Case 1:06-cv-01160-JB-SMV Document 76 Filed 09/30/07 Page 1 of 6
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`IN THE UNITED STATES DISTRICT COURT
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`FOR THE DISTRICT OF NEW MEXICO
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`MARTIN S. FRIEDLANDER, individually and
`as assignee of the Successor Trustee of the Legal
`Defense and Maintenance Trust of California,
`A Citizen of California; and as an Express
`Third Party Beneficiary of the Legal Defense and
`Maintenance Trust of California; the
`Successor in Interest to all the Claims, Assets,
`Rights and Causes of Action Herein Asserted on
`Behalf of Santa Fe Business Park LLC,
`Summit Floormart LLC, Summit Valdes Business
`Park LLC, Summit Investment Company LLC,
`Summit Business Center LLC, El Llano Summit
`Caja Del Rio LLC, and Jeffrey W. Patter,
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`Plaintiffs,
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`v.
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`RICHARD P. COOK; EL LLANO COMPANY, INC.;
`VALLEY NATIONAL BANK; COMEAU, MALDEGEN,
`TEMPLEMAN & INDALL, LLP; GRAY HANDY;
`PAULA A. COOK; JOHN PATTERSON; ROBERT
`ENGEL; VERN BOWERS; SONNY OTERO DBA
`OTERO CONSTRUCTION COMPANY; PHASE
`ONE REALTY; ERNEST (“ERNIE ROMERO”);
`W. JAMES METHANY; AND SARCO
`CONSTRUCTION COMPANY,
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`Defendants.
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` No. CIV 06-1160 JB/DJS
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`MEMORANDUM OPINION AND ORDER
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`THIS MATTER comes before the Court on Defendants Sarco Construction Co., El Llano
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`Company, Inc. and Richard Cook’s Joint Motion to Dismiss the Complaint, filed January 17, 2007
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`(Doc. 26). The Court held a hearing on the motion on September 25, 2007. The primary issues are:
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`(i) whether the Court should abstain from considering the claims asserted in the Complaint against
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`these Defendants because the claims arise out of the same transaction as a state court action, El
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`Case 1:06-cv-01160-JB-SMV Document 76 Filed 09/30/07 Page 2 of 6
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`Llano Company, Inc., et al., v. Summit Investment Co., et al., No. D-0117-CV-2003-00057; (ii)
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`whether, if abstention is appropriate, the Court should dismiss the case against these three
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`Defendants, stay the entire case, or stay only the case as against these three Defendants; and (iii)
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`whether the applicable statute of limitations bars all of Martin S. Friedlander’s claims, with the
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`exception of the written contract claim against El Llano and Cook. Because the state case of El
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`Llano Company, Inc. v. Summit Investment Co. remains pending in state court, and because that
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`case may determine many of the issues involving Friedlander and these three Defendants, the Court
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`will abstain from deciding the claims against these three Defendants and stay the case against them.
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`Under the abstention doctrine that the Supreme Court of the United States set forth in
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`Younger v. Harris, 401 U.S. 37 (1971), a federal court must abstain from hearing an action if three
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`conditions are met: (i) there is an ongoing state proceeding; (ii) the state court provides an adequate
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`forum to hear the claims raised in the subsequent federal complaint; and (iii) the state proceedings
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`involve important state interests or matters which traditionally look to state law for their resolution,
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`or implicate separately articulated state policies. See Crown Point I, LLC v. Intermountain Rural
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`Elec. Ass’n, 319 F.3d 1211, 1215 (10th Cir. 2003). “Once these three conditions are met, Younger
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`abstention is non-discretionary and, absent extraordinary circumstances, a district court is required
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`to abstain.” Id. It also appears that the Court must make the determination in a multiparty case,
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`whether the Younger bar applies to individual parties and individual claims, or all parties and all
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`claims. In D.L. v. Unified Sch. District No. 497, 392 F.3d 1223 (10th Cir. 2004), the Tenth Circuit
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`stated:
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`The parties are not identical in the state and federal lawsuits. In state court the
`District is plaintiff, and Mother and P.P. are defendants. In federal court Mother and
`P.P. are joined as plaintiffs by J.L. and the Estate of R.L., who are not parties in the
`state case. Likewise, the District is not the only defendant; an additional defendant
`is Dr. Eicher, who is not a party in the District's state suit to recover the cost of the
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`children's education. Consequently, we must decide whether Younger bars the claims
`of J.L. and the Estate of R.L. against either defendant, and bars the claims of all
`plaintiffs against Dr. Eicher, even though J.L., the Estate of R.L., and Dr. Eicher are
`not parties in the state case. As we proceed to explain, we hold that the Younger bar
`does extend to these claims.
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`392 F.3d at 1230. See Doran v. Salem Inn, Inc., 422 U.S. 922, 924 (1975)(holding that Younger
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`barred the claim of one plaintiff, but not the other two plaintiffs).
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`While repackaged, the claims that Friedlander asserts in his Complaint arise out of the same
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`transaction as that issue in El Llano Company, Inc., et al. v. Summit Investment Co. et al., which
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`was litigated for over two years until Potter filed a bankruptcy case. In that lawsuit, the state court
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`entered orders on March 1, 2005 and April 19, 2005, dismissing all claims against the defendants
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`in that case with prejudice. That lawsuit is not final, because there are still affirmative claims by
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`Sarco, El Llano, and Cook pending. The state court proceeding is also stayed pending the Potter
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`bankruptcy proceedings. If the state case becomes final at some point, the state court’s proceedings
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`may be res judicata or collateral estoppel on certain claims or issues in this case. In any case, the
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`first Younger factor is met.
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`All of the current claims are based on real property in New Mexico, and involve the rights
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`and duties of members of New Mexico business entities. New Mexico state courts, both the trial
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`and appellate, are adequate forums to resolve matters of common and statutory law. The second
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`Younger abstention factor is also satisfied.
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`Finally, all of Friedlander’s complaints in this lawsuit relate either to the Cook-Potter
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`business disagreements, which were litigated or are being litigated in the state court lawsuit, or to
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`how the district court ruled/handled that litigation. Those claims involve real property, the
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`resolution of New Mexico business entity rights and duties, and traditional and paramount state
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`interests. There is little or no significant federal interest in this case. The final Younger requirement
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`is met.
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`While these three Defendants urge the Court to dismiss the case, the Court does not believe
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`that is necessary at this stage. The United States Court of Appeals for the Tenth Circuit has stated
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`that “the better practice is to stay the federal action pending the outcome of the state proceedings.”
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`Robinson v. Mo. Pac. R. Co., 16 F.3d 1079, 1083 (10th Cir. 1994). “The rationale for Younger
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`abstention can be satisfied, however, by just staying proceedings on the federal damage claim until
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`the state proceeding is final.” D.L. v. Unified Sch. District No. 497, 392 F.3d 1223, 1228 (10th Cir.
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`2004). There may come a time when dismissal becomes appropriate, but there may be some claims
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`here that are not at issue in the state case. After the bankruptcy court rules, the stay in the state case
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`lifted, and the state court finalized, it may be appropriate to revisit whether the case against these
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`three Defendants should proceed at all.
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`The three moving Defendants also contend that the Court should dismiss the claims against
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`them because of the Rooker-Feldman doctrine. Because the state case remains pending, and there
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`is no final judgment, dismissal under Rooker-Feldman would not be appropriate. The dismissal
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`orders in the state case remain interlocutory, and given that the Court is abstaining at the present
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`time, there is no chance that the federal court is going to improperly review the state court’s orders.
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`Because the Court will stay the case pending resolution of the state case, there is no reason
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`for the Court to reach the statute of limitations issue. If, for some reason, the stay is lifted, and it
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`is necessary for the Court to address the limitations issue, the moving Defendants may bring this
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`issue back to the attention of the Court. Accordingly, the Court will deny the motion to dismiss on
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`the basis of statute of limitations without prejudice to these Defendants raising this defense again
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`if necessary and appropriate.
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`IT IS ORDERED that Defendants Sarco Construction Company, El Llano Company, Inc.
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`and Richard Cook’s Joint Motion to Dismiss the Complaint is granted in part and denied in part.
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`The Court will stay the case against these three Defendants under the Younger abstention doctrine.
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`The Court will deny the motion to dismiss the claims on statute of limitations grounds without
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`prejudice to the moving Defendants, raising this issue again if necessary and appropriate.
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`___________________________________
`UNITED STATES DISTRICT JUDGE
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`Parties and Counsel:
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`Martin S. Friedlander
`Los Angeles, California
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`Plaintiff Pro Se
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`Paul Maestas
`Wayne R. Suggett
`Maestas & Suggett, P.C.
`Albuquerque, New Mexico
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`Attorneys for Defendants Richard P. Cook,
`Sarco Construction Company, and
`El Llano Company
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`Eric M. Sommer
`Sommer, Udall, Hardwick, Ahern & Hyatt, LLP
`Santa Fe, New Mexico
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`Attorneys for Defendant Valley National Bank
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`Case 1:06-cv-01160-JB-SMV Document 76 Filed 09/30/07 Page 6 of 6
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`Jim Dines
`Michael A. Gross
`Steven J. Leibel
`Dines & Gross, P.C.
`Albuquerque, New Mexico
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`Attorneys for Defendants Comeau, Maldegen,
`Templeman & Indall, LLP, Paula Cook, and Grey Handy
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`Briggs F. Cheney
`Law Office • Briggs F. Cheney
`Albuquerque, New Mexico
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`Attorneys for Defendant John Patterson
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`J. E. Gallegos
`Gallegos Law Firm, P.C.
`Santa Fe, New Mexico
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`Attorney for Defendant Sonny Otero d/b/a Otero Construction Company
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`David A. Grammar III
`Aldridge, Grammar, Jeffrey & Hammer, P.A.
`Albuquerque, New Mexico
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`Attorneys for Defendants Phase One Realty, Inc.,
`Ernest “Ernie” Romero, and W. James Metheny
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