United States Court of Appeals, Tenth Circuit.

“ On August 23, 2013, the district court issued a written final judgment as to Claims 5 and 12 against the Lasshofer Defendants. In its order granting final judgment as to these claims, the court reiterated that it found no just reason for delay. It also noted its view that despite the complaint's "assert [ion of] more claims . . . and nam [ing of] more defendants than what might be necessary . . . this lawsuit has been pursued as the three plaintiffs' attempt to establish what amount to statutory and common law fraud claims against Mr. Lasshofer and his entities." ”

“ Plaintiffs also argue that Appellants must either post a bond in the amount of the default judgment or obtain a stay before proceeding on appeal. They rely solely on one sentence plucked from the Niemi I decision: "After a final judgment, too, an absent civil defendant cannot appeal without either posting a bond or coming to court and winning a stay." ”

“ Given the focus of the Lasshofer Defendants' previous efforts to defeat this lawsuit, it is unsurprising that they pursue several challenges to the district court's authority to hear and rule upon the case. They contend that: (1) Plaintiffs did not have standing to bring their claims, and the district court thus lacked subject-matter jurisdiction; (2) the court did not have personal jurisdiction over the Lasshofer Defendants; and (3) venue did not properly lie in the District of Colorado. ”

“ Although the standing argument advanced by Appellants may no longer be properly labeled "prudential," we affirm that it is meritless.
In keeping with the procedural history of this case, the chronicle of Appellants' challenge to standing and subject-matter jurisdiction is complex. Although the Lasshofer Defendants asked Niemi some questions related to standing at the preliminary injunction hearing, they did not raise a standing argument at that stage in the proceedings. ”

“ Lasshofer, a domiciliary of Austria, is described as the managing director and sole beneficial owner of defendants Innovatis GmbH and Innovatis Immobilien GmbH, which are registered in Austria, as well as a co-founder and board member of defendant IAM, a Panamanian company. The three companies are members of the Innovatis Group, "a collection of affiliated entities from around the world purporting to provide asset management and consulting services." Burgess was the manager of Prosperity, a now-dissolved Florida company that claimed to engage in real estate development and project financing. ”

“ This isn't to suggest the statutory standing problem is insurmountable—or even close to it. Though standing isn't apparent in the transcript the plaintiffs recently supplied or the record they prepared for our review on appeal, perhaps on remand the plaintiffs can muster credible evidence that an assignment occurred before the lawsuit began. . . . Perhaps they can establish some direct and personal injury. ”

“ We conclude it was implicit from Niemi's declaration and testimony that he would not have agreed to the forum provision if he knew Burgess was lying, and that such an assumption also comports with common sense. We agree with the district court that Niemi has adequately demonstrated that the forum selection clause was fraudulently induced, and thus reject Appellants' venue challenge. ”

“ We disagree. The district court heard evidence that Plaintiffs' project had sold well in early offerings, received positive press, and was unique in the market such that the economic downturn was less harmful to it than to other projects. ”

“ But we elaborated that " [a] plaintiff who can identify some way in which he or she suffered personally and directly as a result of the defendant's conduct—some way in which his or her losses are not derivative of the corporation's losses—can proceed with or without the corporation in the case." ”

“ There are also sufficient minimum contacts for two of the Innovatis Group companies. Plaintiffs presented a JVA between Prosperity and Innovatis GmbH that was sent to Niemi to prove that the two entities were working together to fund the Fairmont Breckenridge. Appellants' assertion that the document is a forgery is insufficient to negate personal jurisdiction. The fact that the JVA was signed after the Loan Agreement was executed is inapposite because it was allegedly sent to induce Plaintiffs to continue to rely on the fraudulent funding scheme. ”

“ To the extent that Appellants' causation argument rests on its contention that the project would have failed even absent the fraud, the argument implicates the factual findings of the district court and fails on clear error review. Appellants essentially ask us to speculate that "lean economic times," Niemi I, 728 F.3d at 1253, and the difficulties Plaintiffs faced in obtaining Phase II financing mandate a conclusion that the damages award exceeds the "natural and proximate consequence [s] of the fraud." ”

“ In their second appeal to this court, Plaintiffs have overcome the burden they failed to surmount in Niemi I.
We first consider Plaintiffs' argument that the Lasshofer Defendants' standing challenge was not timely raised below and is therefore waived. Appellants are correct that the question of subject-matter jurisdiction can be raised at any time. ”

“ As this court held in Niemi I, "Colorado courts interpreting COCCA look to federal [Racketeer Influenced and Corrupt Organizations Act ("RICO") ] law for guidance" and "a shareholder or guarantor lacks standing to assert RICO claims when their losses are only derivative of a corporation's." 728 F.3d at 1260 (citing Bixler v. Foster, 596 F.3d 751, 758-59 (10th Cir. 2010) ) . Appellants assert that subject-matter jurisdiction cannot exist if prudential standing is defeated, and thus all decisions made by the district court are void. ”

“ The district court articulated several grounds for rejecting Appellants' venue arguments. "The enforceability of a forum selection clause is a question of law which we review de novo." K & V Scientific Co., Inc. ”

“ Defendants Lasshofer and Michael Burgess represented that their companies could secure the full amount needed for Phase II, but required Niemi to sign an agreement prohibiting him from seeking other funding before the due diligence process could begin. In September 2009, Niemi authorized a formal loan request. This document required that a $180,000 loan commitment fee be paid to Burgess' company, Prosperity International LLC ("Prosperity") , and contained a confidentiality clause prohibiting Niemi from discussing the project with other potential lenders. ”

“ In February 2010, Niemi traveled to Europe with Burgess to meet with Lasshofer and attempt to resolve any barriers to financing. At the meeting, Lasshofer and Burgess acknowledged the hardship caused by the delayed funding, and Lasshofer assured Niemi that funding would begin within five weeks. On March 9, 2010, the parties entered a Loan Modification Agreement which called for loan payments to begin later that month. ”

“ Nothing in the record persuades us that an improper burden shifting occurred.
We are similarly unpersuaded by Appellants' arguments that the damages award was based on speculative evidence. Appellants point to statements made by Niemi at the damages hearing in which he approximated numbers not included in Exhibit 1, such as the breakdown of debt versus equity lost by Plaintiffs. ”

“ The Niemi I panel expressly declined to decide whether the standing issue was forfeited because the forfeiture argument was first presented to that panel via Fed. R. App. P. 28 (j) letters, after briefing and oral argument. 728 F.3d at 1261-62. However, the forfeiture issue is clearly presented to us in the instant appeal. ”