Nguyen v. Atuta, Inc., et al.

IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF TEXAS
HOUSTON DIVISION
NGUYEN THANH TU,
Plaintiff,
v.
ATUTA INC., et al.,
Defendants.
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CIVIL ACTION NO. H-26-1218
MEMORANDUM AND OPINION
The plaintiff, Nguyen Thanh Tu, also known as Tu Nguyen, has a history of vexatious
litigation. In this case, he has sued a variety of persons and entities for defamation and conspiracy
to defame. The defendants removed on the ground of diversity jurisdiction, (Docket Entry No. 1),
and Tu has moved to remand, (Docket Entry No. 4). 	In his own words, this case is a “re-file” of
a case that was dismissed in November 2025 by Judge David Hittner, another judge in the Houston
Division of the Southern District of Texas. (Docket Entry No. 4 ¶¶ 3–6). Based on the motions,
the pleadings, the record, and the applicable law, the court denies Tu’s motion to remand and
dismisses this case, with prejudice. The reasons for these rulings are set out below.
I. 	Background
This case is the latest in a series of lawsuits filed by Tu, whose state-court vexatious litigant
designation was only lifted in April 2026.1 (Docket Entry No. 15). In this case, as in others, Tu
asserts defamation and conspiracy claims against many members of the Vietnamese and
Vietnamese-American communities. (Docket Entry No. 1-1). Tu filed this case in state court in
January 2026. 	(Docket Entry No. 1-1). 	The defendants removed on the basis of diversity
1 Tu has filed a request for judicial notice of the order vacating his vexatious litigant designation. (Docket
Entry No. 15). The court grants the request, although it is irrelevant to this court’s legal analysis. The later
lifting of his vexatious litigant sanction does not cure his prior failure to comply with Judge Hittner’s order.
United States District Court
Southern District of Texas
ENTERED
June 29, 2026
Nathan Ochsner, Clerk
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jurisdiction, arguing that an in-state defendant, John Nguyen, was improperly joined. 	(Docket
Entry No. 1). Tu moved to remand, arguing that John Nguyen was properly joined and was the
“nerve center” for another defendant, HGP USA. (Docket Entry No. 4 ¶¶ 18, 19).
Tu’s motion to remand set out the procedural background of this case. Tu explained that
he had filed the same case in state court and that the case was removed and assigned to Judge
Hittner. 	(Docket Entry No. 4 ¶ 2 (stating that “[t]his action” was originally filed in state court,
removed to federal court, and assigned to Judge Hittner)). That action was filed in October 2025.
Judge Hittner issued an order noting Tu’s history of vexatious litigation and requiring him to obtain
the requisite permission from a local Administrative Judge to file the suit by a certain date or the
case would be dismissed. 2 (Id. ¶ 2). Tu admits that Judge Hittner dismissed the case after he failed
to obtain the required permission. 	(Id. ¶ 3). 	Tu asserts that although the defendants sought
dismissal with prejudice, Judge Hittner “did not do” so. (Id. ¶ 4). Tu states that he later received
permission to “refile” the case from a local Administrative Judge. (Id. (Id. ¶ 6). He “refiled” in
state court, and the defendants removed. (Id. ¶¶ 6, 11).
The threshold issue, which the court may raise sua sponte,3 is the preclusive effect of Judge
Hittner’s dismissal of Tu’s earlier filed case. As Tu admitted in his motion to remand, (Docket
Entry No. 4 ¶ 4), Judge Hittner dismissed for Tu’s “failure to comply” with a court order. (Case
No. 4:25-cv-04982, Docket Entry No. 17 at 2). 	A dismissal for failure to comply with a court
2 The court notes that, although not referenced in Tu’s motion to remand, Judge Hittner’s order also required
Tu to post a security bond of $100,000, or in an amount otherwise determined by the local Administrative
Judge, in accordance with Tex. Civ. Prac. & Rem. Code § 11052(b). (Case No. 4:25-cv-04982, Docket
Entry No. 8).
3 Although the defendants did not raise the issue of res judicata themselves and did not file a motion to
dismiss, “the Court may raise and consider the res judicata bar sua sponte and may take judicial notice of
prior lawsuits.” 	James v. Allstate Vehicle & Prop. Ins. Co., Civ. Action No. 4:24-CV-636, 2025 WL
847884, at *2 (S.D. Tex. Mar. 18, 2025).
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order is a dismissal under Rule 41(b), which, by default, operates as an adjudication on the merits.
FED. R. CIV. P. 41(b). Judge Hittner’s order did not say that the dismissal was “without prejudice”;
to the contrary, the order stated that it was a “final judgment.” (Case No. 4:25-cv-04982, Docket
Entry No. 17 at 2). The phrase “final judgment” typically indicates a final determination of the
claims on the merits. See, e.g., Wilson Cypress Co. v. Atlantic Coast Liner R. Co., 109 F.2d 623,
625 (5th Cir. 1940) (“[A] judgment of dismissal which is intended to be and is, a disposition of the
cause of action on its merits, is a final judgment and res judicata.”).
Based on its review of Judge Hittner’s order, this court ordered Tu to show cause why this
case should not be dismissed with prejudice under res judicata. (Docket Entry No. 14; see also
Docket Entry No. 17). 	Tu’s response did not argue that any claims would not be precluded.
(Docket Entry No. 18). 	Instead, he argued: (1) that the dismissal was “procedural,” and so the
dismissal was without prejudice; (2) it would have been improper to dismiss the earlier case with
prejudice because a dismissal with prejudice is a severe sanction; and (3) Judge Hittner did not use
the defendants’ proposed order, which had included the phrase “with prejudice,” which “certainly
suggests” that the dismissal “was not intended to be with prejudice.” (Id. ¶ 12–13, 16–20). On
May 22, 2026, the court heard oral argument on the motion to remand and the preclusive effect of
the earlier dismissal. (Docket Entry No. 21). After the oral argument, the parties filed a variety
of post-hearing briefs. (Docket Entry Nos. 37, 39, 40, 41, 42).
II. 	The Legal Standard
A. The Improper Joinder Standard
“Under 28 U.S.C. § 1441(b), when original federal jurisdiction is based on diversity . . . a
defendant may remove a state court civil action only ‘if none of the parties in interest properly
joined and served as defendants is a citizen of the State in which such action is brought.’” Centro
Cristiano Cosecha Final, Inc. v. Ohio Cas. Ins. Co., Civ. Action No. H-10-1846, 2011 WL 240335,
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at *2 (S.D. Tex. Jan. 20, 2011). “The doctrine of improper joinder, or fraudulent joinder, prevents
defeat of federal removal jurisdiction premised on diversity by the presence of an improperly
joined, non-diverse defendant.” 	Id. 	“Citizenship of an improperly joined party is totally
disregarded in determining the court’s subject matter jurisdiction.” Id.
“Improper joinder may be established by showing (1) actual fraud in the pleading of
jurisdictional facts or (2) an inability to establish a cause of action against the non-diverse
defendant in state court.” Id. “Defendants claiming improper joinder based on the second type
bear a heavy burden of showing that there is no possibility of recovery by the plaintiff against the
in-state defendant, i.e., in other words that there is no reasonable basis for predicting that state law
would allow recovery against the in-state defendant.” Id. “A ‘reasonable basis’ means more than
a mere hypothetical basis.” 	Id. 	“To determine whether a plaintiff has a ‘reasonable basis for
recovery under state law, the court may conduct a Rule 12(b)(6)-type analysis.” 	Id. (quoting
Smallwood v. Illinois Cent. R.R. Co., 385 F.3d 568, 572 (5th Cir. 2003)).
“First the court should look at the pleadings to determine whether the allegations state a
claim under state law against the in-state defendant.” Id. “If the ‘plaintiff has stated a claim, but
has misstated or omitted discrete facts that would determine the propriety of joinder,’ the court
may look beyond the pleadings and consider summary judgment-type evidence.” 	Id. 	“[T]he
existence of even a single valid cause of action against the in-state defendants (despite the pleading
of several unavailing claims) requires remand of the entire case to state court.” Id. (quoting Grey
v. Beverly Enterprises-Mississippi, Inc., 390 F.3d 400, 412 & n.11 (5th Cir. 2004)). “The district
court must resolve all contested fact issues and ambiguities of state law in favor of the plaintiff
and remand.” Id.
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B. Res Judicata
“Under res judicata, a final judgment on the merits of an action precludes the parties or
their privies from relitigating issues that were or could have been raised in that action.” 	Oreck
Direct, LLC v. Dyson, Inc., 560 F.3d 398, 401 (5th Cir. 2009) (quoting Allen v. McCurry, 449 U.S.
90, 94 (1980)). 	“Res judicata ‘insures the finality of judgments and thereby conserves judicial
resources and protects litigants from multiple lawsuits.’” Id. (quoting United States v. Shanbaum,
10 F.3d 305, 310 (5th Cir. 1994)). “Res judicata prevents a later suit . . . from collaterally attacking
a prior judgment by a court of competent jurisdiction.” 	Id. 	“The test for res judicata has four
elements: (1) the parties are identical or in privity; (2) the judgment in the prior action was rendered
by a court of competent jurisdiction; (3) the prior action was concluded by a final judgment on the
merits; and (4) the same claim or cause of action was involved in both actions.” 	Test Masters
Educ. Servs., Inc. v. Singh, 428 F.3d 559, 571 (5th Cir. 2005).
III. 	Analysis
A. The Motion to Remand
The motion to remand raises two issues: whether John Nguyen was improperly joined, and
whether HGP USA is a citizen of California alone or both California and Texas. 	The court
concludes that John Nguyen, a Texas citizen, was improperly joined and that HGP USA is a citizen
only of California. Because complete diversity exists, so does federal removal jurisdiction.
First, there are no plausible claims asserted against John Nguyen. Tu’s largely block-text
36-page complaint alleges no specific defamatory act by John Nguyen against Tu. (See generally
Docket Entry No. 1-1). 4 Rather, the complaint alleges that John Nguyen was part of a conspiracy
4 Tu’s motion to remand identifies paragraphs 20, 28, 29, 32, 34, and 26 as the relevant paragraphs
explaining HGP and John Nguyen’s roles in the alleged conspiracy. (Docket Entry No. 4 ¶ 10). Despite
Tu’s assertion that these paragraphs provide “extensive detail about the roles that HGP USA Corp. and
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to defame Tu based only on Nguyen’s brief association with HGP USA. Even assuming that Tu
could bring viable defamation and conspiracy claims against HGP USA, he cannot bring claims
against John Nguyen based only on Nguyen’s brief tenure as one director of HGP USA. See, e.g.,
In re Cohen, Bankr. No. 12-10027, 2013 WL 4079369, at *13 (Bankr. E.D. Tex. Aug. 13, 2013)
(“Under Texas law, ‘a director or officer of a corporation is not liable, merely because of his official
character, for the fraud or false representations of the other officers or agents of the corporation
. . . if such director or officer is not personally connected to the wrong and does not participate in
it.’” (quoting K&G Oil Tool & Serv. Co v. G&G Fishing Tool Serv., 314 S.W.2d 782, 793 (1958)));
Houston Chron. Pub. Co. v. Stewart, 668 S.W.2d 727, 730 (Tex. App. 1983), dismissed (July 11,
1984) (“The appellee did not offer any evidence at the venue hearing connecting either of the
appellants, Johnson and Pickels, with the alleged defamatory article. Although a corporate officer
may be held individually liable for a corporate wrong in which he participates, he cannot be held
personally liable merely by reason of his corporate office.”).
Both Tu’s motion to remand and his reply brief admit that he is bringing claims against
John Nguyen only because of Nguyen’s corporate role, and not because of any action Nguyen took
or any decision he was involved in on behalf of HGP USA. (Docket Entry No. 4 ¶ 19; see generally
Docket No. 10; Docket Entry No. 11 at 3). 	Tu has provided no evidence rebutting Nguyen’s
affidavit explaining his very limited role at HGP USA, which lasted only three months and had
nothing to do with the alleged actions that form the basis for Tu’s claims against HGP USA. 5
John Nguyen played in this conspiracy,” (Docket Entry No. 4 ¶ 10), these paragraphs provide no detail
about John Nguyen’s alleged role; his name is merely mentioned in passing. HGP USA’s role is not given
“extensive detail” either.
5 As noted above, Tu identifies six paragraphs as the basis of his defamation conspiracy claims against HGP
USA. Those paragraphs allege that on a single occasion, HGP USA’s CEO, Thanh Tuan Ho, served as a
cameraman for Pho Bolsa TV.
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(Docket Entry No. 7-2). There are no plausible claims against John Nguyen under state law; he is
improperly joined in this lawsuit.
The court also concludes that HGP USA is a citizen of California. The notice of removal
states that HGP USA is incorporated and has its principal place of business in California. (Docket
Entry No. 1 ¶ 9). In the case before Judge Hittner, Tu asserted that HGP USA was a California
company and did not dispute that diversity jurisdiction existed. (Case No. 4:25-cv-04982, Docket
Entry No. 4-3 ¶ 9). In his motion to remand, Tu now argues that because John Nguyen lives in
Texas and is the “nerve center” of HGP USA, it is also a citizen of Texas. (Docket Entry No. 4 ¶¶
7, 19). “A corporation’s principal place of business is its ‘nerve center’—the actual center of [a
corporation’s] direction, control, and coordination.” NavSav Holdings, LLC v. Beber, 724 F. Supp.
3d 615, 624 (E.D. Tex. 2024) (quoting Hertz Corp. v. Friend, 559 U.S. 77, 92–93 (2010)). “This
is generally a corporation’s headquarters,” id., although it can also be where a single corporate
officer makes decisions, see Selenbio, Inc. v. Selenbio Chem., Inc., No. 1:22-CV-726-LY, 2022 WL
19404029, *3 (W.D. Tex. Nov. 17, 2022), report and recommendation adopted, No. 1:22-CV-726-
LY, 2023 WL 2825851 (W.D. Tex. Jan. 9, 2023).
HGP USA has provided a Rule 7. 1 certificate stating that it is a citizen of California and
has provided a document from the California Secretary of State showing that HGP USA was
founded in California and has its principal address in California.6 (Docket Entry Nos. 33, 33-1).
The only owner and director of HGP USA is Thanh Tuan Ho, a California citizen. (Docket Entry
No. 30). Tu does not dispute that Ho, who he identifies as the CEO and Chairman of the Board of
HGP USA, is a California citizen. (Docket Entry No. 1-1 ¶ 12). The document from the California
6 Although Tu’s complaint labels HGP USA an LLC, (Docket Entry No. 1-1 ¶ 11), it is now (and was at
the time of this suit’s filing) a stock corporation, (Docket Entry No. 33-1).
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Secretary of State states that Ho is HGP USA’s agent and lists a California address. (Docket Entry
No. 33-1). 	As John Nguyen explained in his affidavit and Ho explained in his affidavit, John
Nguyen played only a limited role during his three months as one of the directors of HGP, a role
that ended before this lawsuit even began. (Docket Entry Nos. 7-1, 7-2).
Tu’s declaration in support of his motion for remand asserts that HGP USA is merely
“disguised as a corporation” and “actually functions solely as Ho’s personal alter ego.” (Docket
Entry No. 11 at 4). This assertion undercuts Tu’s arguments that John Nguyen was HGP USA’s
“nerve center” and that the “nerve center” is anywhere but California, where Ho is domiciled.
There is no credible allegation (or evidence) that Ho makes his corporate decisions elsewhere.
Tu’s attempt to recast HGP USA’s citizenship in this second lawsuit based on John Nguyen’s
limited role and his presence in Texas is unavailing.7
The court concludes that HGP USA is a California citizen and that John Nguyen was
improperly joined. Because complete diversity exists, the court denies the motion to remand.
B. Res Judicata
Judge Hittner entered a final judgment dismissing Tu’s earlier version of this case because
Tu failed to comply with the court’s order. A dismissal for failing to comply with a court order is
a dismissal under Rule 41(b). See McCullough v. Lynaugh, 835 F.2d 1126, 1127 (5th Cir. 1988)
(“A district court may dismiss an action for failure of a plaintiff to prosecute or to comply with any
order of court.” (citing FED. R. CIV. P. 41(b)). The default rule is that a Rule 41(b) dismissal is
with prejudice. See FED. R. CIV. P. 41(b) (“Unless the dismissal order states otherwise, a dismissal
under this subdivision (b) and any dismissal not under this rule—except one for lack of jurisdiction,
7 Tu’s declaration also included “evidence” allegedly indicating that HGP USA planned to grow its business
in Texas in the future. (See generally Docket Entry No. 11). The defendants object to Tu’s testimony and
evidence on multiple grounds. (See generally Docket Entry No. 12). In any event, that testimony and
“evidence” merely underscores the fact that Texas is not currently HGP USA’s principal place of business.
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improper venue, or failure to join a party under Rule 19—operates as an adjudication on the
merits.”); Boykin for Roy Lee Kemp Tr. v. Wells Fargo Fin. Tex., Inc., Civ. Action No. 4:17 02663,
2017 WL 6209606, at *3 (S.D. Tex. Dec. 8, 2017) (“A dismissal under Rule 41(b) is with prejudice
unless otherwise stated in the dismissal order.”); Love v. Hunt, 96 F.3d 1445, 1996 WL 512230, at
*2 (5th Cir. 1996) (“Unless otherwise specified in the order of dismissal, a dismissal under Rule
41(b) operates as an adjudication on the merits, and thus as a dismissal with prejudice.”).
Tu’s primary response to the court’s show cause order is that because Judge Hittner
dismissed Tu’s case “for a procedural failure” and did not reach the substantive merits of his
defamation claims, the dismissal was not “on the merits.” (Docket Entry No. 18 ¶ 13). Tu ignores
the “well-settled law that a dismissal for failure to comply with court orders is an adjudication on
the merits.” 	See Cardoza v. Broadway Moving & Storage Co., No. EP-06-CA-191-RPM, 2006
WL 8434121, at *2 (W.D. Tex. July 20, 2006) (concluding that a prior dismissal for failure to
comply with a court order that did not specify that dismissal was without prejudice was an
“adjudication on the merits” and that the plaintiff’s claims were barred by res judicata). 	Such
dismissals have claim preclusive effect. See id; Dillard v. Sec. Pac. Brokers, Inc., 835 F.2d 607,
608 (5th Cir. 1988) (“[Plaintiff’s] first argument—that res judicata should not apply because the
[dismissal for failure to appear at a court-ordered deposition] was not an adjudication on the merits
. . . is meritless.”); Ron Bianchi & Assoc., Inc. v. Ford Motor Co., Civ. A No. 88-2354, 1989 WL
13562, at *5 (E.D. La. Feb. 9, 1989) (“Although there was no trial on the merits of this claim . . .
it is well-settled that dismissal with prejudice as a sanction for failing to follow a Court’s orders is
a dismissal on the merits and triggers claim preclusive effect.”); Cano v. Everest Minerals Corp.,
No. Civ. A. SA-01-CA-610XR, 2004 WL 502628, at *5–6 (W.D. Tex. Mar. 10, 2004) (concluding
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that dismissals for failure to comply with the court’s scheduling orders were “with prejudice” by
default under Rule 41(b) and that res judicata applied).8
Tu’s primary authority, Costello v. United States, 365 U.S. 265 (1961), is inapposite. In
Costello, the Supreme Court concluded that the failure to file an affidavit of good cause (a
precondition to filing in that case) was a dismissal “for lack of jurisdiction” within the meaning of
Rule 41(b), and so the dismissal fell within one of Rule 41(b)’s exceptions to the default rule of
dismissal with prejudice. Id. at 284–85. As Tu admitted in his motion to remand, however, Judge
Hittner specifically dismissed the prior case for Tu’s failure to comply with a court order, not for
failing to satisfy a precondition at the outset. Federal courts have broad authority to control their
own dockets and to dismiss for failures to comply with orders. 	See Hickman v. Fox Television
Station, Inc., 231 F.R.D. 248, 253 (S.D. Tex. 2005) (noting that the inherent power of federal courts
to manage their own affairs “necessarily includes the power of a court ‘to control its docket by
dismissing a case as a sanction for a party’s failure to obey court orders.’” (quoting Woodson v.
Surgitek, Inc., 57 F.3d 1406, 1417 (5th Cir. 1995))); Pond v. Braniff Airways, Inc., 452 F.2d 347,
349 (5th Cir. 1972) (“We do not doubt the district court’s power to dismiss with prejudice for
failure to prosecute or to comply with court orders, either pursuant to the Federal Rules of Civil
8 One of Tu’s post-hearing briefs, (Docket Entry No. 39), quotes (with no analysis) Semtek Int’l Inc. v
Lockheed Martin Corp., which addressed the specific question of “whether the claim-preclusive effect of a
federal judgment dismissing a diversity action on statute-of-limitations grounds is determined by the law
of the State in which the federal court sits” and considered the claim-preclusive effect in Maryland of a
California 	federal 	diversity 	judgment. 	531 	U.S. 	497, 	499, 	506 	(2001); 	see 	also 	Vasquez 	v.
Bridgestone/Firestone, Inc., 325 F.3d 665, 678 (5th Cir. 2003) (“Semtek held that when a diversity court
dismisses a claim on state substantive law grounds, the preclusive effect of the judgment is measured not
by rule 41(b), but by the preclusion law of the state in which the court sits.”). Tu does not explain why
Semtek alters the outcome here, where the first case was not dismissed as a matter of state substantive law
but as a matter of a federal court’s authority to control its own docket. See Semtek, 531 U.S. at 509 (“This
federal reference to state law will not obtain, of course, in situations in which the state law is incompatible
with federal interests. If, for example, state law did not accord claim-preclusive effect to dismissals for
willful violation of discovery orders, federal courts’ interest in the integrity of their own processes might
justify a contrary federal rule.”); see also In re Container Store Grp., 676 B.R. 356, 381 (S.D. Tex. 2026).
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Procedure or, sua sponte, in the exercise of the inherent power of federal courts to control their
dockets.”)
Finally, although the parties spend much of their supplemental briefing arguing whether
Judge Hittner should have dismissed with prejudice, that is not the issue before this court. As the
court discussed with Tu’s counsel at the motion hearing, had Tu wanted to challenge Judge
Hittner’s dismissal order, Tu should have appealed that order rather than re-file the dismissed case
before another judge. “When a dismissal with prejudice is entered, the plaintiff is not permitted
to bring a subsequent lawsuit concerning the same claim or cause of action. The remedy in that
circumstance is an appeal.” Comer v. Murphy Oil USA, Inc., 839 F. Supp. 2d 849, 866 (S.D. Miss.
2012), aff’d, 718 F.3d 460 (5th Cir. 2013). The court concludes that Judge Hitter’s dismissal was
with prejudice. Tu has identified no claims that would not be precluded in this case, which Tu
himself describes as a “re-file” of the case that Judge Hittner dismissed for failure to comply with
a court order. Preclusion applies. This case is dismissed, with prejudice. See Cardoza, 2006 WL
8434121, at *3.
IV. 	Conclusion
The motion to remand is denied and this case is dismissed, with prejudice. Final judgment
is separately entered.
SIGNED on June 29, 2026, at Houston, Texas.
_______________________________
Lee H. Rosenthal
Senior United States District Judge
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