CHG Medical Staffing, Inc. v. San Joaquin Valley Rehabilitation Hospital

[6] 7 UNITED STATES DISTRICT COURT 8 EASTERN DISTRICT OF CALIFORNIA [9] 10 CHG MEDICAL STAFFING, INC. dba Case No. 1:25-cv-00167-SKO Comphealth Medical Staffing, a Delaware 11 corporation, ORDER TO SHOW CAUSE REGARDING SUBJECT MATTER JURISDICTION [12] Plaintiff, 13 (Doc. 1) v. [14] SAN JOAQUIN VALLEY 15 REHABILITATION HOSPITAL, a Delaware limited partnership, [16] 17 Defendant. 18 On February 10, 2025, Plaintiff CHG Medical Staffing, Inc. dba Comphealth Medical 19 Staffing, a Delaware corporation, filed a complaint against Defendant San Joaquin Valley 20 Rehabilitation Hospital, a Delaware limited partnership, asserting claims for breach of contract, 21 breach of implied covenant of good faith and fair dealing, unjust enrichment, and breach of 22 implied duty to perform with reasonable care. (Doc. 1 at 3–5.) 23 Plaintiff asserts this Court has subject matter jurisdiction under 28 U.S.C. § 1332 . (Doc. 1 24 ¶ 3.) The burden of establishing subject matter jurisdiction “rests upon the party asserting 25 jurisdiction.” Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 377 (1994); see also 26 Romero v. Securus Techs., Inc., 216 F. Supp. 3d 1078, 1085 (S.D. Cal. 2016) (“As the party 27 putting the claims before the court, Plaintiffs bear the burden of establishing jurisdiction.”). The 28 Court may consider the issue of subject matter jurisdiction sua sponte at any time during the 1 proceeding, and if the Court finds “it lacks subject matter jurisdiction, the court must dismiss the 2 action.” Fed. R. Civ. P. 12(h)(3); Scholastic Ent., Inc. v. Fox Ent. Grp., Inc., 336 F.3d 982 , 985 3 (9th Cir. 2003). See also Valdez v. Allstate Ins. Co., 372 F.3d 1115, 1116 (9th Cir. 2004) (noting 4 federal courts are “obligated to consider sua sponte whether [they] have subject matter 5 jurisdiction”). As described below, Plaintiff’s complaint fails to sufficiently plead federal 6 jurisdiction. 7 Title 28 U.S.C. § 1332 (a) provides jurisdiction over certain actions between citizens of 8 different states. Complete diversity is a requirement of 28 U.S.C. § 1332 . Thus, the “citizenship 9 of each plaintiff [must be] diverse from the citizenship of each defendant.” Caterpillar Inc. v. 10 Lewis, 519 U.S. 61, 68 (1996). For diversity purposes, corporations are citizens of their states of 11 incorporation and their principal places of business. 28 U.S.C. § 1332 (c); Harris v. Rand, 682 12 F.3d 846 , 850 (9th Cir. 2012). A limited partnership (LP) is the citizen of all of the states of 13 which its partners are citizens. Johnson v. Columbia Properties Anchorage, LP, 437 F.3d 894 , 14 899 (9th Cir. 2006). 15 Plaintiff did not allege the citizenship of the partners of Defendant San Joaquin Valley 16 Rehabilitation Hospital. The complaint simply states Defendant “is a Delaware limited 17 partnership that does business in Fresno, California.” (Doc. 1 ¶ 2.) “Absent unusual 18 circumstances, a party seeking to invoke diversity jurisdiction should be able to allege 19 affirmatively the actual citizenship of the relevant parties.” Kanter v. Warner-Lamber Co., 265 20 F.3d 853, 857 (9th Cir. 2001). Because Plaintiff did not allege the citizenship of the LP partners, 21 the complaint fails to plead complete diversity to establish jurisdiction under § 1332. See Lindley 22 Contours, LLC v. AABB Fitness Holdings, Inc., 414 F. App'x 62, 64 (9th Cir. 2011) (holding that 23 an allegation that no member of a defendant LP “is an Oregon citizen,” without identifying the 24 actual state of citizenship of the LP's members or whether the members were composed of 25 another layer of business entities, was insufficient to establish complete diversity). Accordingly, 26 1. Within fourteen days of the issuance of this order, Plaintiff SHALL show cause in 27 writing why their claims should not be dismissed for lack of subject matter 28 jurisdiction. 1 2. Alternatively, within fourteen days, Plaintiff may either file an amended complaint 2 that contains allegations addressing the Court’s jurisdiction and the issues identified in 3 this order or may voluntarily dismiss their claims. 4 Failure to comply with this order will result in a recommendation to the to-be-assigned 5 district judge that the case be dismissed without prejudice due to lack of jurisdiction. [6] IT IS SO ORDERED. [7] 8 Dated: March 3, 2025 /s/ Sheila K. Oberto . UNITED STATES MAGISTRATE JUDGE