Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca8-06-03004/USCOURTS-ca8-06-03004-0/pdf.json

Nature of Suit Code: 190
Nature of Suit: Other Contract Actions
Cause of Action: 

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1

The Honorable John R. Tunheim, United States District Judge for the District

of Minnesota. 

United States Court of Appeals

FOR THE EIGHTH CIRCUIT

___________

No. 06-3004

___________

Kreditverein der Bank Austria *

Creditanstalt fur Niederösterreich *

und Bergenland; Bank Austria *

Creditanstalt AG, *

*

Appellees, *

* Appeal from the United States

v. * District Court for the

* District of Minnesota.

Christa Nejezchleba, *

*

Appellant. *

___________

Submitted: February 12, 2007

Filed: March 1, 2007

___________

Before RILEY, MELLOY, and SHEPHERD, Circuit Judges.

___________

RILEY, Circuit Judge.

Christa Nejezchleba (Nejezchleba) appeals the district court’s1

 order

(1) granting in part and denying in part Kreditverein der Bank Austria Creditanstalt

fur Niederösterreich und Bergenland and Bank Austria Creditanstalt AG’s

(collectively, the Banks) motion for partial summary judgment, (2) denying

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Nejezchleba’s motion for partial summary judgment, and (3) staying the proceedings

pending calculation of damages by the Austrian courts. The Banks filed a motion to

dismiss for lack of an immediately appealable order. We grant the motion to dismiss

the appeal. 

I. BACKGROUND

In 1995, the Banks commenced collection proceedings against Nejezchleba in

Austria seeking repayment of four loans. In 2003, the Land Court for Civil Matters

Vienna entered judgment against Nejezchleba. Nejezchleba appealed. The Upper

Land Court Vienna affirmed regarding Nejezchleba’s liability; however, the Austrian

appellate court vacated the damages award and remanded to determine the amount of

damages. The Land Court for Civil Matters Vienna has not yet determined the

amount of damages. 

In January 2004, the Banks filed a complaint against Nejezchleba in the District

of Minnesota. The amended complaint alleged several causes of action: (1) four

breach of loan agreement claims; (2) a constructive trust on Nejezchleba’s real

property in Minnesota; (3) recognition of a money judgment that had been assigned

to Bank Austria Creditanstalt AG from the estate of Nejezchleba’s late husband; and

(4) recognition of the judgment of the Austrian courts. Nejezchleba answered and

alleged several affirmative defenses, including the defense that the Austrian judgment

was issued without due process of law and was not entitled to recognition, and

Nejezchleba filed a counterclaim alleging the Banks improperly transferred funds

from Nejezchleba’s accounts. In a separate proceeding, the Banks filed a notice of lis

pendens on Nejezchleba’s real property in Minnesota. 

The Banks filed a motion for partial summary judgment on the Banks’ claim

for recognition of the loans under the Uniform Foreign Country Money-Judgments

Recognition Act (UFCMJRA), Minn. Stat. § 548.35, and on Nejezchleba’s affirmative

defense, arguing the Austrian judgment was entitled to recognition under the

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In the order, the district court stated:

In the interests of judicial economy and the prevention of piecemeal

litigation, the Court will stay this case pending the Austrian court’s

determination of damages with respect to the Loans Judgment. The

Court will permit the parties to bring motions for summary judgment on

remaining issues, including recognition of the Loans Judgment and the

Assigned Judgment, as well as defendant’s counterclaim, at that time.

The district court ordered: “This action in all other respects is STAYED pending a

determination by the Austrian courts of the specific amount of damages with respect

to the Loan Judgment.” 

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UFCMJRA. The Banks also moved the district court to stay the proceedings pending

the exhaustion of the issue of damages. Nejezchleba filed a motion for partial

summary judgment on several claims, including the Banks’ constructive trust claim.

The district court concluded (1) Austria’s legal system provided due process for

purposes of the UFCMJRA; (2) the Austrian judgment was not yet final for purposes

of the UFCMJRA, so the judgment could not yet be recognized; and (3) a genuine

issue of material fact precluded summary judgment on the Banks’ constructive trust

claim. Additionally, the district court stayed the proceedings pending determination

by the Austrian courts of the specific damages amount.2

 Nejezchleba appeals. 

The Banks filed a motion to dismiss the appeal for lack of an immediately

appealable order. Nejezchleba responded arguing jurisdiction exists, and, in the

alternative, if the court lacks jurisdiction, the appeal should be construed as a petition

for a writ of mandamus. We initially consolidated the motion to dismiss with the

merits; however, upon further review, we sever the motion to dismiss from the merits

of the appeal and address the motion to dismiss. 

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We review the stay order based on the facts of record before the district court.

See Clinton v. Jones, 520 U.S. 681, 708 (1997); Smith v. Cent. Ariz. Water

Conservation Dist., 418 F.3d 1028, 1033 n.5 (9th Cir. 2005). “The proponent of a stay

bears the burden of establishing its need.” Clinton, 520 U.S. at 708.

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II. DISCUSSION3

As always, we must determine whether we have jurisdiction over Nejezchleba’s

appeal. See Carter v. Ashland, Inc., 450 F.3d 795, 796 (8th Cir. 2006) (per curiam).

Section 1291 of Title 28, United States Code, provides the courts of appeals with

jurisdiction over appeals from the final decisions of the district courts. Cunningham

v. Hamilton County, Ohio, 527 U.S. 198, 203 (1999). 

A. Immediately Appealable Order

As a preliminary matter, we must decide whether the district court stayed the

proceedings pursuant to the court’s inherent powers or abstained under Colorado

River Water Conservation District v. United States, 424 U.S. 800 (1976), and Moses

H. Cone Memorial Hospital v. Mercury Construction Corp., 460 U.S. 1 (1983).

Compare Landis v. N. Am. Co., 299 U.S. 248, 254 (1936) (reasoning “the power to

stay proceedings is incidental to the power inherent in every court to control the

disposition of the causes on its docket with economy of time and effort for itself, for

counsel, and for litigants”), with Mountain Pure, LLC v. Turner Holdings, LLC, 439

F.3d 920, 926-27 (8th Cir. 2006) (discussing the propriety of abstention pursuant to

Colorado River and Moses H. Cone). The line dividing a stay pending resolution of

an issue by another court and abstention under Colorado River and Moses H. Cone is

not clear. See 15A Charles Alan Wright, Arthur R. Miller & Edward H. Cooper,

Federal Practice and Procedure § 3914.13 (2d ed. 1992). The distinction is important

because a stay pursuant to the court’s inherent powers is typically an order that is not

immediately appealable under § 1291. See Moses H. Cone, 460 U.S. at 10 n.11;

Boushel v. Toro Co., 985 F.2d 406, 408 (8th Cir. 1993). In contrast, abstention under

Colorado River and Moses H. Cone is usually an immediately appealable order. See

Wolfson v. Mut. Benefit Life Ins. Co., 51 F.3d 141, 144 (8th Cir. 1995), abrogated on

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The six Colorado River/Moses H. Cone factors are: 

(1) whether there is a res over which one court has established

jurisdiction, (2) the inconvenience of the federal forum, (3) whether

maintaining separate actions may result in piecemeal litigation, unless

the relevant law would require piecemeal litigation and the federal court

issue is easily severed, (4) which case has priority—not necessarily

which case was filed first but a greater emphasis on the relative progress

made in the cases, (5) whether state or federal law controls, especially

favoring the exercise of jurisdiction where federal law controls, and

(6) the adequacy of the state forum to protect the federal plaintiff’s

rights.

U.S. Fid. & Guar. Co. v. Murphy Oil USA, Inc., 21 F.3d 259, 263 (8th Cir. 1994). 

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other grounds by Quackenbush v. Allstate Ins. Co., 517 U.S. 706, 711 (1996), as

recognized in In re Otter Tail Power Co., 116 F.3d 1207, 1215 n.7 (8th Cir. 1997). 

Here, the district court ordered the proceedings stayed pending the

determination of damages by the Austrian courts. The district court neither cited nor

conducted an analysis under Colorado River or Moses H. Cone.

4

 Neither of these

facts is controlling though because finality is determined by looking at the substance

of what the district court intended. See Lunde v. Helms, 898 F.2d 1343, 1345 (8th

Cir. 1990) (per curiam). 

“The only time that an order granting a stay will be considered a final order is

if [the stay] is tantamount to a dismissal and [the stay] effectively ends the litigation.”

Boushel, 985 F.2d at 408 (citing Moses H. Cone, 460 U.S. at 10); Lunde, 898 F.2d at

1345 (“‘When a stay amounts to a dismissal of the underlying suit, however, an

appellate court may review it.’” (quoting Cheyney State Coll. Faculty v. Hufstedler,

703 F.2d 732, 735 (3d Cir. 1983))). Specifically, a stay is immediately appealable if

the district court proceedings were stayed to allow pending parallel proceedings,

which involve the same parties litigating the same claims and issues, to adjudicate the

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claims and issues, and the judgment of the parallel proceedings will be given res

judicata effect. See In re Kozeny, 236 F.3d 615, 618 (10th Cir. 2000) (per curiam)

(addressing an appeal of a stay pending international proceedings); Michelson v.

Citicorp Nat’l Servs., Inc., 138 F.3d 508, 515 (3d Cir. 1998); see also Moses H. Cone,

460 U.S. at 10 n.11 (stating a stay is immediately appealable if “the object of the stay

is to require all or an essential part of the federal suit to be litigated in [another]

forum” or “when the sole purpose and effect of the stay are precisely to surrender

jurisdiction of a federal suit to [another] court”).

Here, the outcome of the Austrian litigation will affect only a small portion of

the district court proceedings. Cf. Michelson, 138 F.3d at 516. Although the parties

have been and will continue to litigate in Austria, the claims and issues litigated in

Austrian courts are not all or essentially all of the claims and issues to be adjudicated

in the district court proceedings. The only issue left to be resolved in the Austrian

litigation is the amount of damages. The claims in the district court proceedings

include (1) the constructive trust, (2) the recognition of the assignment, and (3) the

recognition of the Austrian judgments. The Austrian courts’ determination of

damages will not resolve all of, or even most of, the issues before the district court.

The stay order contemplates conducting future proceedings after the Austrian

courts have decided the amount of damages. See Lunde, 898 F.2d at 1345 (noting a

stay order that contemplates further proceedings does not have the same effect as

dismissing the case, and thus is not immediately appealable). Additionally, the Banks

seek a remedy in the district court proceeding the Banks cannot seek in the Austrian

litigation, specifically, a judgment against Nejezchleba’s real property in Minnesota.

Because the claims, issues, and available remedies in the district court proceedings

and Austrian proceedings vary, the district court proceedings will continue regardless

of how the Austrian courts determine the amount of damages. See Boushel, 985 F.2d

at 409 (concluding the circuit court lacked jurisdiction over the appeal of a stay order,

even though “the two concurrent suits involve many of the same issues,” because the

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Based on statements made during oral argument, the district court, at its

discretion, may wish to vacate and address the portion of the stay concerning the

Banks’ constructive trust claim. See Lunde, 898 F.2d at 1345.

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resolution of the other proceeding would “not necessarily foreclose additional

proceedings in the United States action”). 

Furthermore, the Austrian judgment will not put Nejezchleba “effectively out

of court.” Moses H. Cone, 460 U.S. at 10. Before the district court can give the

Austrian judgment res judicata effect, the district court must recognize the judgment

under the UFCMJRA. See Minn. Stat. § 548.35(4) (setting forth grounds for

nonrecognition of judgments). This prerequisite ensures the Austrian courts’ final

judgment will not bar further district court proceedings. See Boushel, 985 F.2d at

409; see also Kozeny, 236 F.3d at 619 (concluding a stay was not a final appealable

order because a judgment in the foreign litigation would “not necessarily end the

litigation in [the United States]”). Even if the district court gives the Austrian courts’

damages award res judicata effect, the effect is not of sufficient magnitude to render

the stay immediately appealable because the damages issue is more than offset by

issues relating to the constructive trust, the recognition of the assignment, and the

recognition of the Austrian judgments. Michelson, 138 F.3d at 514 (requiring the stay

to give res judicata effect “on all or an important part of the subsequent federal case”

to be immediately appealable); Boushel, 985 F.2d at 409 (holding some res judicata

effect from a foreign judgment was insufficient to make a stay immediately

appealable). 

The district court’s stay order is not immediately appealable under Colorado

River and Moses H. Cone.

5

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B. Collateral Order

As an alternative ground for appellate jurisdiction, Nejezchleba asserts

jurisdiction exists under the collateral order doctrine. “To qualify for immediate

appeal under the collateral order doctrine, an order must conclusively decide a

disputed question that is important and distinct from the case’s merits, and the

decision must be effectively unreviewable on appeal from a final judgment.”

Kassuelke v. Alliant Techsystems, Inc., 223 F.3d 929, 931 (8th Cir. 2000) (citing

Cohen v. Beneficial Indus. Loan Corp., 337 U.S. 541, 546 (1949), and Carmichael v.

White, 163 F.3d 1044, 1045 (8th Cir. 1998) (citing Coopers & Lybrand v. Livesay,

437 U.S. 463, 468 (1978))). The collateral order doctrine is a narrow exception to the

general rule entitling a party to a single appeal after a final judgment has been entered.

Digital Equip. Corp. v. Desktop Direct, Inc., 511 U.S. 863, 868 (1994). 

In Moses H. Cone, an order staying the proceedings pending resolution of an

issue in another forum qualified for immediate appeal under the collateral order

doctrine because the stay order amounted to a refusal to adjudicate the merits. Moses

H. Cone, 460 U.S. at 12-13. The Supreme Court noted, “there is no step towards final

judgment, but a refusal to proceed at all.” Id. at 12 n.13. Here, in contrast, the order

staying the proceedings only delayed the proceedings relating to the amount of

damages and, after the Austrian courts’ damage award has been decided, the district

court will consider every remaining claim and issue. The stay order does not foreclose

Nejezchleba’s opportunity to adjudicate the issues in a federal forum; rather, the stay

order only, and logically, delays this opportunity. See Kozeny, 236 F.3d at 619-20.

The delay in Nejezchleba’s opportunity to adjudicate in federal court is insufficiently

significant to qualify as important under the collateral order doctrine. Michelson, 138

F.3d at 517.

The stay is not immediately appealable under the collateral order doctrine. 

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The issue of whether the Banks’ notice of lis pendens is valid under § 557.02

is not before the court.

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C. Writ of Mandamus

Nejezchleba requests, if the district court’s stay order cannot be immediately

appealed, the appeal be construed as a petition for a writ of mandamus. Nejezchleba

alleges the denial of summary judgment on the Banks’ constructive trust claim

enabled the Banks to file a notice of lis pendens, which prevents Nejezchleba from

having a free and clear title to her real property. See generally 54 C.J.S. Lis Pendens

§ 41. 

A writ of mandamus “is a ‘drastic and extraordinary’ remedy ‘reserved for

really extraordinary causes.’” Cheney v. U.S. Dist. Ct. for the D.C., 542 U.S. 367,

380 (2004) (quoting Ex parte Fahey, 332 U.S. 258, 259-60 (1947)). “To ensure that

mandamus remains an extraordinary remedy, petitioners must show that they lack

adequate alternative means to obtain the relief they seek and carry the burden of

showing that their right to issuance of the writ is clear and indisputable.” Mallard v.

U.S. Dist. Ct. for the S. Dist. of Iowa, 490 U.S. 296, 309 (1989) (citations, internal

quotation marks, and alterations omitted).

Here, Minnesota Statutes § 557.02 sets forth the procedures to file a notice of

lis pendens. Rehnberg v. Minn. Homes, Inc., 52 N.W.2d 454, 456 (Minn. 1952)

(stating a notice of lis pendens can only be properly filed if the underlying cause of

action affects (1) the title to real property, (2) any interest in real property, or (3) a lien

upon real property, which cannot be based on an expectant judgment). Any notice of

lis pendens that is not in accordance with § 557.02 will be cancelled.6

 See Grace Dev.

Co. v. Houston, 237 N.W.2d 73, 74-75 (Minn. 1975); see also Bly v. Gensmer, 386

N.W.2d 767, 769 (Minn. Ct. App. 1986) (“A constructive trust is not, in itself,

construed as a lien on or as affecting title to property; it does not exist so as to affect

the property held by the wrongdoer until it is declared by a court as a means of

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affording relief.” ). Because Nejezchleba has an adequate alternative means under

Minnesota law to obtain relief, the petition for writ of mandamus is denied. 

III. CONCLUSION

We dismiss Nejezchleba’s appeal for lack of jurisdiction. 

______________________________

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