The opinion of the court was delivered by: Ricardo M. Urbina, United States District Judge.
Document Nos.: 15, 16, 20
MEMORANDUM OPINION GRANTING THE DEFENDANT'S MOTION TO DISMISS
This contract case addresses the basic principle of always ensuring that jurisdiction exists. Before the court is the defendant's motion to dismiss for lack of subject-matter jurisdiction pursuant to Federal Rule of Civil Procedure 12(b)(1). The complaint invokes this court's jurisdiction under 28 U.S.C. § 1332(a), the diversity statute. Given that the parties on both sides of this action are citizens of the District of Columbia, and the plaintiffs present no evidence to the contrary, the court determines that complete diversity between the parties does not exist and therefore grants the defendant's motion.
In March 2000, the parties executed a contract for the purchase of real property. Compl. ¶ 6. Toward that end, the plaintiffs tendered a $200,000 deposit to the defendant. Id. ¶ 7. Subsequently, the parties executed a Contract Termination Agreement, which provides that the defendant "shall use best efforts to resell the property." Id. ¶ 8 & Ex. B at 1. This agreement left to the defendant's "reasonable sole discretion" whether to pay the plaintiffs the portion of the deposit "not needed... to make [the defendant] whole." Id. When the defendant refused to refund the plaintiffs any portion of the deposit, the plaintiffs brought this action. Id. ¶ 14.
The plaintiffs assert subject-matter jurisdiction based on diversity of citizenship under 28 U.S.C. § 1332(a). Id. ¶ 4. The plaintiffs are residents of the District of Columbia. Id. ¶ 1. The defendant is a limited liability company ("LLC") organized under the laws of the Commonwealth of Virginia. Id. ¶ 2. The company's two members are residents of the District of Columbia. Def.'s Mot. at 3.
On June 27, 2002, the plaintiffs filed their complaint alleging both a breach-of-contract claim and a conversion claim. In response, the defendant filed a motion to dismiss the complaint under Rule 12(b)(6) for failure to state a claim. The court granted in part and denied in part the defendant's motion, dismissing the conversion claim and allowing the case to proceed on the contract claim. The defendant then filed an answer and the parties commenced discovery. After discovery ended, the plaintiffs filed a motion for summary judgment on October 8, 2003, and the defendant filed a cross motion for summary judgment on November 7, 2003. On November 19, 2003, the defendant filed its Rule 12(b)(1) motion to dismiss, claiming that complete diversity between the parties does not exist. The court now addresses the defendant's Rule 12(b)(1) motion to determine whether it has subject-matter jurisdiction.
A. Legal Standard for a Motion to Dismiss Pursuant to Rule 12(b)(1)
Federal courts are courts of limited jurisdiction and the law presumes that "a cause lies outside this limited jurisdiction." Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 377 (1994); St. Paul Mercury Indem. Co. v. Red Cab Co., 303 U.S. 283, 288-89 (1938). Because "subject-matter jurisdiction is an 'Art. III as well as a statutory requirement[,] no action of the parties can confer subject-matter jurisdiction upon a federal court.'" Akinseye v. District of Columbia, 339 F.3d 970, 971 (D.C. Cir. 2003) (quoting Ins. Corp. of Ir., Ltd. v. Compagnie des Bauxite de Guinea, 456 U.S. 694, 702 (1982)). On a motion to dismiss for lack of subject-matter jurisdiction pursuant to Rule 12(b)(1), the plaintiff bears the burden of establishing that the court has subject-matter jurisdiction. Evans v. B.F. Perkins Co., 166 F.3d 642, 647 (4th Cir. 1999); Rasul v. Bush, 215 F. Supp. 2d 55, 61 (D.D.C. 2002) (Kotelly, J.) (citing McNutt v. Gen. Motors Acceptance Corp., 298 U.S. 178, 182-83 (1936)). The court may dismiss a complaint for lack of subject-matter jurisdiction only if "'it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief.'" Empagran S.A. v. F. Hoffman-Laroche, Ltd., 315 F.3d 338, 343 (D.C. Cir. 2003) (quoting Conley v. Gibson, 355 U.S. 41, 45-46 (1957)).
Because subject-matter jurisdiction focuses on the court's power to hear the claim, however, the court must give the plaintiff's factual allegations closer scrutiny when resolving a Rule 12(b)(1) motion than would be required for a Rule 12(b)(6) motion for failure to state a claim. Macharia v. United States, 334 F.3d 61, 64, 69 (D.C. Cir. 2003); Grand Lodge of Fraternal Order of Police v. Ashcroft, 185 F. Supp. 2d 9, 13 (D.D.C. 2001). Moreover, the court is not limited to the allegations contained in the complaint. Hohri v. United States, 782 F.2d 227, 241 (D.C. Cir. 1986), vacated on other grounds, 482 U.S. 64 (1987). Instead, to determine ...