Postma v. First Federal Sav. & Loan of Sioux City

• Decision Date: 21 March 1996
• Docket Number: No. 95-2222,95-2222
• Citation: 74 F.3d 160
• Parties: Harold O. POSTMA; Greta K. Postma, Appellants, v. FIRST FEDERAL SAVINGS & LOAN OF SIOUX CITY; Charles L. Corbett; Douglas Grindberg; Marilyn Berke; Randy Jacobsma; Iowa Mediation Service, Inc.; Hank Ostwald; Bonnie Campbell; John Wagenaar, Appellees.
• Court: U.S. Court of Appeals — Eighth Circuit

Page 160

74 F.3d 160

Harold O. POSTMA; Greta K. Postma, Appellants, v. FIRST FEDERAL SAVINGS & LOAN OF SIOUX CITY; Charles L Corbett; Douglas Grindberg; Marilyn Berke; Randy Jacobsma; Iowa Mediation Service, Inc.; Hank Ostwald Bonnie Campbell; John Wagenaar, Appellees.

No. 95-2222.

United States Court of Appeals,

Eighth Circuit.

Submitted Dec. 13, 1995.

Decided Jan. 19, 1996.

Rehearing and Suggestion for Rehearing En Banc Denied March

21, 1996.

Lawrence H. Crosby, St. Paul, Minnesota argued (Patrick C. McCormick, Sioux City, Iowa, on the brief), for appellant.

James Radig, Sioux City, Iowa, argued (William Kevin Stoos, on the brief), for appellee.

Before McMILLIAN, JOHN R. GIBSON and BEAM, Circuit Judges.

McMILLIAN, Circuit Judge.

Harold O. Postma and Greta K. Postma appeal from a final judgment entered in the District Court for the Northern District of Iowa against them and in favor of First Federal Savings & Loan Association of Sioux City, Iowa (First Federal), and certain individual employees of First Federal (the First Federal defendants), and the Iowa Mediation Service, Inc., and Hank Ostwald (the Iowa Mediation Service defendants). Postma v. First Federal Savings & Loan Ass'n, No. C93-4058 (N.D.Iowa Mar. 28, 1995) (judgment). For reversal, the Postmas argue the district court erred in holding it lacked subject matter jurisdiction over their claims against the First Federal defendants and in holding they had failed to state a claim upon which relief could be granted against the Iowa Mediation Service defendants. For the reasons discussed below, we affirm the judgment of the district court.

The underlying facts are fully set forth in the district court's March 28, 1995, summary judgment order. In brief, in 1986, the Postmas had borrowed money from First Federal; the loan was secured by a mortgage on certain agricultural property. In 1990 the Postmas defaulted, and in June 1991 First Federal filed a mortgage foreclosure action in state court. The Postmas removed the action to federal district court, but the federal district court later remanded the case to state court. In March 1992 the state court entered a decree of foreclosure in favor of First Federal. The Postmas filed post-judgment motions to dismiss the foreclosure action and to vacate the judgment and for temporary injunctive relief. The state court denied the post-judgment motions. The Postmas did not appeal the judgment or the order denying the post-judgment motions. The property was later sold at a sheriff's sale.

In June 1993 the Postmas filed a pro se complaint in federal district court against the First Federal defendants alleging violations of Iowa law in foreclosing on the Postmas' mortgage, breach of contract, racketeering violations, violation of the Truth in Lending Act, redlining, trespass, and burglary. The Postmas also sued the Iowa Mediation Service defendants alleging failure to proceed with mediation as required by Iowa law. The Iowa Mediation Service defendants filed a motion to dismiss for failure to state a claim. The First Federal defendants filed motions for summary judgment. At the district court's request, the parties filed supplemental briefs on the question of subject matter jurisdiction.

In February 1994 the district court ¹ granted the Iowa Mediation Service defendants' motion to dismiss. Under Iowa law farm mediators are immune from liability for civil damages unless they act in bad faith, with malicious purpose, or in a manner exhibiting willful and wanton disregard of human rights, safety, or property. Iowa Code Sec. 13.16. The district court concluded that the complaint failed to set forth facts or allegations that the Iowa Mediation Service defendants had acted in bad faith, with malicious purpose or in willful and wanton disregard of human rights, safety, or property.

In March 1995 the district court, ² in an extensive memorandum order, concluded that it did not have subject matter jurisdiction and accordingly dismissed the Postmas' claims against the First Federal defendants. Slip op. at 7-11, citing Rooker v. Fidelity Trust Co., 263 U.S. 413, 44 S.Ct. 149, 68 L.Ed. 362 (1923), and District of Columbia Court of Appeals v. Feldman, 460 U.S. 462, 103 S.Ct. 1303, 75 L.Ed.2d 206 (1983). Under the Rooker-Feldman doctrine, because federal district courts are courts of original jurisdiction, they lack subject matter jurisdiction to engage in appellate review of state court decisions; review of state court decisions may be had only in the Supreme Court. The district court noted that the Postmas' current action was essentially a collateral attack in federal district court on a state foreclosure judgment. The district court decided that the Postmas' current claims were "inextricably intertwined" with the state foreclosure judgment and that it could not evaluate those claims without reviewing the state foreclosure decision, which is exactly what is barred by the Rooker- Feldman doctrine. This appeal followed.

For reversal, the Postmas argue the district court erred in holding it did not have subject matter jurisdiction because the Rooker- Feldman doctrine does not apply when the plaintiff has been denied procedural due process in the state court. The Postmas argue that they did not receive constitutionally adequate notice to cure or to mediate and thus were denied a fair opportunity to participate in the foreclosure proceedings in state court. We disagree. As noted by the district court, the Postmas' claims in the present case are inextricably intertwined with the state court judgment. In particular, their current claims can succeed only to the extent that the state court wrongly decided the foreclosure action. "Where federal relief can only be predicated upon a conviction that the state court was wrong, it is difficult to conceive the federal proceeding as, in substance, anything other than a prohibited appeal of the state-court judgment." Keene Corp. v. Cass, 908 F.2d 293, 296-97 (8th Cir.1990) (citation omitted). See, e.g., Wright v. Tackett, 39 F.3d 155 (7th Cir.1994) (per curiam) (action alleging conspiracy to violate civil rights in connection with foreclosure held barred by Rooker- Feldman ), cert. denied, --- U.S. ----, 115 S.Ct. 1100, 130 L.Ed.2d 1067 (1995); Ritter v. Ross, 992 F.2d 750 (7th Cir.1993) (similar), cert. denied, --- U.S. ----, 114 S.Ct. 694, 126 L.Ed.2d 661 (1994). ³

The Postmas also argue the district court erred in dismissing their claims against the Iowa Mediation Service defendants. We disagree. They alleged at most that the Iowa Mediation Service defendants acted negligently, and not in bad faith, with malicious purpose, or in willful and wanton disregard of human rights, safety, or property.

Accordingly, the judgment of the district court is affirmed.

1 The Honorable Michael J. Melloy, Chief Judge, United States District Court for the Northern District of Iowa.

2 The Honorable Mark W. Bennett, United States District Judge for the Northern District of Iowa.

3 Following oral argument, counsel for the Postmas notified the court by letter dated December 13, 1995, with copies to opposing counsel, that any reference during oral argument that Greta Postma had participated to a limited extent in the state court foreclosure action was a misstatement. Subsequently, the Postmas notified the court by letter dated December 28, 1995, that they had discharged their attorney. In this letter the Postmas stated that they had not received notice of the state court foreclosure action, including the motion to remand, motions for summary judgment, notice of mediation, notice of the right to cure, and other filings. In addition, the Postmas stated that Greta Postma was never served and had never appeared in...