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Liafom, LLC and Aaron Abdelhak v. Big Fresh Pictures

August 24, 2011

LIAFOM, LLC AND AARON ABDELHAK, PLAINTIFFS,
v.
BIG FRESH PICTURES, BIG FRESH PRODUCTIONS, JEFF OPPENHEIM, LLOYD CHREIN, LEO LEICHTER, SANDI CASTRO, AND JOHN DOE, DEFENDANTS.



The opinion of the court was delivered by: Linares, District Judge.

NOT FOR PUBLICATION

OPINION

This matter comes before the Court on Defendants', Lloyd Chrein, Leo Leichter, Sandi Castro, and Big Fresh Pictures, motion to dismiss the Complaint pursuant to Federal Rule of Civil Procedure 12(b)(1) for lack of subject matter jurisdiction. No oral argument was heard. Fed. R. Civ. P. 78. For the reasons set forth in this Opinion, Defendants' motion is GRANTED.

I. Background and Procedural History

The Court makes the following limited factual findings in light of the fact that the matter before the court is solely a jurisdictional determination. The instant matter arises out of a number of state law claims, namely "theft, conversion, business fraud, and breach of contract" related to the production of the film "Aaron Loves Kendra".

Plaintiff Liafom is a limited liability company incorporated in Delaware with its principal place of business in New Jersey. The members of Liafom are Aaron Abdelhak, a domiciliary of New Jersey; Jeff Oppenheim, Aimee Harris, and Malissa Lipton, all domiciled in New York; and Stephen Treadway, a domiciliary of California. (Compl. ¶16, Amended Compl. ¶16, Exhibit H). Plaintiff Aaron Abdelhak is an individual and the sole Class A member of Liafom, whose domicile is New Jersey. Defendants Lloyd Chrein, Leo Leichter, Sandi Castro, and Jeff Oppenheim are alleged partners of the General Partnership, Big Fresh Pictures. Lloyd Chrein, Sandi Castro, and Jeff Oppenheim are domiciled in New York. Leo Leichter is domiciled in California. Defendant asserts that Big Fresh Productions is a Delaware corporation, with its principal place of business in New York.

The relevant procedural history is as follows. On February 3, 2010, Plaintiffs filed the instant action against Defendants in the District Court of New Jersey premised on diversity jurisdiction pursuant to 28 U.S.C. 1332. Plantiffs filed an amended complaint on May 19, 2011, in which they asserted that Defendants "acted independently and conspired with each other and Mr. Oppenheim to deprive Plaintiff of his property" and to "defraud and attempt to defraud plaintiff by whole cloth denial of their involvement directly and indirectly with his properties and the facts that would support their legal obligations to him, and making recovery of his property precarious by leaving it in the hands of their bankrupt partner" (Amended Compl. ¶ 80B). On July 2, 2010, Defendants Leichter, Chrein, and Castro instituted a cross-claim against Plaintiffs and a counterclaim against co-Defendant Jeff Oppenheim (CM/ECF No. 13). Defendants Chrein, Leichter, Castro and Big Fresh Pictures filed the instant motion to dismiss the Amended Complaint for lack of subject matter jurisdiction on July 22, 2011 (CM/ECF No. 100).

Thereafter, the Manager, Aaron Abdelhak, withdrew all outstanding Class B Member Interests and stated that the Operating Agreement was to be governed by Delaware law, rather than New York law (CM/ECF No. 106, Liafom Members Resolution of July 28, 2011). On July 29, 2011, Aaron Abdelhak executed a second Liafom Members Resolution, which dissolved Liafom and distributed all assets "including claims under the present suit and liabilities" to himself in a two-step liquidation plan, but provided that Liafom would remain a business entity until September 30, 2011.

II. LEGAL STANDARD

Pursuant to Rule 12(b)(1), the court must dismiss a complaint if it lacks subject matter jurisdiction to hear a claim. Fed. R. Civ. P. 12(b)(1). Standing is a jurisdictional matter and thus "a motion to dismiss for want of standing is also properly brought pursuant to Rule 12(b)(1)." Ballentine v. United States, 486 F.3d 806, 910 (3d Cir. 2007). As per Rule 12(b)(1), the court must accept as true all material allegations set forth in the complaint, and must construe those facts in favor of the nonmoving party. Id. Motions to dismiss under Rule 12(b)(1) may be treated as either a "facial or factual challenge to the court's subject matter jurisdiction." Gould Electronics Inc. v. U.S., 220 F.3d 169, 176 (3d Cir. 2000). Under a facial attack, the movant challenges the legal sufficiency of the claim and the Court considers only "the allegations of the complaint and documents referenced therein and attached thereto in the light most favorable to the plaintiff." Id. In reviewing a factual attack, however, the challenge is to the actual alleged jurisdictional facts. Thus, in that instance a court is free to consider evidence outside of the pleadings. Id. Finally, once a 12(b)(1) challenge is raised, the burden shifts to the plaintiff to demonstrate the existence of subject matter jurisdiction. See PBGC v. White, 998 F.2d 1192, 1196 (3d Cir. 2000).

III. DISCUSSION

Defendants do not challenge the facts underlying Plaintiffs' jurisdictional assertions. Rather, Defendants argue that the court lacks subject matter jurisdiction because the case involves a state law dispute and the parties are not completely diverse. Thus, the Court is limited in its consideration to the allegations in the complaint and documents referenced therein and thereto.

A. Diversity of Citizenship

Under 28 U.S.C. 1332(a)(1), federal courts have original jurisdiction over civil actions in which the matter in controversy exceeds $75,000 and there is complete diversity of citizenship. Wisconsin Dep't of Corr. V. Schacht, 524 U.S. 381, 389, 118 S.Ct. 2047, 141 L.Ed.2d 364 (1998). "The party asserting diversity jurisdiction bears the burden of proof. A party generally meets this burden by proving diversity of citizenship by a preponderance of the evidence." McCann v. Newman Irrevocable Trust, 458 F.3d 281, 286 (3d Cir. 2006) (citations omitted). Here, Plaintiffs ...


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