United States District Court, District of Columbia
December 8, 2000
CARLOS ALLEN, PLAINTIFF,
MIKE REHMAN AND WILLIAM PANOS, DEFENDANTS.
The opinion of the court was delivered by: Urbina, District Judge.
DISMISSING THE COMPLAINT FOR LACK OF JURISDICTION
The plaintiff brings this breach-of-contract action based on an alleged
investment he made in a nightclub owned by the defendants. The
plaintiff; Carlos Allen ("the plaintiff" or "Mr. Allen"), proceeding pro
se, alleges that the defendants, Mike Rehman and William Panos ("the
defendants"), violated a verbal agreement to give the plaintiff a
10-percent equity share and a management role in a Washington, D.C.
nightclub in exchange for the plaintiffs $30,000 investment. Because the
amount in controversy is less than $75,000, the court lacks diversity
jurisdiction. Accordingly, the court will dismiss the plaintiff's
complaint sua sponte for lack of diversity jurisdiction under Title
28 U.S.C. § 1332 ("section 1332").
Carlos Allen, a Maryland resident, claims that on July 1, 2000 at 9:30
p.m., he entered into a verbal agreement with Washington, D.C. residents
Mike Rehman and William Panos to invest in their nightclub called "Club
Element." See Compl. at 1. Mr. Allen alleges that the deal called for him
to invest $30,000 in Club Element in exchange for a 10-percent equity
share and a management role. See id. According to the complaint:
The defendants were in desperate need for the cash
flow and plaintiff Carlos Allen provided the funds
they needed. Plaintiff Carlos Allen wrote out a blank
check and did not write a check out to the night club
on the advice of co defendant [sic] William Panos who
suggested not to place the check into their club's
name because the banks will deduct [sic] the funds
because of all the bad checks they had written. . . .
The check was post dated for 7/11/2000 and was cashed
5 days before it was officially supposed to be cashed
on 7/6/2000. None of the defendants came back to the
plaintiff and declined the verbal agreement, until all
the funds were deplited [sic].
Mr. Allen claims that several weeks after he gave the defendants the
told him they considered it a loan. See id. He alleges that Mr. Rehman
and Mr. Panos were arguing with each other and saying "they did not agree
on the deal." See id. On October 11, 2000, the plaintiff filed his
complaint in this court. For the reasons that follow, the court will
dismiss the plaintiff's complaint sua sponte.
A. Legal Standard
A district court shall have original jurisdiction over a civil action
"where the matter in controversy exceeds the sum or value of $75,000,
exclusive of interests and costs," and is between, among other things,
"citizens of different states." See 28 U.S.C. § 1332. The Supreme
Court has held that a district court should dismiss a case for failure to
meet the jurisdictional amount requirement only if it is a "legal
certainty" that the plaintiff cannot recover more than the minimum
jurisdictional amount. See St. Paul Mercury Indemnity Co. v. Red Cab
Co., 303 U.S. 283, 288, 58 S.Ct. 586, 82 L.Ed. 845 (1938). The St Paul
The rule governing dismissal for want of jurisdiction
in cases brought in the federal court is that, unless
the law gives a different rule, the sum claimed by the
plaintiff controls if the claim is apparently made in
good faith. It must appear to a legal certainty that
the claim is really for less than the jurisdictional
amount to justify dismissal.
Furthermore; in 1806, the Supreme Court set forth the rule that for
complete diversity to exist, no plaintiff can be a citizen of the same
state as any of the defendants. See Strawbridge v. Curtiss, 3 Cranch
267, 7 U.S. 267, 2 L.Ed. 435 (1806), overruled in part o.g., Louisville,
C. & C.R. Co. v. Letson, 43 U.S. 497, 2 How. 497, 11 L.Ed. 353 (1844);
see also Caterpillar Inc. v. Lewis, 519 U.S. 61, 62, 117 S.Ct. 467, 136
L.Ed.2d 437 (1996); C.T. Garden v. Arkoma Associates, 494 U.S. 185, 187,
110 S.Ct. 1015, 108 L.Ed.2d 157 (1990).
Finally, a court must dismiss a case sua sponte at any time if it
concludes that it lacks jurisdiction over the case. See Williams v. U.S.
Dep't of Justice, 1992 WL 35119, *1 (D.D.C. 1992); Bogush v. Passaic
Police Dep't, 1989 WL 10604, *1 (D.D.C. 1989).
B. The Court Will Dismiss the Complaint for Lack of Diversity
Since the complaint can satisfy only one of the two prongs of section
1332 jurisdiction, the court will dismiss the case sua sponte. The court
has reviewed the complaint and reserves comment on its technical
defects, finding instead that the complaint is legally defective for lack
of jurisdiction. For the sake of analysis, the court accepts the
plaintiff's characterization of the claims alleged in the complaint. See,
e.g., Baker v. State Farm Ins. Cos., slip op., Dkt. No. 2000-328 (D.D.C.
May 31, 2000) (Urbina, J.), aff'd, 2000 WL 1683504 (D.C.Cir. 2000).
The plaintiff satisfies one prong of section 1332 by alleging complete
diversity of citizenship.*fn1 Unfortunately for the plaintiff, however,
he specifically states that the alleged breach of contract concerned a
"$30,000 investment." See Compl. at 1. Applying the Supreme Court test,
therefore, the court concludes that it is a "legal certainty" that the
plaintiff cannot meet the minimum jurisdictional requirement —
$75,000 — set forth in section 1332. See St. Paul Mercury Indemnity
Co., 303 U.S. at 288, 58 S.Ct. 586; 28 U.S.C. § 1332. Accordingly,
the court lacks jurisdiction over this case.*fn2
For all of these reasons, the court dismisses the plaintiff's complaint
for lack of jurisdiction pursuant to Title 28 U.S.C. § 1332. An order
directing the parties in a fashion consistent with this Memorandum
Opinion is separately and contemporaneously issued this 7th day of