Court Opinion

ID: 800682
Source: CourtListenerOpinion
Date Created: 2012-05-22 16:22:23+00
Date Added: 2024-06-11T17:59:56.993770
License: Public Domain

FILED
                                                  United States Court of Appeals
                     UNITED STATES COURT OF APPEALS       Tenth Circuit

                            FOR THE TENTH CIRCUIT                          May 22, 2012

                                                                       Elisabeth A. Shumaker
                                                                           Clerk of Court
LEONID SHIFRIN, a/k/a Leo Shifrin,

             Plaintiff-Appellant,

v.                                                          No. 11-1423
                                               (D.C. No. 1:09-CV-03040-REB-MEH)
ERIN TOLL; MARCIA WATERS;                                    (D. Colo.)
PAUL MARTINEZ; CARY
WHITAKER,

             Defendants-Appellees.

                             ORDER AND JUDGMENT*

Before BRISCOE, Chief Judge, McKAY and LUCERO, Circuit Judges.

      Leonid Shifrin filed suit under 42 U.S.C. § 1983 to challenge defendants’

denial of his application for a mortgage broker license. He now appeals the district

court’s Fed. R. Civ. P. 12(b)(6) dismissal of his complaint for failure to state a claim.

Exercising jurisdiction under 28 U.S.C. § 1291, we affirm.

*
      After examining the briefs and appellate record, this panel has determined
unanimously that oral argument would not materially assist the determination of this
appeal. See Fed. R. App. P. 34(a)(2); 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 This order and judgment is not binding
precedent, except under the doctrines of law of the case, res judicata, and collateral
estoppel. It may be cited, however, for its persuasive value consistent with
Fed. R App. P. 32.1 and 10th Cir. R. 32.1.
                                           I

      In 1993, Shifrin pleaded guilty to burglary and theft in Boulder County,

Colorado. In late 2007, he applied for a permanent Colorado mortgage broker

license, which involved a criminal history record check. The licensing proceedings

were handled by the Division of Real Estate, whose director at the time was

Erin Toll. Paul Martinez, Marcia Waters, and Cary Whitaker were all employed by

the Division of Real Estate, with Waters and Whitaker supervising Martinez.

      Shifrin’s application was complete on December 7, 2007. A Colorado statute

required that the application be granted or denied within twenty-one days, or by

December 28, 2007. Under the law then in effect, only convictions within the

immediate five years before the application were grounds for denying a license.

Therefore, Shifrin’s convictions were too stale to justify denying a license.

      As of January 1, 2008, however, Colorado’s laws changed. A new statutory

section was added allowing the discipline of a licensee (up to and including

suspension and revocation of a license) due to a burglary or theft conviction. The

Division did not grant or deny Shifrin’s application by December 28, 2007. Instead,

on January 2, 2008, Martinez notified Shifrin that his application was denied because

of the 1993 convictions. Later, the Division specified that the denial was based on

the new Colorado law. Eventually a state administrative judge concluded that the

new law did not apply to Shifrin because he had not yet become a licensee. Shifrin’s

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application then was denied on other grounds, which resulted in further proceedings.

Ultimately, however, in September 2010, the Division granted Shifrin’s application.

      Shifrin’s original complaint alleged that defendants, in their official and

individual capacities, violated 42 U.S.C. §§ 1983, 1985, 1986, and 1988 by denying

him equal protection and due process. The magistrate judge recommended

dismissing all claims against defendants in their official capacities, dismissing the

due process claim and the §§ 1985 and 1986 claims against defendants in their

individual capacities, and allowing Shifrin to file an amended complaint setting forth

an equal protection claim against defendants in their individual capacities. No party

filed an objection, and the district court adopted those recommendations.

      Shifrin’s amended complaint alleged that other similarly situated applicants,

i.e., “applicants without convictions in the last 5 years,” including two named

individuals, were granted mortgage broker licenses while he was not. R., Vol. 1 at

310. He also alleged that he was treated differently “in that his application was not

decided within 21 days as required by Colorado Law, Defendants considered

information that was not allowed to be considered for new licensees in denying

Plaintiff his license, and the Defendants used convictions outside the 5 year statutory

period to deny him his license.” Id.

      Defendants moved to dismiss the amended complaint under Rule 12(b)(6).

After briefing on the dismissal motion concluded, Shifrin moved to file a second

amended complaint “to clarify factual allegations [and to] plead the factual basis in

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greater detail.” Id. at 636-37. Specifically, he sought to add allegations that

defendants acted with malice and to name a third similarly situated individual.

      The magistrate judge recommended that the district court grant the motion to

dismiss. He concluded that Shifrin had alleged no personal participation by Waters

and Whitaker. With regard to Martinez and Toll, the magistrate judge concluded that

they were entitled to qualified immunity. Analyzing Shifrin’s allegations as a

class-of-one equal protection claim, the magistrate judge concluded that Shifrin

failed to state a claim because (1) he had not adequately pleaded that his treatment

was different from that of other individuals who were similar in all material respects,

and (2) the underlying facts showed that the Division’s actions were rationally related

to a governmental interest. Further, the magistrate judge concluded that Shifrin

failed to identify any cases showing that the law was clearly established.

      The magistrate judge also recommended that the district court deny Shifrin’s

motion to amend because his proposed amendments were futile and the motion was

untimely. Examining this circuit’s cases, the magistrate judge explained that

“malice” standing alone is not an element of a class-of-one equal protection claim.

He also noted that naming a third individual, without more, did not overcome

Shifrin’s failure to show exactly how other persons were similarly situated to him.

Further, he noted, Shifrin had not explained why he had not known of the new

allegations earlier and why he waited so long to seek amendment.

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       Shifrin objected, but the district court adopted the report and recommendation,

denied the motion to amend, dismissed the complaint, and entered judgment for

defendants. Shifrin now appeals.

                                            II

                                            A

       Shifrin argues that the district court erred in applying a class-of-one analysis to

his equal protection claim. “We review de novo the dismissal of a complaint for

failure to state a claim.” Kan. Penn Gaming, LLC v. Collins, 656 F.3d 1210, 1214

(10th Cir. 2011).

       Although Shifrin denies any intent to proceed under a class-of-one theory, he

does not claim that defendants denied his application based on his sex, race, religion,

or membership in another cognizable group. Rather, he claims that they singled him

out for adverse treatment. See, e.g., Aplt Br. at 6 (“It is Appellant’s intention to

plead by amendment that no other applicant for a license was treated in this manner

and this treatment was intentional . . . .”); R., Vol. 1 at 310 (stating, in first amended

complaint, that plaintiff alone was treated differently than others similarly situated).

Notwithstanding Shifrin’s disclaimers, this is a class-of-one case. See Kan. Penn

Gaming, 656 F.3d at 1216 (“The paradigmatic ‘class of one’ case, sensibly

conceived, is one in which a public official, with no conceivable basis for his action

other than spite or some other improper motive (improper because unrelated to his

public duties), comes down hard on a hapless private citizen.” (brackets and internal

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quotation marks omitted)). Therefore, the district court did not err in employing a

class-of-one analysis.

        The district court also did not err in dismissing the amended complaint for

failure to state a claim. The first element of an equal protection violation is that the

plaintiff “was ‘intentionally treated differently from others similarly situated.’”

SECSYS, LLC v. Vigil, 666 F.3d 678, 688 (10th Cir. 2012) (quoting Village of

Willowbrook v. Olech, 528 U.S. 562, 564 (2000) (per curiam)); see also Jennings v.

City of Stillwater, 383 F.3d 1199, 1213 (10th Cir. 2004) (“This element is especially

important in class-of-one cases.”). Accordingly, “a plaintiff must first establish that

others, ‘similarly situated in every material respect’ were treated differently.” Kan.

Penn Gaming, 656 F.3d at 1216 (quoting Jicarilla Apache Nation v. Rio Arriba

Cnty., 440 F.3d 1202, 1210 (10th Cir. 2006)). Because “it is exceedingly difficult to

demonstrate that any difference in treatment is not attributable to a quirk of the

plaintiff or even to the fallibility of administrators whose inconsistency is as random

as it is inevitable . . . courts have imposed exacting burdens on plaintiffs to

demonstrate similarity in class-of-one cases.” Jicarilla Apache Nation, 440 F.3d at

1213. “Inevitably, the degree to which others are viewed as similarly situated

depends substantially on the facts and context of the case.” Jennings, 383 F.3d at

1214.

        Shifrin identifies certain persons as substantially similar to him simply because

they all were free of convictions from the past five years. But this focus does not

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account for all material characteristics. The reason the Division gave for initially

denying Shifrin’s application was that he had theft and burglary convictions older

than five years. Therefore, it is material whether the allegedly similar individuals

had any convictions, and if they did, what type of crime the convictions involved and

how old they were.

      In addition, Shifrin’s complaint contains minimal references to similarity.

Previously, “some courts initially required nothing more than the threadbare

allegation of different treatment to similarly situated individuals to defeat a motion to

dismiss.” Kan. Penn Gaming, 656 F.3d at 1218. But in light of the Supreme Court’s

recent decisions on pleading standards, “a generalized pleading . . . is no longer

sufficient to state a class-of-one claim.” Id. at 1219; see also id. at 1214-15

(discussing pleading standards established by Bell Atlantic Corp. v. Twombly,

550 U.S. 544 (2007), and Ashcroft v. Iqbal, 556 U.S. 662 (2009)). “[P]laintiffs must

offer enough specific factual allegations to nudge their claims across the line from

conceivable to plausible.” Id. at 1219 (brackets and internal quotation marks

omitted). Accordingly, dismissal is proper where a party offers only conclusory

allegations that others are similarly situated, without any factual support plausibly

suggesting similarities “in all material respects.” Id. at 1220. Shifrin’s complaint

offered just the type of conclusory allegations that are insufficient to state a claim.

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      Shifrin failed to adequately plead the first element of an equal protection

claim. Therefore, we need not consider other aspects of the district court’s analysis

before concluding that the district court did not err in dismissing the complaint.

                                            B

      Shifrin also argues that the district court erred in denying his motion to file a

second amended complaint. The district court accepted the magistrate judge’s

recommendation to deny the motion to amend because (1) the proposed amendments

would be futile, and (2) Shifrin had not offered any explanation for failing to include

his new allegations in his first amended complaint. “Refusing leave to amend is

generally only justified upon a showing of undue delay, undue prejudice to the

opposing party, bad faith or dilatory motive, failure to cure deficiencies by

amendments previously allowed, or futility of amendment.” Frank v. U.S. West, Inc.,

3 F.3d 1357, 1365 (10th Cir. 1993). “Although we review a district court’s decision

to deny a motion to amend a pleading for abuse of discretion, when the denial is

based on a determination that amendment would be futile, our review for abuse of

discretion includes de novo review of the legal basis for the finding of futility.”

Peterson v. Grisham, 594 F.3d 723, 731 (10th Cir. 2010) (internal quotation marks

omitted).

      On appeal, as he did in his objections to the magistrate judge’s report and

recommendation, Shifrin focuses on arguing that his proposed amendments were not

futile. In light of our discussion above, we need only address whether the proposed

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amendments would have cured the infirmities in pleading substantial similarity.

With regard to this issue, Shifrin proposed to name a third similarly situated

individual. But the proposed addition of a new name, with no further information

regarding material circumstances, fails to cure the deficiencies discussed above.

Therefore, allowing the amendment would be futile, as the second amended

complaint would still fail to plead the first element of an equal protection claim.

       In addition, the district court offered a second reason for denying amendment:

undue delay. “It is well settled in this circuit that untimeliness alone is a sufficient

reason to deny leave to amend, especially when the party filing the motion has no

adequate explanation for the delay.” Frank, 3 F.3d at 1365-66 (citations omitted).

Before the district court, Shifrin offered no explanation for the delay. Moreover,

“where the party seeking amendment knows or should have known of the facts upon

which the proposed amendment is based but fails to include them in the original

complaint, the motion to amend is subject to denial.” Id. at 1366 (brackets and

internal quotation marks omitted). The magistrate judge concluded that Shifrin knew

or should have known, at the time he filed his first amended complaint, of the

allegations he sought to add in the second amended complaint. For these reasons, the

district court did not abuse its discretion in denying leave to amend.

                                            C

       Citing Fed. R. Civ. P. 56(d), Shifrin argues that the district court should have

allowed him to engage in discovery before dismissing his complaint. But Shifrin

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requested discovery only in his objections to the magistrate judge’s second report and

recommendation. The request does not identify with specificity what Shifrin hoped

to discover, and it does not appear that he filed a Fed. R. Civ. P. 56(d) affidavit.

Because the request did not comply with Rule 56(d)’s requirements, the district court

did not abuse its discretion in denying discovery. See McKissick v. Yuen, 618 F.3d
1177, 1190 (10th Cir. 2010) (addressing compliance with Fed. R. Civ. P. 56(f), the

predecessor to Rule 56(d)); Price ex rel. Price v. W. Res., Inc., 232 F.3d 779, 783-84

(10th Cir. 2000) (same).

                                            D

      Finally, in his reply brief, Shifrin asserts that the district court erred in

dismissing his due process claim. This court generally does not consider arguments

raised for the first time in a reply brief. See Reedy v. Werholtz, 660 F.3d 1270, 1274

(10th Cir. 2011). Further, Shifrin did not object to the magistrate judge’s

recommendation that the district court dismiss the due process claim. Under this

court’s “firm waiver rule,” a party’s failure to timely object to a report and

recommendation also generally precludes appellate review. See Duffield v. Jackson,

545 F.3d 1234, 1237 (10th Cir. 2008). There are exceptions to the firm waiver rule,

see id., but it does not appear that they would apply here, even if the due-process

issue had been argued in the opening brief.

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                                 III

The judgment of the district court is AFFIRMED.

                                        Entered for the Court

                                        Monroe G. McKay
                                        Circuit Judge

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