Opposition Brief — Martin Marietta Materials, Inc. v. City of Greenwood

Suprema Cour, U.S.

FILED

MAY 19 2010

No. 09-1308 OFFICE OF THE CLERK

jn The

Supreme Court of the United States

«

MARTIN MARIETTA MATERIALS, INC.

and HUNT MARTIN MATERIALS, LLC,

Petitioners,

V.

CITY OF GREENWOOD, MISSOURI,

Respondent.

On Petition For A Writ Of Certiorari

To The Missouri Court Of Appeals

+

RESPONDENT'S BRIEF IN OPPOSITION

+

BRYAN CAVE LLP

THOMAS C. WALSH

(Counsel of Record)

BRIAN C. WALSH

STEVEN E. MAUER

HEATHER S. ESAU ZERGER

One Metropolitan Square

211 N. Broadway, Suite 3600

St. Louis, Missouri 63102

(314) 259-2000

twalsh@bryancave.com

Attorneys for Respondent

COCKLE LAW BRIEF PRINTING CO. (B00) 225-6964

OR CALL COLLECT (402) 342-2851

QUESTIONS PRESENTED

‘The jury in this case (which petitioners refer to

as Greenwood I) awarded compensatory and punitive

damages for public nuisance at the conclusion of a

trial conducted in March 2008. Several months later,

the federal district court in the parallel ltigation

between the parties (which petitioners refer to as

Martin Marietta 1) refused to grant full faith and

credit to issues determined adversely to petitioners in

state court and conducted a bench trial on liability

and a jury trial on damages. The district court

entered its order on the issues decided at the bench

trial in September 2008 (Pet. 46a). Petitioners here

seek review of the state-court ruling, and the

questions presented are, therefore, as follows:

A. Are petitioners entitled to review by this

Court of a federal constitutional issue that was not

properly presented to the state courts and was not

addressed in the opinion of the state appellate court?

B. If so, does an award of punitive damages in

state court on a nuisance claim arising from the

effects of truck traffic passing through a small city

present a compelling reason for the exercise of

certiorari review where the defendants (petitioners

here) subsequently obtained a judgment of a federal

district court, based in part on evidence that was

neither offered nor admitted in evidence in state

il

QUESTIONS PRESENTED -— Continued

court, that the city could not prohibit the truck

traffic?

If.

A. Does this Court have jurisdiction under 28

U.S.C. § 1257(a) to review a state court’s application

of a federal procedural rule?

B. If so, does a state court’s refusal to require

the dismissal of claims in a case that is adjudicated

before the federal action in which those claims

purportedly should have been asserted as counter-

claims represent an important question of federal law

justifying this Court’s grant of a writ of certiorari?

11

TABLE OF CONTENTS

Page

Ob mye Boh By fo yo | i

pe VIP eo Pe Abe. lt fy y | +. Se Vv

REASONS FOR DENYING THE PETITION ....... 1

I.

II.

PETITIONERS DID NOT PROPERLY PRE-

SENT THEIR DUE PROCESS ARGU-

MENT TO THE MISSOURI COURTS .......

A. Petitioners Did Not Identify the Lawful-

Conduct Issue as a Ground for Relief

in Their Motion for Directed Verdict ....

B. The Lawful-Conduct Argument in Peti-

tioners’ Motion for Judgment Notwith-

standing the Verdict Did Not Preserve

i Mr a as

C. Petitioners’ Fleeting References to Due

Process Principles in their Challenge

on Appeal to the Sufficiency of the

Evidence Supporting Punitive Damages

Were Insufficient To Preserve the Issue

for Review by this Court ....................04

PETITIONERS HAVE NOT DEMON-

STRATED COMPELLING REASONS JUS-

TIFYING THIS COURT’S CONSIDERA-

TION OF THEIR LAWFUL-CONDUCT

PATI iar eckctsasacisnettasisractenseieses

A. The Decision of the Missouri Court of

Appeals Is Not Inconsistent with This

Court's Precedents, Because Peti-

tioners Have Not Been Punished on

Account of Lawful Conduct...................

nn

1V

TABLE OF CONTENTS — Continued

Page

1. Petitioners Were Not Required To

Pay Punitive Damages Merely Be-

cause Trucks Used Second Avenue.. 18

2. Conduct That Is Lawful in General

May Be Wrongful in a Particular

Circumstance or Context ................. 20

3. Petitioners Are Not Immune from

Punishment for Creating a Public

UR Ue ee Za

B. In the Context of a Nuisance Action,

Petitioners’ Lawful-Conduct Argument

Does Not Present an Important Ques-

tion of Federal Law Meriting This

Ee SN ois asiavecssacsene ins 26

Ill. THIS COURT DOES NOT HAVE JURIS-

DICTION TO REVIEW A_ STATE

COURT’S APPLICATION OF A FEDERAL

RULE OF CIVIL PROCEDURE .................. 27

IV. PETITIONERS’ DISAGREEMENT WITH

THE MISSOURI COURT’S APPLICA-

TION OF RULE 13(a) TO ALLEGED COM-

PULSORY COUNTERCLAIMS PRIOR TO

JUDGMENT IS NOT AN IMPORTANT

FEDERAL QUESTION REQUIRING A

RESOLUTION BY THIS COURT............... 28

ee PEI scassslevarsantcoess asvacteecsusnmeeioaertassesdets 33

TABLE OF AUTHORITIES

Page

CASES

Adams v. Robertson, 520 U.S. 83 (1997)....4, 10, 13, 15

Alcorn v. Union Pacific R.R., 50 S.W.3d 226

a Ue ye sonar cevicdphvdenncteverrearenes 11,12

Atlantic Coast Line R.R. v. Brotherhood of

Locomotive Engineers, 398 U.S. 281 (1970)........... 30

Bankers Life & Casualty Co. v. Crenshaw, 486

ee eo cc div savadunerusvaveninevcskanws 13, 14, 15

BMW of North America, Inc. v. Gore, 517 U.S.

ee ee ddd uupannbedesuned 4,13

Board of Directors of Rotary International uv.

Rotary Club of Duarte, 481 U.S. 537 (1987) .......... ig

Booth v. Hanson Aggregates New York, Inc.,

791 N.Y.5.24 260 (App. Div. 2005).......................... 12

Bower v. Hog Builders, Inc., 461 S.W.2d 784

a dl ere gece dey aka desidhiecasecneness 22

Brizendine v. Conrad, 71 S.W.3d 587 (Mo.

ERE ERO ED ETS EE EP a 10

Burnett v. Griffith, 769 S.W.2d 780 (Mo. 1989)

ee ae a od su biudnouiedw cscs 11

Burrell v. O'Reilly Automotive, Inc., 175 S.W.3d

co ae St rs

Central West Virginia Energy Co. v. Wheeling-

Pittsburgh Steel Corp., 245 F. App’x 415 (6th

RET ietadctn tattacuessastearecdetdsecuslincanseneuinkoarnocud inet. 29

City of Atlanta v. Kleber, 677 S.E.2d 134 (Ga.

2009)

vl

TABLE OF AUTHORITIES — Continued

Page

City of Cincinnati v. Beretta U.S.A. Corp., 768

IN .B.20 AE See iaseccseescssccscosscsceceee 23

City of Greenwood v. Martin Marietta Mate-

rials, Inc., 299 S.W.3d 606 (Mo. Ct. App.

AN!) ee 16, 25

City of St. Louis v. Varaht, Inc., 39 S.W.3d 531

(Mo. Ct. Aiming 5,500 002..00-........ 16

Cooper Industries, Inc. v. Leatherman Tool

Group, Frc. BOD Wee eee CAD ope ccecccccecncceccscoceee: 1]

Cox v. Loutsiana, 379 U.S. 536 (1965)....................... 21

Crutcher v. Aetna Life Insurance Co., 746 F.2d

1076 (Gta tet csacc..:--.-.-..-.--....... 29

Duplex Printing Press Co. v. Deering, 254 U.S.

44S (LE Des cnce eee eiedenscerceceecctcocsscccece 21

Durousseau v. United States, 10 U.S. (6 Cranch)

307 (18 10) ...<civccsceus eee aneses cederkivntee: 27, 28

Edmonson v. City of Moberly, 11 S.W. 990 (Mo.

jE °..! ) er 22

Exxon Mobil Corp. v. Saudi Basic Industries

Corp., 544 U.S. 280 (2005)........ Ie |

Frager v. Glick, 347 S.W.2d 385 (Mo. 1961)............ ...10

Goede v. Aerojet General Corp., 143 S.W.3d 14

CINE. COU, Fam ce isons ccc sc cesses scene. 7

Grundy v. Thurston County, 117 P.3d 1089

Waren, Baar cdeccnccnssccvcsccccccceees 23

Harrison v. Indiana Auto Shredders Co., 528

wey 12

TABLE OF AUTHORITIES — Continued

Page

Hawkins v. Burlington Northern, Inc., 514

S.W.2d 593 (Mo. 1974) (en banc) ...................65. 22. 26

Hostler v. Green Park Development Co., 986

S.W.2d 500 (Mo. Ct. App. 1999)...... ALKA ame!

lleto v. Glock Inc., 349 F.3d 1191 (9th Cir. 2003)....... 22

J.A.D. v. F.J.D.,978 S.W.2d 336 (Mo. 1998) (en

IIE ovciixcnccuicetcdeascceenssecmenseeieeaten te 9

Kline v. Burke Construction Co., 260 U.S. 226

C BREE Rv's skctbccdcave senacssmanvave abun aaa aan 30

Krebs v. Bambrick Brothers Construction Co.,

129 S.W. 425 (Mo. Ct. App. 1910)..................ccccecees 25

Krysa v. Payne, 176 S.W.3d 150 (Mo. Ct. App.

BEND x cs pen cacutvevawatendemeceeae ate Bite as L |

In re Lamkin, 355 U.S. 59 (1957)............ ccc ccc ccccccccccces |

Looney v. Hindman, 649 S.W.2d 207 (Mo. 1983)

Oth INES oo onsen ckcordaeenes eee eee ee ee 22

Maryland Heights Leasing, Inc. v. Mallinckrodt,

Inc., 706 S.W.2d 218 (Mo. Ct. App. 1985)............... 26

McClellan v. Carland, 217 U.S. 268 (1910) ...............30

McGoldrick v. Compagnie Generale Trans

atlantique, 309 U.S. 430 (1940)........... Tuscan ease

Nazeri v. Missouri Valley College, 860 S.W.2d

DOS CRAG. EI) COME DOTIG ia cicisccncnisessccnvavschcapessevecscessss 21

Pacific Mutual Life Insurance Co. v. Haslip,

499 U.S. 1 (1991)

Paddock v. Somes, 51 Mo. App. 320 (1892)...

Vill

TABLE OF AUTHORITIES — Continued

Page

Parsons Steel, Inc. v. First Alabama Bank, 474

Rae ORT UR oxcsecsecesssces Meri igt ei teat ast re 30

Peters v. General Motors Corp., 200 S.W.3d 1

GR Eis BD cote ee sess cat tikes eyomtesneuiees aires cea 11

Pike v. Bruce Church, Inc. , 397 U.S. 137 (1970)........ 17

Polymer Industrial Products Co. v. Bridgestone/

Firestone, Inc., 347 F.3d 935 (Fed. Cir. 2003) ........ 29

Pruellage v. De Seaton Corp., 380 S.W.2d 403

$8 |) RRR Rani Rene PR PI Finis BAL APRA AN Rays A a Rabes 10

Ritterbusch v. Holt, 789 S.W.2d 491 (Mo. 1990)

Cg ae LOR AGE SIN Neier SPV S Mer BT SAGA EL Aa SOARS? 21

Robbins v. Robbins, 328 S.W.2d 552 (Mo. 1959)..........

Ruppel v. Ralston Purina Co., 423 S.W.2d 752

Ig re ras ee ee eee ee ee eee eee 26

Schumacher v. Shawhan Distillery Co., 165

We. TEGS CRO. GL. ae. SOE) wiciccccecsivcscccsccsessavesess 25

Shipley v. Cates, 200 S.W.3d 529 (Mo. 2006) (en

RE Sen Oe Ca Oy ei NE Ay al Oe SHO ON oe are 4

State v. Damask, 936 S.W.2d 565 (Mo. 1996)

em ee a 10

State v. Shaw, 847 S.W.2d 768 (Mo. 1993) (en

ee, of OT IEEE TEE ASR LD Seeanacdatecicu einievsaeianeec. 10

State ex rel. Dresser Industries, Inc. v. Ruddy,

592 S.W.2d 789 (Mo. 1980) (en banc) ..................... 26

State ex rel. Thompson v. Roberts, 264 S.W.2d

Br NE Ura iia isa csceceevncucesaz in euesecedsaiajasseavdonsconees 4

TABLE OF AUTHORITIES — Continued

State Farm Mutual Automobile Insurance Co.

v. Campbell, 538 U.S. 408 (2008) ..............2.2..... 7, 12

Stone Man, Inc. v. Green, 435 S.E.2d 205 (Ga.

ap eed Ne A Re APC aes AMIDES ld en, a EAS 12

Storey v. Central Hide & Rendering Co., 226

I, ee ED CI, BEPI encivncie cdccccavscanenvinwersvncceceseauerai 23

Streett v. Marshall, 291 S.W. 494 (Mo. 1927)

dc atc cdeaac se coeecesss seca — we <-

Taylor v. Sturgell, 128 S. Ct. 2161 (2008).................. 29

TXO Production Corp. v. Alliance Resources

Corp., 509 ye ee Se io. Zo

Village of Euclid v. Ambler Realty Co., 272 U.S

i a ee TEE te ee gee 21

Warshawsky & Co. v. Arcata National Corp.,

ee cee re CO OEe GRE RITE D oa cccccatcsccceccccssecceceoterse 29

Webb v. Webb, 451 U.S. 493 (198 1).... 3. 4. 5, 10. ia

STATUTES, RULES, AND CONSTITUTIONAL PROVISIONS

re ee ee ee a ea 27

U.S. Const. amend. XIV, 8 1............ . .... passim

ee: ONE VE, BS BO co siccevecosccecccere . cutieeactatee

Be ere ee PUM viva cdc cccccnansadeddapancendiveecws 2 Sek eee or

"SUPE pea SARE Se Re Pea eR A Re i PSR Is Ra 17

Oe OR ns Sv rv 7

Re TURE FEU I oi snc cccés esis cessecscssocsonvescncselg ae

TABLE OF AUTHORITIES — Continued

Page

Supreme Court Rule 14.1(g)(1) ...............cccsescecceccscceseoO

Federal Rule of Civil Procedure 13(a)........... ... passim

Missouri Rule of Civil Procedure 72.01(b)................... 7

Missouri Rule of Civil Procedure 84.04(d)(1) .............. g

Missouri Rule of Civil Procedure 84.04(d)(5) ............ 11

OTHER AUTHORITIES

Douglas D. McFarland, Jn Search of the Trans

action or Occurrence: Counterclaims, 40

CREIGHTON L. REV. 699 (2007).......... SUnrasconaices tease

Restatement (Second) of Torts § 831 cmt. b

(1979) coo ; aan

REASONS FOR DENYING THE PETITION

Neither of the Questions Presented in this case

is properly before this Court. Even if they were,

however, petitioners have failed to demonstrate the

“compelling reasons” necessary to justify certiorari

review. S. Ct. R. 10.

Petitioners argument that they have been

punished for lawful conduct, in violation of the Due

Process Clause, was neither properly presented to nor

passed upon by the Missouri courts. Because the

Missouri Court of Appeals did not address the due

process issue, petitioners must overcome a _ pre-

sumption that they failed to properly present it below.

They cannot do so. Petitioners did not raise the

lawful-conduct point in their motion for directed

verdict at the close of the evidence, as required to

preserve the issue under Missouri procedure. Their

challenge on appeal to the punitive damages awarded

to Respondent City of Greenwood, Missouri

(“Greenwood”) addressed the sufficiency of the

evidence as a matter of state law, with only passing

references to due process and this Court’s punitive-

damages precedents. Because petitioners’ constitu-

tional claim was not properly presented below, the

record on this issue has not been developed, and the

state courts did not have an opportunity to address

the claim.

Even if the lawful-conduct argument had been

preserved, however, it would not be appropriate for

review by this Court. Petitioners’ actions in

dispatching quarry trucks along the Second Avenue

route through Greenwood were lawful only in the

sense that an ordinance passed by Greenwood that

halted the truck traffic was determined to be

impermissible. But neither the compensatory nor the

punitive damages in this case were awarded merely

because of the truck traffic; they were awarded

because of how the trucks drove and the severe

impact they had on Greenwood and its citizens. The

law of nuisance, in Missouri and elsewhere, has long

distinguished between the validity of a defendant’s

actions or business in the abstract and_ the

defendant's liability for the consequences of its

actions in particular circumstances. None of the

justifications proffered by petitioners — most of which

were not presented to the state courts in any event

establishes that their conduct was lawful or

otherwise permissible in the particular context of this

case. As a result, this factually-unique case is not an

appropriate vehicle for this Court to delineate the

boundaries that substantive due process may impose

on the award of punitive damages.

Petitioners’ compulsory-counterclaim argument

in their second Question Presented is based on

Federal Rule of Civil Procedure 13(a). Congress has

not given this Court jurisdiction to review state-court

decisions turning on the application of federal

procedural rules. But even if this Court could

entertain the issue, this case does not merit the

Court’s review. Petitioners do not claim that the

Missouri Court of Appeals applied the wrong

3

standard; they simply quarrel with that court’s

application of what petitioners acknowledge is the

correct standard. Moreover, many decisions of this

Court recognize that parties may pursue parallel

litigation in the federal and state courts, which is

precisely what occurred here.

In the more than two years that have passed

since Greenwood was awarded damages against

petitioners for public nuisance, petitioners have not

paid any portion of the judgment. In their final effort

to avoid liability, petitioners have not raised a

substantial question for review by this Court, nor one

that is procedurally appropriate for the Court’s

consideration. This Court should deny the Petition for

a Writ of Certiorari and bring this case to a close.

I. PETITIONERS DID NOT PROPERLY PRE-

SENT THEIR DUE PROCESS ARGUMENT

TO THE MISSOURI COURTS.

This Court will review a state-court decision

“only if the record as a whole shows either expressly

or by clear implication that the federal claim was

adequately presented in the state system.” Webb v.

Webb, 451 US. 493, 496-97 (1981); see also

McGoldrick v. Compagnie Generale Transatlantique,

309 U.S. 430, 434 (1940) (discussing “reasons of

peculiar force which should lead us to refrain from

deciding questions not presented or decided in the

highest court of a state whose judicial action we are

called upon to review”). Where the highest state court

fails to pass on a federal question, this Court assumes

that the omission is due to lack of proper presen-

tation, unless the party seeking certiorari can

affirmatively demonstrate the contrary. Webb, 451

U.S. at 495; Adams v. Robertson, 520 U.S. 83, 86-87

(1997).

A petitioner seeking review of an issue by this

Court must comply with state-court procedures in

raising the point below. See In re Lamkin, 355 U.S.

59, 59 (1957) (denying petition for writ of certiorari

where petitioner failed to comply with applicable

state procedures below); Adams, 520 U.S. at 87-88

(discussing failure to comply with state procedural

rules as adequate and independent ground for state

court’s disregarding of claim); Webb, 451 U.S. at 493

(referring to requirement to apprise state court of

nature or substance of federal claim “at the time and

in the manner required by the state law”). Among

other things, a party seeking to raise a constitutional

question in the Missouri courts must assert it at the

first available opportunity, specifically designate or

quote the constitutional provision alleged to have

been violated, and preserve the question throughout

the litigation. Stale ex rel. Thompson v. Roberts, 264

S.W.2d 314, 317 (Mo. 1954); Shipley v. Cates, 200

S.W.3d 529, 534 n.5 (Mo. 2006) (en banc).

The opinion of the Missouri: Court of Appeals

in this case did not address the lawful-conduct

argument raised by petitioners in their first Question

Presented in this Court. Petitioners thus have the

burden to affirmatively demonstrate that’ they

properly presented this issue to the Missouri courts.

Webb, 451 U.S. at 495. Petitioners have not even

attempted to comply with this Court's Rule 14.1(g)(),

which requires them to specify when and how they

raised the federal question they seek to have

reviewed by this Court. The record of this case

demonstrates that petitioners could not have com

plied with Rule 14.1(@)0) if they had attempted to do

SO

A. Petitioners Did Not Identify the Lawful-

Conduct Issue as a Ground for Relief in

Their Motion for Directed Verdict.

Petitioners’ motion for directed verdict at the

close of the evidence in this case included only three

paragraphs directed to punitive damages. ‘That

argument did not refer to the Constitution or any

constitutional rights, and all of the cases cited by

petitioners were decisions of the Missouri courts

applying state law. Aside from the recitation of

general principles, the substance of the argument

concerning the punitive damages awarded for nui

sance consisted of the foilowing:

“The only nuisance evidence here is that

independent trucks use 2nd Avenue and

such trucks are not owned or controlled by

Defendants’ Motion for Directed Verdict at the Close of All

Evidence with Suggestions in Support, at 8-9 (Mo. Cir. Ct. Mar

12, 2008)

6

Defendants. There is even a Federal Court

injunction allowing rock trucks to use 2nd

Avenue. ... There is simply no evidence that

{iunt Martin (which didn’t even exist when

the street repairs were made) or Martin

Marietta have acted in a way that would

merit a punitive damages award.”

B. The Lawful-Conduct Argument in Peti-

tioners’ Motion for Judgment Notwith-

standing the Verdict Did Not Preserve

the Point.

After trial, petitioners filed two motions for

judgment notwithstanding the verdict. Those motions

were accompanied by two briefs, one of which was

devoted to issues of punitive damages.’ In contrast to

the directed-verdict papers, petitioners’ brief at this

stage of the case identified a constitutionally-based

argument similar to the issue they raise in this

Court, which was captioned as follows: “Il. The

Fourteenth Amendment Prohibits Punishment for the

Lawful Use of a Public Road Pursuant to Express

Authorization To Do So.” Although some of the

discussion that followed was grounded in state law,

* Id. at 9.

’ Suggestions in Support of Defendants’ Motion for Judg-

ment Notwithstanding the Verdict, or in the Alternative, Motion

for New Trial on Punitive Damages (Mo. Cir. Ct. Apr. 14, 2008)

(“JNOV Suggestions”).

* JNOV Suggestions at 11

7

petitioners cited BMW of North America, Inc. v. Gore,

517 U.S. 559 (1996), and State Farm Mut. Auto. Ins.

Co. v. Campbell, 538 U.S. 408 (2003), and otherwise

made clear that the thrust of their argument was

constitutional.” In addition, petitioners advanced

other due process arguments concerning the punitive

damages awarded.°

As in the federal system, however, a motion for

judgment notwithstanding the verdict in Missouri

serves as a request “to have judgment entered in

accordance with the motion for a directed verdict.”

Mo. R. Civ. P. 72.01(b). An issue not raised in a

motion for directed verdict cannot serve as the basis

for a motion for judgment notwithstanding a verdict,

nor is such an issue preserved for appeal. Burrell v.

O’Reilly Automotive, Inc., 175 S.W.3d 642, 648-49

(Mo. Ct. App. 2005); Goede v. Aerojet General Corp.,

143 S.W.3d 14, 18 (Mo. Ct. App. 2004); see generally

Robbins v. Robbins, 328 S.W.2d 552, 555 (Mo. 1959)

(Missouri appellate courts cannot review a matter

that is not presented to or expressly decided by the

trial court); Mo. Rev. Stat. § 512.160.1. As a result,

* JNOV Suggestions at 12.

° Petitioners argued that the punitive damages were

unconstitutionally excessive and that the trial court improperly

permitted the jury to consider evidence of Martin Marietta’s

nationwide revenues. JNOV Suggestions at 16-17. Neither of

these arguments was renewed on appeal, and neither is before

this Court.

8

petitioners’ attempt to assert their Jawful-conduct

argument after trial was of no consequence.

C. Petitioners’ Fleeting References to Due

Process Principles in their Challenge

on Appeal to the Sufficiency of the

Evidence Supporting Punitive Damages

Were Insufficient To Preserve the Issue

for Review by this Court.

Even if petitioners had preserved the lawful-

conduct issue in the trial court, their abandonment of

the point on appeal would preclude review by this

Court. In the Missouri Court of Appeals, Petitioner

Martin Marietta Materials, Inc. (“Martin Marietta”)

filed a 150-page opening brief of 30,977 words.’ As

mandated by Missouri procedure, that brief specified

eleven “Points Relied On,” each of which was required

to identify the ruling of the tnal court that was

challenged, state the legal reasons for the claim of

reversible error, and explain in summary fashion

why, in the context of the case, the legal reasons

* Petitioner Hunt Martin Materials, LLC (“Hunt Martin”)

filed a separate brief that included one Point Relied On

addressed to punitive damages. Brief of Appellant Hunt Martin

Materials, Inc., at 10 (Mo. Ct. App. Dec. 1, 2008). Both the point

and its supporting argument focused entirely on the proposition

that Greenwood had failed to present clear and convincing

evidence of Hunt Martin’s complete indifference to or conscious

disregard for the safety of others. Jd. at 10, 24-26. Hunt Martin

did not cite the Due Process Clause or any cases addressing the

issue of lawful conduct and punitive damages.

9

supported the claim of error. See Mo. R. Civ. P.

84.04(d)(1). The only Point Relied On conceivably

relevant to the due process claim pressed by peti-

tioners in this Court read as follows:

“X. The Trial Court Erred in Failing To

Grant Appellant’s Motions for a Directed

Verdict, for JNOV and for a New Trial on the

Issue of Punitive Damages and in Sub-

mitting the Issue of Punitive Damages to the

Jury Because Greenwood Failed To Offer

Evidence To Support Punitive Damages in

that Greenwood Failed To Present Clear and

Convincing Evidence of Appellant’s Evil

Motive or its Legal Equivalents in Paying

Contractors To Make Repairs to Second

Avenue or in Making its Quarry Products

Available to the Contractors of the Quarry’s

Customers Who Legally Used the Street

Greenwood Had Designated as a Commercial

Truck Route for Years.”

This Point Relied On did not adequately preserve

the lawful-conduct argument. “To properly assert a

violation of a constitutional right in a point relied on,

an appellant must specifically identify the consti-

tutional] provision claimed to have been violated, such

as by explicit reference to the article and section or by

quotation of the provision itself.” J.A.D. v. F-J.D., 978

S.W.2d 336, 339 (Mo. 1998) (en banc). When an

appellant does not claim a violation of a particular

* Brief of Appellant Martin Marietta Materials, Inc., at 42

(Mo. Ct. App. Dec. 1, 2008) (“Martin Marietta Brief”).

LU

constitutional right in its Points Relied On, that issue

is not before the appellate court. State v. Damask, 936

S.W.2d 565, 570 (Mo. 1996) (en banc) (refusing to

consider Fourth Amendment challenge to detention

and search where Point Relied On challenged only

initial traffic stop); State v. Shaw, 847 S.W.2d 768,

773 n.4 (Mo. 1993) (en banc) (First Amendment

argument not included in Points Relied On in court of

appeals was abandoned); Pruellage v. De Seaton

Corp., 380 S.W.2d 403, 405 (Mo. 1964) (constitutional

question not included in Points Relied On is con-

sidered abandoned and no longer an issue in the

case).” See generally Adams, 520 U.S. at 87-88 & n.1

(noting that failure to identify federal claim in

“statement of issues” required by state procedural

rules appeared to be adequate and independent

ground for this Court’s refusal to entertain issue);

Webb, 451 U.S. at 498 n.4 (remarking that petitioner

had not demonstrated that state supreme court’s

failure to reach federal issue was not based on her

failure to cite authority to support enumerated errors,

as required by state procedure).

Following its Point Relied On, Martin Marietta

was required to list up to four cases, as well as

* Even where non-constitutional issues are involved, the

Missouri courts treat arguments “not set out in the point relied

on but merely referred to in the argument portion of the brief”

as abandoned. Brizendine v. Conrad, 71 S.W.3d 587, 593 (Mo.

2002) (en banc); see also Frager v. Glick, 347 S.W.2d 385, 390-91

(Mo. 1961).

11

constitutional provisions, on which it principally

relied. See Mo. R. Civ. P. 84.04(d)(5). Martin Marietta

cited three cases, each of which turned on the

sufficiency of evidence supporting punitive damages

solely as a matter of state law.'’ Martin Marietta did

not cite the Due Process Clause there or anywhere

else in its brief.

Martin Marietta’s argument supporting Point X

occupied fifteen pages of its brief. As the point itself

suggested, the argument focused on the sufficiency of

the evidence of petitioners’ evil motive. For example,

Martin Marietta identified the standard of review as

“clear and convincing evidence that the defendants

acted with an evil mind or [its] legal equivalent,””

rather than the de novo standard applicable to a due

process challenge to punitive damages. See Krysa v.

Payne, 176 S.W.3d 150, 156 (Mo. Ct. App. 2005),

citing Cooper Indus., Inc. v. Leatherman Tool Group,

Inc., 532 U.S. 424, 436 (2001). Martin Marietta also

included two lengthy discussions of Alcorn v. Union

Pac. R.R., 50 S.W.3d 226 (Mo. 2001) (en banc).” In

that case, the Supreme Court of Missouri reversed an

award of punitive damages because the defendant’s

actions were consistent with applicable regulations.

'° Martin Marietta Brief at 42, citing Alcorn v. Union Pac.

R.R., 50 S.W.3d 226 (Mo. 2001) (en banc); Burnett v. Griffith, 769

S.W.2d 780 (Mo. 1989) (en banc); and Peters v. General Motors

Corp., 200 S.W.3d 1 (Mo. Ct. App. 2006).

'' Martin Marietta Brief at 132.

“ Martin Marietta Brief at 137-38, 141-42.

42

See td: at 248-49: But-that-holding-was-based-on-state-.

law; the court held that the defendant’s compliance

with applicable law defeated the plaintiff’s effort to

show that the defendant acted with a mental state

sufficient to permit the imposition of punitive

damages. See id. at 249. Martin Marietta also cited a

number of other cases, from Missouri and elsewhere,

in support of the same and similar propositions.”

Martin Marietta used the words “due process”

three times in its argument regarding the _ sub-

missibility of punitive damages, and the phrase also

appeared twice in quotations from cases.” In

addition, Campbell was cited twice — in connection

with a reference to “the most basic notions of fairness

and due process” and for the proposition that a state

cannot punish conduct that was lawful where it

'’ Hostler v. Green Park Dev. Co., 986 S.W.2d 500, 507 (Mo.

Ct. App. 1999) (a party who acts in good faith and honestly

believes that his act is lawful is not liable for punitive damages

under Missouri law); Harrison v. Indiana Auto Shredders Co.,

528 F.2d 1107, 1125-26 (7th Cir. 1975) (reversing permanent

injunction against operation of business that complied with

zoning and other laws and concluding that “{oJn balance,”

grounds for punitive damages did not exist); Stone Man, Inc. v.

Green, 435 S.E.2d 205, 206 (Ga. 1993) (under state law, punitive

damages are “as a general rule, improper where a defendant has

adhered to environmental and safety regulations”); Booth uv.

Hanson Aggregates N.Y., Inc., 791 N.Y.S.2d 766, 768 (App. Div.

2005) (defendant’s continuing operation in reliance on con-

sultant’s study and state permit did not constitute “willful or

wanton negligence or recklessness”).

'* Martin Marietta Brief at 138, 141, 143.

13

occurred — and Gore once, for the point that a person

cannot be punished for what the law plainly allows

him to do.” After each of these citations, Martin

Marietta promptly resumed its discussion of the

sufficiency of the evidence under state law. Its stray

references to constitutional principles, coming as they

did in the midst of an argument based on state law,

were not sufficient to preserve the constitutionality of

the punitive damage award under the Fourteenth

Amendment for this Court’s review. “The discussion

of ‘a federal case, in the midst of an unrelated

argument, is insufficient to inform a state court that

it has been presented with a claim.’” Adams, 520 U.S.

at 88, quoiing Board of Directors of Rotary Int'l v.

Rotary Club of Duarte, 481 U.S. 537, 550 n.9 (1987);

see also TXO Production Corp. v. Alliance Resources

Corp., 509 U.S. 448, 464 (1993) (plurality opinion)

(refusing to consider challenge to jury instruction on

punitive damages where petitioner “did not squarely

argue” in state court that instruction violated due

process).

Moreover, the mere use of a phrase that may

have constitutional significance does not preserve a

constitutional claim. See Webb, 451 U.S. at 496

(several references to “full faith and credit” were

insufficient to preserve claim under Full Faith and

Credit Clause); Barkers Life & Cas. Co. v. Crenshaw,

486 U.S. 71, 78 (1988) (argument characterizing

'* Martin Marietta Brief at 138, 141.

14

punitive damages as an excessive fine was insuffi-

cient to preserve claim under Eighth Amendment’s

Excessive Fines Clause). This principle is particularly

applicable where the federal and state constitutions

have provisions with similar labels. See Bankers Life,

486 U.S. at 78 (noting that Mississippi Constitution

also prohibited excessive fines). A bare reference to

“due process” involves just such an ambiguity.

Compare U.S. Const. amend. XIV, § 1 with Mo. Const.

art. I, $ 10.

The conclusion of the argument supporting

Martin Marietta’s Point X exemplifies its failure to

preserve the lawful-conduct issue that it asks this

Court to review. Following one of its discussions of

state-law cases on the sufficiency of the evidence to

support punitive damages, Martin Marietta argued

that the award of punitive damages in this case

“fundamentally by-passes the necessity of showing an

evil mind by clear and convincing evidence and thus

violates due process guarantees.”"® This assertion

betrays a lack of preservation of petitioners’ first

Question Presented and, in fact, is a non sequitur, for

the Due Process Clause does not require such a

showing. See Pacific Mut. Life Ins. Co. v. Haslip, 499

U.S. 1, 23 n.11 (1991) (rejecting argument that

preponderance standard is unconstitutional).

© Martin Marietta Brief at 143.

15

Viewed generously, Martin Marietta’s presen-

tation to the Missouri Court of Appeals included a

“vague appeal to constitutional principles,” which

does not preserve an argument for review by this

Court. Bankers Life, 486 U.S. at 77. And, as noted,

Hunt Martin did not even mention the Constitution

or any of its provisions. In the circumstances of this

case, “it would have been perfectly reasonable for a

state court to conclude that the broader federal

claim was not before it.” Adams, 520 U.S. at 89."

Accordingly, even if petitioners had not waived their

lawful-conduct argument by failing to raise it in their

motion for directed verdict, their abandonment of the

point on appeal should preclude this Court from

entertaining the issue on certiorari.

Il. PETITIONERS HAVE NOT DEMON-

STRATED COMPELLING REASONS JUSTI-

FYING THIS COURT’S CONSIDERATION

OF THEIR LAWFUL-CONDUCT ARGU-

MEN'T.

Petitioners’ formulation of their first Question

Presented to this Court inappropriately conflates the

proceedings held in Missouri state court with those

held in federal district court. Petitioners then confuse

” Indeed, Greenwood did not understand that an argument

under the Due Process Clause was at issue in petitioners’

appeal. Greenwood did not address due process issues in its

responsive brief, nor did petitioncrs in thcir reply briefs. And, of

course, the Missouri Court of Appeals did not discuss the issue.

16

the issues in the two cases, which are, in significant

respects, distinct and independent. The result,

suggest petitioners, is a state court’s punishment of

“conduct that a federal district court held to be lawful

under a valid and enforceable contract and consti-

tutionally protected by the Commerce Clause” (Pet. i).

In reality, the proceedings in the parallel litiga-

tion between these parties were both more straight-

forward and more complex than petitioners have

made them appear. This litigation in state court

involved the common-law tort of public nuisance. As

the Missouri Court of Appeals stated, such a nuisance

“is an offense against the public order and economy of

the state and violates the public’s right to life, health,

and the use of property, while, ‘at the same time

annoys, injures, endangers, renders insecure, inter-

feres with, or obstructs the rights or property of the

whole community, or neighborhood, or of any con-

siderable number of persons.’” City of Greenwood uv.

Martin Marietta Materials, Inc., 299 S.W.3d 606, 616

(Mo. Ct. App. 2009), quoting City of St. Louts uv.

Varahi, Inc., 39 S.W.3d 531, 535 (Mo. Ct. App. 2001)

(Pet. 10a). Trial in this case was conducted in March

2008.

The proceedings in federal court involved two

relevant claims. First, petitioners contended that a

contract executed in 1991 required Greenwood in

good faith to continue to designate the Second Avenue

route through the city as available for commercial

use. This agreement is not part of the “undisputed

history of the parties’ conduct and the relations

17

between the parties,” as petitioners suggest (Pet. 14).

In fact, Greenwood raised substantial questions as to

its enforceability, the interpretation of ambiguous

language within it, and whether Greenwood acted in

good faith in closing the road to through commercial

traffic. The federal judge resolved these issues in

favor of petitioners at a bench trial, despite

Greenwood’s argument that the latter two issues

were matters for the jury to decide (Pet. 50a, 52a),

Petitioners also claimed that Greenwood’s re-

striction of commercial traffic on Second Avenue

violated the Commerce Clause, on the theory that the

burden of the city’s ordinance upon _ interstate

commerce was clearly excessive in comparison to its

local benefits. See Pike v. Bruce Church, Inc., 397 U.S.

137, 142 (1970). This issue also was adjudicated by

the federal judge in favor of petitioners (Pet. 59a),

over Greenwood’s objection that it was a claim at law

because petitioners sought damages under 42 U.S.C.

§ 1983. The trial in federal court was conducted in

June and July 2008, and only the amount of damages

was determined by the jury. The district court’s

decision on the matters decided by the court was

entered in September 2008 (Pet. 46a).

As petitioners acknowledge, Greenwood has

appealed the judgment of the district court to the

United States Court of Appeals for the Eighth Circuit.

The issues in that appeal include Greenwood’s

Seventh Amendment right to a jury trial, the validity

of the 1991 contract, the district court’s determina-

tion of the Commerce Clause claim, petitioners’

18

failure to establish a nexus between interstate com-

merce and the damages they sought, and the district

court’s refusal to prohibit relitigation of issues pre-

viously determined adversely to petitioners on the

nuisance claim in state court. The Eighth Circuit

heard oral argument and took Greenwood’s appeal

under submission on September 21, 2009.

A. The Decision of the Missouri Court of

Appeals Is Not Inconsistent with This

Court’s Precedents, Because Petitioners

Have Not Been Punished on Account of

Lawful Conduct.

Petitioners do not seek this Court’s review on the

basis that the federal courts of appeals and state

courts of last resort are in disagreement on the

lawful-conduct question raised by petitioners. Rather,

petitioners argue that the Missouri courts’ handling

of the punitive damages in this case is inconsistent

with this Court’s precedents (Pet. 13). The record in

this case, along with common-law and common-sense

principles, demonstrates that petitioners are incor-

rect,

1. Petitioners Were Not Required To Pay

Punitive Damages Merely Because

Trucks Used Second Avenue.

Throughout their petition, petitioners charac-

terize the parallel state and federal cases as

fundamentally irreconcilable, because the behavior

19

punished in state court was “the very conduct” that

the federal district court concluded was “plainly

allowed” (Pet. 14, 16). The record does not support

this assertion.

Petitioners commenced the federal litigation

because of Greenwood’s passage of an ordinance that

effectively precluded them from dispatching vehicles

from their quarry, located south of Greenwood, along

Second Avenue to points north of Greenwood.” The

district court invalidated the ordinance, and the

federal-court jury awarded petitioners more than

$468,000 in damages for Greenwood’s supposed

breach of the 1991 contract and violation of the

Commerce Clause. The district court also enjoined

Greenwood “from taking any action that has the

effect of prohibiting all through-truck traffic through

the City” (Pet. 60a).

The “very conduct” validated by the federal court,

therefore, was the driving of trucks along Second

Avenue or another north-south route that might be

offered by Greenwood as an alternative. If the

Missouri state courts had authorized the punishment

18

Perhaps in an effort to overstate the interstate-commerce

aspects of their claim, petitioners suggest that their goal is to

reach Interstate Highways 35 and 435 (Pet. 3). But these

highways, which are located many miles from Greenwood, were

not the subject of evidence or argument in either state court or

federal court. The undisputed evidence is that petitioners’

primary market is the city of Lee’s Summit, Missouri, which is

immediately north of Greenwood, and the main point of interest

is the intersection of Missouri State Highways 150 and 291.

20

of petitioners solely for this particular conduct,

petitioners might well have a valid complaint about

their treatment — one that they should have raised in

the state courts in the first instance, of course.

But petitioners were not punished merely for the

existence of the traffic they set in motion. In fact,

they were not even found liable for compensatory

damages on that basis. In the Missouri Court of

Appeals, petitioners argued that “traffic alone cannot

constitute a nuisance” (Pet. 12a). The court acknowl-

edged that this was a correct principle of law, but not

an applicable one, because the issue in this case

was “whether the trucks’ use of Second Avenue was

reasonable” (Pet. 13a). Recognizing that Greenwood

complained not merely of the existence of traffic, but

also of “the effect of large trucks transporting crushed

rock at times through a residential area at the rate of

every one to two minutes,” the Missouri Court of

Appeals concluded that Greenwood had adequately

proved its claim for public nuisance (vd. ).

2. Conduct That Is Lawful in General

May Be Wrongful in a Particular

Circumstance or Context.

The law makes a significant distinction between

the legality of an act in the abstract and the actor’s

potential liability for the manner in which that act is

performed, or the consequences the act may have for

others. For example, one may not “insist upon a

street meeting in the middle of Times Square at the

21

rush hour as a form of freedom of speech or

assembly.” Cox v. Louisiana, 379 U.S. 536, 554 (1965).

Conspirators may be punished for pursuing “some

purpose not in itself criminal or unlawful by criminal

or unlawful means.” Duplex Printing Press Co. v.

Deering, 254 U.S. 443, 465 (1921); see also

Ritterbusch v. Holt, 789 S.W.2d 491, 494 (Mo. 1990)

(en banc) (civil conspiracy may involve use of “un-

lawful means to do an act which is lawful”). Similarly,

a defendant may be liable under the theory of prima

facie tort for engaging in “an intentional lawful act”

with intent to injure another. Nazeri v. Missouri

Valley College, 860 S.W.2d 303, 315 (Mo. 1993) (en

banc).

The distinction between the general legality of an

act and the actor’s liability for damages is particu-

larly meaningful in a case involving a nuisance. As

this Court stated in its seminal decision upholding

zoning regulations,

“the question whether the power exists to

forbid the erection of a building of a

particular kind or for a particular use, like

the question whether a particular thing is a

nuisance, is to be determined, not by an

abstract consideration of the building or of

the thing considered apart, but by con-

sidering it in connection with the circum-

stances and the locality. A nuisance may be

merely a right thing in the wrong place, like

a pig in the parlor instead of the barnyard.”

Village of Euclid v. Ambler Realty Co., 272

U.S. 365, 388 (1926) (citation omitted).

22

Missouri nuisance law recognizes the same distinc-

tion. See, e.g., Looney v. Hindman, 649 S.W.2d 207,

213 (Mo. 1983) (en banc) (“The term ‘nuisance’

connotes the use of one’s property in a manner which

is not abstractly unlawful but which, in the circum-

stances, demonstrates an unreasonable interference

with the rights of neighboring property owners.”);

Edmonson v. City of Moberly, 11 5.W. 990 (Mo. 1889)

(city’s legal authority to establish sewer system did

not permit city to exercise power in such a manner as

to create a nuisance); Streett v. Marshall, 291 S.W.

494, 499 (Mo. 1927) (en banc) (funeral home that was

“not only lawful but indispensable” yet located in a

residential neighborhood was a nuisance as a matter

of law); Bower v. Hog Builders, Inc., 461 S.W.2d 784,

795 (Mo. 1970) (affirming award of compensatory and

punitive damages for nuisance despite defendant’s

argument “that its business was lawful”); Hawkins v

Burlington Northern, Inc., 514 S.W.2d 593, 598-99

(Mo. 1974) (en banc) (rejecting defendant’s argument

that statute with which it claimed to have complied

supplanted common law of nuisance)."”

See generally Restatement (Second) of Torts § 831 cmt. b

(1979) (“There are suitable and unsuitable places for carrying on

all lawful activities and sound public pojicy demands that people

carry them on in suitable places so as to avoid as much of the

conflict between incompatible interests _as_possible.”); Ileto_v.

Glock Inc., 349 F.3d 1191, 1214 (9th Cir. 2003) (“[T]he fact that

a certain occupation or business can be performed in a legal

manner does not prevent that occupation or business from

becoming a nuisance when the occupation or business is

(Continued on following page)

23

3. Petitioners Are Not Immune from

Punishment for Creating a Public

Nuisance.

Petitioners cite three bases for their assertion

that the conduct for which punitive damages were

imposed was lawful: the 1991 contract, the Commerce

Clause, and Greenwood’s designation of Second

Avenue as a commercial-use route before June 2006

(Pet. 14-22).” Each of these three arguments suffers

from the general flaw discussed above — 1.e., each

authorized, at most, the mere presence of trucks on

Second Avenue, and not their deleterious impact

on Greenwood and its residents — but each is

problematic for other reasons as well.

performed in a manner that unreasonably infringes on a public

right.”); Storey v. Central Hide & Rendering Co., 226 S.W.2d 615,

617 (Tex. 1950) (a lawful business may become a nuisance when

it is operated in a place or manner as to seriously interfere with

the enjoyment of life and property); City of Cincinnati uv. Beretta

U.S.A. Corp., 768 N.E.2d 1136, 1143 n.4 (Ohio 2002) (a qualified

nuisance involves a lawful act negligently or carelessly done);

Grundy v. Thurston County, 117 P.3d 1089, 1092 n.5 (Wash.

2005) (a lawful action may still be a nuisance); City of Atlanta v.

Kleber, 677 S.E.2d 134, 135 n.1 (Ga. 2009) (the fact that an act is

otherwise lawful does not prevent it from being a nuisance).

20

Petitioners also argue that they had a reasonable belief

that their conduct was lawful or otherwise protected (Pet. 15,

16). Assuming for the sake of argument that petitioners

presented evidence to support this contention and argued the

issue before the jury, the verdict in this case demonstrates

clearly that the jury did not find it persuasive. The Due Process

Clause does not require or permit a reviewing court to credit a

defendant’s self-serving testimony that it acted in good faith

when the factfinder has determined otherwise.

24

Although petitioners identified the 1991 contract

in an affirmative defense in their answer in this

state-court case, they made no effort to pursue that

defense. They did not move to dismiss the case or

seek summary judgment on the basis of the contract;

they did not offer the contract into evidence at trial;

and they did not request that the jury be instructed

on their contractual defense. Petitioners apparently

chose to proceed in this fashion because they were

justifiably concerned that the state courts might rule

that the contract was unenforceable. But whatever

the reason for petitioners’ choice not to present the

contract to the state court for consideration, they

cannot now complain of constitutional error by a

court that was never presented with either evidence

or argument in support of what petitioners now claim

to have been their rights.

Petitioners’ argument based on the Commerce

Clause is similarly flawed. Several months after the

jury awarded punitive damages to Greenwood in

state court, the federal district court held that

Greenwood’s ordinance barring through-truck traffic

violated the Commerce Clause (Pet. 59a-60a). But

petitioners did not rely on the Commerce Clause at

trial in state court as justification for their actions,

and they did not assert the Commerce Clause as a

ground for relief on appeal. In any event, the federal

court’s interpretation of the Commerce Clause _pro-

tected petitioners only against claims that they

violated Greenwood’s ordinance by dispatching trucks

along Second Avenue. The district court ruled that

25

petitioners’ trucks must be permitted to use the road,

not that they must be permitted to pollute, to spew

dust throughout the neighborhood, to require

residents and businesses to keep their windows

closed because of the noise, or to force children out of

their front yards and off their bicycles. See City of

Greenwood, 299 S.W.3d at 613 (Pet. 4a).

Although petitioners’ argument regarding Green-

wood’s identification of Second Avenue as a route for

commercial traffic prior to 2006 is not fundamentally

different from its arguments regarding the 1991

contract and the Commerce Clause, petitioners

phrase the argument in terms of fair notice rather

than substance (Pet. 19). That distinction does not

make a difference. As with the 1991 contract and the

Commerce Clause, Greenwood’s pre-2006 ordinance

simply authorized commercial vehicles to use Second

Avenue for through traffic; it did not permit those

vehicles to operate in any manner petitioners deemed

appropriate, without regard to the consequences.

As for the issue of fair notice, due process “is

satisfied if prior Jaw fairly indicated that a punitive

damages award might be imposed in response to

egregiously tortious conduct.” TXO, 509 U.S. at 466.

More than a century of Missouri precedent advised

petitioners that they could be liable for punitive

damages for maintaining a nuisance willfully or with

reckless indifference to the rights of others. See, e.g.,

Paddock v. Somes, 51 Mo. App. 320, 325 (1892); Krebs

v. Bambrick Bros. Constr. Co., 129 S.W. 425 (Mo. Ct.

App. 1910); Schumacher v. Shawhan Distillery Co.,

26

165 S.W. 1142, 1144 (Mo. Ct. App. 1914); Ruppel v.

Ralston Purina Co., 423 S.W.2d 752, 756-58 (Mo.

1968); Hawkins, 514 S.W.2d at 603; State ex rel.

Dresser Indus., Inc. v. Ruddy, 592 S.W.2d 789, 793

(Mo. 1980) (en banc); Maryland Heights Leasing, Inc.

v. Mallinckrodt, Inc., 706 S.W.2d 218, 222 (Mo. Ct.

App. 1985).

B. In the Context of a Nuisance Action,

Petitioners’ Lawful-Conduct Argument

Does Not Present an Important Ques-

tion of Federal Law Meriting This

Court’s Review.

Petitioners suggest that “no award of punitive

damages is constitutionally permissible” in certain

cases or circumstances (Pet. 11). Assuming that this

proposition has some merit in the abstract, this fact-

bound case is not an appropriate vehicle for the

delineation of its boundaries. As discussed above,

nuisance law requires the balancing of the rights of

the respective parties, often in situations in which a

defendant’s activities are lawful in general but

unreasonable, and thus tortious, in their specifics.

Despite petitioners’ efforts to paint the scene in

starkly contrasting hues — the federal court held that

their conduct was lawful, while the state court

punished them for engaging in it — the reality of this

case, like many nuisance cases, is far more nuanced.

And the Missouri courts were not provided—an

opportunity to weigh in on the constitutional question

now pressed by petitioners.

27

If this Court is inclined to consider whether

substantive due process categorically bars punitive

damages where lawful conduct is at issue, it should

grant certiorari in a case with a fully-developed

record and no room for dispute that the defendant’s

actions were authorized in the specific respects that

gave rise to the plaintiff’s claims. Because this is not

such a case, the petition should be denied.

Ill. THIS COURT DOES NOT HAVE JURIS-

DICTION TO REVIEW A STATE COURT’S

APPLICATION OF A FEDERAL RULE OF

CIVIL PROCEDURE.

This Court’s jurisdiction to review state-court

judgments is limited, in relevant part, to cases

“where any title, right, privilege, or immunity is

specially set up or claimed under the Constitution or

the treaties or statutes of ... the United States.” 28

U.S.C. § 1257(a). The compulsory-counterclaim issue

raised by petitioners involves no such title, right,

privilege, or immunity. Rather, petitioners’ secord

Question Presented argues that the Missouri courts

misapplied Federal Rule of Civil Procedure 13(a),

which governs compulsory counterclaims in civil

actions ‘n the federal courts.

This Court’s certiorari jurisdiction is governed by

statute. U.S. Const. art. II], § 2; Durousseau v. United

States, 10 U.S. (6 Cranch) 307, 314 (1810). Section

1257(a) affirmatively authorizes this Court to review

state-court decisions in which parties claim rights or

28

immunities under certain bodies of federal law, but

these do not include federal procedural rules.

Congress’ affirmative description of this Court’s

jurisdiction “has been understood to imply a negative

on the exercise of such appellate power as is not

comprehended within it.” Durousseau, 10 U.S. at 314.

Accordingly, even if this were a case that otherwise

called out for this Court’s intervention — which it is

not, for the reasons explained helow — the Court

would not have the power to address the Missouri

courts’ application of Rule 13(a).

IV. PETITIONERS’ DISAGREEMENT WITH

THE MISSOURI COURT’S APPLICATION

OF RULE 13(a) TO ALLEGED COMPUL-

SORY COUNTERCLAIMS PRIOR TO JUDG-

MENT 1S NOT AN IMPORTANT FEDERAL

QUESTION REQUIRING A RESOLUTION

BY THIS COURT.

In connection with their second Question

Presented, petitioners suggest that the courts have

applied four different tests to determine whether a

counterclaim is compulsory for purposes of Rule 13(a)

(Pet. 25). They also cite a law-review article in which

the author criticizes these four tests and proposes

more than 20 alternatives. See Douglas D.

McFarland, /n Search of the Transaction or Occur-

rence: Counterclaims, 40 CREIGHTON L. REv. 699, 729-

30 & n.160 (2007). Nevertheless, petitioners argued

below that the “logical relationship” test was the

appropriate one (Pet. 28a), and the Missouri Court of

29

Appeals agreed (Pet. 28a-29a). Petitioners cannot and

do not suggest now that the Court of Appeals should

have applied a different test; rather, they complain

that the “Missouri Court of Appeals misapplied the

logical relationship test” (Pet. 27) (emphasis added).

This Court rarely grants certiorari to address “the

misapplication of a properly stated rule of law.” S. Ct.

R. 10. Even aside from the jurisdictional problem

addressed above, this is not the rare case in which

this Court should depart from its ordinary practice.

It is important to understand what is and is not

at issue in this case. This is not, for example, a

situation in which related actions were filed and

pending simultaneously in two different federal

judicial districts. Cf. Warshawsky & Co. v. Arcata

Nat'l Corp., 552 F.2d 1257, 1263 (7th Cir. 1977) (dis-

cussing one court’s power to enjoin prosecution of

claims in another). Nor does this case involve a

party’s failure to assert claims until after a final

judgment on related matters in federal court. Cf.

Crutcher v. Aetna Life Ins. Co., 746 F.2d 1076, 1078-

79 (5th Cir. 1984); Polymer Indus. Products Co. v.

Bridgestone/Firestone, Inc., 347 F.3d 935, 935-36 (Fed.

Cir. 2003); Central W. Va. Energy Co. v. Wheeling-

Pittsburgh Steel Corp., 245 F. App’x 415, 429 (6th Cir.

2007). In those situations, Rule 13(a) is directly

applicable and permits the federal courts to ensure

the orderly presentation of claims. In the latter

situation, principles of claim preciusion and issue

preclusion also are implicated. See generally Taylor v.

Sturgell, 128 S. Ct. 2161, 2171 (2008).

30

This dispute, by contrast, involves parallel

actions in federal and state court, in which each of

the respective defendants asserted no counterclaims.

Petitioners’ position appears to be that once they

commenced litigation in federal court, Greenwood

could not assert related claims against them in state

court, even prior to the entry of judgment on

petitioners’ federal claims. But this Court has long

recognized that parallel litigation in federal and state

court is permissible. See Exxon Mobil Corp. v. Saudi

Basic Indus. Corp., 544 U.S. 280, 292-93 (2005)

(holding that precivsion law, not Rooker-Feldman

doctrine, governs disposition of federal litigation

when parallel state litigation reaches judgment first);

Parsons Steel, Inc. v. First Alabama Bank, 474 U.S.

518, 524-25 (1986) (“[SJimultaneous litigation in state

and federal courts on the same issue... is one of the

costs of our dual court system.”); Atlantic Coast Line

R.R. v. Brotherhood of Locomotive Engineers, 398

U.S. 281, 295 (1970) (“[T]he state and federal courts

had concurrent jurisdiction in this case, and neither

court was free to prevent either party from simul-

taneously pursuing claims in both courts.”); Kline v.

Burke Constr. Co., 260 U.S. 226, 230 (1922) (“Each

court is free to proceed in its own way and in its own

time, without reference to the proceedings in the

other court.”); McClellan v. Carland, 217 U.S. 268,

282 (1910) (“[T]he pendency of an action in the state

court is no bar to proceedings concerning the same

matter in the Federal court having jurisdiction, for

both the state and Federal courts have certain con-

current jurisdiction over such controversies.”).

31

Petitioners’ selective and out-of-context recitation

of snippets of Greenwood’s filings in the two cases

cannot transform the Rule 13(a) question into one

worthy of this Court’s review, even if certiorari were

jurisdictionally available. Many of the statements

cited by petitioners, for example, were made before

Greenwood amended its state-court petition to

include the nuisance claim. Prior to that amendment,

which occurred several months after this case was

removed and remanded, Greenwood had asserted

only two claims: one for a declaratory judgment as to

the validity of its ordinance under state law and one

for petitioners’ negligent repair of Second Avenue.”

After the nuisance claim was asserted in this

case, the factual interrelatedness between the two

cases increased, as petitioners acknowledge (Pet. 7).

Despite the change in circumstances, the federal

court concluded that Greenwood was _ judicially

estopped from invoking the doctrine of issue pre-

clusion following the state court’s nuisance judgment

(Pet. 49a). Greenwood disagrees with that ruling of

the district court and has pressed the issue on appeal

to the Eighth Circuit.” But that dispute has no

“ First Amended Petition for Declaratory Judgment and

Other Relief (Mo. Cir. Ct. Feb. 1, 2007); Plaintiff’s Motion for

Leave to Amend the Petition (Mo. Cir. Ct. Oct. 2, 2007).

” Although petitioners now claim that the “facts and

evidence that Greenwood relied upon in attempting to defend

against Petitioners’ Commerce Clause claim in federal court

were the same facts and evidence that formed the basis of

Greenwood’s nuisance claims in state court” (Pet. 29), they have

(Continued on following page)

32

bearing on the substantiality of the compulsory-

counterclaim issue raised in this Court by petitioners.

In sum, this case involves parallel litigation in

federal and state courts, and the state court entered

judgment first. Petitioners do not claim that the

Missouri Court of Appeals applied the wrong stan-

dard in its discussion of Rule 13(a); they simply

disagree with the court’s application of that standard.

Even if this Court had jurisdiction to review a state

court’s application of a federal procedural rule, it

should decline to do so tn this case.

+

taken a different position before the Eighth Circuit. In response

to Greenwood’'s argument that the district court should have

precluded petitioners from relitigating the issues decided in

Greenwood’s favor on the nuisance claim, petitioners argued

that issue preclusion was inappropriate because the two cases

did not involve the same issues. Appellees’ Response Brief, No.

08-3983, at 67-68 (8th Cir. May 19, 2009).

33

CONCLUSION

For the reasons stated, the Petition for a Writ of

Certiorari should be denied.

Respectfully submitted,

BRYAN CAVE LLP

THOMAS C. WALSH

(Counsel of Record)

BRIAN C. WALSH

STEVEN EF. MAUER

HEATHER 8S. ESAU ZERGER

One Metropolitan Square

211 N. Broadway, Suite 3600

St. Louis, Missouri 63102

(314) 259-2000