Van Stelton v. Van Stelton, No. C11-4045-MWB

• Court: United States District Courts. 8th Circuit. Northern District of Iowa
• Writing for the Court: MARK W. BENNETT
• Parties: VIRGIL VAN STELTON, CAROL VAN STELTON, AND ALVIN VAN STELTON, Plaintiffs, v. JERRY VAN STELTON, DONNA VAN STELTON, EUGENE VAN STELTON, GARY CHRISTIANS, DOUG WEBER, SCOTT GRIES, NATE KRIKKE, ROBERT E. HANSEN, DANIEL DEKOTER, OSCEOLA COUNTY, IOWA, THE CITY OF SIBLEY, IOWA, AND DEKOTER, THOLE AND DAWSON, P.C. Defendants.
• Docket Number: No. C11-4045-MWB
• Decision Date: 17 July 2013

VIRGIL VAN STELTON, CAROL VAN STELTON, AND ALVIN VAN STELTON, Plaintiffs,
v.
JERRY VAN STELTON, DONNA VAN STELTON, EUGENE VAN STELTON,
GARY CHRISTIANS, DOUG WEBER, SCOTT GRIES, NATE KRIKKE,
ROBERT E. HANSEN, DANIEL DEKOTER, OSCEOLA COUNTY, IOWA,
THE CITY OF SIBLEY, IOWA, AND DEKOTER, THOLE AND DAWSON, P.C. Defendants.

No. C11-4045-MWB

UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF IOWA WESTERN DIVISION

Dated: July 17, 2013

MEMORANDUM OPINION AND ORDER REGARDING DEFENDANTS' MOTIONS TO DISMISS
TABLE OF CONTENTS

I. INTRODUCTION AND BACKGROUND..............................................4

A. Factual Background ............................................................... 4

1. The parties and principal actors......................................... 4
2. Osceola County's tax law ................................................. 5
3. The Enterprise .............................................................. 6
4. Tax protest and reaction .................................................. 6
5. The Van Stelton Trust kerfuffle ......................................... 9

B. Procedural Background ......................................................... 12

II. LEGAL ANALYSIS ...................................................................... 14

A. Standards For A Motion To Dismiss.......................................... 14

B. Sufficiency Of the § 1983 Allegations ........................................ 16

1. Requirements for § 1983 action ....................................... 16
2. Allegations against the Law Firm defendants....................... 19

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a. DeKoter's actions................................................21
b. The Law Firm's liability........................................22

C. Sufficiency Of RICO Allegations..............................................25

1. Purpose and scope of RICO............................................25
2. Requirements for RICO claim .........................................27
3. Analysis .................................................................... 29

D. First Amendment Right To Petition Claim Against The County Defendants ......................................................................... 32

1. Overview of the right to access and requirements for claim .....34
2. Analysis .................................................................... 35

E. State Law Claims .................................................................37

1. Carol Van Stelton's slander and libel claim.........................37
2. False arrest claim against the Law Firm defendants ..............37
3. Malicious prosecution claim against the Law Firm defendants ................................................................. 39
4. Defamation claim against the Law Firm defendants ..............42
5. Tortious interference with prospective business relations claims ....................................................................... 44

a. Requirements for a claim.......................................45
b. Claim against the Law Firm defendants.....................45
c. Claim against the County defendants ........................47

6. Fraud/breach of fiduciary duty........................................47

a. Fraud ............................................................... 47
b. Breach of fiduciary duty........................................49

7. Ongoing criminal conduct ..............................................52

a. Overview of the OCC............................................52
b. Analysis ............................................................ 54

F. The City Of Sibley's Motion....................................................54

III. CONCLUSION............................................................................55

Page 3

In music, a "mashup" is a song "created by blending two or more pre-recorded songs, usually by overlaying the vocal track of one song seamlessly over the instrumental track of another." Mashup, http://en.wikipedia.org/wiki/Mashup_(music) (last visited July 15, 2013). Plaintiffs' Third Amended Complaint reads like a literary mashup of John Grisham's novel, "the Firm," and John Steinbeck's "East of Eden."¹ Plaintiffs allege that the defendant law firm controls and manipulates a wide array of legal matters in Osceola County, Iowa. The law firm allegedly maintains such control through symbiotic relationships it enjoys with the county attorney and sheriff, as well its attorneys' self-serving advice to county officials. Plaintiffs also allege a conflict between two sets of brothers over their interests in a family trust. In this sibling conflict, the defendant law firm has allegedly aligned itself with one set of brothers who, not by coincidence, are clients. Plaintiffs bring a panoply of claims against the law firm, one set of the brothers, and other defendants, including claims for civil rights violations under 42 U.S.C. § 1983; violations of the Racketeer Influenced and Corrupt Organizations Act ("RICO"), 18 U.S.C. § 1961, et seq.; and pendent state law claims for false arrest, malicious prosecution, slander and libel, and tortious interference with prospective economic advantage. Defendants' motions to dismiss require me to consider whether plaintiffs' allegations adequately state viable claims under Federal or Iowa law.

Page 4

I. INTRODUCTION AND BACKGROUND
A. Factual Background

"When ruling on a defendant's motion to dismiss, a judge must accept as true all of the factual allegations contained in the complaint." Erickson v. Pardus, 551 U.S. 89, 94 (2007) (citing Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555-56 (2007)). Thus, the factual background presented here is based on the plaintiffs' allegations in their Third Amended Complaint.

1. The parties and principal actors

Plaintiffs Virgil Van Stelton and his wife, plaintiff Carol Van Stelton, are residents of Iowa. They both live in Sibley, Iowa, which is located in Osceola County. Both own real estate in Osceola County and pay real estate taxes there. Plaintiff Alvin Van Stelton is also a resident of Iowa. He lives in Ashton, Iowa, which is also located in Osceola County. He too owns real estate in Osceola County and pays real estate taxes there. Defendants Jerry Van Stelton, Donna Van Stelton, and Eugene Van Stelton are residents of Iowa, all living in Sibley. Virgil, Alvin, Jerry, and Eugene are brothers. Jacob Van Stelton and Margaret Van Stelton were their father and stepmother.

Defendants Gary Christians, Doug Weber, Scott Gries, Nate Krikke, Robert E. Hansen, and Daniel E. DeKoter are also residents...