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[DO NOT PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
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No. 11-15478
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D.C. Docket No. 2:11-cv-00002-LGW-JEG
BOND SAFEGUARD INSURANCE COMPANY,
LEXON INSURANCE COMPANY,
llllllllllllllllllllllllllllllllllllllll Plaintiffs - Appellants,
versus
WELLS FARGO BANK, N.A.,
as successor in interest to Wachovia Bank, N.A.,
KEYBANK, N.A.,
llllllllllllllllllllllllllllllllllllllll Defendants - Appellees.
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Appeal from the United States District Court
for the Southern District of Georgia
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(December 21, 2012)
Before MARCUS and PRYOR, Circuit Judges, and FRIEDMAN, ∗ District Judge.
PER CURIAM:
The issue presented in this appeal is whether two sureties have standing to
bring claims against lenders that could have been brought by the bankruptcy estate
∗
Honorable Paul Friedman, United States District Judge for the District of Columbia, sitting by designation.
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of a debtor. This appeal involves a complaint filed by two sureties, Bond
Safeguard Insurance Company and Lexon Insurance Company, against two
lenders, Wells Fargo Bank and KeyBank. The sureties allege that the lenders
wrongfully required Land Resource LLC and other developers to make payments
to the lenders. The sureties also allege that, because of these wrongful payments,
the developers were unable to complete improvements for which the sureties had
issued subdivision bonds, which led the sureties to pay over $16 million to satisfy
the obligations of the developers. The sureties asserted seven causes of action
against the lenders: (i) negligence, (ii) breach of fiduciary duty, (iii) money had
and received, (iv) tortious interference with contract, (v) unjust enrichment and
constructive trust, (vi) negligence per se, and (vii) commercial bad faith. The
lenders argue that the sureties lack standing to assert these claims because the
claims belong to the bankruptcy estate of the developers and only the trustee of the
bankruptcy estate has standing to assert the claims. See 11 U.S.C. § 541(a). The
district court agreed with the lenders and dismissed the complaint of the sureties.
Because we conclude that the sureties lack standing to assert their complaint, we
affirm.
I. BACKGROUND
The developers owned and developed real estate projects in North Carolina,
Georgia, and Tennessee. The developers entered an agreement with the counties
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where their projects were located to complete certain infrastructure improvements
as part of their real estate projects. The counties required the developers to secure
performance bonds for the completion of the infrastructure improvements, and the
sureties issued subdivision bonds in favor of the counties.
After the developers experienced financial difficulties, the counties declared
defaults under the subdivision bonds because the developers failed to complete the
infrastructure improvements. The counties looked to the sureties to satisfy the
obligations of the developers, and the sureties made payments of more than $16
million to the counties.
The developers filed a bankruptcy petition, and all claims against the lenders
by the developers have been waived, released, or settled. The only claims not
released are those held by third parties that arose “entirely independently of any
alleged claim or cause of action of [the developers].”
On January 4, 2011, the sureties filed suit against the lenders in the Southern
District of Georgia. On April 18, 2011, the sureties filed their first amended
complaint that asserted seven causes of action against the lenders. On May 9,
2011, the lenders filed a motion to dismiss the first amended complaint for lack of
subject matter jurisdiction and for failure to state a claim.
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At a hearing on the motion, the district court asked the sureties whether the
same claims for relief could be brought by the developers, and the sureties
answered that the claims could be brought by other creditors or the developers:
Q: Do you acknowledge that any of the claims, either legal or
equitable, that you are making, could the developers have raised any
of those?
A: They could have, but the facts would be different. The facts and
the damages would certainly be different. I could see the developer[s]
making an argument that there’s a breach of fiduciary duty. I could
see that. I could see a lot of these claims. In fact, if I think about it, I
probably could see all of them. But again, that’s not — those claims
would be different. The conduct was the same, but the causes of
action and the application of those causes of action, and specifically
the damages . . . are specific, unique and personal to the sureties. . . .
Q: What you are saying is the particular way that you suffered from
the alleged negligence or fraud, or whatever the cause of action is
called, the way you suffered it was a particular way. But nevertheless,
the wrongdoing you allege, isn’t that generalized? Wouldn’t other
creditors have been hurt by the misconduct or any kind of
misrepresentation or breach? How is that not generalized?
A: I think they would. I think they would, but it’s not generalized in
the strict application . . . .
The sureties distinguished themselves from other creditors because they “issued
bonds.”
On October 21, 2011, the district court dismissed the suit of the sureties
because the sureties lacked standing to bring their causes of action. The district
court ruled that the claims pleaded by the sureties were general in nature and
derived indirectly from harms directly suffered by the developers. The district
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court ruled that the claims raised by the sureties belong to the trustee of the
bankruptcy estate of the developers.
II. STANDARD OF REVIEW
“In reviewing the district court's decision to grant the motion to dismiss
pursuant to [Federal Rule of Civil Procedure] 12(b)(1) [for] lack of subject matter
jurisdiction, this Court reviews the legal conclusions of the district court de novo.”
McElmurray v. Consol. Gov't of Augusta-Richmond Cnty., 501 F.3d 1244, 1250
(11th Cir. 2007). “[T]he plaintiff will have the burden of proof that jurisdiction
does in fact exist.” Eaton v. Dorchester Dev., Inc., 692 F.2d 727, 732 n.9 (11th
Cir. 1982).
III. DISCUSSION
This appeal turns on whether the claims of the sureties allege only indirect
harm to the sureties and whether the developers could raise the same claims against
the lenders. “[A] debtor’s bankruptcy estate [] includes ‘all legal and equitable
interests of the debtor in property as of the commencement of the case.’” Baillie
Lumber Co. v. Thompson (In re Icarus Holding, LLC), 391 F.3d 1315, 1319 (11th
Cir. 2004) (quoting 11 U.S.C. § 541(a)). If a cause of action belongs to the estate,
then the trustee “is the only party with standing to prosecute [it].” Parker v.
Wendy’s Int’l, Inc., 365 F.3d 1268, 1272 (11th Cir. 2004). “If a cause of action
alleges only indirect harm to a creditor (i.e., an injury which derives from harm to
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the debtor), and the debtor could have raised a claim for its direct injury under the
applicable law, then the cause of action belongs to the estate.” Schertz-Cibolo-
Universal City v. Wright (In re Educators Grp. Health Trust), 25 F.3d 1281, 1284
(5th Cir. 1994). A general claim that “applies equally to all creditors” and can be
brought by the debtor is the property of the bankruptcy estate of the debtor.
Baillie, 391 F.3d at 1319, 1320.
The claims asserted by the sureties are general in nature and could have been
raised by the developers against the lenders. At the heart of all seven of the claims
of the sureties is the allegation that the lenders wrongfully required the developers
to make payments to the lenders. Because this complaint alleges generally that the
developers lacked sufficient funds to fulfill various obligations because of the
actions of the lenders, any creditor of the developer could assert the same causes of
action on the same theory. Because the sureties allege that the lenders required the
developers to make wrongful payments to the lenders, the developers could have
raised the same claims against the lenders. Even the sureties conceded to the
district court that they could “probably see” how the developers could have
asserted all of the claims raised by the sureties. The general nature of the claims of
the sureties and the ability of the developers to assert the same claims against the
lenders fulfills our definition of claims that belong to a bankruptcy estate.
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The sureties argue that their status as bond issuers distinguishes them from
other creditors, but that argument has no basis in our jurisprudence. When we
determine whether a claim belongs to a bankruptcy estate, we ask if a claim
“applies equally to all creditors” and can be brought by the debtor. Baillie, 391
F.3d at 1319–20. Although a supplier of the developers would be owed a debt that
is unique from the debt the developers owe to the sureties, the theory behind their
causes of action would be the same. It is the general nature of a claim instead of
the general nature of a debt that causes a claim to belong to a bankruptcy estate.
At oral argument, the sureties contended that the claims for tortious
interference with contract and breach of fiduciary duty are distinguishable from the
other claims of the sureties, but this distinction was neither raised before the
district court nor developed in the briefs filed before this Court. The sureties
contend that the claims for tortious interference with contract and breach of
fiduciary duty could be asserted only by them because the developers were not
parties to the third-party contracts at issue and the lenders owed a unique fiduciary
duty to the sureties. Ordinarily, we will not consider an issue raised for the first
time on appeal. Access Now, Inc. v. Sw. Airlines Co., 385 F.3d 1324, 1331 (11th
Cir. 2004). We “will consider an issue not raised in district court if it involves a
pure question of law, and if refusal to consider it would result in a miscarriage of
justice,” Garcia v. Pub. Health Trust, 841 F.2d 1062, 1066 (11th Cir. 1988)
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(internal quotation omitted), but that exception does not apply. Moreover, issues
that are not developed in the briefs filed before this Court are considered
abandoned. Hartsfield v. Lemacks, 50 F.3d 950, 953 (11th Cir. 1995). “Without
the benefit of developed argument from both sides regarding” this issue, we cannot
effectively review it. Adler v. Duval Cnty. Sch. Bd., 112 F.3d 1475, 1480 (11th
Cir. 1997).
IV. CONCLUSION
We AFFIRM the dismissal of the complaint of the sureties.
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