Neroni

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF LOUISIANA

NEW ORLEANS CITY CIVIL ACTION

VERSUS No. 25-1366

FREDERICK NERONI, ET AL. SECTION I

ORDER & REASONS

Before the Court is an administrative adjudication removed from the

Administrative Hearing Department of the Code Enforcement Division of the City of

New Orleans (“CED”) to the United States District Court for the Eastern District of

Louisiana by defendants Frederick Neroni (“Frederick”) and Tatiana Neroni

(“Tatiana”) (collectively, “defendants”).1 Defendants, after filing their notice of

removal, also filed an answer and counterclaims2 against plaintiff New Orleans City

(“New Orleans”), alleging numerous federal statutory and constitutional claims.

Because a party cannot answer their own filing, the Court construes defendants’

filings as supplemental briefings relating to the notice of removal. For the reasons

stated herein, the removal was improper.

Defendants have moved3 for a declaratory judgment finding that any “post-

removal state proceedings” in this action “are void as a matter of law,” a permanent

injunction against New Orleans “barring enforcement of any adverse determinations

1 R. Doc. No. 1.

2 R. Doc. No. 2; R. Doc. No. 4.

3 R. Doc. No. 8.

in any post-removal state proceedings,” an order requiring New Orleans to remove

any publication relating to the administrative proceeding, and judicial

disqualification pursuant to 28 U.S.C. § 155 and 28 U.S.C. § 455.

I. BACKGROUND

On June 10, 2025, New Orleans commenced administrative adjudicative

proceedings against defendants, alleging twenty-four violations of the Code of the

City of New Orleans (the “Code”) in relation to defendants’ property at 116 Huntlee

Drive in New Orleans, La. (the “property”).4 According to defendants, New Orleans

seeks to impose numerous fines and damages upon defendants, and if the violations

are proven, defendants would be required to undertake a major reconstruction of the

property within thirty days—a practical impossibility.5

Defendants filed a notice6 of removal on July 2, 2025, asserting that this Court

had subject matter jurisdiction over this action on the basis of diversity jurisdiction.7

Both defendants are domiciled in South Carolina.8

Defendants each subsequently filed an answer to the notice of removal and six

counterclaims against New Orleans.9 Defendants’ first counterclaim alleges that New

Orleans unlawfully entered the property for an inspection, which defendants allege

is an unconstitutional search. Defendants seek relief for that claim pursuant to 42

4 R. Doc. No. 1 ¶¶ 1, 16.

5 Id. ¶ 13.

6 Id.

7 Id. ¶¶ 21, 23.

8 Id. ¶ 22.

9 Id.; R. Doc. No. 4.

U.S.C. § 1983 and state trespass law.10 Defendants’ second counterclaim alleges

abuse of process, which defendants say is based on state law, an unspecified 42 U.S.C.

§ 1983 claim, and an unspecified 42 U.S.C. § 1985 claim.11 This second counterclaim

is based on defendants’ allegation that New Orleans, along with “individuals [New

Orleans] associate[d] with,” fabricated the administrative proceedings against

defendants to induce defendants to sell the property for a below-market rate.12 In

their third counterclaim, defendants allege violations of their procedural and

substantive due process rights based on the allegation that New Orleans established

the CED and, therefore, exerts undue influence on the CED’s administrative

proceedings.13 The fourth counterclaim alleges that the proceedings against

defendants have reduced the market value of their property such that a taking has

occurred in violation of the Takings Clause of the Fifth Amendment.14 The fifth

counterclaim asserts that New Orleans violated due process and state law by filing

and serving the adjudicative proceeding with a document that was not signed by

counsel, as required by Louisiana law and due process.15 Finally, in their sixth

counterclaim, defendants assert that the fines New Orleans is authorized by the Code

to levy against them, should the administrative hearing result in a ruling adverse to

10 R. Doc. No. 2 ¶¶ 32–48.

11 Id. ¶¶ 49–61.

12 Id.

13 Id. ¶¶ 62–77.

14 Id. ¶¶ 78–85.

15 Id. ¶¶ 86–93.

defendants, would violate the Excessive Fines Clause of the Eighth Amendment.16

New Orleans has not made any filings since the case was removed to this Court.

On September 30, 2025 the Court issued an order17 to show cause why

plaintiffs’ claims should not be dismissed for improper service of process and

mootness. On October 10, 2025 defendants filed a motion for a declaratory judgment

arguing that all post-removal administrative proceedings are null and void, that this

Court should issue an injunction barring New Orleans from enforcing any judgment

or publishing any publicly available information relating to any post-removal

administrative proceedings, and that this Court should be disqualified pursuant to

28 U.S.C. § 155 and 28 U.S.C. § 455. However, because the motion was filed after the

close of business on Friday, October 10, 2025 the motion was not placed on the docket

sheet for this action until Tuesday, October 14, 202518—some time after the show

cause hearing. Unaware of defendants’ undocketed motion, the Court held the show

cause hearing on October 14, 2025 at 9 a.m.19 Defendants did not appear at the

hearing.

II. STANDARD OF LAW

a. Subject Matter Jurisdiction

Subject matter jurisdiction is a non-waivable requirement that delineates the

power of federal courts. McDonal v. Abbott Lab’ys, 408 F.3d 177, 182 (5th Cir. 2005)

16 Id. ¶¶ 94–101.

17 R. Doc. No. 7.

18 The motion was not placed on the docket sheet on Monday, October 13, 2025 due

to the observance of a federal holiday.

19 Id.

(quoting Ruhrgas AG v. Marathon Oil Co., 526 U.S. 574, 583 (1999)). “[A] claim is

‘properly dismissed for lack of subject-matter jurisdiction when the court lacks the

statutory or constitutional power to adjudicate’ the claim.” In re FEMA Trailer

Formaldehyde Prods. Liab. Litig., 668 F.3d 281, 286 (5th Cir. 2012) (quoting Home

Builders Ass’n, Inc. v. City of Madison, Miss., 143 F.3d 1006, 1010 (5th Cir. 1998)).

A district court can properly exercise subject matter jurisdiction over a claim

in federal court either when that case was originally brought in federal court through

original jurisdiction, or when a state action has been removed to federal court through

removal jurisdiction. See, e.g., Halmekangas v. State Farm Fire & Cas. Co., 603 F.3d

290, 293–96 (5th Cir. 2010); 28 U.S.C. §§ 1331, 1332, 1441. However, for a district

court to properly exercise removal jurisdiction, it must have been able to assert

original jurisdiction over the case as well. Halmekangas, 603 F.3d, at 293; 28 U.S.C.

§ 1441(a) (“[A]ny civil action brought in a State court of which the district courts of

the United States have original jurisdiction, may be removed by the defendant or the

defendants, to the district court of the United States for the district and division

embracing the place where such action is pending.”)

Pursuant to 28 U.S.C. § 1367, “in any civil action of which the district courts

have original jurisdiction, the district courts shall have supplemental jurisdiction

over all other claims that are so related to claims in the action within such original

jurisdiction that they form part of the same case or controversy under Article III of

the United States Constitution.” However, § 1367 only grants supplemental

jurisdiction over state claims when original jurisdiction has already been established

by diversity or federal question jurisdiction. Halmekangas, 603 F.3d, at 294; see also

id. at 294–95 (“The supplemental jurisdiction statute is not a source of original

subject-matter jurisdiction, and a removal petition therefore may not base subject-

matter jurisdiction on the supplemental-jurisdiction statute, even if the action which

a defendant seeks to remove is related to another action over which the federal

district court already has subject-matter jurisdiction, and even if removal would be

efficient.”) (quoting Ahearn v. Charter Twp. Of Bloomfield, 100 F.3d 451, 456 (6th Cir.

1996)). This means that while in some instances § 1367 permits a district court to

hear claims over which it would not otherwise have jurisdiction, supplemental

jurisdiction itself does not provide a basis for the district court to exercise subject

matter jurisdiction over the original claim. Id.

A district court must have original jurisdiction over an action either through

diversity jurisdiction or federal question jurisdiction. Halmekangas, 603 F.2d at 293

(finding when “the plaintiff files an action in state court with no federal question or

complete diversity, the original jurisdiction necessary for removal under § 1441 does

not exist”); see also id. (“Original jurisdiction, in non-maritime claims, lies where the

conditions of 28 U.S.C. § 1331 [federal question] or 1332 [diversity] are satisfied.”)

(alterations in original) (internal quotation marks omitted) (quoting Avitts v. Amoco

Prod. Co., 53 F.3d 690, 693 (5th Cir. 1995)).

Courts can assert federal question jurisdiction when the claim “arises under

the Constitution, laws, or treaties of the United States.” Mitchell v. Clinkscales, 253

F. App’x 339, 340 (5th Cir. 2007); 28 U.S.C. § 1331 (“The district courts shall have

original jurisdiction of all civil actions arising under the Constitution, laws, or

treaties of the United States.”). “Federal jurisdiction exists when a federal question

is presented on the face of a plaintiff’s properly pleaded complaint.” Sam L. Majors

Jewelers v. ABX, Inc., 117 F.3d 922, 924 (5th Cir. 1997); Renegade Swish, LLC v.

Wright, 857 F.3d 692, 697 (5th Cir. 2017) (“[T]he well-pleaded complaint rule also

governs whether a case is removable from state to federal court pursuant to 28 U.S.C.

§ 1441(a).”) “The existence of a defense based upon federal law is insufficient to

support jurisdiction.” Renegade Swish, 857 F.3d, at 697. It is well-settled that “federal

question jurisdiction depends on the contents of a well-pleaded complaint, and may

not be predicated on counterclaims.” Id. (quoting Vaden v. Discover Bank, 556 U.S.

49, 62 (2009)); see also Metro Ford Truck Sales, Inc. v. Ford Motor Co., 145 F.3d 320,

326–27 (5th Cir. 1998) (“When an action is brought to federal court through the § 1441

mechanism, for both removal and original jurisdiction, the federal question must be

presented by plaintiff’s complaint as it stands at the time the petition for removal is

filed and the case seeks entry into the federal system. It is insufficient that a federal

question has been raised as a matter of defense or as a counterclaim.”); 28 U.S.C. §

1441(a) (requiring original jurisdiction for an action to be removed to federal court).

Federal courts have subject matter jurisdiction based on diversity when “the

matter in controversy exceeds the sum or value of $75,000 [exclusive of interest and

costs] and is between: (1) citizens of different States; or (2) citizens of a State and

citizens of a foreign [S]tate.” Dos Santos, 516 F. App’x, at 402. “A party must allege

‘complete diversity,’ which means that ‘all persons on one side of the controversy

[must] be citizens of different states than all persons on the other side.’” Smith v.

Toyota Motor Corp., 978 F.3d 280, 281 (5th Cir. 2020) (quoting McLaughlin v. Miss.

Power Co., 376 F.3d 344, 353 (5th Cir. 2004) (per curiam)). A person is a citizen of a

state for diversity purposes if he is domiciled within that state and is a citizen of the

United States. Coury v. Prot, 85 F.3d 244, 248 (5th Cir. 1996). A corporate entity is a

citizen of its state of incorporation and its principal place of business. Howery v.

Allstate Ins. Co., 243 F.3d 912, 920 (5th Cir. 2001).

“[F]ederal courts are duty-bound to examine the basis of subject matter

jurisdiction sua sponte.” Union Planters Bank Nat. Ass’n v. Salih, 369 F.3d 457, 460

(5th Cir. 2004). This differs from the power a court possesses to consider improper

bases for removal that are not based on a lack of subject matter jurisdiction, which

cannot be considered sua sponte. Ziegler v. Champion Mortg. Co., 913 F.2d 228, 230

(5th Cir. 1990) (“Procedurally, a court may consider remand only if the parties raise

the issue; conversely, a court may consider the existence of subject matter jurisdiction

on its own motion.”). When deciding a question of subject matter jurisdiction, the

burden of proof is on the party asserting jurisdiction. Ramming v. United States, 281

F.3d 158, 161 (5th Cir. 2001); see also Garcia v. Koch Oil Co. of Tex. Inc., 351 F.3d

636, 638 (5th Cir. 2003) (holding that the “party seeking to invoke federal diversity

jurisdiction bears the burden of establishing both that the parties are diverse and

that the amount in controversy exceeds $75,000”).

If a court determines that it does not have subject matter jurisdiction over an

action, the action is dismissed without prejudice. See, e.g., Hitt v. City of Pasadena,

561 F.2d 606, 608 (5th Cir. 1977). In the case of a pro se plaintiff, courts “hold pro se

plaintiffs to a more lenient standard than lawyers when analyzing complaints.”

Chhim v. Univ. of Tex. At Austin, 836 F.3d 467, 469 (5th Cir. 2016).

b. Judicial Disqualification

1. 28 U.S.C. § 155

Title 28 United States Code Section 155, cited by defendants, governs the

temporary transfer of bankruptcy judges. Section 155(a) states that “[a] bankruptcy

judge may be transferred to serve temporarily as a bankruptcy judge in any judicial

district other than the judicial district for which such bankruptcy judge was

appointed upon the approval of the judicial council of each of the circuits involved.”

§ 155(b) allows for a retired bankruptcy judge to be recalled to serve as a bankruptcy

judge in any judicial district by the judicial council of the circuit where such judicial

district is located.

2. 28 U.S.C. § 455

Title 28, U.S.C. § 455(a) of the U.S. Code provides that “[a]ny justice, judge, or

magistrate judge of the United States shall disqualify himself in any proceeding in

which his impartiality might reasonably be questioned.” The “purpose of § 455(a) is

not just to prevent actual partiality, but to avoid even the appearance of partiality.”

Republic of Pan. v. American Tobacco Co. Inc., 217 F.3d 343, 346 (5th Cir. 2000)

(citation modified).

Subsection (b)(1) provides that a judge “shall also disqualify himself” when “he

has a personal bias or prejudice concerning a party, or personal knowledge of disputed

evidentiary facts concerning the proceeding.” 28 U.S.C. § 455(b)(1). Subsections (a)

and (b)(1) “afford separate, though overlapping, grounds for recusal.” Andrade v.

Chojnacki, 338 F.3d 448, 455 (5th Cir. 2003).

Both subsections require the court to evaluate three factors in making its

decision: (1) whether the bias is based on extrajudicial or intrajudicial sources; (2)

whether the specific facts shown in the motion would cause an objective observer to

harbor doubts regarding the judge’s impartiality; and (3) the timeliness of the party’s

motion. Id.; Patterson v. Mobil Oil Corp., 335 F.3d 476, 484 (5th Cir. 2003).

First, the Court should consider “whether the alleged bias ‘was of extrajudicial

origin,’ that is, whether it was based on events or information outside the judicial

proceedings.” Andrade, 338 F.3d at 455. Alleged bias arising from an intrajudicial

source requires recusal only if there is a “display [of] deep-seated favoritism or

antagonism that would make fair judgment impossible.” Id. (quoting Liteky v. United

States, 510 U.S. 540, 555 (1994)); United States v. Brocato, 4 F.4th 296, 302 (5th Cir.

2021) (per curiam).

Second, a motion brought pursuant to any subsection of § 455 must state

specific facts such that a reasonable observer, knowing all the circumstances, would

“harbor doubts about the judge’s impartiality.” Travelers Ins. Co. v. Liljeberg

Enterprises, 38 F.3d 1404, 1408 (5th Cir. 1994). “The decision to recuse is committed

to the sound discretion of the district court.” In re Chevron U.S.A., Inc., 121 F.3d 163,

165 (5th Cir. 1997). Additionally, the recusal inquiry “ask[s] how things appear to the

well-informed, thoughtful and objective observer, rather than the hypersensitive,

cynical, and suspicious person.” United States v. Jordan, 49 F.3d 152, 156 (5th Cir.

1995) (citation modified); accord Andrade, 338 F.3d at 454–55.

Third, “[s]ection 455 also obligates a party to raise the disqualification

argument at a reasonable time in the litigation.” United States v. Anderson, 160 F.3d

231, 234 (5th Cir. 1998) (citation omitted). The party seeking “‘disqualification must

do so at the earliest moment after knowledge of the facts demonstrating the basis of

such disqualification.’” Id. (quoting Travelers Ins. Co., 38 F.3d at 1410).

III. ANALYSIS

a. Subject Matter Jurisdiction

This Court finds that it cannot exercise removal jurisdiction over the

administrative proceeding because it is not a “state court” as required for the exercise

of removal jurisdiction in 28 U.S.C. § 1441. While the Fifth Circuit has not addressed

the question of whether administrative proceedings can qualify as “state courts” for

the purpose of removal jurisdiction, other U.S. Circuit Courts of Appeal have done so.

See, e.g., Or. Bureau of Lab. & Indus. ex rel. Richardson v. U.S. W. Commc’ns, Inc.,

288 F.3d 414 (9th Cir. 2002). Those circuit courts that have addressed this issue take

two different approaches when answering this question, known as the “literal test”

and the “functional test.” Wilson v. Gottlieb, 821 F.Supp.2d 778, 783 (D. Md. 2011)

(comparing the different approaches taken by different circuit courts to resolve the

question of whether an administrative proceeding can qualify a state court pursuant

to § 1441). The literal test looks to the plain language of § 1441 and finds that

administrative proceedings are not state courts for the purposes of removal

jurisdiction, while the functional test looks to see whether the administrative

proceeding is a “functional equivalent” of a state court, and if so, allows for the

administrative proceeding to be removed to federal court. Id.

This Court finds the literal test to be the correct approach. “[W]hen the plain

language of a statute is unambiguous and does not lead to an absurd result, our

inquiry begins and ends with the plain meaning of that language.” Dunn-McCampbell

Royalty Int. v. Nat’l Park Serv., 630 F.3d 431, 438 (5th Cir. 2010). To expand the

language of “state court” in § 1441 to encompass administrative proceedings such as

the one defendants attempt to remove here would expand the removal jurisdiction of

the districts courts beyond that which Congress clearly described in § 1441. U.S. W.

Commc’ns, Inc., 288 F.3d at 419. To assert jurisdiction in this case would be

tantamount to replacing the words “state court” in § 1441 with words such as “‘any

tribunal that acts as a court’ or ‘any tribunal having court-like functions.’” Id. This

Court declines to rewrite Congress’s clear language, particularly when, because

federal courts are courts of limited jurisdiction, “[a]ny ambiguities are construed

against removal because the removal statute should be strictly construed in favor of

remand.” Manguno v. Prudential Prop. and Cas. Ins. Co., 276 F.3d 720, 723 (5th Cir.

2002); Vantage Drilling Co. v. Hsin-Chi Su, 741 F.3d 535, 537 (5th Cir. 2014) (quoting

Acuna v. Brown & Root Inc., 200 F.3d 335, 339 (5th Cir. 2000)).

Alternatively, even if this Court were to adopt the functional test, defendants

have not met their burden of showing that the CED administrative proceedings are

the functional equivalent of a state court. Defendants, as the parties claiming

jurisdiction, have the burden to show that federal jurisdiction exists and that removal

is proper. Id. However, even liberally construing defendants’ pro se notice of removal,

they have failed to make sufficient factual allegations or provide support for an

argument that the CED administrative proceedings function in a fashion equivalent

to a state court20—such as the ability to exercise subpoena power. Courts that have

used the functional test have found the ability to exercise subpoena power to be

important when determining whether an administrative proceeding is functionally

equivalent to a state court. See Gottlieb v. Lincoln Nat’l Life Ins. Co., 388 F.Supp.2d

574, 580 (D. Md. 2005). This Court cannot properly assert removal jurisdiction over

the administrative hearing.21

b. Judicial Disqualification

1. 28 U.S.C. § 155

28 U.S.C. § 155 is inapplicable in this case. § 155 concerns the transfer of

bankruptcy judges and makes no mention of judicial disqualification. This Court

cannot grant a motion for judicial disqualification pursuant to § 155.

2. 28 U.S.C. § 455

Defendants argue that disqualification pursuant to 28 U.S.C. § 455 is proper

because the Court raised sua sponte the issues of improper service of process and

mootness, and because the Court scheduled a show cause hearing which defendants

20 R. Doc. No. 1.

21 While this Court initially thought that this action could potentially be dismissed as

moot and for improper service of process, upon further reflection, the Court is of the

opinion that this case is more properly dismissed for lack of subject matter

jurisdiction.

were unable to attend because their disabilities prevented them from traveling to the

hearing and defendants were unaware of the hearing until October 10, 2025.22

First, this Court was obligated to raise the issues of mootness and improper

service sua sponte. Fed. R. Civ. P. 4(m); Golden, 166 F.3d at 717–19. In doing so, this

Court was not demonstrating bias or prejudice toward any party in this action, but

rather, it was acting in accord with duly enacted and well-settled federal law. See,

e.g., Fed. R. Civ. P. 4(m); Golden, 166 F.3d at 717–19. The Court raising improper

service of process and mootness sua sponte would not cause a reasonable observer,

knowing all of the circumstances, to harbor doubts as to the Court’s impartiality.

Second, while this Court understands that defendants were unaware of the

show cause hearing before October 10, 2025, and that defendants were unable to

travel because of disabilities, this Court had no knowledge of that fact prior to the

October 14, 2025 show cause hearing. While defendants had previously mentioned

disabilities in prior filings23 with this Court, they made no mention that their

disabilities would impact their ability to appear in person for a hearing if required to

do so. This Court was unaware of the inability of defendants to travel until receiving

their most recent motion which, as discussed previously, was not available to the

Court until after the show cause hearing. Regardless, this Court does not consider

defendants’ inability to attend the show cause hearing in connection with the

resolution of this motion.

22 R. Doc. No. 8-1.

23 R. Doc. No. 5.

Additionally, this Court could not predict that defendant Frederick Neroni,24

who in his own words “purchas[es] the docket report of the court from pacer.gov from

time to time, to keep [him]self current of the filings in the case,” would not check the

September 30, 2025 docket entry of the order to show cause until October 10, 2025

when defendant reviewed the docket sheet. The order setting this case for the October

14, 2025 hearing was issued with two weeks’ notice,25 sufficient to provide defendants

with adequate notice of the hearing. See, e.g., Gohe v. Seven Eleven, 2006 WL 1152682

at *1 (N.D. Tex. April 10, 2006) (finding that two weeks’ notice for a show cause

hearing was sufficient notice to plaintiff such that their presence at the hearing was

required).

A reasonable observer would not harbor doubts as to the Court’s impartiality.

Defendants have also not demonstrated any bias of this Court toward defendants

which would warrant recusal. The defendants’ motion for judicial disqualification

pursuant to 28 U.S.C. § 455 must be denied.

Accordingly, for the reasons assigned,

IT IS ORDERED that the above-captioned case is hereby DISMISSED

WITHOUT PREJUDICE.

24 Defendant Frederick Neroni states, in his declaration attached to the defendants’

motion for recusal, that he purchases docket reports from the court’s electronic filing

system to keep himself up to date on the case. R. Doc. No 8-4 ¶ 2. Defendant Tatiana

Neroni does not mention purchasing docket reports in her declaration. R. Doc. No. 8-

5.

25 R. Doc. No. 7.

IT IS FURTHER ORDERED that defendants’ motion?® for judicial

disqualification is DENIED.

New Orleans, Louisiana, October 20, 2025.

ad M. AFRICK

UNITED STATES DISTRICT JUDGE

26 R. Doc. No. 8.

16