Court Opinion

ID: 4117988
Source: CourtListenerOpinion
Date Created: 2017-01-24 19:00:55.556238+00
Date Added: 2024-06-11T07:46:18.841389
License: Public Domain

Case: 16-60414      Document: 00513846420         Page: 1    Date Filed: 01/24/2017

           IN THE UNITED STATES COURT OF APPEALS
                    FOR THE FIFTH CIRCUIT
                                                                             United States Court of Appeals
                                                                                      Fifth Circuit

                                    No. 16-60414
                                                                                    FILED
                                                                              January 24, 2017
                                  Summary Calendar
                                                                               Lyle W. Cayce
                                                                                    Clerk
SONJA B. HENDERSON, on behalf of the Estate and Wrongful Death
Beneficiaries of Nolan Ryan Henderson, III (Deceased),

              Plaintiff – Appellant,

v.

WEST JACKSON STUDENT HOUSING, L.L.C., doing business as The
Palisades @ E-City; CAMPUS ADVANTAGE, INCORPORATED; ARLANDO
CLEMONS, Individually; STARVEL WILLIAMS, Individually; QUANDA
ODOM, Individually; DEWAYNE YOUNG, doing business as American's
Master Security; JOHN DOES 1-5,

              Defendants – Appellees.

                   Appeal from the United States District Court
                     for the Southern District of Mississippi
                             USDC No. 3:14-CV-332

Before REAVLEY, OWEN, and ELROD, Circuit Judges.
PER CURIAM:*
       Sonja B. Henderson, on behalf of the estate of Nolan Ryan Henderson,
III and wrongful death beneficiaries of Nolan Henderson, has appealed from

       * Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH
CIR. R. 47.5.4.
     Case: 16-60414          Document: 00513846420        Page: 2   Date Filed: 01/24/2017

                                           No. 16-60414
the district court’s order dismissing her complaint for failure to state a claim
and denying her motion for reconsideration. We AFFIRM.
                                                I.
       Nolan Ryan Henderson was killed on March 25, 2012, while on the
premises of an apartment complex, Palisades @ E-City. At the time of Nolan
Henderson’s death, Palisades was under the receivership of Campus
Advantage, Inc., pursuant to an order entered by the Southern District of
Mississippi in July of 2011 (Appointment Order). 1 As Receiver, Campus
Advantage was authorized to manage, maintain, and operate Palisades. The
Appointment Order provided that Campus Advantage had “no personal
liability” “[e]xcept in the event of gross negligence, willful misconduct or
actions in violation of orders of the Court.” Campus Advantage’s receivership
over Palisades was subsequently terminated at the request of the parties by
court order on November 28, 2012 (Termination Order). The Termination
Order contained a clause providing that Campus Advantage “shall be fully and
forever released and discharged from any and all liability as Receiver of
[Palisades].” 2

       1The receivership was instituted in the context of litigation between Wells Fargo and
West Jackson Student Housing, LLC—the Palisades’s owner. Wells Fargo had sued West
Jackson over unpaid debts.
       2   The release provides in full:
       [T]he Receiver shall be fully and forever released and discharged from any and
       all liability as Receiver of Receivership Property. Said release and discharge
       shall include any and all claims, cross-claims, counterclaims, causes, damages,
       and actions of every kind and character, and all suits, costs, damages,
       expenses, compensation, and liabilities of every kind, character, and
       description, whether direct or indirect, known or unknown, in law or in equity,
       that anyone has or will have against Receiver and/or any of Receiver’s agents,
       representatives, officers, attorneys, professionals, employees, or contractors,
       on account of, arising, or resulting from, or in any manner incidental to, the
       Receivership, Receivership Property, Receiver’s possession and/or use of
       Receivership Property, the administration of the Receivership estate, and/or
       any acts or omissions of Receiver.
                                                2
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                                        No. 16-60414
       On November 12, 2013—nearly a year after Campus Advantage was
terminated as Receiver over Palisades—Sonja Henderson, on behalf of the
estate and wrongful death beneficiaries of Nolan Henderson, brought suit in
state court against Campus Advantage, three of its employees 3 (collectively,
Campus Advantage), and various other defendants, alleging that defendants
had negligently failed to provide adequate security at Palisades and had
negligently failed to warn of foreseeable dangers on the premises. Henderson
also asserted that these alleged failures amounted to gross negligence. Campus
Advantage subsequently removed the case to federal district court 4 and moved
to dismiss the complaint under Fed. R. Civ. P. 12(b)(6).
        In its motion to dismiss, Campus Advantage argued that the release in
the Termination Order barred Henderson’s claim. In response, Henderson
offered two arguments. First, she argued that enforcing the Termination Order
to bar her claim would violate procedural due process because Campus
Advantage did not “mail to Plaintiffs a notice of the receivership, how to file
claims against the subject property of the receivership, and date that claims
would be barred.” Second, Henderson argued that, because the Appointment
Order exempted claims of “gross negligence” and because she alleged that
Campus Advantage had been grossly negligent, the suit could proceed.
       The district court granted the motion to dismiss with prejudice as to all
claims against Campus Advantage and its three employees. The court first
rejected Henderson’s due process argument, concluding that she had not

       3   The employees are Arlando Clemons, Starvel Williams, and Quanda Odom.
       4  Removal was based on Campus Advantage’s status as a federal court-appointed
Receiver. Federal law provides that any civil action commenced against “[a]ny officer of the
courts of the United States” may be removed to federal district court. 28 U.S.C. § 1442(a).
The district court concluded that Campus Advantage was an officer of the court as a result
of its status as a court-appointed Receiver. See Med. Dev. Int’l v. Cal. Dep’t of Corr. & Rehab.,
585 F.3d 1211, 1216 (9th Cir. 2009). Henderson agrees that removal was proper.
                                               3
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                                  No. 16-60414
identified any authority mandating that Campus Advantage provide notice to
non-party potential claimants regarding the receivership’s creation or
termination. The court then rejected Henderson’s argument that the
Appointment Order, rather than the subsequent Termination Order,
determined the scope of Campus Advantage’s liability exposure. Henderson
filed a motion for reconsideration reasserting the same arguments previously
made, which the district court denied.
                                       II.
      We review a district court’s motion to dismiss under Rule 12(b)(6) de
novo, U.S. ex rel. Grubbs v. Kanneganti, 565 F.3d 180, 185 (5th Cir. 2009), and
a district court’s denial of a motion for reconsideration for abuse of discretion.
Briddle v. Scott, 63 F.3d 364, 379 (5th Cir. 1995). On a motion to dismiss, we
accept all well-pleaded facts as true, but “courts are not bound to accept as true
a legal conclusion couched as a factual allegation.’” Bell Atl. Corp. v. Twombly,
550 U.S. 544, 555 (2007) (quotation marks and alterations omitted). To
overcome a Rule 12(b)(6) motion to dismiss, a plaintiff must plead “enough
facts to state a claim to relief that is plausible on its face.” Twombly, 550 U.S.
at 570. “A claim has facial plausibility when the plaintiff pleads factual content
that allows the court to draw the reasonable inference that the defendant is
liable for the misconduct alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009).
                                       III.
      We first address Henderson’s claim that the district court erred in
concluding that the Termination Order’s release clause bars her claims against
Campus Advantage. Henderson provides two arguments to support this
position. First, relying on out-of-circuit precedent, Henderson argues that
Campus Advantage is not entitled to judicial immunity where the receiver has
acted contrary to the court’s directives. Here, the Appointment Order required
Campus Advantage to “take reasonable actions to ensure that it complies with
                                         4
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                                 No. 16-60414
all laws applicable to the possession, use, occupancy, management, operation
and maintenance of the Property as provided under any laws of the United
States, the State of Mississippi, and otherwise . . . .” Henderson argued that
Campus Advantage contravened the court’s order by violating Mississippi law
through the negligence alleged in the complaint. Second, Henderson argues
that the district court wrongly concluded that the Termination Order, rather
than the Appointment Order, determines Campus Advantage’s liability.
      We reject Henderson’s first argument because it has been forfeited.
“Generally, ‘this Court will not consider an issue that a party fails to raise in
the district court absent extraordinary circumstances.’” Black v. N. Panola
Sch. Dist., 461 F.3d 584, 593 (5th Cir. 2006) (alterations omitted) (quoting
Leverette v. Louisville Ladder Co., 183 F.3d 339, 342 (5th Cir. 1999)). As
Henderson admits, Campus Advantage relied on the doctrine of judicial
immunity in its motion to dismiss. Henderson, however, never argued to the
district court that judicial immunity was unavailable to Campus Advantage
because it had failed to comply with the Appointment Order’s directives. Nor
did Henderson ever rely on 28 U.S.C. § 959. Instead, Henderson relied entirely
on the portion of the Appointment Order that authorized claims for gross
negligence to rebut Campus Advantage’s immunity argument.
      In her briefing to this court, Henderson tries to make up for her failure
to brief this issue, asserting that she “clearly set forth allegations in the
Amended Complaint that [Campus Advantage] . . . did not comply with the
laws or standards of care of the State of Mississippi . . . .” The Appointment
Order says nothing about “standards of care”; it refers only to “laws.” We
cannot agree that an allegation of negligence, even if sufficient facts were
pleaded, plausibly states that Campus Advantage violated the “laws” of
Mississippi. Twombly, 550 U.S. at 570. Indeed, Henderson’s attempt to revise
the Termination Order to include the phrase “or standards of care” confirms
                                       5
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                                       No. 16-60414
our conclusion that Henderson’s allegations of negligence do not plausibly
allege a violation of “laws” within the meaning of the Termination Order. Thus,
Henderson never argued, and did not plausibly allege, that Campus Advantage
contravened the district court’s Appointment Order. 5
       We also reject Henderson’s argument that the district court wrongly
concluded that the Termination Order, rather than the Appointment Order,
determines Campus Advantage’s liability. Henderson argues essentially that
the Appointment Order—along with its exception for claims of gross
negligence—controls because the asserted claims accrued before the
Termination Order was entered. 6 But as the district court noted, Henderson
has not provided any authority for the counterintuitive claim that a superseded
order governs over the order that did the superseding. In her opposition to the
motion to dismiss, Henderson agreed that courts have authority to define the
scope of a Receiver’s immunity. If a court has discretion to define a Receiver’s
immunity in the first instance, we see no logical reason why it may not adjust
that immunity through a subsequent order. The district court did precisely
that by releasing Campus Advantage “from any and all liability as Receiver of
Receivership Property.” Given that Henderson has offered no authority to
support her position, we reject it.
       Henderson argues next that the district court erred in rejecting her due
process argument. As the district court noted, Henderson has provided no
relevant support for the argument that Campus Advantage, as Receiver, was
required to provide notice to Henderson—a non-party to the receivership

       5We also note that the district court did not conclude that judicial immunity protected
Campus Advantage from liability. Instead, the district court’s conclusion rests entirely on its
view that the Termination Order controls over the Appointment Order.
       6   Henderson does not argue that her claims could proceed if the Termination Order
governs.
                                              6
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                                       No. 16-60414
action—either of the existence of the receivership or its termination. The first
case that Henderson relies on—Miller v. FDIC, 738 F.3d 836 (7th Cir. 2013)—
is not a due process case and instead interprets provisions of the Financial
Institutions Reform, Recovery, and Enforcement Act of 1989. Id. at 838, 840–
43. The second case Henderson relies on—Garcia v. Federal Nat’l Mort. Ass’n,
782 F.3d 736 (6th Cir. 2015)—held that Michigan’s “foreclosure-by-
advertisement statute’s notice requirement” was consistent with due process.
Id. at 740–42. Garcia has nothing to do with whether a receiver must provide
notice of the existence of the receivership, its termination, or how to file claims
against the receivership property. Otherwise, the only law Henderson cites
merely states the general principles of procedural due process. We are
therefore unpersuaded by Henderson’s argument. 7
       AFFIRMED.

       7 Because we conclude that the district court correctly decided Henderson’s due
process argument, we also conclude that the district court’s refusal to reconsider its decision
was not an abuse of discretion.
                                              7