The opinion
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
GIROD LOANCO, LLC CIVIL ACTION
VERSUS NO. 24-CV-2366
HENRY L. KLEIN SECTION: D(5)
ORDER AND REASONS
Before the Court is a Motion for Sanctions Pursuant to Federal Rule of Civil
Procedure 11 filed by Plaintiff Girod LoanCo., LLC (“Girod”).1 Defendants Henry L.
Klein (“Klein”) opposes the Motion.2 Girod filed a reply.3 After careful consideration
of the parties’ memoranda, the record, and the applicable law, the Court DENIES
without prejudice the Motion and REMANDS this matter to the Civil District
Court for the Parish of Orleans, State of Louisiana.
I. FACTUAL AND PROCEDURAL BACKGROUND
On June 15, 2021, Girod filed a Petition on Guaranty against Klein in Civil
District Court for the Parish of Orleans, State of Louisiana, to recover a post-
foreclosure sale balance owed to Girod by Klein as the guarantor of a promissory
note.4 The state court entered a final judgment on July 7, 2023, which directed Klein
to pay $317,185.47 to Girod.5 The parties conducted post-judgment discovery, during
which Girod issued a third-party subpoena duces tecum to Michael N. Pittman
inquiring about potential assets for enforcement of the state court’s judgment.6 In
1 R. Doc. 17.
2 R. Doc. 21.
3 R. Doc. 24.
4 R. Doc. 27-1 at 1.
5 Id. at 206.
6 Id. at 325-26.
response, Michael N. Pittman, Amy Schoultz Pittman, Marcus L. Pittman III, Janet
Lattanzi Pittman, Pittman Assets, LLC, Pittman Assets MSSC, LLC, Ozone
Properties, LLC, Medical Center Diagnostics, LLC, Shadrock Enterprises, LLC,
Bullet Advertising, LLC, Hermes Health Alliance, LLC, the Michael Norton Pittman
Family Trust, “and any members, managers, trustee, employees, attorneys, agents,
or representative thereof” (the “Pittmans”) filed a Motion to Intervene and Enroll
Counsel, which the state court denied.7 October 1, 2024, two days before scheduled
hearings on a motion to enforce the subpoena against Michael N. Pittman and a
motion to compel filed against Klein, Klein and the Pittmans, through their attorney
John H. Musser IV, removed this case to this Court, alleging that the state court’s
denial of the Motion to Intervene made this case removable.8 After finding that the
Notice of Removal did not state a basis for subject matter jurisdiction, the Court
ordered Klein to file an Amended Notice of Removal, allowing him a further
opportunity to properly allege the basis for this Court’s subject matter jurisdiction.9
The Order was directed at Klein alone because the Pittmans, who never successfully
intervened in this case, are not parties to this suit.
Following the Court’s Order, Girod filed the instant Motion for Sanctions
Pursuant to Federal Rule of Civil Procedure 11 (the “Motion for Sanctions”).10 In it,
Girod seeks sanctions against Klein, Musser, and the Pittmans.11 Girod argues that
7 Id. at 363-66.
8 R. Docs. 1 at ¶¶ 7-16 and 27-1 at 377, 381.
9 Id.
10 R. Doc. 17.
11 R. Doc. 17-1 at 18.
sanctions are appropriate because the removal of this matter violates Federal Rule of
Civil Procedure 11 because Klein and Musser “knew that that [sic] the factual
allegations in the Notice of Removal did not have evidentiary support and were not
likely to have evidentiary support after further investigation.”12 Specifically, Girod
argues that (1) Klein and Musser misrepresented that the Pittmans are intervening
defendants because the Notice of Removal contains copies of the state court’s order
denying the Pittmans’ Motion to Intervene; and (2) the Notice of Removal fails to
assert any legitimate basis for subject matter jurisdiction.13 Girod argues that
“dismissal of the notice of removal, remand of this action, imposition of monetary
sanctions, and an award of attorneys’ fees and costs to Girod are appropriate
sanctions for the Rule 11 violations.”14
On November 7, 2024, in a response to the Court’s Order of October 17, 2024,
Klein filed a Comprehensive Notice of Removal, amending the original Notice of
Removal, in which he alleged that this Court has subject matter jurisdiction pursuant
to diversity jurisdiction and federal question jurisdiction.15
Thereafter, Klein filed an opposition to Girod’s Motion for Sanctions, arguing
that the Motion, which Klein argues attacks the original and not the Comprehensive
Notice of Removal, should be stricken from the record.16 Klein then urges the Court
to grant his pending Motion to Consolidate and appears to argue that without
12 Id. at 7 (citing FED. R. CIV. P. 11(b)(3)).
13 Id. at 7–13.
14 Id. at 13 (cleaned up).
15 R. Doc. 18 at ¶¶ 1, 10.
16 R. Doc. 21 at 2.
consolidation, Klein is unable to address certain arguments and/or issues in this
case.17 Specifically, Klein appears to argue that the Motion for a Rule 57 Speedy
Hearing pending in Hermes Health Alliance v. Girod Titling Trust (24-2161-WBV-
MBN, E.D. La), the case with which Klein hopes to consolidate this case, will resolve
the issues raised by Girod in its Motion for Sanctions.18
In its reply, Girod first notes that neither the Pittmans nor Musser oppose
Girod’s Motion and that Klein does not oppose the substance of the Motion.19 Girod
then insists that sanctions remain appropriate in light of the Comprehensive Notice
of Removal, because the grounds on which Girod seeks sanctions also exist in the
Comprehensive Notice of Removal.20 Specifically, according to Girod, the
Comprehensive Notice of Removal, like the original Notice of Removal, makes false
statements and fails to state factual allegations supporting the Court’s jurisdiction
over this matter.21 22
II. LEGAL STANDARD
Rule 11 of the Federal Rules of Civil Procedure governs the imposition of
sanctions for improper or vexatious pleadings by a party. “By presenting to the court
a pleading, written motion, or other paper––whether by signing, filing, submitting,
17 Id.
18 Id. at 3-7.
19 R. Doc. 24 at 2.
20 Id.
21 Id. at 4.
22 During the Court’s consideration of the instant matter, Girod filed a Motion to Remand to State
Court, which is currently set for submission on December 24, 2024. R. Doc. 29. To the extent that the
Motion seeks remand, the Motion is mooted by this Order and Reasons. However, to the extent that
Girod’s Motion to Remand to State Court seeks attorney’s fees and costs pursuant to 28 U.S.C. §
1447(c), the Motion remains pending and is set for submission on December 24, 2024. To be clear,
should Klein wish to respond to Girod’s Motion, he should address only the request for attorney’s fees
and costs.
or later advocating it––an attorney or unrepresented party certifies that to the best
of the person’s knowledge, information, and belief, formed after an inquiry reasonable
under the circumstances: (1) it is not being presented for any improper purpose, such
as to harass, cause unnecessary delay, or needlessly increase the cost of litigation; (2)
the claims, defenses, and other legal contentions are warranted by existing law or by
a nonfrivolous argument for extending, modifying, or reversing existing law or for
establishing new law.”23 A party seeking sanctions must file a motion for sanctions
separately from any other motion describing “the specific conduct that allegedly
violates Rule 11(b).”24 Importantly, any motion for sanctions “must be served under
Rule 5, but it must not be filed or be presented to the court if the challenged paper,
claim, defense, contention, or denial is withdrawn or appropriately corrected within
21 days after service or within another time the court sets.”25
III. ANALYSIS
A. Whether Girod’s Motion for Sanctions Is Procedurally Proper
As an initial matter, the Court declines to strike Girod’s Motion for Sanctions.
Federal Rule of Civil Procedure 12 allows the Court to strike “any redundant,
immaterial, impertinent, or scandalous matter.”26 Klein’s argument in support of
striking the Motion is essentially that it is moot in light of the Comprehensive Notice
of Removal. Even if this presented a circumstance under which the Court could strike
a matter, however, Girod insists that the allegations and deficiencies with which
23 FED. R. CIV. P. 11(b).
24 FED. R. CIV. P. 11(c)(2).
25 Id.
26 FED. R. CIV. P. 12(f).
Girod originally took issue also exist in the Comprehensive Notice of Removal.
Accordingly, the Court will consider the Motion for Sanctions.27
Before turning to the substance of Girod’s Motion, however, the Court must
consider whether Girod complied with the requirements of Rule 11 in filing its Motion
for Sanctions. As explained above, Rule 11 requires that a motion for sanctions must
be served pursuant to Rule 5 and may not be filed until at least twenty-one days after
service.28 “This ‘safe harbor’ provision in Rule 11 is a mandatory prerequisite for a
Rule 11 motion.”29 “To fully comply with the ‘safe harbor’ provision, the motion served
and filed must be identical.”30
Here, Girod fails to meet its burden to show that it complied with the
requirements of Rule 11. It attaches to its Motion an exhibit titled “Rule 11 Letter.”31
Aside from the heading, which reads “Via U.S. Mail & E-Mail,” there is nothing in
the record indicating that the letter was sent to Klein—much less in compliance with
Rule 5. Moreover, there is nothing to show that Girod sent Klein an identical copy of
the Motion. At the close of the letter, Girod writes “[i]f you do not dismiss the Notice
of Removal within twenty-one (21) days of the date of this letter Girod will seek relief
27 See New World Int’l, Inc. v. Ford Glob. Techs., LLC, 2017 WL 1078525, at *5 (N.D. Tex. Mar. 22,
2017) (“Plaintiffs argue that Defendants' Motion for Sanctions was specifically directed towards the
original, now-superseded Complaint, and therefore it should be denied as moot, because the original
Complaint has no current legal effect. The Court disagrees. Defendants' Motion for Sanctions
alleged that Plaintiffs unnecessarily multiplied and extended litigation by refiling the identical
declaratory judgment claims on the '299 and '685 patents that were previously dismissed, a concern
that applies with equal force to the Amended Complaint, which asserts the same declaratory
judgment claims as did the original Complaint.”) (internal citations omitted).
28 Id.
29 Uptown Grill, LLC v. Camellia Grill Holdings, Inc., 46 F.4th 374, 388 (5th Cir. 2022).
30 Suanphairin v. Ataya, No. 23-CV-3346, 2024 WL 4289573, at *11 (E.D. La. Sept. 25, 2024) (citing
Uptown Grill, 46 F.4th at 389).
31 R. Doc. 17-2 at 2.
against you and your client as detailed in the enclosed draft Rule 11 Motion for
Sanctions.”32 Girod does not attach the draft Motion, however. Without the benefit
of the purported attachment, the Court cannot be sure that the identicality
requirement has been met.33 For this reason, the Court denies without prejudice
Girod’s Motion for Sanctions.
B. Whether the Court Has Subject Matter Jurisdiction Over this Matter
The Court notes that one of the arguments raised in Girod’s Motion for
Sanctions is that removal was improper because the Court does not have subject
matter jurisdiction over this matter. The Court, in its Order of October 17, 2024,
already recognized its independent obligation to ensure that it had subject matter
jurisdiction, stating, “To be clear, if the Court determines that it lacks subject matter
jurisdiction, the Court must, on its own, remand this matter.”34 Taking into
consideration Klein’s Comprehensive Amended Notice of Removal,35 the Court sponte
considers whether this matter should be remanded for lack of subject matter
jurisdiction.
“Federal courts are courts of limited jurisdiction, having the power to hear only
cases that present a federal question or are between citizens of different states.”36
32 Id. at 5.
33 Suanphairin, 2024 WL 4289573, at *11 (“To establish ‘identicality,’ the party seeking sanctions
should append to its filed motion the motion it served the opposing party.”); see also Horton v. Tex.
Fed’n for Child. PAC, Inc., No. 22-CV-2736, 2024 WL 2754042, at *3 n.2 (N.D. Tex. May 29, 2024)
(reasoning that movant failed to comply with Rule 11(c)(2)’s “safe harbor” provision because the
movant did not append to its sanctions motion the motion it served on the opposing party, precluding
the court from confirming that the motion served and the motion filed were identical).
34 R. Doc. 11.
35 R. Doc. 18.
36 Quinn v. Guerreo, 863 F.3d 353, 358 (5th Cir. 2017) (citing Arbaugh v. Y&H Corp., 546 U.S. 500,
513 (2006)).
“The burden of subject matter jurisdiction lies with the party asserting jurisdiction,
and it must be proved by a preponderance of the evidence.”37 “If the court determines
at any time that it lacks subject-matter jurisdiction, the court must dismiss the
action.”38 “Any ‘doubts regarding whether removal jurisdiction is proper should be
resolved against federal jurisdiction.’”39
i. Whether the Court May Exercise Diversity Jurisdiction Over This
Matter
Klein’s first purported basis for jurisdiction is diversity jurisdiction. Diversity
jurisdiction gives federal courts original jurisdiction over actions arising between
citizens of different states and in which the amount in controversy exceeds $75,000.40
The Court notes Girod’s argument that Klein’s invocation of diversity jurisdiction is
untimely. The Court need not address this argument, however, because if it is timely,
Klein fails to establish diversity jurisdiction. Klein states that the amount in
controversy is over $317,185 and that Klein, a citizen of Louisiana, is completely
diverse from Girod, which Klein alleges “may not be a citizen of any state.”41 It is
well established, however, that “the presence of a single stateless entity as a party to
a suit destroys complete diversity.”42 Thus, if Girod is indeed stateless, diversity is
destroyed. And if Girod is a citizen of a state, Klein has failed to properly allege its
citizenship, and the Court is therefore unable to assess diversity. Under either
37 In re S. Recycling, LLC, 982 F.3d 374, 379 (5th Cir. 2020).
38 FED. R. CIV. P. 12(h)(3).
39 Vantage Drilling Co. v. Hsin-Chi Su, 741 F.3d 535, 537 (5th Cir. 2014) (citing Acuna v. Brown &
Root, Inc., 200 F.3d 335, 339 (5th Cir. 2000)).
40 28 U.S.C. § 1332.
41 R. Doc. 18 at ¶ ..
42 Mitchell v. Bailey, 982 F.3d 937, 942 (5th Cir. 2020).
scenario, it is removing Defendant’s burden, and he has failed to meet his burden to
show that this Court has diversity jurisdiction over this matter.
ii. Whether the Court May Exercise Federal Question Jurisdiction
Over This Matter
Klein also argues that the Court has federal question jurisdiction. Although it
is not entirely clear, Klein appears to be invoking federal question jurisdiction in
response to the state court’s “failure . . . to make the declarations sought.”43 Klein
then asks the Court to hold a hearing to determine:
1. Whether Louisiana Revised Statute 12:1354 is a law passed for the protection
of the public interest;
2. Whether the November 13, 2017 sale of 244 FNBC loans by the FDIC to Girod
constituted “transacting business” requiring qualification pursuant to
Louisiana Revised Statute 12:1354;
3. Whether Girod and/or Girod Titling Trust was exempted from complying with
Louisiana Revised Statute 12:1354; and
4. That all judicial demands filed in any Louisiana court by Girod or Girod Titling
Trust are absolute nullities pursuant to Article 7 of the Louisiana Civil Code.44
Under the well-pleaded complaint rule, “a federal court has original or removal
jurisdiction only if a federal question appears on the face of the plaintiff’s well-
pleaded complaint; generally, there is no federal jurisdiction if the plaintiff pleads
only a state law cause of action.”45 “A case pleading only state law claims may arise
under federal law ‘where the vindication of a right under state law necessarily turns
43 R. Doc. 18 at ¶ 20.
44 Id. at ¶ 26.
45 Bernhard v. Whitney Nat’l Bank, 523 F.3d 546, 551 (5th Cir. 2008).
on some construction of federal law.’”46 Moreover, “a defense that raises a federal
question is inadequate to confer federal jurisdiction.”47
The Petition in this case is one for enforcement of a promissory note. Even if
such an action did arise under federal law, however, the Rooker-Feldman doctrine
would bar the exercise of subject matter jurisdiction. “Reduced to its essence, the
Rooker-Feldman doctrine ‘holds that inferior federal courts do not have the power to
modify or reverse state court judgments.’”48 “The doctrine applies where: 1) the
plaintiff loses in the state court proceeding, 2) the plaintiff’s complaint alleges the
state court judgment causes an injury, 3) the judgment was rendered before federal
proceedings commenced; and 4) the plaintiff seeks review and rejection of the state
court judgment.”49
Each of these elements are plainly met here. As to the first element, the state
court’s July 7, 2023 order granting summary judgment was both a final judgment
under Louisiana law and adverse to Klein, against whom summary judgment was
granted.50 Second, Klein appears to allege that the state court litigation, including
the final judgment, caused injuries. While Klein frames these injuries as injuries to
the Pittmans, the Pittmans were not parties to the state court lawsuit. Therefore,
46 Id. (quoting Franchise Tax Bd. v. Const. Laborers Vacation Tr., 463 U.S. 1, 9 (1983)) (internal
quotations and brackets omitted).
47 Id. (quoting Merrell Dow Pharms., Inc. v. Thompson, 478 U.S. 804, 808 (1986)) (internal quotations
omitted) (cleaned up).
48 Union Planters Bank Nat. Ass’n v. Salih, 369 F.3d 457, 462 (5th Cir. 2004).
49 Williams v. Trosclair, 627 F.Supp.3d 594, 603 (E.D. La. Sept. 14, 2022) (citing Exxon Mobil Corp. v.
Saudi Basic Indus. Corp., 544 U.S. 280, 284 (2005)).
50 R. Doc. 27-1 at 206 (“This is a final appealable judgment.”).
any injury must have been to Klein. Third, the state court judgment was rendered
on July 7, 2023—well before this matter was removed on October 1, 2024.51
Finally, Klein’s chief complaint is that the state court erred in issuing a
judgment against Klein. Klein’s Comprehensive Notice of Removal makes a number
of references to actions taken against the Pittmans. It appears that that what Klein
really seeks is the reversal of the state court judgment by his request that the Court
declare “that any judicial demands filed in any Louisiana court of law by Girod
LoanCo, LLC or Girod Titling Trust are absolute nullities.”52 Such a prayer for relief
is nothing more than an invitation to reject the state court’s judgment. And even if
this was not Klein’s chief prayer, this suit would still be barred by the Rooker-
Feldman doctrine. Klein “cannot circumvent [the Rooker-Feldman doctrine] by
asserting claims not raised in the state court proceedings or claims framed as original
claims for relief,” because “these claims are ‘inextricably intertwined’ with [the] state
judgment[.]”53 Such a maneuver would necessarily require this Court to review the
July 7, 2023 state court judgment, “and the originality of the district court’s
jurisdiction precludes such a review.”54 This prong, therefore, like the others, is met.
Finally, to the extent Klein attempts to couch his claims as some kind of broad
violation of his rights by the state court, such a claim does not confer subject matter
jurisdiction on the Court.
51 R. Docs. 1 and 27-1 at 206.
52 R. Doc. 27-1 at 206.
53 Heisler v. Girod LoanCo, LLC, No. 21-CV-1343, 2021 WL 4125057, at *3 (E.D. La. Sept. 9, 2021)
(citing Turner v. Cade, 354 F. App’x 108, 111 (5th Cir. 2009)) (internal quotations omitted).
54 Id. (quoting United States v. Shepherd, 23 F.3d 923, 924 (5th Cir. 1994)) (internal quotations
omitted).
Constitutional questions arising in state proceedings are to be resolved
by state courts. Ifa state trial court errs the judgment is not void, it is
to be reviewed and corrected by the appropriate state appellate court.
Thereafter, recourse at the federal level is limited solely to an
application for a writ of certiorari to the United States Supreme Court.
The casting of a complaint in the form of a civil rights action cannot
circumvent this rule.®
Under any of these theories, Klein has failed to establish that this Court has subject
matter jurisdiction, and the Court therefore must remand this matter.
IV. CONCLUSION
For the foregoing reasons, IT IS ORDERED that Plaintiff Girod LoanCo.
LLC’s Motion for Sanctions Pursuant to Federal Rule of Civil Procedure 1156 is
DENIED.
IT IS FURTHER ORDERED that this matter is REMANDED to the Civil
District Court for the Parish of Orleans, State of Louisiana.
IT IS FURTHER ORDERED that Defendant Henry L. Klein’s Motion to
Consolidate Cases®’ is DENIED AS MOOT.
New Orleans, Louisiana, December 4, 2024.
WENDY B. (2
United States District Judge
55 Liedtke v. State Bar of Tex., 18 F.3d 315, 317 (5th Cir. 1994).
58 R. Doc. 17.
57 R. Doc. 16.
12