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Adderley v. Three Angels Broadcasting Network, Inc.

United States District Court, S.D. Florida

December 23, 2019

David Lawrence Adderley, Plaintiff,
v.
Three Angels Broadcasting Network, Inc. and others, Defendants.

          OMNIBUS ORDER ON DEFENDANTS' MOTIONS TO DISMISS

          Robert N. Scola, Jr. United States District Judge

         This matter is before the Court on Defendants Three Angels Broadcasting Network (“3ABN), Roy Hunt, James Gilley, and Danny Shelton's (the “3ABN Defendants”) motion to dismiss the Plaintiff's Second Amended Complaint. (ECF No. 135.) Also before the Court is Defendant Benton's motion to dismiss the Second Amended Complaint. (ECF No. 90.) Both motions are fully briefed and ripe for the Court's review. Upon review of the record and the relevant legal authority, the Court grants in part and denies in part the Defendants' motion (ECF No. 135) and grants Defendant Benton's motion in its entirety. (ECF No. 90.)

         I. Background

         This case involves a dispute over a trust prepared in 2011. (ECF No. 68 at ¶ 5.) According to the allegations in the complaint, Plaintiff Adderley owned over 400 acres of vacant land in The Bahamas. (Id. at ¶ 13.) As a devout member of the Seventh Day Adventist Church, Adderley wished to donate a small portion of his property in The Bahamas to the Seventh Day Adventist Church to build a sanctuary and for other religious purposes. (Id. at ¶ 14.) Adderley is legally blind. (Id. at ¶ 3.)

         Adderley worked with 3ABN, a charitable organization, to facilitate and structure his donation. (Id. at ¶15.) 3ABN retained Defendant Benton, a Georgia attorney, to prepare a charitable remainder unitrust (the “Trust”) for 3ABN's benefit, rather than the intended purpose. (Id. at ¶ 19.) On August 22, 2011, Adderley signed the Trust. The Trust transferred Adderley's property to the Trust and identifies 3ABN as the charity that will receive 100% of the charitable distribution upon his death. (Id. at ¶ 25.) The 3ABN Defendants and Benton did not disclose to Adderley the true contents of the Trust. According to the complaint, Adderley did not know that he was signing an irrevocable Trust or any trust instrument. (Id. at ¶ 23.) Based on 3ABN's misrepresentations, Adderley also signed three indentures of conveyance which conveyed part of his property to the Trust in exchange for $150, 000. (Id. at ¶ 41.) Adderley's property is valued at $22.9 million. (Id. at ¶ 41.) Adderley never received $150, 000 for his property. (Id.)

         Adderley did not discover the Defendants' fraud until 2016 when he hired a Florida attorney to review the Trust documents because he was interested in selling his property. (Id. at ¶ 62.) On August 17, 2018, Adderley filed a 20-count complaint against the Defendants for various counts of fraud, misrepresentation, negligence, and to undo the Trust documents. (ECF No. 1.) The Plaintiff's 28-count Second Amended Complaint is now before this Court. (ECF No. 68.)

         II. Legal Standard

         When considering a motion to dismiss under Federal Rule of Civil Procedure 12(b)(6), the Court must accept all the complaint's allegations as true, construing them in the light most favorable to the plaintiff. Pielage v. McConnell, 516 F.3d 1282, 1284 (11th Cir. 2008). A pleading must only contain “a short and plain statement of the claim showing that the pleader is entitled to relief.” Fed.R.Civ.P. 8(a)(2). A motion to dismiss under Rule 12(b)(6) challenges the legal sufficiency of a complaint. See Fed. R. Civ. P. 12(b)(6). In assessing the legal sufficiency of a complaint's allegations, the Court is bound to apply the pleading standard articulated in Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007) and Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). That is, the complaint “must . . . contain sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face.” Am. Dental Ass'n v. Cigna Corp., 605 F.3d 1283, 1289 (11th Cir. 2010) (quoting Twombly, 550 U.S. at 570). “Dismissal is therefore permitted when on the basis of a dispositive issue of law, no construction of the factual allegations will support the cause of action.” Glover v. Liggett Grp., Inc., 459 F.3d 1304, 1308 (11th Cir. 2006) (internal quotations omitted) (citing Marshall Cnty. Bd. of Educ. v. Marshall Cnty. Gas Dist., 992 F.2d 1171, 1174 (11th Cir. 1993). “A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Iqbal, 556 U.S. at 678. “The plausibility standard is not akin to a ‘probability requirement,' but it asks for more than a sheer possibility that a defendant has acted unlawfully.” Id. A court must dismiss a plaintiff's claims if he fails to nudge his “claims across the line from conceivable to plausible.” Twombly, 550 U.S. at 570.

         Thus, a pleading that offers mere “labels and conclusions” or “a formulaic recitation of the elements of a cause of action” will not survive dismissal. See Id. at 555. “Rule 8 marks a notable and generous departure from the hyper-technical, code-pleading regime of a prior era, but it does not unlock the doors of discovery for a plaintiff armed with nothing more than conclusions.” Iqbal, 556 U.S. at 679.

         III. Analysis

         A. Subject Matter Jurisdiction

         On August 29, 2019, this Court ordered jurisdictional discovery as to the citizenship of Defendant Gilley. “Federal courts are courts of limited jurisdiction.” Word v. U.S. Commodity Future Trading Comm., 924 F.3d 1363, 1366 (11th Cir. 2019). Here, this Court's subject matter jurisdiction is premised on diversity pursuant to 28 U.S.C. § 1332(a). Diversity must be complete, meaning that all plaintiffs to an action must be of different citizenship than all defendants. See Underwriters at Lloyd's, London v. Osting-Schwinn, 613 F.3d 1079, 1085 (11th Cir. 2010) (“For federal diversity jurisdiction to attach, all parties must be completely diverse . . . .”); Cabalceta v. Standard Fruit Co., 883 F.2d 1553, 1557 (11th Cir. 1989) (stating same). The party commencing suit in federal court has the burden of establishing, by a preponderance of the evidence, facts supporting the existence of federal jurisdiction. Underwriters, 613 F.3d at 1085; see also Banci v. Wright, 44 F.Supp.2d 1272, 1274 (S.D. Fla. 1999). “[A]nd if the diversity jurisdiction is properly challenged, that party also bears the burden of proof.” Mas v. Perry, 489 F.2d 1396, 1399 (5th Cir. 1974). “Diversity is determined when the suit is instituted, not when the cause of action arose.” Jones v. Law Firm of Hill and Ponton, 141 F.Supp.2d 1349, 1354-55 (M.D. Fla. 2001).

         To be a citizen of a state within the meaning of the diversity provision, a natural person must be both a citizen of the United States and a domiciliary of a state. A person is not necessarily a citizen of, or domiciled in, the state in which he resides at any given moment.” Id. at 1355. Domicile is determined by two factors: (1) residence and (2) intent to remain. Id. In determining domicile, a court should consider both positive evidence and presumptions. One such presumption is that the state in which a person resides at any given time is also that person's domicile. McDonald v. Equitable Life Ins. Co. of Iowa, 13 F.Supp.2d 1279, 1281 (M.D. Ala. 1998). “But because changes in residence are so common in this country, courts also refer to another presumption: once an individual has established a domicile, he remains a citizen there until he satisfies the mental and physical requirements of domicile in a new state.” Id.

         An individual's entire course of conduct determines domicile for diversity jurisdiction purposes. “Facts frequently taken into account include but are not limited to: current residence; residence of family and dependents; place of employment and name of business; voting registration and voting practices; location of personal and real property; location of brokerage and bank accounts; membership in church, clubs, and business organizations; driver's license and automobile registration; and payment of taxes. No. single factor is conclusive; instead, a ‘totality of evidence' approach is necessary.” Id. Courts generally “give little weight” to a party's declaration of domicile because “these declarations are often self-serving.” Travaglio v. Am. Express Co., 735 F.3d 1266, 1270 (11th Cir. 2013).

         Based on the record before jurisdictional discovery, Gilley's citizenship was in dispute. If Gilley were found to be a Florida citizen, he would defeat complete diversity. The Plaintiff claims that at the time of the filing of this lawsuit, Gilley was a citizen of California. Upon review of the record, the parties' ...


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