Mitchell v. State Farm Fire And Casualty Company

OCR transcription for search; preserved printed pages are authoritative

Case 3:26-cv-00087 Document 21 Filed 05/18/26 in TXSD Page 1of6

United States District Court
Southem District of Texas

ENTERED
UNITED STATES DISTRICT COURT May 18, 2026
SOUTHERN DISTRICT OF TEXAS Nathan Ochsner, Clerk
GALVESTON DIVISION
ANDREW J MITCHELL, §
§
Plaintiff, §
§
V. § 3:26-cv-87

§
STATE FARM FIREAND CASUALTY §
COMPANY, et al., §
§
Defendants. §

ORDER ADOPTING MAGISTRATE JUDGE’S
MEMORANDUM AND RECOMMENDATION

On March 25, 2026, all pretrial matters in this case were referred to United
States Magistrate Judge Andrew M. Edison under 28 U.S.C. § 636(b)(4). Dkt. 9.
Judge Edison filed a memorandum and recommendation sua sponte on April 27,
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. 17.

On May 6, 2026, the plaintiff filed his objections to the memorandum and
recommendation. Dkt. 18. The plaintiff simultaneously filed a motion for
appointment of counsel and a motion to stay, requesting the same relief requested
in his objections. Dkts. 19, 20. 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),

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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. 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. There does not need to be a precedential
opinion from the Fifth Circuit for this court to follow every other court to have
confronted 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 corporations legal
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claims.” Jones v. Niagara Frontier Transp. Auth., 722 F.2d 20, 23 (2d Cir. 1983)
(quotation omitted). It is irrelevant why the plaintiff wishes to represent his
corporate entity—every individual who attempts to represent his business in
litigation surely believes he has a compelling reason for doing so. The fact remains
that limited liability entities may appear in federal court only through licensed
counsel, and assignments may not be used to defeat that 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),
and the Mandatory Victims Restitution Act. This objection is overruled. Sprint did
not address whether a non-lawyer may proceed pro se on behalf of a limited
liability entity and has no bearing here.
Nor does the Mandatory Victims Restitution Act have any bearing on
whether the plaintiff may represent his limited liability entity. The plaintiff, an
incarcerated felon, refers to himself as a “federal restitution beneficiary.” Dkt. 18
at 8. 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 “is
personally obligated to pursue restitution recoveries for the benefit of [his] federal
victims,” that he is the real party in interest “regardless of the corporate-form
analysis applied in the M&R.” Id. The plaintiff cites no law to support such an
argument. What happened in the plaintiff’s criminal case is not the determiner of
who the real party in interest is in this litigation.
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As for the plaintiff’s contention that he has claims against the defendant in
his individual capacity—namely, “the deprivation of his contractual right to be
named as payee on instruments”—that contention is undercut by the plaintiff’s
own pleadings. Id. at 9. The only contract that the plaintiff attaches to his
complaint shows that the “additional payee on all settlement checks, drafts and/or
payments” was to be Mitchell Adjusting International, LLC, not the plaintiff
personally. Dkt. 1-2 at 11. Nevertheless, if the plaintiff believes that he has claims
to assert solely as an individual and not as the assignee of his LLC, the court will
permit the plaintiff 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
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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).
In his fourth 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. 17, 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 member of his LLC;
(3) The plaintiff’s motion for appointment of counsel, Dkt. 19, is denied;
(4) This case is conditionally dismissed unless the plaintiff appears
through licensed counsel within 30 days from the entry of this order
and/or files an amended complaint asserting claims against the
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Case 3:26-cv-00087 Document 21 Filed 05/18/26 in TXSD Page 6 of 6

defendant solely in his individual capacity and not as an assignee of
his LLC’s claims or its sole member; and

(5) The plaintiffs motion to stay, Dkt. 20, is granted, in that all other
deadlines in this case are stayed for the next 30 days.

SIGNED on Galveston Island this 18th day of May 2026.

J BM eco BROWN

UNITED STATES DISTRICT JUDGE