Mitchell v. The LCF Group, Inc

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF TEXAS
GALVESTON DIVISION
ANDREW J MITCHELL, 	§
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Plaintiff,
V. 	CIVIL ACTION NO. 3:26-cv-00097
THE LCF GROUP, INC.,
Defendant.
MEMORANDUM AND RECOMMENDATION
This case has been referred to me for all pretrial purposes. See Dkt. 9. I am
sua sponte issuing this memorandum and recommendation to suggest that the
court order the conditional dismissal of this lawsuit without prejudice unless
Plaintiff Andrew Mitchell appears through licensed counsel within 30 days from
the date this memorandum and recommendation is adopted.
On March 15, 2026, Mitchell, an incarcerated person proceeding pro se,
instituted this lawsuit against Defendant The LCF Group, Inc. Mitchell was a
licensed public adjuster. Mitchell provided his public adjusting services through
Mitchell Adjusting International LLC (“MAI”), a Texas limited liability company.
At all times, Mitchell has been the sole member of MAI. Mitchell claims that
Defendant “caused [his] accounts to be frozen” and “exploited the account freeze
to coerce [him] into signing a settlement release agreement under economic
duress, demanding a waiver of all claims in exchange for restoring access to
accounts that LCF should never have frozen in the first place.” Dkt. 1 at 1. Mitchell
asserts claims for breach of contract, civil RICO, extortion/economic duress, fraud
and fraudulent inducement, conversion, unjust enrichment, and declaratory and
injunctive relief. Mitchell purports to bring this lawsuit as “the owner and
operator” of MAI. Id. at 2. Mitchell cannot do this.
United States District Court
Southern District of Texas
ENTERED
May 04, 2026
Nathan Ochsner, Clerk
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“In all courts of the United States the parties may plead and conduct their
own cases personally or by counsel as, by the rules of such courts, respectively, are
permitted to manage and conduct causes therein.” 28 U.S.C. § 1654. The right to
conduct one’s own cases personally is limited to one’s own interests. “It has been
the law for the better part of two centuries . . . that a corporation may appear in the
federal courts only through licensed counsel.” Rowland v. Cal. Men’s Colony, Unit
II Men’s Advisory Council, 506 U.S. 194, 201–02 (1993). This rule applies to all
“[a]rtificial business entities—such as limited liability companies, corporations,
and partnerships.” Alt. Materials, LLC v. TCH Constr. Grp., Inc., 339 F.R.D. 322,
324 (N.D. Fla. 2021).
Mitchell does not attach the Purchase and Sale of Future Receivables
Agreement at issue to his complaint. Mitches alleges, however, that the agreement
required LCF to “purchase $770,000.00 in future receivables from Mitchell
Adjusting International in exchange for a stated purchase price of $550,000.00.”
Dkt. 1 at 3 (emphasis added). To the extent that Mitchell has a personal claim
against Defendant, Mitchell may prosecute that claim himself. But to the extent
that Mitchell seeks to prosecute a claim belonging to MAI, such a claim may be
prosecuted only through a licensed attorney. See, e.g., Robinson v. Ashland Inc.,
No. 1:24-cv-97, 2024 WL 5158429, at *8 (E.D. Tex. Dec. 18, 2024) (collecting cases
and holding that “Plaintiffs, even as sole owners of their LLC, lack standing to
assert claims individually where the cause of action belongs to the company.”).
MAI is free to assign its claims to Mitchell, but such assignment still does
not authorize Mitchell to appear on MAI’s behalf. “Courts faced with this question
routinely hold that an individual who has been assigned claims from a corporation
cannot proceed pro se.” Stark v. Kohrs, No. 1:19-cv-041, 2020 WL 734480, at *3 &
n.1 (collecting cases). As the Court of Appeals for the District of Columbia
explained more than 90 years ago:
We think the words ‘the parties,’ as used in [28 U.S.C. § 1654],
mean the parties in interest—the real, beneficial owners of the claims
asserted in the suit[], and by implication that it excludes agents and
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attorneys in fact and confines the representation, where the party
whose rights are actually involved does not appear in person, to
attorneys and counselors at law. It cannot be doubted, we think,
that an assignment of a claim against another, made solely
for 	the 	purpose 	of 	permitting 	the 	assignee—not 	an
attorney—to 	conduct 	the 	litigation 	in 	proper 	person,
would be colorable only and, therefore, insufficient to
accomplish the purpose; and this, for the reason that such an
assignment would transfer only the naked legal title or, perhaps more
accurately, no more than an agency— a power without an interest;—
and in such case there would be lacking that element of personal
interest which alone permits the management of an action at law in a
court by some one other than an attorney at law.
. . . .
Petitioner is not an attorney at law, nor is he the real party in
interest, and hence had no standing to commence or to prosecute the
action.
Heiskell v. Mozie, 82 F.2d 861, 863 (D.C. Cir. 1936) (emphasis added). 1 It appears
that Mitchell’s “sole reason for pursuing the assignment . . . was so that [MAI]
could protect its [contractual] rights in federal court without retaining counsel.”
M2 Tech., Inc. v. M2 Software, Inc., 589 F. App’x. 671, 675 n.2 (5th Cir. 2014). This
is not allowed.
“A district court may dismiss a claim on its own motion as long as the
procedure employed is fair.” Davoodi v. Austin Indep. Sch. Dist., 755 F.3d 307, 310
(5th Cir. 2014) (cleaned up). Fairness “requires both notice of the court’s intention
and an opportunity to respond.” Id. (quotation omitted). Here, Mitchell has both
the opportunity to object to this memorandum and recommendation and, in the
1 See also Palazzo v. Gulf Oil Corp., 764 F.2d 1381, 1386 (11th Cir. 1985) (“We see no
reason to permit any evasion of the general rule [of corporate representation by counsel]
by the simple expedient of the assignment of corporate claims to the pro se plaintiff. Nor
is any injustice done to plaintiff by this holding.”); Jones v. Niagara Frontier Transp.
Auth., 722 F.2d 20, 23 (2d Cir. 1983) (“In light of the[] policy reasons for preventing a lay
person from representing a corporation in litigation, the federal courts have, in cases
governed by federal law, disapproved any circumvention of the rule by the procedural
device of an assignment of the corporation’s claims to the lay individual.”).
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event it is adopted, 30 days to appear through counsel before this action is
dismissed without prejudice. That is fair.
CONCLUSION
For the reasons discussed above, I recommend that the court order the
conditional dismissal of this lawsuit without prejudice unless Mitchell appears
through licensed counsel within 30 days from the date this memorandum and
recommendation is adopted.
The 	parties 	have 	14 	days 	from 	service 	of 	this 	Memorandum 	and
Recommendation to file written objections. See 28 U.S.C. § 636(b)(1)(C); Fed. R.
Civ. P. 72(b)(2). Failure to file timely objections will preclude appellate review of
factual findings and legal conclusions, except for plain error.
SIGNED this ___ day of May 2026.
______________________________
ANDREW M. EDISON
UNITED STATES MAGISTRATE JUDGE
4th
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