Infant Swimming Research, Inc. v. Faegre & Benson, LLP

335 F. App'x 707
CourtCourt of Appeals for the Tenth Circuit
DecidedJune 9, 2009
Docket07-1510, 08-1235, 08-1484
StatusUnpublished
Cited by10 cases

This text of 335 F. App'x 707 (Infant Swimming Research, Inc. v. Faegre & Benson, LLP) is published on Counsel Stack Legal Research, covering Court of Appeals for the Tenth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Infant Swimming Research, Inc. v. Faegre & Benson, LLP, 335 F. App'x 707 (10th Cir. 2009).

Opinion

ORDER AND JUDGMENT *

MICHAEL W. McCONNELL, Circuit Judge.

Invoking diversity jurisdiction, plaintiff Infant Swimming Research Inc., (“ISR”), filed a complaint against attorney Mark Fischer, his then-law firm, Faegre & Benson, L.L.P., (“Faegre”), and their clients, Judy and Norman Heumann, based on Fischer’s admission that, during the pendency of litigation between ISR and Ms. Heumann, he fabricated a federal court order that released ISR’s judgment lien on Ms. Heumann’s property. In separate orders, the district court dismissed all of ISR’s claims, based on its finding that, nothwithstanding Fischer’s abhorrent conduct, ISR suffered no inju *710 ry-in-fact because its judgment was paid in full immediately after the final judgment was entered; thus, it never needed to execute or rely on its lien. ISR appeals the district court’s (1) partial grant of Faegre’s motion to dismiss and its grant of Faegre’s motion for summary judgment as to the remaining claims (Appeal No. 07-1510); (2) dismissal of the claims against Fischer and the Heumanns under Fed.R.Civ.P. 12(b)(1) (Appeal No. 08-1235); and (3) award of attorney fees and costs to Fischer and the Heumanns pursuant to Colo.Rev.Stat. § 13-17-201, which mandates such award when an action is dismissed under Rule 12(b) (Appeal No. 08-1484). We have jurisdiction over all of the appeals under 28 U.S.C. § 1291, and we affirm.

I. Factual Background

A. The Underlying ISR/Heumann Litigation. In April 2000, ISR sued Judy Heumann for breach of a license agreement and misappropriation of trade secrets. In February 2004, a jury ruled that Ms. Heumann had breached the license agreement but had not misappropriated trade secrets. See Harvey Barnett, Inc. v. Shidler, 200 Fed.Appx. 734, 736 (10th Cir.2006). Judgment was entered against Ms. Heumann in favor of ISR, and ISR recorded the judgment as a lien against the Heumanns’ real property. ISR and Ms. Heumann cross-appealed. Fischer, then a partner with Faegre, represented Ms. Heumann at trial and on appeal. In August 2006, this court affirmed the jury’s verdict against Ms. Heumann, but reversed the award of attorney fees to ISR, and remanded the matter to the district court. See id. at 736-37.

On remand, the district court entered judgment against Ms. Heumann for ISR’s attorneys’ fees in March 2007. Ms. Heu-mann immediately tendered payment of $44,836.09 to the district court, the full judgment amount she claimed was due if the court granted her motion to permit certain offsets. While that motion was pending, ISR’s counsel discovered that a false satisfaction-of-judgment order had been recorded in April 2005, releasing ISR’s judgment lien on the Heumanns’ property.

On April 9, 2007, Fischer sent a letter to the federal court and the parties admitting that, on April 25, 2005, he had fabricated a false federal court order, forging the district court judge’s signature, that purported to stay the ISR judgment and release ISR’s recorded judgment lien against the Heumanns’ property. See No. 07-1510, Aplt.App. at 68. He stated that he had done so without assistance from any other person and, specifically, without the knowledge or involvement of either Ms. Heu-mann or anyone at Faegre. See id. Fischer further stated that he had given the false order to Ms. Heumann, “knowing that she would file it with the Boulder County Clerk and Recorder in connection with securing permanent financing for a home she and her husband were building.” Id. Fischer withdrew as counsel, resigned from Faegre, and was immediately suspended from the practice of law. He later pleaded guilty to forging the signature of a federal judge, in violation of 18 U.S.C. § 505, and was disbarred.

The district court allowed Ms. Heu-mann’s requested offsets, and entered a final judgment for ISR for $44,901.87 in June 2007, ruling that this judgment su-perceded all prior judgments in the case. Two days later, Ms. Heumann paid in full the net judgment against her to ISR.

B. The Complaint at Issue. In April 2007, immediately after receipt of Fischer’s letter, but before the final judgment in the ISR/Heumann litigation was entered, ISR filed the complaint at issue in *711 these appeals. The complaint asserted ten claims, including claims against all defendants for fraudulent transfer; fraud; negligent misrepresentation; conspiracy; contempt; and declaratory and injunctive relief; as well as a claim of negligent supervision against Faegre.

1. Claims Against Faegre. Faegre filed a Fed.R.Civ.P. 12(b)(6) motion to dismiss for failure to state a claim. A month later, it filed a motion for summary judgment, and submitted as evidence Fischer’s April 9, 2007 letter and a sworn declaration from Fischer. In the declaration, Fischer stated that no one associated with Faegre had any knowledge of his fabrication prior to his April 9, 2007 disclosure, or had reason to suspect his fabrication; nor did anyone associated with Faegre authorize, agree to, or support the fabrication. Faegre’s motion also asserted that the complaint should be dismissed for lack of subject matter jurisdiction because ISR had not been damaged because ISR never attempted to execute on the judgment lien, its judgment was paid in full, and, thus, the fabricated release order never impeded or impaired its ability to have its judgment satisfied.

In response, ISR argued that Faegre’s motion was deficient because (1) it did not include any affidavit from Faegre; (2) a Faegre associate and paralegal had worked on issues relating to a stay of judgment and a supersedeas bond between December 22, 2004 and January 6, 2005; (3) the court should disregard Fischer’s declaration because he was an admitted forger; (4) Fischer also fabricated another court order purporting to set a bond amount of $90,000; 1 (5) ISR was entitled to damages under Colo.Rev.Stat. § 38-35-109(3), which allows the owner of real property to recover damages if a false lien is placed on his property; and (6) discovery had not yet begun (though ISR never filed a Fed.R.Civ.P. 56(f) motion).

Reviewing an amended ISR complaint, the district court ruled that ISR had sufficiently stated claims for vicarious liability under Colorado’s partnership law, for negligent supervision, and for conspiracy, but had not alleged any actual controversy to support its claims for declaratory and in-junctive relief. Thus, it granted in part the motion to dismiss.

The court then granted summary judgment to Faegre as to all of the remaining claims.

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335 F. App'x 707, Counsel Stack Legal Research, https://law.counselstack.com/opinion/infant-swimming-research-inc-v-faegre-benson-llp-ca10-2009.