Sisk v. Levings

868 F.2d 159, 1989 WL 17434
CourtCourt of Appeals for the Fifth Circuit
DecidedMarch 21, 1989
DocketNo. 88-4378
StatusPublished
Cited by15 cases

This text of 868 F.2d 159 (Sisk v. Levings) is published on Counsel Stack Legal Research, covering Court of Appeals for the Fifth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Sisk v. Levings, 868 F.2d 159, 1989 WL 17434 (5th Cir. 1989).

Opinion

JOHNSON, Circuit Judge:

Plaintiffs, the manager and directors of Bear Creek Water Association (Bear Creek [160]*160Directors), a nonprofit rural water association, brought the instant suit against the mayor and board of aldermen of the City of Madison, Mississippi (Madison city officials) pursuant to 42 U.S.C. § 1988. In their section 1983 suit, the Bear Creek Directors allege that the Madison city officials deprived them of due process by initiating purportedly unfounded and malicious legal proceedings challenging the authority of the Bear Creek Directors to govern the Bear Creek Water Association (Bear Creek). The district court dismissed the complaint of the Bear Creek Directors for failure to state a cognizable claim pursuant to Fed.R.Civ.P. 12(b)(6). The Bear Creek Directors now appeal the dismissal of their claim to this Court. Persuaded that the facts, as alleged by the Bear Creek Directors in their complaint, do not rise to the level of a constitutional deprivation within the context of 42 U.S.C. § 1983, we affirm.

I. FACTS AND PROCEDURAL HISTORY

The instant action is the latest in a series of legal proceedings between the City of Madison and Bear Creek stemming from the efforts of Madison to acquire control of Bear Creek water facilities located within Madison city limits. In Madison v. Bear Creek Water Association, Inc., 816 F.2d 1057 (5th Cir.1987), one such earlier legal entanglement between these parties, this Court set forth the following relevant historical background underlying the parties’ differences which is equally applicable to the instant appeal.

In the early 1970’s, Bear Creek, a nonprofit corporation, was organized to seek a certificate of public convenience and necessity from the Mississippi Public Utility Commission to operate a rural water utility. As the proposed certificated area was within one mile of the city limits of Madison, the city’s acquiescence was necessary before the certificate could be issued. In 1971, the city agreed to relinquish its rights in the area, and Bear Creek received the certificate of public convenience. Since this time, Bear Creek has installed and operated the water system in the certificated area, financed by five loans from FmHA.
However, during this time the City of Madison has grown substantially, and its boundaries now include a part of the area served by Bear Creek. In 1985, the city instituted eminent domain proceedings to condemn Bear Creek's facilities located within city limits as well as Bear Creek’s certificate to operate in that area. This area includes approximately 40% of Bear Creek’s customers, and 60% of Bear Creek’s water supply facilities, including its water plant, wells, and feeder mains.

Madison, 816 F.2d at 1058 (footnote omitted). In Madison, this Court affirmed the judgment of a federal district court precluding municipal condemnation by Madison of Bear Creek’s water facilities pursuant to 7 U.S.C. § 1926(b) during the term of indebtedness of Bear Creek to the Farmers Home Administration (FmHA).

Following the decision of this Court in Madison, the Madison city officials, apparently continuing in their efforts to expand the Madison municipal water system into the area serviced by Bear Creek, filed a derivative action against the manager and directors of Bear Creek. The derivative action initiated by the Madison city officials charged the Bear Creek Directors with fraud and mismanagement in their duties as officers and directors of Bear Creek, sought to void all outstanding loans from FmHA to Bear Creek, and sought to hold the Bear Creek Directors personally liable for the FmHA loans.

Thereafter, the Bear Creek Directors filed the instant suit against the Madison city officials in their individual and official capacities seeking damages for an alleged constitutional deprivation of due process pursuant to 42 U.S.C. § 1983. Specifically, the Bear Creek Directors maintain in their complaint that the derivative action filed by the Madison city officials constitutes an unconstitutional misuse of legal process in that the derivative action was purportedly malicious and unfounded. The Madison city officials subsequently filed a motion to dismiss the Bear Creek Director’s section [161]*1611983 complaint in the instant appeal pursuant to Fed.R.Civ.P. 12(b)(6). In granting the Madison city officials’ motion to dismiss, the district court concluded that the Bear Creek Directors did not allege sufficient facts in their complaint which, if proven, would assert a claim of misuse of legal process rising to the level of a constitutional deprivation within the context of section 1983. We affirm.

II. DISCUSSION

On appeal, the Bear Creek Directors contend that the district court erred in dismissing their section 1983 complaint for failure to state a claim. A district court should refrain from granting a motion to dismiss pursuant to Rule 12(b)(6) unless it appears, from a reading of the plaintiff’s complaint, that the plaintiff has failed to set forth facts which, if proven, would establish a violation of a constitutional right. Auster Oil & Gas, Inc. v. Stream, 764 F.2d 381, 386-87 (5th Cir.1985), cert. dismissed, — U.S. -, 108 S.Ct. 2007, 100 L.Ed.2d 237 (1988). It should be noted, however, that to state a cognizable claim under section 1983, a plaintiff may not merely plead con-clusory allegations, but must instead set forth specific facts, which if proven, would warrant the relief sought. Elliott v. Perez, 751 F.2d 1472, 1479 (5th Cir.1985).

In the instant case, the Bear Creek Directors assert in their complaint that the Madison city officials deprived them of their constitutional due process rights through misuse of legal procedure or process. Specifically, the Bear Creek Directors challenge as unfounded and malicious the derivative action initiated by the Madison city officials which refutes the authority of the Bear Creek Directors to govern Bear Creek and which seeks to hold the Directors personally liable for any outstanding FmHA loans to Bear Creek. Relying on the previous holding of this Court in Madison that the City of Madison is prohibited from attempting to acquire control of Bear Creek water facilities while Bear Creek is indebted to the FmHA, the Bear Creek Directors maintain in their complaint, and on appeal, that the derivative suit filed by the Madison city officials amounts to no more than an attempt to circumvent the previous Fifth Circuit ruling in Madison by shifting the FmHA indebtedness from Bear Creek itself to the Bear Creek Directors.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Cite This Page — Counsel Stack

Bluebook (online)
868 F.2d 159, 1989 WL 17434, Counsel Stack Legal Research, https://law.counselstack.com/opinion/sisk-v-levings-ca5-1989.