Interstate Fire & Casualty Company, Lexington
Insurance Company, Federal Insurance, Underwriters at
Lloyd's London, and St. Paul (collectively
“Defendants”). Plaintiff's Complaint seeking
indemnity alleges the following causes of action: (1) breach
of contract; (2) breach of the implied covenant of good faith
and fair dealing; (3) violations of Nevada's Unfair
Claims Settlement Practices Action; and (4) declaratory
relief. (Compl. ¶¶ 98- 119).
December 30, 2016, St. Paul filed the instant Motion to
Dismiss for Lack of Jurisdiction pursuant to Federal Rule of
Civil Procedure 12(b)(1). St. Paul alleges that the Court
does not have jurisdiction over this case because Plaintiff
failed to allege complete diversity of Defendants. (Mot. to
Dismiss (“MTD”) 3:3-5).
Rule of Civil Procedure 12(b)(1) provides for dismissal of an
action for lack of subject matter jurisdiction. “A
party invoking the federal court's jurisdiction has the
burden of proving the actual existence of subject matter
jurisdiction.” Thompson v. McCombe, 99 F.3d
352, 353 (9th Cir. 1996). A motion to dismiss for lack of
subject matter jurisdiction pursuant to Rule 12(b)(1) may
take one of two forms. Thornhill Publ'g Co. v.
General Tel. & Elec. Corp., 594 F.2d 730, 733 (9th
Cir. 1979). It may be a “facial” challenge or it
may be a “factual” challenge. Id.
“In a facial attack, the challenger asserts that the
allegations contained in a complaint are insufficient on
their face to invoke federal jurisdiction.” Safe
Air for Everyone v. Meyer, 373 F.3d 1035, 1039 (9th Cir.
“[a] factual challenge relies on affidavits or any
other evidence properly before the court to contest the truth
of the complaint's allegations.” Courthouse
News Serv. v. Planet, 750 F.3d 776, 780 (9th Cir. 2014).
When a factual challenge is asserted, the Court need not
presume the truthfulness of the allegations in the complaint.
See Meyer, 373 F.3d at 1039; White v. Lee,
227 F.3d 1214, 1242 (9th Cir. 2000). “Once the moving
party has converted the motion to dismiss into a factual
motion by presenting affidavits or other evidence properly
brought before the court, the party opposing the motion must
furnish affidavits or other evidence necessary to satisfy its
burden of establishing subject matter jurisdiction.”
Savage v. Glendale Union High Sch., 343 F.3d 1036,
1040 (9th Cir. 2003).
courts have jurisdiction in civil actions where there is
complete diversity of citizenship among the parties and the
amount in controversy exceeds $75, 000, exclusive of interest
and costs.” See Crum v. Circus Circus
Enterprises, 231 F.3d 1129, 1131 (9th Cir. 2000) (citing
28 U.S.C. § 1332(a)).
Paul alleges that this Court does not have jurisdiction
because Plaintiff “fails to allege properly the
citizenship of Defendant Certain Underwriters at Lloyd's,
London” (“Lloyd's”). (MTD 3:7-9).
Specifically, St. Paul alleges that “Lloyd's is not
a traditional insurance company, but rather a uniquely
structured marketplace” where members are called
“Names” and “each Name invests in a
percentage of an insurance policy risk.” (Id.
5:1-3). Together, these Names “comprise
‘Syndicates, ' or groups of hundreds to thousands
of Names, ” and these Syndicates are treated as
“unincorporated associations or groups for
jurisdictional purposes.” (Id. 5:4-8). St.
Paul seeks dismissal because Plaintiff fails to “allege
the citizenship of any Name in the Syndicate that purchased
the insurance risk at issue, ” and Plaintiff fails to
“identify the citizenship of the lead underwriters
assigned the Syndicate.” (MTD 6:8-10).
Complaint, Plaintiff alleges that Lloyd's is “an
England corporation with its principal place of business in
London, England.” (Compl. ¶ 11). Moreover,
Plaintiff contends that “Lloyd's is no longer
comprised of individual members with unlimited personal
liability and now has a central corporate fund to meet
liabilities.” (Resp. 2:8-10). Plaintiff asserts that
“Lloyd's is a corporation organized under the laws
of England with its principal place of business in
England-this should end the inquiry regarding
diversity.” (Id. 4:20-21).
corporation, even if a foreign one, is a citizen of the state
of its incorporation and the state where it has its principal
place of business. 28 U.S.C. § 1332(c)(1); Danjaq,
S.A. v. Pathe Communications Corp., 979 F.2d 772, 774
(9th Cir. 1992) (holding that § 1332(c) makes “no
distinction [ ] between those corporations incorporated in a
state of the United States and those incorporated in a
foreign country”). Unincorporated entities, such as
partnerships, however, have the citizenship of all of their
members. Carden v. Arkoma Associates, 494 U.S. 185,
195- 96 (1990); Johnson v. Columbia Properties Anchorage,
LP, 437 F.3d 894, 899 (9th Cir. 2006) (“In cases
where entities rather than ...