Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca10-88-02300/USCOURTS-ca10-88-02300-0/pdf.json

Nature of Suit Code: 850
Nature of Suit: Securities, Commodities, Exchange
Cause of Action: 

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.FILED 

u~1ice-d Srates Court of Appeals 

Tenth G r-liit 

UNITED STATES COURT OF APPEALS 

TENTH CIRCUIT JAN 5 - 1 S 

ROBERT L. HOECKER 

Clerk 

OXBOW ENERGY, INC.; SPRING CREEK ART ) 

FOUNDATION INC.; WILLIAM I. KOCH; ) 

WILLIAM I. KOCH, Trustee of Mary R. Koch) 

"WIK" Trusts A-D; GAY A. ROANE, ANN A. ) 

LINN, and ANN A. LINN, Trustees of ) 

Howard B. Alspaugh Trust B; ANN A. LINN,) 

GAY A. ROANE, and WILLIAM I. KOCH, ) 

Trustees of Mixson-Simmons-Gray Trusts-) 

A-D; WILLIAM I. KOCH, and MARJORIE ) 

SIMMONS GRAY, Trustees of Mixson- ) 

Simmons-Gray Trust No. One; WILLIAM I. ) 

KOCH and THE NORTHERN TRUST COMPANY, ) 

Trustees of the William I. Koch Family ) 

Trust; MARJORIE L. SIMMONS and GAY A. ) 

ROANE, Trustees of Ann Alspaugh Trust; ) 

LOUIS HOWARD ANDRES COX; PAUL ANTHONY ) 

ANDRES COX; HOLLY ANTOINETTE ANDRES COX) 

FARABEE; WILLIAM I. KOCH and HOLLY ) 

ANTOINETTE ANDRES COX FARABEE, Trustees ) 

of The Simmons 1976 Trust; L.B. SIMMONS) 

ENERGY, INC., d/b/a ROCKET OIL COMPANY; ) 

FREDERICK R. KOCH and UNITED STATES ) 

TRUST COMPANY OF NEW YORK, as Trustee ) 

u/d/t dated October 23, 1981, as ) 

amended, ) 

Plaintiffs-Appellants, 

v. 

KOCH INDUSTRIES, INC.; CHARLES D. KOCH; 

DAVID H. KOCH; STERLING V. VARNER; 

DONALD L. CORDES; THOMAS M. CAREY, 

Defendants-Appellees. 

) 

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ORDER AND JUDGMENT* 

No. 88-2300 

(D.C. No. 87-2436S) 

(D. Kansas) 

* This order and judgment has no precedential value and shall 

not be cited, or used by any court within the Tenth Circuit, 

except for purposes of establishing the doctrines of the law of 

the case, res judicata, or collateral estoppel. 10th Cir. R. 

Appellate Case: 88-2300 Document: 01019958988 Date Filed: 01/05/1990 Page: 1 
Before BALDOCK and BRORBY, Circuit Judges, and BOHANON,** District 

Judge. 

Plaintiffs-Appellants (Oxbow) are all former shareholders of 

Koch Industries, Inc. Oxbow sued Koch Industries, Inc. and 

various individuals who are officers or directors of Koch 

Industries. All Appellees are hereinafter referred to as Koch. 

The trial court granted summary judgment in favor of Koch holding 

that the instant law suit was in effect on appeal from an adverse 

ruling in a prior suit. 

The essential facts are undisputed. In 1983 Oxbow sold its 

stock to Koch. The consideration was a substantial sum of cash 

and various oil and gas properties. In 1985, Oxbow, feeling that 

it had been deceived into selling its stock for less than it was 

worth, filed a class action on behalf of all stockholders. This 

action was filed in the District Court of Kansas and alleged 

theories of fraud, security law violations and breaches of 

fiduciary duty. The district judge (Judge Crow) granted Koch's 

motion for partial summary judgment. Oxbow then filed a motion to 

amend its pleadings raising additional claims uncovered by 

discovery including breach of warranty. Oxbow also filed a motion 

for reconsideration. The district judge rejected the amendment 

36.3. 

** - The Honorable 

District Judge for 

designation. 

Luther L. Bohanon, Senior United States 

the Western District of Oklahoma, sitting by 

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/ 

for various reasons and denied the motion for reconsideration. 

Oxbow thereupon filed a mandamus action with this Court seeking 

relief from the actions of the District Court. This Court denied 

the petition in Appeal No. 87-1689, holding that mandamus is not a 

substitute for review by proper appeal. This 1985 action is still 

pending before Judge Crow. 

In 1987 Oxbow filed the instant action which, like the 1985 

suit, was filed in the District of Kansas; however, this case was 

assigned to a 

pleadings in 

different district judge (Judge 

this action contain exactly the 

Saffels). The 

same factual 

allegations as are contained in the proposed amended complaint 

filed in the 1985 action; in addition, a RICO claim has been 

asserted. Koch filed a motion to dismiss and the District Court 

treated the motion as a motion for summary judgment. Oxbow argued 

that the separate claims were proper because each alleged 

misrepresentation pertained to a different asset held by Koch. 

Koch argued that all allegations arose out of the 1983 sale of 

stock. The District Court granted Koch's motion holding that the 

alleged wrongs committed by Koch arose out of a single incident 

and resulted in a single wrong and Oxbow should be required to 

bring all claims of misrepresentation arising out of the 

settlement and stock sale in one action and specifically in the 

first action. 

Oxbow now appeals, asserting: (1) the District Court 

misinterpreted the scope of the complaint and the scope and effect 

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Appellate Case: 88-2300 Document: 01019958988 Date Filed: 01/05/1990 Page: 3 
of the District Court's rulings in the 1985 action and thus should 

have allowed this action; (2) the second suit (the instant action) 

was not "claim splitting"; (3) Koch's actions in the first action 

necessitated the filing of this action, and the first action is 

not a bar to the present action; and (4) Appellants have been 

denied their constitutional right to due process as a result of 

not being able to maintain this action. 

We have listened to the oral argument of the parties and 

carefully considered the briefs; however, we are not persuaded by 

Oxbow's arguments. We do not feel the issues raised merit 

discussion by this Court. The instant action presents the same 

"claims that [Appellants] were not permitted to plead in the 

[1985] Action." Brief of Appellants at 4. Thus this is 

Appellants' second attempt to obtain review of Judge Crow's ruling 

outside proper appellate procedures. As we indicated in denying 

Appellants' earlier petition for mandamus, and as Judge Saffels 

correctly ruled in the instant action, the "proper course of 

plaintiffs is to appeal Judge Crow's ruling to [this Circuit] once 

the 1985 action is concluded." District Court's Order of May 19, 

1988 at 9. 

Judge Saffels astutely recognized the "absurd outcome which 

would result" if this action were allowed to proceed. District 

Court's Order at 10. He stated that in such an event he 

would then be inclined to consolidate [this] action with 

the 1985 action, since the factual circumstances of each 

case are so similar. [He] might then seek to transfer 

the case to Judge Crow. As a practical matter, [Judge 

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Appellate Case: 88-2300 Document: 01019958988 Date Filed: 01/05/1990 Page: 4 
Id. 

Saffels] would in effect have reversed Judge Crow's 

decision to deny plaintiffs' motion to amend. Despite 

his prior ruling, [Judge Crow] would have before him 

plaintiffs' claims concerning the other assets 

previously excluded from the 1985 action. 

We therefore AFFIRM the decision of the District Court. 

Entered for the Court: 

WADE BRORBY 

United States Circuit Judge 

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