Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca8-07-01462/USCOURTS-ca8-07-01462-1/pdf.json

Nature of Suit Code: 440
Nature of Suit: Other Civil Rights
Cause of Action: 

---

1

The Honorable David S. Doty, United States District Judge for the District of

Minnesota, sitting by designation.

United States Court of Appeals

FOR THE EIGHTH CIRCUIT

__________

Nos. 06-3794/07-1462

___________

Alternate Fuels, Inc. and *

Larry W. Pommier, *

*

Appellant/Cross-Appellees, *

* Appeal from the United States

v. * District Court for the

* Western District of Missouri.

Thomas M. Cabanas and *

Richard A. Hall, *

* 

Appellee/Cross-Appellant. *

___________

 Submitted: November 15, 2007

Filed: August 18, 2008 (Corrected August 21, 2008)

___________

Before WOLLMAN, and BENTON, Circuit Judges, and DOTY,1

 District Judge.

___________

BENTON, Circuit Judge.

Alternate Fuels, Inc. (AFI) and its President, Larry W. Pommier, sued two

officials of the Missouri Department of Natural Resources (DNR) – Thomas M.

Cabanas and Richard A. Hall – for denial of equal protection, tortious interference

with contract, and First Amendment retaliation. Summary judgment was granted to

Cabanas and Hall on all claims except part of AFI’s tortious-interference-withAppellate Case: 07-1462 Page: 1 Date Filed: 08/21/2008 Entry ID: 3463390
2

The Honorable John T. Maughmer, Chief United States Magistrate Judge for

the Western District of Missouri, to whom the case was referred for decision by the

consent of the parties pursuant to 28 U.S.C. § 636(c).

-2-

contract claim against Cabanas, who appealed. AFI and Pommier cross-appealed the

partial summary judgment, which was dismissed for lack of jurisdiction, as not

immediately appealable. See Alternate Fuels, Inc. v. Cabanas, 435 F.3d 855, 860

(8th Cir. 2006). This court affirmed the district court’s2

 denial of summary judgment

on the tortious-interference claim. Id. at 858-60.

This remaining claim was tried to a jury, with a verdict for AFI. Cabanas

appeals. Pommier appeals the summary judgment for Cabanas on his First

Amendment claim. Having jurisdiction under 28 U.S.C. § 1291, this court affirms.

I.

.

The Land Reclamation Commission, a sub-component of DNR, oversees

compliance with the surface coal-mining laws. See Mo. Rev. Stat. §§ 444.800–.970.

The Commission’s mine inspectors were supervised by Hall, who was supervised by

Section Chief Cabanas.

AFI operated Blue Mound Mine, a surface coal mine that DNR regulated.

Pommier was president (but not a shareholder) of AFI.

In 1996, Pommier complained to Cabanas’s supervisor about his inappropriate

conduct while at Blue Mound. Following this complaint, Cabanas instructed the

inspector assigned to Blue Mound to cite the mine for numerous violations, even if

they did not exist. He also instructed him to issue violation notices before

determining if violations actually existed.

Appellate Case: 07-1462 Page: 2 Date Filed: 08/21/2008 Entry ID: 3463390
-3-

In May 1997, Pommier complained in writing about Cabanas’s abusive and

unfair conduct toward AFI, and treatment it received from the DNR section Cabanas

supervised. In 1999, DNR and AFI entered into a Consent Agreement that attempted

to resolve both the complaints against Cabanas and the alleged violations by AFI. It

included a provision that inspectors of Blue Mound would report directly to the

administrator of the Commission, bypassing Cabanas on regulatory matters. 

Some time in 1998 or 1999, AFI and Midwest Coal, LLC, entered negotiations

for Midwest to buy AFI’s assets and liabilities (“Deal One”). After engaging in due

diligence, Midwest decided the risk was too high. Deal One was not finalized. The

parties began to discuss the possibility of Midwest buying AFI’s coal slurries and

using AFI’s coal-washing facilities (“Deal Two”). Again, Midwest assessed the risks

and benefits, including issues at Blue Mound that needed to be resolved with DNR.

Deal Two did not materialize. 

In early 2000, AFI began negotiating with Midwest for the sale of part of its

coal slurries to be processed elsewhere (“Deal Three”). While the companies were

negotiating and the Consent Agreement in effect, Cabanas made negative comments

to Midwest about the possible purchase of AFI’s coal slurries. This deal would have

required a transfer of the DNR permit. Cabanas told Midwest’s president “as long

as I’m here, that won’t happen.” As a result, Midwest decided not to proceed with the

purchase. At trial, Midwest testified it would have purchased all of AFI’s recoverable

slurries if Cabanas had not made this statement.

II.

This court now reviews the denial of Pommier’s claim for First Amendment

retaliation. See AFI, 453 F.3d at 860 (grant of partial summary judgment is not

immediately appealable). This court reviews de novo a district court’s ruling on a

Appellate Case: 07-1462 Page: 3 Date Filed: 08/21/2008 Entry ID: 3463390
-4-

motion for summary judgment. Canady v. Wal-Mart Stores, Inc., 440 F.3d 1031,

1034 (8th Cir. 2006). 

 Cabanas asserts that Pommier does not have standing to assert this First

Amendment claim. Pommier relies on International Ass’n of Firefighters v. City of

Ferguson, 283 F.3d 969 (8th Cir. 2002), where this court held that an employee’s wife

had standing to present a First Amendment attack on the employer’s prohibition on

employee involvement in city politics (which clearly did not apply to her). Id. at 973.

 The wife alleged she was prevented from participating in political activities for fear

of hurting her husband’s position. Id. at 972. This court held that because of the

economic effect on her (a joint bank account and the level of spousal support), she

was asserting her own rights and thus had standing. Id. at 973. 

Similarly, a corporate officer cannot maintain a personal action against a third

party for harm caused to the corporation, unless the officer alleges a direct injury not

derivative of the company’s injury. Potthoff v. Morin, 245 F.3d 710, 717-18 (8th Cir.

2001) (sole shareholder and principal employee has no standing to enforce a First

Amendment claim because he did not personally suffer a direct, nonderivative injury).

The complaint here alleges only injury to the corporation AFI:

In retaliation for the Plaintiffs [AFI and Pommier] exercising their First

Amendment rights, Defendants [Cabanas and Hall] engaged in an

intentional and continuing course of retaliation against Plaintiffs,

including but not limited to, improper enforcement actions against AFI,

issuing numerous Notices of Violations to AFI, and interference with

Plaintiffs’ business relationship with Midwest.

Plaintiffs’ summary judgment motion also does not allege any direct nonderivative

injury to Pommier. On appeal, Pommier emphasizes that the summary judgment

Appellate Case: 07-1462 Page: 4 Date Filed: 08/21/2008 Entry ID: 3463390
-5-

exhibits include Cabanas’s statement that “this sale of [AFI] was an attempt by Larry

Pommier to ‘try to get out of this on his feet, and that’s unacceptable to us.’” Even

this statement does not reflect a direct injury to Pommier that is distinct from the harm

suffered by AFI. Pommier has no standing to assert the First Amendment claim. See

Jaffke v. Dunham, 352 U.S. 280, 281 (1957) (district court’s decision may be

affirmed for any reason supported by the record).

III.

Twice during trial, Cabanas moved for judgment as a matter of law: at the close

of the plaintiff’s evidence, and at the close of all evidence. Neither motion was in

writing nor included any relevant law or facts. 

This court reviews de novo the denial of motions for judgment as a matter of

law. Walsh v. Nat’l Computer Sys., Inc., 332 F.3d 1150, 1158 (8th Cir. 2003).

However, if the movant’s legal theories are not articulated before the verdict, review

is limited to whether the judgment sought is “required to prevent manifest injustice.”

Conseco Fin. Servicing Corp. v. N. Am. Mortgage Co., 381 F.3d 811, 821 (8th Cir.

2001). 

Cabanas argues that a specific basis was not required in the motions for

judgment as a matter of law. Rule 50(a)(2) refutes this. It says that the motion must

specify both the law and the facts that entitle the moving party to the judgment. Fed.

R. Civ. P. 50(a)(2). If the motion for judgment as a matter of law is not specific

enough to give notice to the opposing party of the issues underlying the motion, it

cannot be granted or upheld on appeal. See Conseco, 381 F.3d at 821. If the

conversation between the parties and the judge provides sufficient insight into the

grounds on which it is based, the issues could be preserved for appeal. See id. While

technical precision in stating grounds is not necessary, some basis for the motion has

Appellate Case: 07-1462 Page: 5 Date Filed: 08/21/2008 Entry ID: 3463390
3

Cabanas does not argue on appeal that the alleged insufficiency of evidence of

damages requires reversal in order to prevent manifest injustice. See Conseco, 381

F.3d at 821.

-6-

to be apparent to the court and the parties. See Rockport Pharmacy, Inc. v. Digital

Simplistics, Inc., 53 F.3d 195, 197 (8th Cir. 1995). 

Cabanas’s motions for judgment as a matter of law gave no legal or factual

basis. There was no discussion between the parties or the court that indicates any

insufficiencies in the proof. Cabanas’s motions for judgment as a matter of law

cannot be the basis of an appeal.3

IV.

After trial, Cabanas filed a written motion for judgment as a matter of law and

in the alternative, a motion for new trial – which did include legal theories. Cabanas

outlined separate grounds for the motion for new trial. The new trial portion was

based on the district court’s refusal of two proffered instructions. A denial of a

motion for new trial and the refusal to give proffered jury instructions are both

reviewed for abuse of discretion. Shaw Group, Inc. v. Marcum, 516 F.3d 1061,

1067-68 (8th Cir. 2008); Otting v. J.C. Penney Co., 223 F.3d 704, 712 (8th Cir.

2000); Peerless Corp. v. United States, 185 F.3d 922, 927 (8th Cir. 1999).

Cabanas objected to the district court’s refusal to give his “official duties” and

“official immunity” verdict-directing instructions. Cabanas cites this court’s footnote

that Cabanas was being sued in his “official capacity, making the suit one against the

state.” AFI, 435 F.3d at 857 n.2. Cabanas promotes this argument as the “law of the

case” that bars suit against him personally. 

Appellate Case: 07-1462 Page: 6 Date Filed: 08/21/2008 Entry ID: 3463390
-7-

Cabanas’s argument ignores that after this court ruled in the earlier appeal, the

district judge allowed AFI and Pommier to amend the complaint in order to sue him

individually. Allowing or denying the amendment of a complaint is reviewed for

abuse of discretion. Hammer v. City of Osage Beach, 318 F.3d 832, 844 (8th Cir.

2003) citing Bell v. Allstate Life Ins. Co., 160 F.3d 452, 454 (8th Cir. 1998). Leave

to amend should be freely granted unless there are compelling reasons “such as undue

delay, bad faith, or dilatory motive . . . undue prejudice to the non-moving party, or

futility of the amendment.” Brown v. Wallace, 957 F.2d 564, 566 (8th Cir. 1992).

Cabanas opposed the amendment when requested. He argues that the motion

should have been denied because of the inordinate amount of time between the

original complaint and the request for leave to amend. The district court found that

because of the intervening appeal, there was no undue delay. The court also ruled that

the amendment was not futile because it related back to the date of the initial filing

and allowed Cabanas to be sued individually. The court found no prejudice to

Cabanas because throughout the suit, the parties had assumed the defendants were

sued individually. The district court did not abuse its discretion by granting leave to

amend the complaint. 

This court previously held as a matter of law “that Cabanas was not acting

within the scope of his official duties.” AFI, 435 F.3d at 859. An employee must be

performing official duties in order to receive official immunity. Davis v. Lambert-St.

Louis Intern. Airport, 193 S.W.3d 760, 765 (Mo. banc 2006). The district court

properly refused Cabanas’s “official duties” and “official immunity” instructions.

V.

Cabanas continues to object that the district court did not have jurisdiction

because the plaintiffs failed to exhaust their administrative remedies. In Missouri,

failure to exhaust administrative remedies in a “contested case” divests courts of

Appellate Case: 07-1462 Page: 7 Date Filed: 08/21/2008 Entry ID: 3463390
-8-

subject matter jurisdiction. See Strozewski v. City of Springfield, 875 S.W.2d 905,

906 (Mo. banc 1994) (describing state constitutional right to administrative review,

and types of cases that require exhaustion); Mo. Rev. Stat. § 444.850.5 (land

reclamation permit proceeding is a contested case). Subject matter jurisdiction can be

raised at any time. Bueford v. Resolution Trust Corp., 991 F.2d 481, 485 (8th Cir.

1993).

Assuming this is an issue of subject matter jurisdiction, exhaustion applies if

a contested-case remedy is available. See Hamby v. City of Liberty, 20 S.W.3d 515,

518 (Mo. banc 2000); Pessin v. State Tax Comm’n, 875 S.W.2d 143, 146 (Mo. App.

1994). In this case, the sale was not finalized due to Cabanas’s comments. No one

was required to apply for a permit transfer. See AFI, 435 F.3d at 859; Mo. Rev. Stat.

§ 444.840 (Commission approval required for revision, transfer, assignment or sale

of rights under permit). The district court had subject matter jurisdiction of the

tortious-interference claim.

VI. 

The judgment of the district court is affirmed.

______________________________

Appellate Case: 07-1462 Page: 8 Date Filed: 08/21/2008 Entry ID: 3463390