Yaklich v. Grand County

FILED
United States Court of Appeals
Tenth Circuit

May 7, 2008
UNITED STATES COURT OF APPEALS
Elisabeth A. Shumaker
TENTH CIRCUIT Clerk of Court

ROBERT YAKLICH,

Plaintiff - Appellant, No. 05-1563
v. D. Colo.
GRAND COUNTY, a Political (D.C. No. 1:05-CV-01081-LTB-OES)
Division of the State of Colorado, by
and through its BOARD OF COUNTY
COMMISSIONERS OF THE
COUNTY OF GRAND, COLORADO;
ROBERT ANDERSON, in his official
capacity; DUANE DAILEY, in his
official capacity; JAMES
NEWBERRY, in his official capacity;
TABERNASH MEADOWS WATER
AND SANITATION DISTRICT;
IRENE COOK, in his official capacity
as President of the Board of Directors
of Tabernash Meadows Water and
Sanitation District; LAURALEE
KOURSE, individually and as
manager, Tabernash Meadows Water
and Sanitation District; BETSY
ELIZABETH REDFIELD, in her
official capacity as Bookkeeper,
Tabernash Meadows Water and
Sanitation District; BOARD OF
DIRECTORS FOR TABERNASH
MEADOWS WATER AND
SANITATION DISTRICT; BOB
ALEXANDER, in his official
capacity; DOUGLAS OURI, in his
official capacity; GRETCHEN
BRETZ, in her official capacity; MR.
STOVALL, in his official capacity;
LURLINE UNDERBRINK, in her
official capacity as County Manager,
 Grand County; WILLIAM GRAY, in
his official capacity as Acting Director
of Planning, State of Colorado, Grand
County Department of Planning and
Zoning; COLORADO BOND
SHARES, a security broker; FRED
KELLY, in his capacity as President
of Colorado Bond Shares; BANK OF
THE WEST, a California Corporation
authorized to do business in Colorado;
and TERESA TURNER, in her
capacity as President of Bank of the
West,

Defendants - Appellees.

ORDER AND JUDGMENT *

Before O’BRIEN, BALDOCK, and HOLMES, Circuit Judges.

This appeal arises out of Tabernash Meadows, LLC’s (Tabernash) failed

attempt to create a subdivision called Pole Creek Valley in Grand County,

Colorado. Robert Yaklich, the founder and sole owner of Tabernash, filed suit

against various defendants, who moved to dismiss. The district court granted the

motions. We AFFIRM in part, REVERSE in part, and REMAND as set forth in

*
This order and judgment is not binding precedent except under the
doctrines of law of the case, res judicata, and collateral estoppel. It may be cited,
however, for its persuasive value consistent with Fed. R. App. P. 32.1 and 10th
Cir. R. 32.1.

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this Order and Judgment.

I. BACKGROUND

Pole Creek Valley is located approximately two miles southwest of

Tabernash, Colorado, on Highway 40. It consists of 168 acres of land subdivided

into 113 single-family, multi-family and commercial lots. Yaklich started the

platting process with Grand County in the mid-1990’s but did not receive final

plat approval until April 2000. In 1996, Yaklich formed Tabernash Meadows

Water and Sanitation District (the District) as part of the development process.

He was chairman of the District’s Board of Directors from its inception through

November of 2002, when he resigned.

On August 9, 2000, Yaklich negotiated a loan to Tabernash from Peak

National Bank (Peak) in the amount of $3,500,000 to develop Pole Creek Valley.

The loan was secured by a First Deed of Trust conveying Lots 1-15, 22-113 and

MF1-2, and Yaklich’s personal guaranty. The construction of the District’s water

and sanitation facilities was funded by general obligation bonds issued in the

amount of $5,300,000. Yaklich negotiated the issuance of the bonds, representing

both the District and Tabernash, and signed the bonds’ offering statements on

behalf of the District. The bonds were secured, in part, by the District’s covenant

to levy ad valorem property taxes on the lots and to collect “tap fees” from new

users. The bonds were also secured by Tabernash’s Developer Guaranty

Agreement (Guaranty) wherein it agreed to pay the principal and interest on the

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bonds, up to a maximum of $4,758,000, in four “Minimum Annual Guaranty”

payments to start in 2000 and continue through 2003. As security for its payment

obligations, Tabernash granted the District a lien against certain Pole Creek

Valley properties, some of the properties junior to Peak’s Deed of Trust. 1 The

Guaranty provided for the release of portions of the District’s liens upon

Tabernash’s compliance with its payment terms. In case of default, the District

was given several remedies, including initiation of foreclosure proceedings.

Tabernash started selling single-family lots in mid-2000. Delays in the

completion of the water system, allegedly due to Grand County’s erroneous cost

projections, caused Tabernash to request building permits be issued even though

the water system had not been completed. In reliance on Yaklich’s representation

that the completion of the water system was imminent, Grand County allowed

building permits to be issued. When the water system was not completed as

promised, Grand County required the District to post security for completion of

the water system.

Delay of the water system was not the only problem. Sales of Pole Creek

Valley lots were far below Tabernash’s initial projections. By the time the first

“Minimum Annual Guaranty” payment came due in November 2000, only thirty-

1
Specifically, Tabernash guaranteed the following amounts based on a tap
fee price of $13,000 per tap: $1,196,000 in 2000 or fees from ninety-two taps;
same in 2001; $1,183,000 in 2002, or fees from ninety-one taps; same in 2003.
Over time, the tap fee increased to $15,000 and then to $20,000.

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one single-family lots had been sold, creating a shortfall of $793,000. Six more

lots were sold in early 2001, leaving a shortfall of $715,000. Tabernash took out

a $900,000 loan from First United Bank to make up the difference. To provide

unencumbered collateral for the loan, Yaklich, acting as president of the District,

caused the District to release its lien on four lots not encumbered by the Peak

Deed of Trust. Tabernash pledged these and other lots as collateral to First

United Bank.

Tabernash payed $715,000 of the loan proceeds to the District in March

2001, but disputes arose over which properties would be credited with the tap

fees. Sales continued to decline over the next two years. The cause for the

failure of the project became a matter of contention between Tabernash, the

District and the County. Tabernash did not make any further Guaranty payments

to the District and Yaklich eventually resigned from the District’s Board of

Directors.

After Yaklich’s resignation, the District commenced judicial foreclosure

proceedings on its junior Deed of Trust with the Grand County Public Trustee’s

Office. The Grand County district court subsequently entered orders authorizing

a foreclosure sale. On June 6, 2003, Tabernash filed a separate action in Grand

County district court, seeking a preliminary injunction to enjoin the foreclosure.

The preliminary injunction was denied. On July 24, 2003, Tabernash filed a

Chapter 11 bankruptcy petition, staying the District’s foreclosure action.

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 Peak subsequently filed a complaint against Yaklich in Denver district

court alleging breach of his personal loan guarantees. In February 2004, the

Denver district court entered two judgments against Yaklich in Peak’s favor, one

for $1,461,511.93, and the other for $406,411.41. Meanwhile, after holding a

two-day hearing on the District’s Motion for Release from Stay, on April 14,

2004, the bankruptcy court granted the motion, concluding Tabernash had not

shown it was able to present an adequate reorganization plan. In July 2004, Peak

assigned its judgments against Yaklich and its interest in the first deed of trust to

Colorado BondShares.

On June 13, 2005, Yaklich filed suit in the United States District Court for

the District of Colorado against four groups of defendants: (1) the “County”

defendants, including the Grand County Board of County Commissioners, County

Manager Luraine Underbrink Curran, and Grand County Director of Planning and

Zoning William Gray; (2) “the Bank of the West” defendants, including its

President Teresa Turner; (3) the “BondShares” defendants, including its President

Fred Kelley; and (4) the “District” defendants, including its Manager Lurane

Kourse, its Bookkeeper Elizabeth Redfield, its Board of Directors, the Board’s

President Irene Cook, and individual directors Bob Alexander, Gretchen Bretz,

Doug Ouri and Mr. Stovall.

Each group of defendants filed motions to dismiss under either Rule

12(b)(1) for lack of subject matter jurisdiction or Rule 12(b)(6) for failure to state

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a claim upon which relief can be granted. See Fed. R. Civ. P. 12(b)(1), (b)(6).

The district court granted the motions to dismiss.

II. STANDARD OF REVIEW

We review de novo a dismissal for lack of subject matter jurisdiction

pursuant to Rule 12(b)(1), and review findings of jurisdictional facts, if any, for

clear error. Davis ex rel. Davis v. United States, 343 F.3d 1282, 1294-95 (10th

Cir. 2003). Whether a claim is ripe for review “bears on the court’s subject

matter jurisdiction under the case or controversy clause of Article III of the

United States Constitution.” New Mexicans for Bill Richardson v. Gonzales, 64

F.3d 1495, 1498-99 (10th Cir. 1995). Accordingly, a ripeness challenge, “like

[most] other challenges to a court’s subject matter jurisdiction, is treated as a

motion to dismiss under Rule 12(b)(1).” Id. at 1499.

We review de novo the legal sufficiency of a complaint under Rule

12(b)(6). Sutton v. Utah State Sch. for the Deaf & Blind, 173 F.3d 1226, 1236

(10th Cir. 1999). Such a motion “admits all well-pleaded facts in the complaint

as distinguished from conclusory allegations.” Mitchell v. King, 537 F.2d 385,

386 (10th Cir. 1976). In reviewing a motion to dismiss, the court must “look for

plausibility in the complaint.” Alvado v. KOB-TV, L.L.C., 493 F.3d 1210, 1215

(10th Cir. 2007) (quotation and citation omitted). Under this standard, a

complaint must include “enough facts to state a claim to relief that is plausible on

its face.” See Bell Atlantic Corp. v. Twombly, --U.S.--, 127 S.Ct. 1955, 1974

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(2007).

III. DISCUSSION

A. Federal Claims 2

1. Conspiracy to Deprive Civil Rights (Claims 2 and 3)

Yaklich’s Complaint alleged the County and District defendants

discriminated against him in violation of 42 U.S.C. § 1985(3) 3 based on his

gender and failed to prevent such discrimination in violation of 42 U.S.C.

§ 1986. 4

2
Yaklich’s opening brief fails to address the dismissal of his claim
alleging conspiracy in violation of 42 U.S.C. § 1983. Therefore, the claim is
waived. See State Farm Fire & Cas. Co. v. Mhoon, 31 F.3d 979, 984 n.7 (10th
Cir. 1994).
3
Section 1985(3) provides in relevant part:

If two or more persons . . . conspire . . . for the purpose of depriving
. . . any person . . . of the equal protection of the laws, or of equal
privileges and immunities under the laws; . . . or cause to be done,
any act in furtherance of the object of such conspiracy, . . . the party
so injured or deprived may have an action for the recovery of
damages . . . .
4
Section 1986 provides in pertinent part:

Every person who, having knowledge that any of the wrongs
conspired to be done, and mentioned in section 1985 of this title, are
about to be committed, and having power to prevent or aid in
preventing the commission of the same, neglects or refuses so to do,
if such wrongful act be committed, shall be liable to the party
injured, . . . for all damages caused by such wrongful act, which such
person by reasonable diligence could have prevented.

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 “The essential elements of a § 1985(3) claim are: (1) a conspiracy; (2) to

deprive plaintiff of equal protection or equal privileges and immunities; (3) an act

in furtherance of the conspiracy; and (4) an injury or deprivation resulting

therefrom.” Tilton v. Richardson, 6 F.3d 683, 686 (10th Cir. 1993). “The

language requiring intent to deprive of equal protection, or equal privileges and

immunities, means that there must be some racial, or perhaps otherwise

class-based, invidiously discriminatory animus behind the conspirators’ action.”

Griffin v. Breckenridge, 403 U.S. 88, 102 (1971) (footnote omitted). In other

words, “[i]n order to support a section 1985(3) claim, the plaintiff must be a

member of a statutorily protected class, and the actions taken by defendant must

stem from plaintiff’s membership in the [protected] class.” Silkwood v. Kerr-

McGee Corp., 637 F.2d 743, 746 (10th Cir. 1980).

Outside the context of racial discrimination, the Supreme Court has not

defined what “otherwise class-based” discrimination may be protected under

§ 1985(3). The parties dispute whether a claim based upon gender bias is one of

the protected classes. Because Yaklich’s claim fails for a separate reason, we

need not determine the scope of the statute here. See United Bhd. of Carpenters

& Joiners of Am. v. Scott, 463 U.S. 825, 836 (1983).

Even if gender is a protected class, Yaklich’s complaint contains no factual

allegation of racial or class-based motivation. See Hughes v. Ranger Fuel Corp.,

467 F.2d 6 (4th Cir. 1972); Action v. Gannon, 450 F.2d 1227 (8th Cir. 1971); and

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Kletschka v. Driver, 411 F.2d 436 (2nd Cir. 1969). He merely alleges the same

gender-neutral actions taken against him to ensure his bankruptcy were based on

his gender. This conclusory statement is insufficient to state a claim. See Tal v.

Hogan, 453 F.3d 1244, 1261 (10th Cir. 2006) (“Conclusory allegations . . .

without any supporting facts are insufficient . . . .”), cert. denied, 127 S.Ct. 1334

(2007). Section 1985(3) was not intended “to reach conspiracies motivated by

bias towards others on account of their economic views, status, or activities.”

United Bhd. of Carpenters & Joiners of Am., 463 U.S. at 837 (emphasis omitted).

Because the § 1985(3) claim is insufficient, Yaklich’s § 1986 claim also

fails. Taylor v. Nichols, 558 F.2d 561, 568 (10th Cir. 1977) (“A claim under

Section 1986 exists for refusal to take positive action where the circumstances

demand to prevent acts which give rise to a cause of action under Section 1985.

In view then of this relationship, there cannot be a valid claim under Section 1986

unless there is also a claim under Section 1985.”). The district court properly

dismissed these claims.

2. Regulatory Taking and Procedural Due Process (Claims 6 and 7)

Yaklich alleged the County and the District violated his Fifth and

Fourteenth Amendment rights by regulating the Pole Creek Valley property to the

point it became worthless – an inverse condemnation – without providing him just

compensation. He further alleged these defendants violated his Fourteenth

Amendment procedural due process rights premised on the alleged taking. The

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district court dismissed these claims with prejudice because Yaklich failed to

exhaust the eminent domain remedies provided for in Colo. Rev. Stat. Ann. §§ 38-

1-101 to 122.

The Just Compensation Clause of the Fifth Amendment states: “[P]rivate

property [shall not] be taken for public use, without just compensation.” U.S.

Const. amend. V. This prohibition applies against the states through the

Fourteenth Amendment. See Chicago, B. & Q.R. Co. v. Chicago, 166 U.S. 226,

241 (1897). “The Fifth Amendment does not proscribe the taking of property; it

proscribes taking without just compensation.” Williamson County Reg’l Planning

Comm’n v. Hamilton Bank of Johnson City, 473 U.S. 172, 194 (1985). “Nor does

the Fifth Amendment require that just compensation be paid in advance of, or

contemporaneous with the taking; all that is required is that a reasonable, certain

and adequate provision for obtaining compensation exist at the time of the

taking.” Id. (quotation omitted). “[I]f a State provides an adequate procedure for

seeking just compensation, the property owner cannot claim a violation of the Just

Compensation Clause until it has used the procedure and been denied just

compensation.” Id. at 194-95. “[T]he ripeness requirement of Williamson applies

to due process and equal protection claims that rest upon the same facts as a

concomitant takings claim.” Bateman v. City of West Bountiful, 89 F.3d 704, 709

(10th Cir. 1996).

Yaklich does not address the Williamson exhaustion of state remedies

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requirement. Rather, he asserts his claims are final under Abbot Laboratories v.

Gardner, because the defendants’ decisions were definite, had the status of law,

and compliance with the law had a direct and immediate effect on his day-to-day

business. 387 U.S. 136, 151-52 (1967), overruled on other grounds by Califano

v. Sanders, 430 U.S. 99, 105 (1977). Even if the decisions of the County and

District were final, Yaklich cannot bring a takings claim until he utilizes the

Colorado compensation procedure.

At all times relevant to this lawsuit, Colorado has statutorily provided a

method for seeking just compensation under eminent domain proceedings. See

Colo. Rev. Stat. Ann. §§ 38-1-101 to 122; see also Linnebur v. Pub. Serv. Co. of

Colo., 716 P.2d 1120, 1123 (Colo. 1986) (“An inverse condemnation action . . . is

to be tried as if it were an eminent domain proceeding.”). Section (2)(a) of § 38-

1-101 provides:

In all cases in which compensation is not made by the state in its
corporate capacity, such compensation shall be ascertained by a
board of commissioners of not less than three disinterested and
impartial freeholders pursuant to section 38-1-105(1) or by a jury
when required by the owner of the property as prescribed in section
38-1-106. All questions and issues, except the amount of
compensation, shall be determined by the court unless all parties
interested in the action stipulate and agree that the compensation may
be so ascertained by the court. In the event of such stipulation and
agreement, the court shall proceed as provided in this article for the
trial of such causes by a board of commissioners or jury.

Yaklich claims he is not required to comply with the statute because his efforts

would be futile. The district court disagreed, stating the statute does not require

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approval of the various defendants to determine the taking or just compensation.

We agree.

Yaklich’s regulatory takings and due process claims fail because he did not

exhaust available Colorado remedies. As a consequence, Yaklich’s claims are not

ripe and the district court could not address their merits. Dismissal with

prejudice, however, was inappropriate. See Brereton v. Bountiful City Corp., 434

F.3d 1213, 1216 (10th Cir. 2006) (“[W]here the district court dismisses an action

for lack of jurisdiction . . . the dismissal must be without prejudice.”); cf.

Hollander v. Sandoz Pharm. Corp., 289 F.3d 1193, 1216-17 (10th Cir. 2002)

(dismissal for lack of personal jurisdiction should be without prejudice when it

does not address merits of claim). We reverse the district court’s dismissal of

claims 6 and 7 with prejudice and remand for dismissal without prejudice.

B. State Law Claims

1. Colorado Government Immunities Act (Claims 1, 4, 5, 8, and 9)

Yaklich alleged state law claims of civil conspiracy, intentional and

tortious interference with contractual relations, intentional infliction of emotional

distress (outrageous conduct) and civil conversion against the County and District

defendants. The district court dismissed these claims for lack of jurisdiction

because Yaklich failed to provide these defendants notice within 180 days of

discovering his injury, as required by the Colorado Government Immunities Act

(CGIA).

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 Under the CGIA, anyone claiming to have suffered an injury by a public

entity or its employee must file written notice within 180 days after the discovery

of the injury, regardless of whether the person knew all of the elements of the

claim or of a cause of action for such injury. See Colo. Rev. Stat. Ann. § 24-10-

109(1). Compliance with the 180-day notice requirement is a jurisdictional

prerequisite and failure to comply with it is an absolute bar to suit. Id.; see also

Gallagher v. Bd. of Tr. for Univ. of N. Colo., 54 P.3d 386, 393 (Colo. 2002) (en

banc). “[N]on-claim statutes and the issue of subject matter jurisdiction are not

subject to equitable defenses such as waiver, tolling, or estoppel.” Gallagher, 54

P.3d at 393. Furthermore, “the judicially-constructed continuing violation

doctrine cannot be used to remedy an untimely filing under the CGIA.” Id.

“For purposes of the CGIA, . . . the notice period is triggered when a

claimant has only discovered that he or she has been wrongfully injured.” Id. at

391.

[T]he plaintiff need not yet know the cause of the injury nor must all
elements of the claim have ripened before the plaintiff must file [his]
notice of claim. The plaintiff’s 180-day time limit may expire if [he]
wait[s] to discover the cause of [his] injury before filing pursuant to
the CGIA. . . . [T]he trial court is the pre-trial fact-finder to
determine whether notice was timely filed-that is, when the injury
was discovered by the claimant. When there is a factual dispute
concerning when the plaintiff discovered [his] injury, an evidentiary
hearing is necessary to resolve the dispute. The trial court may also
permit limited discovery to decide the notice issue. The plaintiff has
the burden of proving jurisdiction and the trial court will not
construe inferences in favor of the plaintiff.

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Id. (citation omitted). Relying on the order granting the District relief from stay

in Yaklich’s bankruptcy proceedings, the district court determined Yaklich was

aware of his injuries well before September 3, 2004, 180 days before he gave

notice on March 2, 2005.

Yaklich argues the conspiracy is the “real harm,” and the conspiracy of all

the defendants did not “occur” until the fall of 2004; it “could not have occurred

in Plaintiff’s mind sooner.” (Appellant’s Br. at 28.) Yaklich further maintains

the question of whether he had “knowledge” or “discovered” his injuries prior to

September 3, 2004, is a factual question which could not be resolved without an

evidentiary hearing.

The question is when Yaklich “knew or, through the exercise of reasonable

diligence, should have known” of his injury. Trinity Broadcasting of Denver, Inc.

v. City of Westminster, 848 P.2d 916, 923 (Colo. 1993) (en banc). A review of

the bankruptcy court order leaves no question that Yaklich should have been

aware of his injuries well before September 3, 2004. 5 The bankruptcy court

5
The bankruptcy court’s order was not included in Yaklich’s complaint,
but he made reference to the Bankruptcy action and its effect upon him.
“Generally, a district court must convert a motion to dismiss into a motion for
summary judgment when matters outside the pleadings are relied upon.” Utah
Gospel Mission v. Salt Lake City Corp., 425 F.3d 1249, 1253 (10th Cir. 2005)
(emphasis omitted). “We have recognized however, that a document central to
the plaintiff’s claim and referred to in the complaint may be considered in
resolving a motion to dismiss, at least where the document’s authenticity is not in
dispute.” Id. at 1253-54 (citing County of Santa Fe v. Pub. Serv. Co. of N.M., 311
F.3d 1031, 1045 (10th Cir. 2002)). Yaklich did not contest the bankruptcy court’s
order as an invalid document and it was reasonable for the district court to review

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determined Tabernash had not shown it was capable of effectuating a successful

reorganization, that the value of the land at Pole Creek was insufficient to service

the debt, and Yaklich was unable to demonstrate that financing was “imminent or

even possible.” (Bankruptcy Order at 16.) These findings were allegedly based,

in part, on deliberate testimonial misrepresentations at the bankruptcy hearing

given by several County and District defendants. In the bankruptcy order, the

court noted the District had formally opposed Yaklich’s proposed plan to save

Tabernash as well as Yaklich’s other unpaid personal debts which would impede a

successful extrication from financial disaster. Taking Yaklich’s current

allegations as true, he clearly should have known that County and District actions

had caused him injury when he received the bankruptcy court’s ruling.

Yaklich attempts to avoid the statutory time limitations by alleging the

defendants entered “into a series of conspiracies designed to deny Robert Yaklich

of his property rights.” This is not sufficient. Knowledge of injury is all that is

necessary. Knowledge of the cause of action or the identity of the tortfeasor is

not required. See East Lakewood Sanitation Dist. v. District Court, 842 P.2d 233,

235-36 (Colo.1992) (knowledge of the identity of the tortfeasor not required for

running of notice period). Further, a “series of conspiracies” is akin to a

continuing violation, on which he cannot rely. Gallagher, 54 P.3d at 393.

the order to determine when Yaklich became aware of his injuries for CGIA
purposes.

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 Because the bankruptcy court’s order was not contested as invalid, the

district court was not required to hold an evidentiary hearing or provide for

limited discovery regarding the date Yaklich knew of his injury. See Padilla ex

rel. Padilla v. Sch. Dist. No. 1 in the City and County of Denver, 25 P.3d 1176,

1180 (Colo. 2001) (en banc) (“Where there is no evidentiary dispute,

governmental immunity or waiver of immunity is a matter of law, and the trial

court may rule on the jurisdictional issue without a hearing.”). The district court

properly dismissed Claims 1, 4, 5, 8 and 9 against the County and District

defendants under the CGIA.

2. Breach of Contract (Claim 10)

The CGIA applies only to tort claims and therefore does not bar Yaklich’s

breach of contract claim against the District and its Board of Directors. The

district court declined to exercise supplemental jurisdiction over the claim and

dismissed it without prejudice. Yaklich’s only argument in his opening brief on

this issue is as follows: “Appellant has demonstrated that it was also error to

dismiss the Tenth Claim without prejudice.” (Appellant’s Br. at 37.) This

conclusory statement will not preserve this issue. See Am. Airlines v.

Christensen, 967 F.2d 410, 415 n.8 (10th Cir.1992) (“It is insufficient merely to

state in one’s brief that one is appealing an adverse ruling below without

advancing reasoned argument as to the grounds for the appeal.” (citing Fed. R.

App. P. 28(a)(4)). Because the district court had dismissed the federal claims

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with prejudice, the court did not abuse its discretion in dismissing Claim 10. See

28 U.S.C. § 1367(c)(3) (“The district court may decline to exercise supplemental

jurisdiction over a claim . . . if . . . [it] has dismissed all claims over which it has

original jurisdiction.”).

3. Civil Conspiracy and Outrageous Conduct (Claims 1 and 8)

Yaklich complains the district court erroneously dismissed his civil

conspiracy and outrageous conduct claims against the private entities, Bank of the

West and BondShares. While Yaklich abandoned his claims against Bank of the

West at oral argument, he continues to claim the district court erred in dismissing

these claims against the BondShares defendants under the Rooker-Feldman

doctrine. See D.C. Court of Appeals v. Feldman, 460 U.S. 462 (1983); Rooker v.

Fidelity Trust Co., 263 U.S. 413 (1923).

a. Rooker-Feldman Doctrine

The Rooker-Feldman doctrine is a narrow one confined to “cases brought

by state-court losers complaining of injuries caused by state-court judgments

rendered before the district court proceedings commenced and inviting district

court review and rejection of those judgments.” Exxon Mobil Corp. v. Saudi

Basic Indus. Corp., 544 U.S. 280, 284 (2005). The doctrine does not apply to

parallel state and federal litigation and “does not otherwise override or supplant

preclusion doctrine or augment the circumscribed doctrines that allow federal

courts to stay or dismiss proceedings in deference to state-court actions.” Id. at

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284, 292. More specifically, it does not deprive lower federal courts of

jurisdiction if the federal court suit was filed before the end of the state court’s

appeal process. See Guttman v. Khalsa, 446 F.3d 1027, 1031-32 (10th Cir. 2006).

It must be remembered that BondShares did not even come into the picture

until after Yaklich defaulted, Peak secured the judgments against Yaklich, and the

bankruptcy court ordered the stay of foreclosure on the Pole Creek properties

removed. Yaklich alleges, after BondShares received payment in full on its loans

in March 2005, it took title to Lot 48 and proceeded to unlawfully foreclose on

the same property in May 2005. In addition, some time in late 2004 and early

2005, BondShares failed to credit the District’s foreclosure sales to Yaklich’s

debt. It was only when Yaklich filed suit in the Colorado district court that

BondShares properly credited his account. 6 Based on these allegations, Yaklich

alleged in Claim 1 that BondShares conspired with the other defendants to

bankrupt him. In Claim 8, Yaklich alleged BondShares engaged in extreme and

outrageous conduct with the intent of causing him severe emotional distress.

At the time Yaklich filed his complaint in this case, the state court had not

reached a final judgment determining whether BondShares properly credited

6
The record reveals Yaklich did not file a separate suit against
BondShares, but rather filed a motion to apply the foreclosure proceeds to the
judgments against him in the ongoing case originally brought by Peak against
Yaklich. The Denver district court granted Yaklich’s motion in part by requiring
BondShares to provide a verified accounting of all sales of the collateral securing
the debts underlying the judgments.

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Yaklich with the foreclosure sale’s proceeds. BondShares’ motion to dismiss

admitted this fact. Therefore, the district court improperly dismissed this claim

under Rooker-Feldman. Id., 446 F.3d at 1032 (holding that federal district court

had subject matter jurisdiction to hear case, notwithstanding Rooker-Feldman

doctrine, where plaintiff filed federal suit while certiorari petition to New Mexico

Supreme Court was pending in similar state court action).

Alternatively, BondShares argues Yaklich failed to plead sufficient facts to

establish the claims against it. However, BondShares did not raise this alternative

argument below. Ordinarily, “a federal appellate court does not consider an issue

not passed on below.” Singleton v. Wulff, 428 U.S. 106, 120 (1976). While this

general rule is not absolute, we decline to exercise our discretion, in this instance,

because we do not know the exact nature of the state court claims or whether the

state court has reached an ultimate resolution. We remand these state law claims

to the district court for dismissal without prejudice. 28 U.S.C. § 1367(c)(3).

AFFIRMED in part, REVERSED in part, and REMANDED for action

consistent with this Order and Judgment.

ENTERED FOR THE COURT

Terrence L. O’Brien
Circuit Judge

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