ECCO Plains, LLC. v. United States
728 F.3d 1190
10th Cir.2013Background
- FDIC acted as receiver for New Frontier Bank and controlled sale proceeds from ECCO Plains cattle.
- ECCO Plains sold approximately $5.5 million of cattle; sale proceeds were made payable to ECCO Plains and FDIC.
- High Plains (50% member) demanded the full proceeds apply to its loan per the operating agreement with English; English instructed 50% to High Plains and 50% to English Cattle Company.
- FDIC applied all proceeds to the English Cattle Company loan and later sold both High Plains and English Cattle Company loans to third parties.
- ECCO Plains, High Plains, and Ulrich sued the United States under FTCA for conversion and negligence, with ECCO Plains also asserting a Fifth Amendment Takings claim; the district court dismissed for lack of jurisdiction or failure to state a claim.
- The appellate court reversed in part on the FTCA issues, determining the interference-with-contract FTCA exception applied to High Plains and Ulrich and remanded to dismiss those claims for lack of jurisdiction; ECCO Plains’ takings claim was treated as an illegal exaction claim under the Tucker Act and remanded for jurisdictional dismissal.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| FTCA interference with contract applies? | High Plains/Ulrich allege FDIC interfered with their contract. | United States asserts FTCA § 2680(h) interferences apply. | Yes; the claim falls within interference with contract exception. |
| Whether ECCO Plains’ takings claim is cognizable under FTCA/Tucker Act | ECCO Plains seeks return of proceeds under takings theory. | Takings claim belongs under Tucker Act/illegal exaction. | Takings claim recognized as illegal exaction under Tucker Act; jurisdictional dismissal appropriate. |
| FTCA subject-matter jurisdiction for ECCO Plains due to notice of claim | ECCO Plains filed FTCA claims; district court lacked jurisdiction. | FTCA notice requirement governs jurisdiction. | ECCO Plains’ FTCA claims dismissed for lack of jurisdiction; remanded accordingly. |
Key Cases Cited
- Kosak v. United States, 465 U.S. 848 (U.S. 1984) (FTCA scope and exceptions; interference with contract context matter of])
- United States v. Neustadt, 366 U.S. 696 (U.S. 1961) (misrepresentation vs. independent duties under FTCA; economic harms analyzed under traditional misrepresentation)
- Block v. Neal, 460 U.S. 289 (U.S. 1983) (distinguishes misrepresentation exemption from independent tort claims under FTCA)
- Estate of Trentadue ex rel. Aguilar v. United States, 397 F.3d 840 (10th Cir. 2005) (jurisdictional prerequisites under FTCA; interplays with exceptions)
- Sowell v. United States, 835 F.2d 1133 (5th Cir. 1988) (duty to process administrative forms; applicability of interference with contract exception)
- Krystkowiak v. W.O. Brisben Cos., 90 P.3d 859 (Colo. 2004) (Colorado elements for intentional interference with contract; standards discussed)