UNITED STATES CO URT OF APPEALS FOR THE TENTH CIRCUIT

FISH CREEK CAPITAL, LLC, a Wyoming limited liability company, Plaintiff-Appellant,

and FLAT CREEK CAPITAL, LLC, a Wyoming limited liability company, Plaintiff,

v. WELLS FARGO BANK, N.A., a national bank, Defendant-Appellee. No. 11-8081 (D.C. No. 2:11-CV-00176-NDF) (D. Wyo.)

ORDER AND JUDGMENT *

Before BRISCOE , Chief Judge, PORFILIO , Senior Circuit Judge, and MURPHY , Circuit Judge.

* After examining the briefs and appella te record, this pa nel has determined unanimously to grant the parties’ request for a decision on the briefs without oral argument. See Fed. R. App. P. 34(f); 10th Cir. R. 34.1(G). The case is therefore ordered submitted without oral argument. This order and judgment is not binding precedent, except under the doctr ines of law of the case, res judicata, and collateral estoppel. It may be cite d, however, for its persuasi ve value consistent with Fed. R. App. P. 32.1 a nd 10th Cir. R. 32.1. FILED United States Court of Appeals Tenth Circuit 

### June 20, 2012

Elisabeth A. Shumaker Clerk of Court- 2 - Plaintiff Fish Creek Capital, LLC, app eals from the dismissa l of its contract claims against Wells Far go Bank, N.A. Exercising jurisdiction under 28 U.S.C. § 1291, we affirm. The Snake River Sporting Club De velopment Company (Snake River Company) obtained a subdi vision permit from the Teton County Board of Commissioners (Teton County) in Jackson, Wyoming. In July 2005, Wells Fargo (successor by consolidation with Jackson St ate Bank and Trust) issued a letter of credit (LC) to Teton County. The purpose of the LC, which had a termination date of July 15, 2006, was “to ensure that [Snake River Company] will install INFRASTRUCTURE IMPROVEMENTS” in the Snake River Sporting Club Development (Snake River Development) by the LC’s termination date and to “insure that [Snake River Company] will be financially responsible should [it] fail to install [those improvements] in the specified time and manne r.” App. at 19. Wells Fargo extended the LC by issuing three repl acement LCs. The second terminated on July 14, 2007, the third on July 14, 2008, and the fourth on October 14, 2008 (later extended to February 12, 2009). Each LC stated that it was governed by the Wyoming Uniform Commercial Code. Snak e River Company never completed the infrastructure improvements, and in Janua ry 2009, Teton County drew on the LC. Wells Fargo paid off on it, and Teton County completed the infrastructure in the fall

of 2010.- 3 - Meanwhile, on August 30, 2006, Fish Creek obtained a $1.425 million loan from Wells Fargo for the purchase of propert y in the Snake River Development. The loan had a term of one year. Fish Creek ’s co-plaintiff, Flat Creek Capital, LLC, granted a $500,000 mortgage to Wells Fargo against real property it owned to secure

the loan to Fish Creek. 1 Sometime after Wells Fargo issued the third LC in July 2007, one of Fish Creek’s pr incipals met with Wells Fa rgo to notify the bank that extending the LC would adversely affect th e value of property in the Snake River Development and make it difficult or impossi ble to sell because th e infrastructure had not been timely completed. During this same time fr ame, Wells Fargo became a lender to the previous senior lender for the Snake River Development project, R.E. Loans, LLC, which subordinat ed its interests to Wells Fargo, thereby making Wells Fargo the lender to R.E. Loans and th e senior lender for the Snake River Development. Ultimately, Wells Fargo gave notice of its intent to foreclose the mortgage Flat Creek had given to secure the Fish Creek loan . Fish Creek then filed this action. In its complaint, as clarifie d somewhat in its response to Wells Fargo’s motion to dismiss, Fish Creek claimed that Wells Fargo breached a covenant of good faith and fair dealing in their loan agreement by extending the second LC beyond the July 2007 termination date. Fish Creek alleged th at it had relied on the completion of the

1 Flat Creek is repeatedly identified in this action as “Flat Creek Capital, LLC,” although the entity’s name appear s to be Flat Creek Capital Corporation, as set out on the mortgage.- 4 - infrastructure by that date in deciding to borrow funds to purchase property in the Snake River Development, and that Wells Fargo had negotiated extensions of the LCs for its own benefit, apparently eviden ced by the fact that Wells Fargo’s funding exposure was reduced by more than $2.1 million between the second LC and the

fourth LC. Fish Creek also claimed that it was a third-party beneficiary of the LCs and, as such, entitled to da mages arising from Wells Fargo’s failure to pay on the LC that terminated on July 14, 2007. Fish Creek noted that property values in Teton Valley decreased dramatically between th e July 2007 termination date and the eventual completion of the infrastructure in the fall of 2010. Fish Creek estimated that the value of its property in the Sn ake River Development had decreased over $700,000 during that time. Wells Fargo moved to dismiss Fish Creek’s claims under Fed. R. Civ. P. 12(b)(6), arguing that it had no duty to Fish Creek under the loan transaction—and no duty at all under the LCs—to assure that Snake River Company completed the infrastructure improvements by any particular date. Wells Fargo contended that its only duty under the loan agr eement was to advance the loan proceeds, which it did. Wells Fargo also argued that Fish Creek wa s not a third-party beneficiary of the LCs and, in any event, Well Fargo’s only duty under the LCs was to pay when Teton County drew on an LC, which it did. The district court agreed with We lls Fargo’s position. The court first

considered Fish Creek’s clai m that Wells Fargo breached the covenant of good faith- 5 - and fair dealing, observing that Wells Fargo had no obligation under the loan agreement to complete the infrastructure by the summer of 2007; Wells Fargo’s only obligation was to lend money to Fish Creek, and it fulfilled that dut y. The court also

observed that there was no alle gation that Wells Fargo prom ised Fish Creek that the infrastructure would be comple ted by any particular date. Because “[ t]he covenant of good faith and fair dealing ma y not . . . be construed to establish new, independent rights or duties not agreed upon by the parties,” Whitlock Constr., Inc. v. S. Big Horn Cnty. Water Supply Joint Powers Bd. , 41 P.3d 1261, 1267 (W yo. 2002) (quotation omitted), the court concluded that the claim must be dismissed. 2 Turning to the third-party-beneficiar y breach-of-contract claim, the court rejected Fish Creek’s argumen t that Wells Fargo knew that lot owners were intended

beneficiaries of the LCs. Fish Creek re lied on two Wyoming stat utes in support of that argument, Wyo. Stat. §§ 18-5-304 a nd 18-6-306(a)(viii). Section 18-5-304 provides that “[n]o person sha ll sell land subject to subdiv ision regulation under this article, record a plat or commence cons truction of a subdiv ision without first obtaining a subdivision permit pursuant to W.S. 18-5-306 or, if applicable, W.S. 18-5-316 from the board of the county in which the land is lo cated.” In turn, § 18-6-306(a)(viii) requires a developer to “provide a performance bond, acceptable

letter of credit or other suff icient financial commitment to assure that any facilities

2 Because this is a diversit y case, Wyoming law applies. See Cooperman v. David , 214 F.3d 1162, 1164 (10th Cir. 2000).- 6 - proposed or represented to be part of the subdivision w ill in fact be completed as proposed, or escrow sufficient monies out of land sales to guarantee that [infrastructure improvements] are installed.” The court f ound no legal basis in these statutes supportive of Fish Creek’s allegation that it was an intended third-party beneficiary of the LCs. Further, the LC s themselves provided no support for Fish Creek’s position because each one id entified the Teton County Board of Commissioners as the beneficiary entitled to payment in th e event Snake River Company failed to install the infrastructure improve ments, and there was no indication that lot purchasers had any rights under the LCs. The court also recognized that the purpose of the statutor y requirements is to protect a county from financial burden in the event a developer fa ils to complete a s ubdivision project, and that it is the county, not th e issuer of an LC, who dete rmines when and whether to draw on an LC. Teton County set the time lines for completion of the project, and when it ultimately drew on th e LC, Wells Fargo fulfilled it s sole obligation by paying on it. Accordingly, the district court c oncluded that it must dismiss Fish Creek’s

second claim.

We review a dismissal under Fed. R. Civ. P. 12(b)(6) de novo. Kan. Penn Gaming, LLC v. Collins , 656 F.3d 1210, 1214 (10th Ci r. 2011). “[I]n ruling on a motion to dismiss, a court should disregard all concluso ry statements of law and

consider whether the remaini ng specific factual allegations , if assumed to be true, plausibly suggest the de fendant is liable.” Id. Having reviewed the record, the- 7 - applicable law, and the partie s’ arguments, we agree with th e district court that Fish Creek’s factual allegations di d not plausibly suggest that Wells Fargo was liable. We therefore affirm the judgment for substant ially the same reasons set forth in the

district court’s well-reasoned dismissal order. We add onl y two points. First, Fish Creek did not allege that Teton County atte mpted or intended to draw on the LC that terminated in July 2007, so the allegation that Wells Fargo redu ced its obligation by negotiating an extension of that LC fails th e plausibility test. Second, provisions of the Wyoming Uniform Commercial Code, wh ich expressly govern the LCs, reinforce the conclusion that Wells Fargo was not oblig ated to Fish Creek for any failure of performance in the underlying contract for which the LCs were issued. See Wyo. Stat. § 34.1-5-103(d) (“Rights and obligations of an issu er to a beneficiary or a nominated person under a letter of credit are independent of the existence, performance, or nonperformance of a contract or arrangement out of which the letter of credit arises or which underlies it, in cluding contracts or arrangements between the issuer and the applicant and between the applicant and the beneficiary.”); id. § 34.1-5-108(f)(i)-(ii) (“An issuer [of an LC] is not responsible for (i) The performance or nonperformance of the underlying contract, arrangement or transaction; [or] (ii) An act or omission of others[.]”). The judgment of the dist rict court is AFFIRMED.

Entered for the Court

John C. Porfilio Senior Circuit Judge