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Algiers Development District v. Vista Louisiana, LLC

United States District Court, E.D. Louisiana

January 12, 2017

ALGIERS DEVELOPMENT DISTRICT
v.
VISTA LOUISIANA, LLC, ET AL.

         SECTION "S"

          ORDER AND REASONS

          MARY ANN VIAL LEMMON, UNITED STATES DISTRICT JUDGE

         IT IS HEREBY ORDERED that Algiers Development District's Motion to Remand (Doc. #6) is DENIED.

         BACKGROUND

         This matter is before the court on a motion to remand filed by plaintiff, Algiers Development District (“ADD”). ADD argues that this matter must be remanded to the Civil District Court, Parish of Orleans, State of Louisiana because this court lacks subject matter jurisdiction.

         ADD, an economic development district and political subdivision of the State of Louisiana, acquired ownership of the former United States Navy barracks and associated property in Orleans Parish, Louisiana for the purpose of enhancing the economic development of the property and surrounding areas through the creation of a mixed use commercial and residential development. To accomplish this mission, ADD entered into contracts with defendants, Vista Louisiana, LLC, Vista Trust and DeVere Construction Company, Inc. The contracts included a Master Development Agreement dated March 2, 2015, a First Supplemental Development Agreement dated January 1, 2016, and a Purchase and Sale Agreement dated January 7, 2016. Under the contracts ADD agreed to sell all or part of the property to defendants for development after defendants fulfilled certain contractual obligations including: (1) providing timely and satisfactory evidence of financial commitments; (2) submitting completed project business plans; and, (3) obtaining approval from the City of New Orleans to subdivide the property.

         On October 14, 2016, ADD filed this declaratory judgment action against defendants in the Civil District Court, Parish of Orleans, State of Louisiana alleging that defendants failed to fulfill their contractual obligations to provide timely and adequate evidence of financial commitments, obtain rezoning, and provide adequate project business plans. ADD alleges that it terminated the contracts as a result of these failures. ADD seeks declarations that defendants breached the contracts by failing to perform their contractual obligations, and that as a result of the breaches, the contracts are terminated.

         On November 16, 2016, defendants removed this action to the United States District Court for the Eastern District of Louisiana alleging both federal question and diversity subject matter jurisdiction under 28 U.S.C. §§ 1331 and 1332, respectively. ADD moved to remand the matter to the Civil District Court, Parish of Orleans, State of Louisiana, arguing that neither asserted type of subject matter jurisdiction is present.

         ANALYSIS

         A. Remand Standard

         Motions to remand to state court are governed by 28 U.S.C. § 1447(c), which provides that “[i]f at any time before the final judgment it appears that the district court lacks subject-matter jurisdiction, the case shall be remanded.” The removing defendant bears the burden of demonstrating that federal jurisdiction exists and therefore that removal was proper. Jernigan v. Ashland Oil, Inc., 989 F.2d 812, 815 (5th Cir. 1993). In assessing whether removal is appropriate, the court is guided by the principle, grounded in notions of comity and the recognition that federal courts are courts of limited jurisdiction, that removal statutes should be strictly construed. See Manguno v. Prudential Prop. & Cas. Ins. Co., 276 F.3d 720, 723 (5th Cir. 2002). Doubts regarding whether federal jurisdiction is proper should be resolved against federal jurisdiction. Acuna v. Brown & Root, 200 F.3d 335, 339 (5th Cir. 2000).

         B. Diversity Subject Matter Jurisdiction under § 1332(a)

         Defendants allege that this court has diversity subject matter jurisdiction under 28 U.S.C. § 1332(a)(1), which provides that district courts have original jurisdiction over civil actions where the amount in controversy exceeds $75, 000, exclusive of interest and costs, and are between citizens of different States.

         1. ...


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