Mitchell v. Pearl Delta Funding, LLC et al

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-00125
PEARL DELTA FUNDING, LLC, et al.,
Defendants.
MEMORANDUM AND RECOMMENDATION
This case has been referred to me for all pretrial purposes. See Dkt. 6. 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 April 9, 2026, Mitchell, an incarcerated person proceeding pro se,
instituted this lawsuit against Defendants. 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 Defendants operated a
“predatory merchant cash advance scheme” that “induced [MAI] into a June 2021
renewal carrying a significantly higher fixed daily repayment obligation” that
Defendants knew would “exceed MAI’s ability to maintain sufficient liquidity for
policyholder trust fund disbursements.” Dkt. 1 at 1. Mitchell asserts claims for civil
RICO, 	civil 	RICO 	conspiracy, 	breach 	of 	contract, 	fraudulent 	inducement,
conversion, unjust enrichment, and violations of the Texas Finance Code. Mitchell
purports to bring this lawsuit as “owner and operator of Mitchell Adjusting
International LLC.” Id. Mitchell cannot do this.
United States District Court
Southern District of Texas
ENTERED
April 30, 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).
The Revenue Purchase Agreement that Mitchell attaches to his complaint
shows that the MAI was a party to the agreement, not Mitchell personally. See
Dkt. 1-2 at 2. The merchant cash advances on which this lawsuit is based were
issued to MAI as the account holder, not to Mitchell personally. See Dkt. 1-3. The
account statements attached to the complaint are accounts held in MAI’s name,
not Mitchell’s name. See Dkt. 1-4. The claims here clearly belong to MAI, the
company with whom Defendants contracted. MAI can appear in federal court only
through an attorney. Mitchell is not an attorney. Thus, he cannot prosecute MAI’s
claims himself. 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.”).
“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
event it is adopted, 30 days to appear through counsel before this action is
dismissed without prejudice. That is fair.
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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 April 2026.
______________________________
ANDREW M. EDISON
UNITED STATES MAGISTRATE JUDGE
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