Inviron Techs., Inc. v. W. States Int'l, Inc.
| Decision Date | 04 March 2016 |
| Docket Number | No. 1:15-cv-01643-DAD-JLT,1:15-cv-01643-DAD-JLT |
| Parties | INVIRON TECHNOLOGIES, INC., Plaintiff, v. WESTERN STATES INTERNATIONAL, INC. et al., Defendants. |
| Court | U.S. District Court — Eastern District of California |
ORDER GRANTING DEFENDANTS' MOTION TO DISMISS PURSUANT FEDERAL RULE OF CIVIL PROCEDURE 12(b)(1)
ORDER DENYING DEFENDANTS' MOTION FOR ATTORNEY'S FEES AND COSTS
This matter comes before the court on a motion to dismiss pursuant to Rules 12(b)(1) and 12(b)(6), and a motion for attorney's fees and costs both brought on behalf of defendants Western States International, Inc. ("WSI") and Ingrid Aliet-Gass. A hearing on these motions was held February 16, 2016. Joseph M. Hoats appeared in person on behalf of plaintiff Inviron Technologies, Inc. ("Inviron"). Anthony Alexander Gorman appeared telephonically on behalf of defendants WSI and Aliet-Gass. The court has considered the parties' briefs1 and oral arguments,and for the reasons set forth below, GRANTS defendants' motion to dismiss and DENIES the motion for attorney's fees and costs.
Plaintiff Inviron commenced this action on October 23, 2015.2 (Doc. No. 1.) According to plaintiff's complaint, defendants WSI and Riverwood Energy, LLC ("Riverwood") entered into a Letter of Intent agreement ("LOI") in or around June 2009 pursuant to which Riverwood would acquire a 70% working interest from WSI in certain land leases located in Kern County, California. (Id. ¶¶ 80-82.) In or around July 2009, defendants WSI and Riverwood entered into a Joint Operating Agreement ("JOA") setting forth additional rights and obligations of the parties, with respect to ownership and operation of the land leases. (Id. ¶ 83.) Specifically, Riverwood agreed to fund certain repairs in exchange for its ownership interest in the leases. (Id.) Thereafter, defendant WSI designated Riverwood as WSI's agent and as the operator of the land leases, and Riverwood began work on, and investment in, the properties pursuant to the agreements. (Id. ¶¶ 85-87.) Plaintiff alleges that defendants WSI and Aliet-Gass represented to several other parties that WSI's interest in the land leases was "free and clear from any liens and/or judgments," and that WSI, through Aliet-Gass, entered into agreements with those parties for the same interest they purportedly transferred to defendant Riverwood. (See, e.g., id. ¶¶ 55-75, 96-97, 101.)
In or around August 2012, Riverwood was sold to defendant Jose Miguel Aguilar and later transferred to defendant Anthony Aguilar in December 2012. (Id. ¶ 88.) Riverwood then sold or assigned its interest in the JOA to plaintiff Inviron. (Id. ¶ 102.) Plaintiff Inviron's complaint generally seeks a declaratory judgment finding that: (1) the agreement between Inviron and Riverwood — the JOA separately, or in combination with the LOI — is valid and is the only enforceable agreement relating to the land leases in question; (2) defendants WSI and Aliet-Gass are in breach of the agreement; (3) as a result of the breach, plaintiff is entitled tocertain rights and remedies under the agreement; and (4) an assignment of rights, dated 2006, between defendants WSI and Tearlach Resources Ltd., is invalid. Plaintiff also appears to seek injunctive relief as to defendants WSI and Aliet-Gass, as well as mandamus relief against federal and state agencies.
Plaintiff Inviron asserts that this court has federal subject matter jurisdiction — both diversity jurisdiction and subject matter jurisdiction — over the claims set out in its complaint. In particular, Inviron contends that this court has subject matter jurisdiction because the U.S. Department of the Interior, Bureau of Land Management originally issued the land leases in question to defendant WSI, pursuant to the Mineral Leasing Act of 1920, 30 U.S.C. § 181 et seq.3
On December 21, 2015, defendants WSI and Aliet-Gass filed the instant motion to dismiss plaintiff's claims. (Doc. No. 25.) On December 28, 2015, defendants filed an addendum to their motion. (Doc. No. 28.) Separately, defendant Derek Willshee, proceeding pro se, filed a request for dismissal. (Doc. Nos. 17, 21.) To the extent the instant motion to dismiss covers claims also alleged against defendant Willshee, the court will liberally interpret defendant Willshee's request for dismissal as a joinder in this motion. See Bretz v. Kelman, 773 F.2d 1026, 1027 n.1 (9th Cir. 1985) (en banc).
In addition, on December 28, 2015, defendants WSI and Aliet-Gass filed a motion for attorney's fees and costs. (Doc. No. 29.) Defendants' motion essentially seeks the imposition of sanctions against plaintiff and its counsel, pursuant to both 28 U.S.C. § 1927 and the district
/////
/////
/////court's inherent power to impose sanctions, for allegedly frivolous and bad-faith behavior related to the filing of the complaint in this case.4
MOTION TO DISMISS PURSUANT TO RULE 12(b)(1)
Defendants move to dismiss plaintiff's claims for lack of subject matter jurisdiction pursuant to Rule 12(b)(1) of the Federal Rules of Civil Procedure. Rule 12(b)(1) allows a defendant to raise the defense, by motion, that the court lacks jurisdiction over the subject matter of an entire action or of specific claims alleged in the action.5 "In civil cases, subject matter jurisdiction is generally conferred upon federal district courts either through diversity jurisdiction, 28 U.S.C. § 1332, or federal question jurisdiction, 28 U.S.C. § 1331." Peralta v. Hispanic Bus., Inc., 419 F.3d 1064, 1068 (9th Cir. 2005). "A motion to dismiss for lack of subject matter jurisdiction may either attack the allegations of the complaint or may be made as a 'speaking motion' attacking the existence of subject matter jurisdiction in fact." Thornhill Publ'g Co. v. Gen. Tel. & Elecs. Corp., 594 F.2d 730, 733 (9th Cir. 1979).
When a party brings a facial attack to subject matter jurisdiction, that party contends that the allegations of jurisdiction contained in the complaint are insufficient on their face to demonstrate the existence of jurisdiction. Safe Air for Everyone v. Meyer, 373 F.3d 1035, 1039 (9th Cir. 2004). In a Rule 12(b)(1) motion of this type, the plaintiff is entitled to safeguards similar to those applicable when a Rule 12(b)(6) motion is made. See Sea Vessel Inc. v. Reyes, 23 F.3d 345, 347 (11th Cir. 1994); Osborn v. United States, 918 F.2d 724, 729 n.6 (8th Cir. 1990). Accordingly, the factual allegations of the complaint are presumed to be true, and the motion isgranted only if the plaintiff fails to allege an element necessary for subject matter jurisdiction. Savage v. Glendale Union High Sch. Dist. No. 205, 343 F.3d 1036, 1039 n.1 (9th Cir. 2003); Miranda v. Reno, 238 F.3d 1156, 1157 n.1 (9th Cir. 2001). Nonetheless, district courts "may review evidence beyond the complaint without converting the motion to dismiss into a motion for summary judgment" when resolving a facial attack. Safe Air for Everyone, 373 F.3d at 1039.
When a Rule 12(b)(1) motion attacks the existence of subject matter jurisdiction, however, no presumption of truthfulness attaches to the plaintiff's allegations. Thornhill Publ'g, 594 F.2d at 733. "[T]he district court is not restricted to the face of the pleadings, but may review any evidence, such as affidavits and testimony, to resolve factual disputes concerning the existence of jurisdiction." McCarthy v. United States, 850 F.2d 558, 560 (9th Cir. 1988). When a Rule 12(b)(1) motion attacks the existence of subject matter jurisdiction in fact, plaintiff has the burden of establishing that such jurisdiction does in fact exist. Thornhill Publ'g., 594 F.2d at 733.
District courts have original jurisdiction of civil actions where the matter in controversy exceeds $75,000 and where the suit is between (1) citizens of different states; (2) citizens of a state and citizens or subjects of a foreign state; (3) citizens of different states in a suit in which citizens or subjects of a foreign state are additional parties; or (4) a foreign state as plaintiff and citizens of a state or of different states. 28 U.S.C. § 1332(a).
Complete diversity is required, and one instance of common citizenship between plaintiffs and defendants will prevent federal diversity jurisdiction. Exxon Mobil Corp. v. Allapattah Servs., Inc., 545 U.S. 546, 553 (2005) (); Abrego Abrego v. Dow Chem. Co., 443 F.3d 676, 679 (9th Cir. 2006) (). Diversity is determined by the state of facts that existed when the case was filed. Grupo Dataflux v. Atlas Glob. Grp., L.P., 541 U.S. 567, 570-71 (2004).
In this case, plaintiff alleges that this court has diversity jurisdiction over the claims presented in its complaint pursuant to § 1332(a)(1). However, it is clear that plaintiff and at least three defendants are citizens of California. Indeed, according to the allegations of plaintiff's complaint, plaintiff Inviron and defendants Riverwood and Riverwood Gas and Oil, LLC are all California corporations, while defendant Aliet-Gass is a citizen of California. (Doc. No. 1 at 5-6.) The common citizenship of plaintiff and at least one defendant prevents federal diversity jurisdiction over this suit.
Under 28 U.S.C. § 1331, district courts have "original jurisdiction of all civil actions arising under the Constitution, laws, or treaties of the United States." An action "arises under" federal law pursuant to § 1331 if the cause of action is (1) created by federal law, or (2) necessarily requires resolution of a...
To continue reading
Request your trial