Jones v. Dalrymple , 679 F. App'x 668 ( 2017 )

FILED
United States Court of Appeals
UNITED STATES COURT OF APPEALS Tenth Circuit
FOR THE TENTH CIRCUIT February 14, 2017
_________________________________
Elisabeth A. Shumaker
Clerk of Court
A. KATHLEEN JONES,
Plaintiff - Appellant,
v. No. 15-3183
(D.C. No. 6:14-CV-01245-SAC-GEB)
MICHAEL DALRYMPLE; SHARON (D. Kan.)
MCCAFFREY; CAROL KLATASKE,
Defendants - Appellees,
and
LEE DALRYMPLE SPECIAL NEEDS
TRUST,
Defendant.
_________________________________
ORDER AND JUDGMENT*
_________________________________
Before BACHARACH, PHILLIPS, and McHUGH, Circuit Judges.**
_________________________________
*
This order and judgment is not binding precedent, except under the doctrines
of law of the case, res judicata, and collateral estoppel. It may be cited, however, for
its persuasive value consistent with Fed. R. App. P. 32.1 and 10th Cir. R. 32.1.
**
After examining the briefs, the appellate record, and the parties’ responses
to our order dated January 25, 2017, this panel has determined the oral argument
scheduled for March 21, 2017 would not materially assist in the determination of this
appeal. See Fed. R. App. P. 34(a)(2); 10th Cir. R. 34.1(G). Consequently, that
hearing is vacated, counsel are excused, and the appeal will be submitted without oral
argument.
I. INTRODUCTION
Kathleen Jones filed this breach of contract action against her siblings,
Michael Dalrymple, Sharon McCaffrey, and Carol Klataske, and the Lee Dalrymple
Special Needs Trust (collectively, Defendants), in the United States District Court for
the District of Kansas. The district court dismissed the action as barred by the
doctrines of claim and issue preclusion based on a prior lawsuit brought by Ms. Jones
against Defendants in Kansas state court.
At the time of the prior action, all parties were citizens of the State of Kansas.
Subsequently, Ms. Jones relocated to Ecuador. She then brought the present action,
asserting federal subject matter jurisdiction based on diversity under 28 U.S.C.
§ 1332(a)(2), which governs suits between United States citizens and citizens or
subjects of a foreign country. Because we conclude that Ms. Jones has failed to
establish complete diversity, we must vacate the district court’s order and remand
with instructions to dismiss the action for lack of subject matter jurisdiction.
II. BACKGROUND
Federal 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, 514 (2006). The issue of subject matter
jurisdiction may not be forfeited or waived. Id. A court must dismiss a case if it finds
subject matter jurisdiction lacking at any point in the proceedings. Fed. R. Civ. P.
12(h)(3). There is a presumption against jurisdiction, which the party asserting
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jurisdiction must overcome. Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S.
375, 377 (1994).
Diversity jurisdiction presents questions of both law and fact. While circuit
courts review diversity jurisdiction de novo, we review the district court’s findings of
domicile for clear error. We will reverse only if the district court’s finding lacks
factual support in the record. Middleton v. Stephenson, 749 F.3d 1197, 1201 (10th
Cir. 2014).
III. DISCUSSION
Ms. Jones asserted that she “resides in Ecuador,” that the amount in
controversy exceeds $75,000, and that these facts satisfy the requirements of
§ 1332(a)(2). {Compl. 1-2, Aug. 8, 2014.} But at the time of the state court
proceedings, Ms. Jones and the defendants in this case were all citizens of Kansas.
{Appellee’s Br. at 4.} Even accepting that she has moved to Ecuador, Ms. Jones has
failed to establish federal subject matter jurisdiction.
A United States citizen domiciled in a foreign country is not a “citizen[] or
subject[] of a foreign state,” but is stateless and unable to assert jurisdiction under 28
U.S.C. § 1332(a)(2) or § 1332(a)(1), which governs suits between citizens of
different States. See Newman-Green, Inc. v. Alfonzo-Larrain, 490 U.S. 826, 828–29
(1989). A United States citizen living abroad may only invoke diversity jurisdiction
if the party is domiciled in a particular State and satisfies the diversity requirements
of 28 U.S.C. § 1332(a)(1). Frett-Smith v. Vanterpool, 511 F.3d 396, 400 (3d Cir.
2008). Courts have increasingly found that even when the United States citizen
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possesses dual citizenship, only the American citizenship is relevant to finding
diversity under 28 U.S.C. § 1332(a)(2). Id. at 399–400 (citing Coury v. Prot, 85 F.3d
244, 250 (5th Cir. 1996); Action S.A. v. Marc Rich & Co., 951 F.2d 504 (2d Cir.
1991); Sadat v. Mertes, 615 F.2d 1176 (7th Cir. 1980); Mutuelles Unies v. Kroll &
Linstrom, 957 F.2d 707 (9th Cir. 1992); Las Vistas Villas, S.A. v. Petersen, 778 F.
Supp. 1202 (M.D. Fla. 1991), aff'd, 13 F.3d 409 (11th Cir. 1994)).
In the district court, Ms. Jones failed to put forth any evidence that she satisfied 28
U.S.C. § 1332(a)(2) by having renounced her United States citizenship. As a result, we
were unable to ascertain whether we had subject matter jurisdiction over this appeal. We
therefore entered an Order on January 25, 2017, directing the parties to file separate
written responses to show cause why the appeal should not be dismissed for lack of
subject matter jurisdiction. Within fourteen days of the Order, each party was ordered to
address:
whether diversity jurisdiction is proper under 28 U.S.C. §1332(a)(2) when
it appears all parties are citizens of Kansas. See Newman Green Inc. v.
Alfonzo-Larrain, 490 U.S. 826, 828-29 (1989); See also Louisiana
Municipal Police Employees’ Retirement System v. Wynn, 829 F.3d 1048,
1056-57 (9th Cir. 2016)(discussing when a party is a citizen for purposes of
establishing diversity); Molinos Valle Del Cibao, C. por A. v. Lama, 633
F.3d 1330, 1341 (11th Cir. 2011)(discussing difference between domicile
and residence). In filing the responses, the parties should also address with
particularity whether diversity exists given Ms. Jones’ domicile in Ecuador
but apparent citizenship in Kansas. See Frett-Smith v. Vanterpool, 511 F.3d
396, 400 (3rd Cir. 2008)(concluding “that for purposes of diversity
jurisdiction, only the American nationality of a dual national is
recognized”).
Defendants responded and concede that Ms. Jones failed to establish federal
subject matter jurisdiction. They argue that Ms. Jones should be required to file an
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affidavit resolving the question of her citizenship, or that this appeal and the district
court action should be dismissed. Ms. Jones also filed a response to the Order.
Although she concedes that she does not fall within § 1332(a)(2), she asks us to
exercise jurisdiction despite that deficiency so that she will not be deemed stateless
for purposes of federal jurisdiction. We decline Ms. Jones’s invitation and instead
follow the Supreme Court’s direction in Newman-Green, and that of every federal
circuit to have considered the issue. Newman-Green, 490 U.S. at 828–29.
Defendants are all citizens of Kansas. Ms. Jones was a citizen of Kansas and
now resides in Ecuador. She has provided no evidence from which we could conclude
that she has relinquished her United States citizenship and is now a citizen or subject
of a foreign country as required for jurisdiction under § 1332(a)(2). Accordingly, the
district court lacked subject matter jurisdiction over this action and it must be
dismissed.
IV. CONCLUSION
Ms. Jones has failed to establish that she is a citizen or subject of a
foreign country, as required under 28 U.S.C. § 1332(a)(2). We therefore vacate the
district court’s judgment and remand with instructions to dismiss the action for lack
of subject matter jurisdiction.
ENTERED FOR THE COURT
Carolyn B. McHugh
Circuit Judge
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