Jensen v. Redevelopment Agency of Sandy City

• Decision Date: 15 July 1993
• Docket Number: No. 92-4084,92-4084
• Citation: 998 F.2d 1550
• Parties: , 30 U.S.P.Q.2d 1032 Paul M. JENSEN, individually and dba PMJ Enterprises, and Perimeter Properties, Inc., a Utah Corporation, Plaintiffs-Appellants, v. REDEVELOPMENT AGENCY OF SANDY CITY, a political subdivision of the State of Utah, Sandy City, a municipal corporation, J. Steven Newton, as an individual and as a corporate officer, Woodbury Corporation, a Utah corporation, Vestwood, a Utah general partnership and DOES 1 to 25, Defendants-Appellees.
• Court: U.S. Court of Appeals — Tenth Circuit

Page 1550

998 F.2d 1550

26 Fed.R.Serv.3d 457, 30 U.S.P.Q.2d 1032

Paul M. JENSEN, individually and dba PMJ Enterprises, and Perimeter Properties, Inc., a Utah Corporation Plaintiffs-Appellants, v. REDEVELOPMENT AGENCY OF SANDY CITY, a political subdivision of the State of Utah, Sandy City, a municipal corporation J. Steven Newton, as an individual and as a corporate officer, Woodbury Corporation, a Utah corporation, Vestwood a Utah general partnership and DOES 1 to 25, Defendants-Appellees.

No. 92-4084.

United States Court of Appeals Tenth Circuit.

July 15, 1993.

Robert H. Copier, Salt Lake City, Utah, for plaintiffs-appellants.

Jody K. Burnett (Kurt M. Frankenburg with her on the brief), of Williams & Hunt, and Glen W. Roberts, Salt Lake City, Utah, for defendants-appellees.

Before KELLY and SETH, Circuit Judges, and ALLEY, District Judge. ^*

ALLEY, District Judge.

This is an appeal by plaintiffs-appellants Paul M. Jensen, PMJ Enterprises and Perimeter Properties, Inc. (hereinafter collectively referred to as "plaintiffs") from the award of summary judgment and order of dismissal of the United States District Court for the District of Utah, Central Division, in favor of defendants-appellees Redevelopment Agency of Sandy City ("RDA"), Sandy City, J. Steven Newton, Woodbury Corporation, and Vestwood. Our jurisdiction arises under 28 U.S.C. § 1291. We affirm.

I. BACKGROUND

This action arises out of plaintiffs' attempt to finance, broker and develop an auto mall ¹ in Sandy City, Utah. Plaintiffs allege that from 1986 until 1988, they disclosed "intellectual property, trade secrets, and proprietary information" relating to the auto mall to Sandy City, the RDA, and J. Steven Newton, mayor of Sandy City (hereinafter collectively referred to as "the City"), after being assured that the information would be kept confidential. The information delivered to the City included detailed site plans showing the location and development of the project in particular phases, including information regarding street access, land acquisition, construction costs, development schedules and design concepts. Plaintiffs also supplied a variety of financial statements and pro forma evaluations that demonstrated the viability of the auto mall complex, such as the income, sales and other tax and economic benefits that would be received by the City. Plaintiffs maintain that the primary reason for confidentiality was to allow them an opportunity to complete the land assembly phase of the auto mall before disclosure to other real estate developers who might have proceeded to buy up the land at the auto mall site.

Plaintiffs allege that the City unlawfully disclosed the information concerning the proposed auto mall to Woodbury Corporation and Vestwood, real estate developers, who then proceeded to develop the auto mall using plans that are substantially similar to the plans of plaintiffs. Plaintiffs further contend that the City stigmatized plaintiffs by falsely attributing to them a scheme to make money quickly by taking advantage of the City.

Plaintiffs filed an action in the district court asserting a violation of 42 U.S.C. § 1983 and numerous pendent state law claims. ² Their initial complaint was filed on August 1, 1990, and an amended complaint was filed on September 7, 1990. On January 29, 1991, the district court entered a scheduling order setting May 31, 1991, as the deadline for discovery. On April 18, 1991, plaintiffs filed a second amended complaint, and the district court entered an amended scheduling order on June 17, 1991, requiring the completion of all discovery by December 31, 1991.

On January 15, 1992, two weeks after the discovery cutoff date, all defendants filed motions for summary judgment, arguing, inter alia, that the district court did not have jurisdiction because plaintiffs' claims did not raise a federal question. In response, plaintiffs filed an affidavit pursuant to Rule 56(f) of the Federal Rules of Civil Procedure stating that they could not oppose the motions for summary judgment as they had not yet taken the deposition of Woodbury Corporation corporate officer Wallace Woodbury because he had been on vacation in the Caribbean, and, because the deposition of Mayor Newton was only recently transcribed and had not yet been signed.

Woodbury Corporation and Vestwood filed a reply memorandum in support of their motion for summary judgment and in response to the Rule 56(f) affidavit on March 3, 1992. Sandy City and the RDA also filed a memorandum in response to the Rule 56(f) affidavit on March 3, 1992. Thereafter, plaintiffs, without leave of court, filed an interim memorandum in response to the pending summary judgment motions, to which Sandy City and the RDA filed a motion to strike.

Following a hearing on defendants' motions for summary judgment on April 2, 1992, the district court ruled that there were no genuine issues as to any material facts with respect to plaintiffs' federal claims and that each of the defendants was entitled to judgment on those claims as a matter of law. The district court then denied plaintiffs' request for relief under Rule 56(f), dismissed their federal claims under 42 U.S.C. § 1983 with prejudice upon the merits, and dismissed all remaining pendent state law claims without prejudice for lack of subject matter jurisdiction. This appeal followed.

On appeal, plaintiffs contend that the district court erred in: (1) granting defendants' motions for summary judgment without honoring plaintiffs' Rule 56(f) affidavit and allowing them an opportunity to conduct additional discovery; and, (2) granting summary judgment in favor of defendants because the information relating to the auto mall constituted federally protected property interests that gave rise to federal question jurisdiction. Thus, this appeal presents two issues--one procedural, and one substantive.

II.

RULE 56(f)

The first issue presented by this appeal is whether the district court erred in denying plaintiffs' request for relief under Rule 56(f). ³ We review a district court's denial of a Rule 56(f) motion for an abuse of discretion. Committee for the First Amendment v. Campbell, 962 F.2d 1517, 1522 (10th Cir.1992); Patty Precision v. Brown & Sharpe Mfg. Co., 742 F.2d 1260, 1264 (10th Cir.1984).

Plaintiffs argue that the district court erred in granting defendants' motions for summary judgment without honoring their Rule 56(f) affidavit and interim memorandum in opposition to those motions because they were unable to oppose the summary judgment motions without further discovery. Specifically, plaintiffs contend that they could not respond to the summary judgment motions because they had not yet taken the deposition of Mr. Woodbury, whose testimony would have gone to the core of the factual issues concerning the alleged unauthorized disclosures made to Woodbury Corporation and Vestwood. In further support of their contention, plaintiffs state that they timely noticed the deposition of Mr. Woodbury but that the deposition was continued until April 1992 by agreement of the parties due to the unavailability of Mr. Woodbury who was in the Caribbean. They also argue that by local rule, ⁴ counsel are required to cooperate and work together in scheduling discovery and that a motion to compel would have been inappropriate in their atmosphere of cooperation. They thus claim that the district court should have rewarded and encouraged the cooperation between counsel by deferring any decision on the motions until after discovery was completed.

When a party files an affidavit under Rule 56(f) for additional discovery time, the party invokes the trial court's discretion. Patty Precision, 742 F.2d at 1264. The trial court may deny the affiant's request for additional time, deny the motion for summary judgment, order a continuance for additional discovery or make "such other order as is just." ⁵ Fed.R.Civ.P. 56(f). " 'Unless dilatory or lacking in merit, the motion should be liberally treated.' " Campbell, 962 F.2d at 1522 (quoting James W. Moore & Jeremy C. Wicker, Moore's Federal Practice p 56.24 (1988)). See also Patty Precision, 742 F.2d at 1264.

To invoke the protection of Rule 56(f), the party filing the affidavit must state with specificity how "the desired time would enable [the nonmoving party] to meet its burden in opposing summary judgment." Pasternak v. Lear Petroleum Exploration, Inc., 790 F.2d 828, 833 (10th Cir.1986); see also Guthrie v. Sawyer, 970 F.2d 733, 738 (10th Cir.1992); Weir v. Anaconda Co., 773 F.2d 1073, 1081-83 (10th Cir.1985). "Rule 56(f) may not be invoked by the mere assertion that discovery is incomplete or that specific facts necessary to oppose summary judgment are unavailable...." Pasternak, 790 F.2d at 833. Moreover, merely asserting " 'that the evidence supporting a [party's] allegation is in the hands of the [opposing party] is insufficient to justify a denial of a motion for summary judgment under Rule 56(f).' " Weir, 773 F.2d at 1083 (quoting Patty Precision, 742 F.2d at 1264). "Rather, the party filing the affidavit must show how additional time will enable him to rebut [the] movant's allegations of no genuine issue of fact." Patty Precision, 742 F.2d at 1264. Furthermore, if the party filing the Rule 56(f) affidavit has been dilatory, or the information sought is either irrelevant to the summary judgment motion or merely cumulative, no extension will be granted. Id. at 1264-65.

In this case, the district court did not abuse its discretion in denying plaintiffs' request for additional time for discovery, as plaintiffs' Rule 56(f) affidavit was deficient in two ways. First, plaintiffs' affidavit merely states in conclusory terms that they were unable to obtain the deposition of Mr. Woodbury, and that they could have conducted further discovery if given more time. ⁶ Our cases have established that this kind of conclusory affidavit is insufficient. See, e.g., id.; Campbell, 962...