Mitchell v. Church Mutual Insurance Company

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF TEXAS
GALVESTON DIVISION
ANDREW J MITCHELL, 	§
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Plaintiff,
V. 	3:26-cv-129
CHURCH MUTUAL INSURANCE
COMPANY,
Defendant.
ORDER ADOPTING MAGISTRATE JUDGE’S
MEMORANDUM AND RECOMMENDATION
On April 23, 2026, all pretrial matters in this case were referred to United
States Magistrate Judge Andrew M. Edison under 28 U.S.C. § 636(b)(1). Dkt. 7.
Judge Edison filed a memorandum and recommendation sua sponte on April 30,
2026, recommending that that the court order the conditional dismissal of this
lawsuit without prejudice unless the plaintiff appears through licensed counsel
within 30 days from the date the memorandum and recommendation is adopted.
Dkt. 11.
On May 15, 2026, the plaintiff filed his objections to the memorandum and
recommendation. 	Dkt. 	12. 	The 	plaintiff 	simultaneously 	filed 	a 	motion 	for
appointment of counsel and a motion to stay, requesting the same relief requested
in his objections. Dkts. 13, 14. Because these motions request the same relief
requested in the plaintiff’s objections, the court will address these two motions
alongside the plaintiff’s objections. In accordance with 28 U.S.C. § 636(b)(1)(C),
United States District Court
Southern District of Texas
ENTERED
May 22, 2026
Nathan Ochsner, Clerk
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this court is required to “make a de novo determination of those portions of the
[magistrate judge’s] report or specified proposed findings or recommendations to
which objection [has been] made.” After conducting this de novo review, the court
may 	“accept, 	reject, 	or 	modify, 	in 	whole 	or 	in 	part, 	the 	findings 	or
recommendations made by the magistrate judge.” Id.; see also Fed. R. Civ. P.
72(b)(3).
The court has carefully considered the objections; the memorandum and
recommendation; the pleadings; and the record. The court accepts Judge Edison’s
memorandum and recommendation and adopts it as the opinion of the court.
The plaintiff first objects that Judge Edison misapplied certain authorities
cited in his memorandum and recommendation, and that he treated as controlling
authority the opinion issued in M2 Technology, Inc. v. M2 Software, Inc., 589 F.
App’x 671 (5th Cir. 2014). Dkt. 18 at 5–6. This objection is overruled. “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). It is this centuries-old,
binding 	precedent 	that 	underpins 	Judge 	Edison’s 	memorandum 	and
recommendation. Binding Fifth Circuit authority is not required for this court to
follow the uniform rule adopted by every federal court to confront the issue and
hold 	that 	where 	“the 	lay 	individual 	chose 	to 	accept 	the 	advantages 	of
incorporation,” he “must now bear the burdens of that incorporation; thus, he
must have an attorney present the corporation’s legal claims.” Jones v. Niagara
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Frontier Transp. Auth., 722 F.2d 20, 23 (2d Cir. 1983) (quotation omitted).
Assignment of an LLC’s claims does not defeat this rule.
The plaintiff next objects that he has standing as the real party in interest
under Sprint Communications Co. v. APCC Services, Inc., 554 U.S. 269 (2008),
the Mandatory Victims Restitution Act, and his direct individual injury as the
licensed professional whose labor underpins the claims at issue. This objection is
overruled. To start, Sprint did not address whether a non-lawyer may proceed pro
se on behalf of an LLC and has no bearing here.
Nor does the Mandatory Victims Restitution Act have any bearing on
whether the plaintiff may represent his LLC. The plaintiff, an incarcerated felon,
refers to himself as “the federally-directed restitution-recovery vehicle.” Dkt. 12 at
6. The court is unfamiliar with this term, which does not appear in any case law or
the Mandatory Victims Restitution Act. The plaintiff argues that because he
allegedly “holds legal title to [his LLC’s] receivable under a federally-disclosed
transfer that pre-existed this litigation and was made for federal restitution-
coordination purposes,” he has standing. Id. at 6–7. The plaintiff “points to no
authority for his proposition that when [a federal district court in an unrelated
criminal action] determines an LLC is an individual [criminal defendant’s asset]
for [restitution] purposes, the LLC should be disregarded for all purposes,
including when determining whether an LLC’s sole member has standing to assert
a . . . claim alleging harm to the LLC or when applying federal law requiring
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business entities to appear in court only through licensed counsel.” Lunnon v.
United States, No. 21-2140, 2022 WL 17729999, at *6 (10th Cir. Dec. 16, 2022).
As for the plaintiff’s contention that he has claims against the defendants in
his individual capacity—namely, as “the licensed individual public adjuster whose
personal labor generated the compensation at issue.” Dkt. 12 at 6. If the plaintiff
believes that he has claims to assert solely as an individual and not as the sole
member of his LLC or as an assignee of its claims, the court will permit him to
amend his complaint to assert such claims.
In his third objection, the plaintiff argues that Judge Edison wrongly
recommended dismissal without first affording the plaintiff an opportunity to cure
under Rule 17(a) and Wieburg v. GTE Southwest Inc., 272 F.3d 302 (5th Cir.
2001). This objection is overruled. Unlike here, the court in Wieburg dismissed the
action outright. Judge Edison recommended conditional dismissal if the plaintiff
does not appear through licensed counsel within 30 days. If the plaintiff does
appear through licensed counsel, the action will not be dismissed. If the plaintiff
does not appear through licensed counsel, the action will be dismissed, but only
once the 30 days have passed. Conditional dismissals are a standard means for
dealing with the substitution of the real party in interest. See, e.g., Wright v. Sears
Roebuck & Co., No. CIV.A. 09-1498, 2010 WL 6032803, at *5 (W.D. La. Oct. 19,
2010) (holding that the remedy under Rule 17 is conditional dismissal unless the
real party in interest joins the litigation), report and recommendation adopted,
No. CIV.A. 09-1498, 2011 WL 867252 (W.D. La. Mar. 10, 2011).
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In his fourth and final objection, the plaintiff argues that Judge Edison
should have considered appointing counsel under 28 U.S.C. § 1915(e)(1) and
Naranjo v. Thompson, 809 F.3d 793 (5th Cir. 2015). This objection is overruled.
The United States Supreme Court held more than 30 years ago that § 1915 extends
only to natural persons. See Rowland, 506 U.S. at 208. Thus, the court has no
power to appoint counsel to a corporate plaintiff under § 1915. While the Fifth
Circuit recognized a district court’s “inherent power to appoint counsel for an
insolvent corporate criminal defendant,” this court is unaware of any authority that
would support appointing counsel for a corporate plaintiff in civil litigation.
Naranjo, 809 F.3d at 802. Assuming the court has such inherent power, the court
declines to use it. If the value of this litigation is as great as the plaintiff believes,
he should have no difficulty securing counsel on a contingency basis.
It is therefore ordered that:
(1) 	Judge 	Edison’s 	memorandum 	and 	recommendation, 	Dkt. 	11, 	is
approved and adopted in its entirety as the holding of the court;
(2) 	The plaintiff has 30 days from the date of this order to file an amended
complaint asserting claims solely in his individual capacity and not as
an assignee or the sole member of his LLC;
(3) 	The plaintiff’s motion for appointment of counsel, Dkt. 13, is denied;
(4) 	This case is conditionally dismissed unless, within 30 days from the
entry of this order, the plaintiff appears through licensed counsel to
pursue his LLC’s claims or files an amended complaint asserting only
individual claims against the defendant and not as his LLC’s sole
member or as an assignee of his LLC’s claims; and
(5) 	The plaintiff’s motion to stay, Dkt. 14, is granted, in that all other
deadlines in this case are stayed for the next 30 days.
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SIGNED on Galveston Island this 22nd day of May 2026.
______________________________
JEFFREY VINCENT BROWN
UNITED STATES DISTRICT JUDGE
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