author: SMITH, Circuit Judge.

text:
    Phil ROSEMANN; Judith Smith; Suzanne Glisson; Clark Amos; Odis Hash; Mark Bernstein; Marie Merlotti; Robert Givens; Preston Amos; Clayton Givens; Jill Wittenmyer; Mary O’Sullivan, individually and as Trustee of the Thomas E. O’Sullivan Revocable Living Trust and Neil J. O’Sullivan Trust and Executor of Neil J. O’Sullivan Estate; Donna Hogshooter; Thomas Currier; Rudolf Ouwens; Barbara O'Hanlon, as successor co-trustee of the Angelene Block Revocable Trust and as trustee of the Barbara J. O’Hanlon Living Trust; Roy Currier; Richard Aguilar; Billy Harrison; Sheila Mays; Elaine Reed; Cindy Merlotti; Buddy Quessenberry; Dorothy Smith; Arlene Sincoski; Jerry Cronkite; Northwest Properties (1973), Ltd; Marjorie Bernstein; Stanley Kuhlo; Lewis Bernstein; Brad Werner, trustee of the JH Werner Revocable Trust; Tom Bertani; Daryll Currier; Jim Neill; Lorena Messenger; Homer Smith; Henry Barthel; Casey Cook; Mark Merlotti; Donna Bertani; John Holl; Gary Smith; Charles Davis; Stanko Matayo; Carol McCarthy, as successor co-trustee of the Angelene Block Revocable Trust & co-trustee of the Carol A. McCarthy Living Trust; Delores Cook; William McLemore; Wanda Lavender; Carol Green; Lewis Vollmar; Daren Mays; William Wantling; Ben Miller; Kent Sturhahn; Sharon Cobb; Gifford Jordan; Mark Cunningham; Bonita Cobb; Melba Aguilar; Thomas Barnes; Dorothy Ziegler; Leonard Roman; John Shahan; Bob Moore; Julia Barthel; Audrey Holl; Barbara Jordan; Eric Wittenmyer, Plaintiffs-Appellants v. ST. LOUIS BANK, Defendant-Appellee
    No. 15-3965
    United States Court of Appeals, Eighth Circuit.
    Submitted: December 14, 2016
    Filed: May 24, 2017
    Rehearing and Rehearing En Banc Denied July 20, 2017

      Counsel who presented argument on behalf of the appellant was Jonathan F. Andres, of Saint Louis, MO. The following attorney(s) appeared on the appellant brief; Sebastian Rucci, of Huntington Beach, CA.
    Counsel who presented argument on behalf of the appellee was Michael A. Campbell, of Saint Louis, MO. The following attorney(s) appeared on the appellee brief; Matthew C. Hans, of Saint Louis, MO.
    Before WOLLMAN, SMITH, and BENTON, Circuit Judges.

      . The Honorable Lavenski R. Smith became Chief Judge of the United States Court of Appeals for the Eighth Circuit on March 11, 2017.

   SMITH, Circuit Judge.

This case continues to chronicle the legal consequences flowing from Martin Sigillito’s Ponzi scheme known as the British Lending Program (BLP). See, e.g., Aguilar v. PNC Bank, N.A., 853 F.3d 390 (8th Cir. 2017); United States v. Sigillito, 759 F.3d 913 (8th Cir. 2014). Sigillito maintained commercial accounts at defendant St. Louis Bank during the Ponzi scheme’s life. In this case, the plaintiffs, seeking to recoup losses due to the BLP, sued St. Louis Bank, alleging (1) violations of Missouri’s Uniform Fiduciaries Law (UFL); (2) aiding and abetting the breach of Sigillito’s fiduciary duties; (3) conspiracy to breach Sigillito’s fiduciary duties; and (4) conspiracy to violate the Racketeer Influenced and Corrupt Organizations Act (RICO), 18 U.S.C. § 1962(d). The district court granted summary judgment to St. Louis Bank, and the plaintiffs appeal. We affirm.

I. Background

A. Martin Sigillito and the BLP

Sigillito, an attorney located in St. Louis, Missouri, and J. Scott Brown, an attorney in Kansas, formed the BLP in the late 1990s. They formed the BLP to serve as “an investment program to facilitate loans to an English law firm ... to fund ‘black lung’ claims brought on behalf of English coal miners. In approximately 2000 or 2001, the BLP began marketing loans for purported investments in real estate developments in England.” Aguilar, 853 F.3d at 395. Sigillito operated the BLP from 1999 to 2010. During the Ponzi scheme, Sigillito directed' investors to deposit money for BLP loans into his Interest on Lawyers Trust Account (IOLTA). But instead of sending the funds to England for investment, Sigillito fraudulently drew the funds out of his IOLTA account for distribution to himself and others. In 2012, “Sigillito was convicted of multiple counts of wire fraud, mail fraud, conspiracy to commit wire and mail fraud, and money laundering because of his involvement in” the BLP Ponzi scheme. Sigillito, 759 F.3d at 920.

B. St. Louis Bank’s Role

From 2006 to 2010, Sigillito was a commercial customer at St. Louis Bank. Sigillito’s accounts- at St. Louis Bank included (1) the Martin T. Sigillito & Associates, Ltd. business account (“Business Account”); (2) the Martin T. Sigillito & Associates, Ltd. business checking account (“Checking Account”); and (3) the Martin T. Sigillito Attorney At Law IOLTA. In addition, Sigillito had lines of credit at St. Louis Bank (“4316 Loan” and “4382 Loan” (collectively, “MTSA Loans”)) and a Certificate of Deposit Account Registry Service (CDARS).

Except for plaintiff Phil Rosemann’s money, Sigillito deposited most of the BLP investors’ funds into the IOLTA and immediately transferred them into another account. Investors authorized Sigillito to manage their investments for them. Ro-semann signed four handwritten authorizations directing St. Louis Bank to follow instructions from Sigillito on specific transactions.

Primarily, two St. Louis Bank employees interacted with Sigillito during the relevant time period: Craig Hingle and Julie Ohlms. Hingle served as a commercial loan officer at St. Louis Bank from 2005 until 2012. Previously, Hingle worked as a loan officer at Allegiant Bank and knew Sigillito as a trust customer. While at Allegiant Bank, Hingle set up a commercial line of credit for Sigillito and hired Sigillito to create a trust for Hingle’s children. During his employment with St. Louis Bank, Hin-gle helped to secure and service lines of credit for Sigillito and Rosemann. Hingle was generally aware of the BLP and knew that Sigililto was involved with it.

Ohlms was the Assistant Vice President of Treasury Management at St. Louis Bank from 2006 to 2010. She worked with Sigillito and Elizabeth Stajduhar, his executive assistant, on various financial transactions, such as wire transfers, transfers between accounts, and check cashing. Staj-duhar was responsible for reconciling Sigil-lito’s IOLTA and reviewing monthly account statements. Stajduhar frequently contacted Ohlms to transfer money. At some point, Stajduhar began stealing money out of Sigillito’s accounts by writing checks payable to “Elizabeth Perigen,” her maiden name. Sigillito discovered Stajdu-har’s defalcation and asked Ohlms to tell .him if any checks payable to “Elizabeth Perigen” were cashed. Ohlms called Sigilli-to’s office, spoke to Stajduhar, and asked her to tell Sigillito that these checks were being cashed. Ohlms did not know that Stajduhar was Perigen. StajduhAr never explained anything about the BLP to Ohlms and “did not want [Ohlms] to know what was going on.” Nothing in Stajdu-har’s “conversation with [Ohlms] suggested that [Ohlms] knew that [Stajduhar] or somebody was stealing—just that Sigillito wanted to know when these checks were cashed.”

The only discussions that Stajduhar and Sigillito had with Ohlms “concerned issues with the accounts, and at no time did the discussions concerní] the BLP.” At no time did Stajduhar or Sigillito provide St. Louis Bank with any fee deduction authorities, loan agreements, spreadsheets, reconciliation of the IOLTA, or other BLP transaction records, nor did they provide documentation showing where investors thought their money was going or the intent behind deposits. Stajduhar “never explained to anyone at [St. Louis] Bank what was going on with the BLP borrowers ..., and no one explained these to [St. Louis] Bank when checks were issued with various names in the memo lines.” Neither Stajduhar nor Sigillito informed St. Louis Bank that Sigillito was only engaged in work for the BLP, as opposed to other types of legal work. And they never spoke with St. Louis Bank about how BLP investments were distributed. In May 2010, Stajduhar believed that Sigillito was defrauding his investors; however, she never informed St. Louis Bank.

Sigillito engaged in- numerous transactions at St. Louis Bank, beginning in 2006. The most relevant transactions occurred in 2008, 2009, and 2010, as thoroughly detailed in the district court’s order. See Rosemann v. St. Louis Bank, No. 14-CV-983-LRR, Doc. 152 at 8-15 (E.D. Mo. Nov. 17, 2015).

C. Procedural History

Sixty-eight plaintiffs filed suit against St. Louis Bank, alleging (1) violation of Missouri’s UFL (“Count I”); (2) aiding and abetting breach of fiduciary duty (“Count II”); (3) conspiracy to breach fiduciary duty (“Count III”); and (4) conspiracy to violate RICO (“Count IV”). St. Louis Bank moved for summary judgment on all claims, and the plaintiffs moved for partial summary judgment on Count I. In a 60-page opinion, the district court granted St. Louis Bank’s motion for summary judgment on all claims and denied the plaintiffs’ motion for partial summary judgment on Count I.

II. Discussion

The plaintiffs appeal the district court’s grant of summary judgment to St. Louis Bank on all claims and the district court’s denial of summary judgment to them on Count I (UFL claim).

“We review de novo a district court’s grant or denial of summary judgment.” Aguilar, 853 F.3d at 401 (quoting Myers v. Lutsen Mountains Corp., 587 F.3d 891, 892 (8th Cir. 2009)).

A. Count I—UFL Claim

The plaintiffs argue that the district court erred in granting summary judgment to St. Louis Bank on Count I for violations of the UFL. They contend that the undisputed evidence establishes that (1) Sigillito was a fiduciary of the IOLTA; (2) Sigillito breached his fiduciary duty; and (3) St. Louis Bank (a) had actual knowledge of Sigillito’s breach, (b) acted in bad faith, or (c) knew that Sigillito received a benefit from the breach of his fiduciary duty.

We recently set forth the state of the law regarding Missouri’s UFL in Aguilar. See 853 F.3d at 405-06. As in Aguilar, the UFL provision at issue provides:

If a check or other bill of exchange is drawn by a fiduciary as such, or in the name of his principal by a fiduciary empowered to draw such instrument in the name of his principal, the payee is not bound to inquire whether the fiduciary is committing a breach of his obligation as fiduciary in drawing or delivering the instrument, and is not chargeable with notice that the fiduciary is committing a breach of his obligation as fiduciary unless he takes the instrument with actual knowledge of such breach or with knowledge of such facts that this action in taking the instrument amounts to bad faith. If, however, such instrument is payable to a personal creditor of the fiduciary and delivered to the creditor in payment of or as security for a personal debt of the fiduciary to the actual knowledge of the creditor, or is drawn and delivered in any transaction known by the payee to be for the personal benefit of the fiduciary, the creditor or other payee is liable to the principal if the fiduciary in fact commits a breach of his obligation as fiduciary in drawing or delivering the instrument.

Mo. Ann. Stat. § 469.270 (emphases added).

Contrary to the plaintiffs’ contention, § 469.270 is not a strict-liability statute. Aguilar, 853 F.3d at 409. Under the first sentence of § 469.270, a bank is not “liable for a fiduciary’s breach of duty absent either (1) actual knowledge of the breach or (2) knowledge of sufficient facts to constitute bad faith.” Id. at 406 (quotations omitted). Under the second sentence of § 469.270,

a payee is liable to the principal for a fiduciary’s breach if either: (1) the check is payable to a personal creditor of the fiduciary and delivered to the creditor to pay or secure the fiduciary’s personal debt to the actual knowledge of the creditor, or (2) the check is drawn and delivered in any transaction known by the payee to be for the personal benefit of the fiduciary.

Id. at 409 (quoting Chouteau Auto Mart, Inc. v. First Bank of Mo., 55 S.W.3d 358, 360 (Mo. 2001) (en banc)). Thus, in order to hold the bank liable, § 469.270 requires proof that the Bank have “actual knowledge that it was applying the proceeds to a debt owed the Bank,” DeLaRosa v. Farmers State Bank S/B, 474 S.W.3d 240, 245 (Mo. Ct. App. 2015), or “must know that [the fiduciary] is using the fiduciary funds for [his] personal benefit,” Aguilar, 853 F.3d at 409 (alterations in original) (quoting Chouteau, 55 S.W.3d at 360-61). On this record, the plaintiffs fail to establish either actual knowledge or bad faith.

1. Actual Knowledge

The plaintiffs argue that numerous e-mails between Sigillito and Hingle and Ohlms prove Hingle’s and Ohlms’s knowledge that Sigillito was misappropriating fiduciary funds in the IOLTA to pay off his line of credit at St. Louis Bank. For Hin-gle and Ohlms to have actual knowledge of Sigillito’s breach of his fiduciary duty, they must have had an “awareness that, at the moment, the fiduciary was defrauding the principal.” Aguilar, 853 F.3d at 407 (quotations omitted). They must have possessed “express factual information” that Sigillito was using the fiduciary funds “for private purposes in violation of the fiduciary relationship.” Id. (quotations omitted). St. Louis Bank cannot be found to have “actual knowledge of a breach of trust merely because at some stage of the handling of the fiduciary account it could, by inspection of public records or by piecing together all the facts known by different employees of the bank, become aware of a breach of trust.” Id. (quotations omitted).

Having reviewed the record, we agree with the district court that “nothing in the e-mails [offered by the plaintiffs] evidences any understanding with respect to the fiduciary status of the funds being discussed or any possible misappropriation of Plaintiffs’ funds.” These e-mails and other record evidence show Sigillito moving large sums of money between his IOLTA, Business Account, and MTSA Loans. But, as the district court recognized, none of this “evidence show[s] that St. Louis Bank had a duty to investigate these transactions, or that St. Louis Bank’s employees should have been on notice that Sigillito was misusing funds [from the IOLTA].”

The multiple-source nature of the IOLTA precluded St. Louis Bank and its employees from knowing whether transactions in the account involved fiduciary funds. As we recognized in Aguilar, “[t]he funds held in a Missouri IOLTA ... may contain a variety of funds, including individual client funds, multiple client funds, and attorney’s fees.” 853 F.3d at 397 (emphasis added). In the present case, St. Louis Bank offered unrebutted expert testimony from certified public accountant Joseph Hopkins that an IOLTA includes “[Retainer fees paid to lawyers by clients which become attorneys’ fees as legal work is performed”; “[judgments or settlements paid that will be split between the lawyer and client at a later date”; “[p]ayments from third parties for other activity such as investments to be made by the lawyer on behalf of the client whereby the lawyer will earn a fee”; and “Reimbursement by clients and non-clients for expenses incurred by the lawyer.” Hopkins identified as a “common scenario” an IOLTA “holding] funds paid by the client up front as an advance on fees and expenses before the work is done and prior to the client’s approval of billing.” Consistent with Aguilar, Hopkins explained that funds in an IOLTA “may be owed to the beneficiaries of the trust, the attorney involved, and unrelated third parties.”

The plaintiffs argue that Hopkins’s con-clusory statement that “[t]he funds in the account may be owed to ... the attorney involved” ignores the fact that client funds in an IOLTA that are paid as an advance on fees remain client property until the fees are earned; once those fees are earned, the lawyer must remove his fees from the IOLTA. In his report, Hopkins did recognize that “[o]nce the lawyer earns the fees and bills the client, and upon the client’s .approval of the lawyer’s billing, the funds are no longer property of the client and should be removed from the lawyer’s [IOLTA].” The plaintiffs have not provided evidence that any funds that Sigillito removed from the IOLTA were not properly earned fees or funds that he was otherwise authorized to remove.

Furthermore, other undisputed evidence shows that St. Louis Bank’s understanding of the IOLTA—even if mistaken—was that an IOLTA may consist of money belonging to the lawyer. See Aguilar, 853 F.3d at 407 (“Neither party disputes that ‘[i]n 2001, Allegiant Bank’s understanding of the nature and function of IOLTA accounts was that ... an IOLTA account can be funds for an individual client, multiple clients, and could include funds that belong to the lawyer, themselves.’ ” (ellipsis and alteration in original)). For example, Kim-berli Palmer, Executive Vice President and Chief Operations Officer of St. Louis Bank, declared that

unlike a typical trust account in which the Bank might know the identity of specific beneficiaries, an IOLTA Account can contain funds of multiple and ever-changing beneficiaries, as well as third party funds and fees earned by the attorney. The Bank did not have Sigillito’s detailed records concerning IOLTA funds, and did not know whether a given transaction was authorized or not.

The undisputed evidence also shows that St. Louis Bank’s employees lacked actual knowledge of Sigillito’s breach of fiduciary duty. The evidence shows that Hingle did not know whether money in Sigillito’s IOLTA account was received from investors, law clients, or others, and had no way of knowing the source of the funds. Likewise, Ohlms had no understanding of Sigil-lito’s law practice and lacked knowledge of the parties involved in the various transactions, reasons for the transfers, or whether the money belonged to Sigillito. And Staj-duhar, Sigillito’s assistant, testified that (1) St. Louis Bank was given no information concerning the BLP; (2) Stajduhar and Sigillito would contact Ohlms to handle transactions, but Stajduhar never explained why they were made or whether they pertained to the BLP; (3) Stajduhar never saw any documents about the BLP that were sent to St. Louis Bank; (4) Staj-duhar never gave St. Louis Bank any breakdown of the process, loan agreements, spreadsheets, or instructions showing how investors’ money was being used; and (5) Stajduhar never saw anything indicating that St. Louis Bank had knowledge of what was happening with the BLP.

As a result, we hold that the plaintiffs have failed to show that St. Louis Bank had actual knowledge that Sigillito misappropriated fiduciary funds.

2. Bad Faith

The plaintiffs argue that they proved that St. Louis Bank acted in bad faith when it “covered up” “two material overdrafts in the IOLTA.” The first overdraft occurred on April 20, 2009, when the IOLTA was overdrawn in the amount of $249,032.46. Sigillito addressed the deficiency by directing St. Louis Bank to transfer $288,200.25 from the Business Account into the IOLTA, thereby resolving the overdraft. The second overdraft occurred on May 20, 2009, when Sigillito wired $141,000 from the IOLTA to the British American Group. This wire created an overdraft in the IOLTA of $143,839.12. Also on May 20, 2009, Hingle signed the check disbursing $150,000 from the 4382 Loan with check no. 3424.

The plaintiffs argue that “Sigilli-to’s $249,032 and $143,839 overdraft[s] of his IOLTA put St. Louis Bank on notice that Sigillito was misappropriating client funds. St. Louis Bank even advanced funds from its line of credit to cover the overdraft.” They assert that “[a] check on a client account that is dishonored for insufficient funds is often evidence that a lawyer has improperly commingled client funds, in violation of his or her fiduciary duties.” (Quoting Lemer v. Fleet Bank, N.A., 459 F.3d 273, 280 (2d Cir. 2006).) They maintain that “IOLTA overdrafts are ‘indicative of trust withdrawals for non-trust purposes.’” (Quoting Lemer, 459 F.3d at 288.)

“The test of bad faith is ‘whether it is commercially unjustifiable for the person accepting a negotiable instrument to disregard and refuse to learn facts readily available. Where circumstances suggestive of the fiduciary’s breach become sufficiently obvious it is “bad faith” to remain passive.’” [Watson Coatings, Inc. v. Am. Express Travel Related Servs., Inc., 436 F.3d 1036, 1041 (8th Cir. 2006) ] (quoting Trenton [Tr. Co. v. W. Sur. Co.], 599 S.W.2d [481,] 492 [ (Mo. 1980 (en banc) ]). For a bank to act in bad faith, “[t]he facts and circumstances must be so cogent and obvious that to remain passive would amount to a deliberate desire to evade knowledge because of a belief or fear that inquiry would disclose a defect in the transaction.” Hendren [v. Farmers State Bank, S.B.], 272 S.W.3d [345,] 350 [(Mo. Ct. App. 2008)] (quoting Gen. Ins. Co. of Am. [v. Commerce Bank of St. Charles], 505 S.W.2d [454,] 458 [(Mo. Ct. App. 1974)]).

Aguilar, 853 F.3d at 408 (fifth alteration in original).

In Buffets, Inc. v. Leischow, we concluded that a bank’s toleration of a severe practice of overdrafts or significant evidence of check kiting amounts to bad faith (as opposed to actual knowledge) under the Uniform Fiduciaries Act only when the bank knows either a designated fiduciary account or a segregated account contains the principal’s funds. 732 F.3d 889, 900-01 (8th Cir. 2013). We explained:

Where funds are held in a fiduciary account and the bank is thus aware that they do not belong to the fiduciary, the nature of the account necessarily puts the bank on notice of fiduciary obligations. So it follows that the fiduciary’s suspicious banking practices alone can indicate a violation of those obligations and the bank’s bad faith. Where funds are held in the fiduciary’s personal account, by contrast, overdrafts and check kiting do not necessarily implicate a fiduciary duty. The bank may be unaware that any funds are held subject to a fiduciary obligation. Even if the bank knows that fiduciary obligations apply to some funds in the account, overdrafts and check kiting may not involve those specific funds, so the bank may not be acting in bad faith in processing any particular transaction.
Given this distinction, ... a bank’s toleration of “a severe practice of overdrafts or significant evidence of check kiting” by itself amounts to bad faith only in the context of either a designated fiduciary account or a segregated account that the bank knows contains the principal’s funds.

Id. (second emphasis added) (quoting McCartney v. Richfield Bank & Tr. Co., Nos. CX-00-1466, C1-00-1467, 2001 WL 436154, at *4 (Minn. Ct. App. May 1, 2001)).

Here, the IOLTA is a fiduciary account. But as Hopkins’s unrebutted expert testimony shows, an IOLTA is a “demand deposit” account, different from a typical trust account. A trust account at a bank is “an account whereby the trust department of a bank ... is the trustee of the account and has primary fiduciary responsibility to an individual or limited group of individuals ... who are the beneficiaries of such a trust.” Funds in an IOLTA, however, “may be owed to the beneficiaries of the trust, the attorney involved and unrelated third parties.” Hopkins stated that “the activity in the IOLTA comports with the activity you would anticipate seeing with an attorney.” Finally, Hopkins stated that there was no activity in or patterns that led him to believe that St. Louis Bank, “acting in a commercially reasonable banking manner, should have known” that Sigillito was misappropriating client funds.

Because an IOLTA is not a typical trust account and may involve a variety of funds—some of which are attorney’s fees that the attorney withdraws when earned'—even if St. Louis Bank knew that Sigillito had fiduciary obligations as to “some funds in the account, overdrafts and check kiting may not involve those specific funds, so the bank may not be acting in bad faith in processing any particular transaction.” Buffets, 732 F.3d at 901.

And, the undisputed facts show St. Louis Bank’s belief that “unlike a typical trust account in which the Bank might know the identity of specific beneficiaries, an IOLTA Account can contain funds of multiple and ever-changing beneficiaries, as well as third party funds and fees earned by the attorney.”

Finally, in uncontroverted testimony, Palmer explained that the overdrafts were caused by Sigillito’s mistakes involving transfers to or from the wrong accounts, or the timing of the transfers. Both overdrafts were corrected by transfers using funds already available prior to the overdrafts. And Hingle stated that the increase to the MTSA Loans was discussed with Sigillito on March 27, 2009, well before the April 20 overdraft, and it was authorized on May 18, prior to the May 20 overdraft.

Accordingly, we conclude that the plaintiffs have failed to prove that St. Louis Bank acted in bad faith.

3. Personal Benefit

The plaintiffs also argue that St. Louis Bank is liable under the UFL because it knew that Sigillito was “using the fiduciary funds for [his] personal benefit.” Chouteau, 55 S.W.3d at 360-61. Before the district court, the plaintiffs argued that Sigillito held personal debts at St. Louis Bank in the form of the 4316 Loan and the 4382 Loan (MTSA lines-of-credit loans) and, therefore, St. Louis Bank is strictly liable for payments on these loans. The plaintiffs noted that Sigillito was a personal guarantor of the 4316 Loan and the 4382 Loan and argued that “[a]s guarantor of these loans, the debt owed to St. Louis Bank was a personal debt of Sigillito.”

St. Louis Bank correctly points out that, on appeal, the plaintiffs have “abandon[ed] their arguments about the MTSA loans, only to make similar claims about repayments of a loan to Rosemann.” Specifically, the plaintiffs argue that Sigillito pledged his collateral for Rosemann’s $600,000 line-of-credit loan; the collateral for this line of credit “was the assignment of the CDARS account of MTSA in the amount of $327,556 and the CDARS account of Martin T. Sigillito in the amount of $280,224.” They argue that Sigillito personally bene-fitted from the repayment of Rosemann’s loan “by having his collateral returned to him.”

We agree with St. Louis Bank that the plaintiffs have failed to provide any legal authority that repayments of debts guaranteed by a fiduciary are for the fiduciary’s “personal benefit.” This is not a case in which Rosemann defaulted on the loan, thereby resulting in him being personally liable for the debt on the guarantor. Cf. Enter. Bank & Tr. v. Barney Ashner Homes, Inc., 300 P.3d 115 (Kan. Ct. App. 2013) (memorandum opinion) (liability following default on loan).

The plaintiffs also argue that St. Louis Bank is liable for accepting fiduciary funds from Sigillito’s IOLTA to repay his corporate loan. They maintain that St. Louis Bank benefitted from this repayment. According to the plaintiffs, “[s]hortly after accepting direct payments for Rosemann, St. Louis Bank on May 19, 2008, accepted a check for $175,053.47 ‘as payee and drawee bank’ and applied [that amount] ‘to pay off the MTSA line of credit, loan number 431600.’ ” But these MTSA loans were not personal debts of Sigillito’s. Stajduhar testified that the MTSA Loans were not loans to Sigillito personally, and she knew of no payments on a personal loan or personal debt of Sigillito from the IOLTA. Both Palmer and Hingle testified that St. Louis Bank’s loans were made to MTSA and were not personal loans to Sigillito and were not- reported on his personal credit bureau report because they were not personal loans. Palmer testified that Sigillito had no personal debt owed to St. Louis Bank and that St. Louis Bank had no knowledge of any payment by Sigillito of a personal debt. She also testified that although Sigillito and his wife gave St. Louis Bank Commercial Guaranties on MTSA Loans, they were not a personal debt of Sigillito and were not classified as such by St. Louis Bank. As the district court stated, the evidence in the record demonstrates that the 4316 Loan and the 4382 Loan were commercial loans made to Martin T. Sigillito & Associates and were never classified as personal loans.

As a result, we conclude that the plaintiffs have failed to show that St. Louis Bank knew that Sigillito was “using the fiduciary funds for [his] personal benefit.” Chouteau, 55 S.W.3d at 360-61.

We hold that the district court properly denied summary judgment to the plaintiffs on their UFL claim and granted summary judgment to St. Louis Bank on that claim.

B. Counts II, III, and IV— Common-law Claims and RICO Claim

The plaintiffs argue that the district court erred in granting summary judgment to St. Louis Bank on the common-law claims set forth in Counts II and III: aiding and abetting breach of fiduciary duty and conspiracy to breach fiduciary duty. They also assert that the district court erred in granting summary judgment to St. Louis Bank on their claim that St. Louis Bank conspired with Sigillito to violate RICO.

Under Missouri law, to prove that St. Louis Bank aided and abetted Sigillito in the breach of-his fiduciary duty, the plaintiffs must establish that St. Louis Bank “kne[w] that [Sigillito’s] conduct constitute[d] a breach of duty and g[ave] substantial assistance or encouragement to [Sigillito] so to conduct himself.” Aguilar, 853 F.3d at 403 (first and fourth alterations in original) (quoting Bradley v. Ray, 904 S.W.2d 302, 315 (Mo. Ct. App. 1995)). The plaintiffs must show that St. Louis Bank “affirmatively act[ed] to aid [Sigillito].” Id. (first alteration in original) (quoting Bradley, 904 S.W.2d at 315). St. Louis Bank is not liable for a mere “failure to object to the tortious act [or its] mere presence at the commission of the tort.” Id. (quoting Bradley, 904 S.W.2d at 315). “[M]ere negative acquiescence” is insufficient to hold St. Louis Bank liable; instead, it must have “associated] [itself] in some way with [Sigillito] in bringing about the commission of the crime.” Id. (second alteration in original) (quoting Bradley, 904 S.W.2d at 315).

To prove that St. Louis Bank conspired with Sigillito to breach his fiduciary duties, the plaintiffs “must prove the elements of civil conspiracy.” Id. at 402. Those elements include:

(1) two or more persons, (2) an object to .be accomplished, (3) a meeting of the minds on the object or course of action, (4) one or more unlawful overt acts, and (5) resulting damages. The essence of a civil conspiracy is an unlawful act agreed upon by two or more persons.

Id. at 402-03 (quoting Mackey v. Mackey, 914 S.W.2d 48, 50 (Mo. Ct. App. 1996)). The third element requires the plaintiffs to prove “that any two of the Defendants involved in the alleged civil conspiracy met, negotiated, and more importantly, achieved a meeting of the minds to carry out some unlawful purpose.” Id. at 403 (quoting Intertel, Inc. v. Sedgwick Claims Mgmt. Servs., Inc., 204 S.W.3d 183, 204-05 (Mo. Ct. App. 2006)). To prove that St. Louis Bank and Sigillito had a “meeting of the minds,” the plaintiffs must show that the parties had “a unity of purpose or a common design and understanding.” Id. (quoting Glob. Control Sys., Inc. v. Luebbert, No. 4:14-CV-657-DGK, 2016 WL 910190, at *2 (W.D. Mo. Mar. 9, 2016)).

To prove that St. Louis Bank conspired with Sigillito to violate RICO, the plaintiffs must not only prove the elements of a RICO violation but also that St. Louis Bank “objectively manifested an agreement to participate ... in the affairs of [the] enterprise.” Id. at 402 (ellipsis and alteration in original) (quoting United States v. Darden, 70 F.3d 1507, 1518 (8th Cir. 1995)). Proving that St. Louis Bank merely associated with Sigillito, knew about the conspiracy, and was present during conspiratorial discussions is insufficient to show that St. Louis Bank conspired with Sigillito to violate RICO. Id. Instead, the plaintiffs must produce evidence that St. Louis Bank “was aware of the scope of the enterprise and intended to participate in it.” Id. (quoting United States v. Stephens, 46 F.3d 587, 592 (7th Cir. 1995)).

The plaintiffs argue that St. Louis Bank’s handling of the overdrafts in the IOLTA proves that it knew that Sigillito was breaching his fiduciary duty. They also reference several e-mails to prove that St. Louis Bank, as payee and drawee bank, accepted millions in fiduciary funds for payment of principal and interest on Sigillito’s personal line of credit. They contend that they have proven a common-law conspiracy and conspiracy to violate RICO by producing evidence that Sigillito used the IOLTA to pay personal expenses and loans with St. Louis Bank.

We conclude that the plaintiffs’ common-law and RICO claims fail because their evidence does not create any genuine issues of material fact. We have already held that the evidence of overdrafts and e-mails is insufficient to prove St. Louis Bank’s actual knowledge under the UFL. See supra Part II.A.1. For the same reasons, such evidence is insufficient to prove that St. Louis Bank knew that Sigillito’s conduct constituted a breach of his fiduciary-duty, had a meeting of the minds with Sigillito to breach his fiduciary duty, or objectively manifested an agreement to participate in criminal activity with Sigilli-to. This reasoning extends to the plaintiffs’ contention that St. Louis Bank “knew that Sigillito was prohibited from using funds in his IOLTA ... to pay his personal debts.” Even assuming Sigillito was using IOLTA funds to pay personal debts, the plaintiffs have failed to produce evidence that the funds were not properly earned fees or funds that he was otherwise authorized to remove from the account. See supra Part II.A.1. This is because an IOLTA is a unique trust account that may involve a variety of funds, some of which are attorney’s fees that the attorney withdraws when earned. See supra Part II.A.1.

As a result, we hold that the district court properly granted summary judgment to St. Louis Bank on Counts II, III, and IV.

III. Conclusion

Accordingly, we affirm the judgment of the district court.

      . The Honorable Linda R. Reade, United States District Judge for the Northern District of Iowa, sitting by designation.

      . The 2006 and 2007 versions of the Missouri Supreme Court Rules are the same as that set forth in Aguilar, 853 F.3d at 397 n.5. The 2008, 2009, and 2010 versions provide that "[a] lawyer shall deposit into a client trust account legal fees and expenses that have been paid in advance, to be withdrawn by the lawyer only as fees are earned or expenses incurred.” Mo. Sup. Ct. R. 4-1.15(e) (2008, 2009, 2010); see also Mo. Sup. Ct. R. 4-1.15 cmt. 3 (2008, 2009, 2010) (“Lawyers often receive funds from which the lawyer's fee will be paid. The lawyer is not required to remit to the client funds that the lawyer reasonably believes represent fees owed. However, a lawyer may not hold funds to coerce a client into accepting the lawyer's contention. The disputed portion of the funds must be kept in a trust account, and the lawyer should suggest means for prompt resolution of the dispute, such as arbitration. The undisputed portion of the funds shall be promptly distributed.”).

      . "The UFL is the Missouri codification of the Uniform Fiduciaries Act....” Aguilar, 853 F.3d at 405 (quotations omitted). Buffets involved Minnesota’s Uniform Fiduciaries Act. 732 F.3d at 898.

      . The parties agree that Missouri law applies to the common-law claims.


source: Caselaw Access Project

author: GRUENDER, Circuit Judge.

license: Public Domain

text:
    Deshawn Maurice FLETCHER, Petitioner-Appellant v. UNITED STATES of America, Respondent-Appellee
    No. 16-1220
    United States Court of Appeals, Eighth Circuit.
    Submitted: November 17, 2016
    Filed: May 26, 2017
    As Amended July 12, 2017
    Rehearing and Rehearing En Banc Denied July 20, 2017

      Deshawn Maurice Fletcher, Pro Se.
    Michael Hansen, Assistant Federal Public Defender, Federal Public Defender’s Office, Lincoln, NE, for Petitioner-Appellant.
    Sara Elizabeth Fullerton, Assistant U.S. Attorney, U.S. Attorney’s Office, Lincoln, NE, Michael P. Norris, Assistant U.S. Attorney, U.S. Attorney’s Office, District of Nebraska, Omaha, NE, for Respondents Appellee.
    Before COLLOTON, BEAM, and GRUENDER, Circuit Judges.
   GRUENDER, Circuit Judge.

Deshawn Fletcher appeals the denial of his motion under 28 U.S.C. § 2255 to vacate, set aside, or correct his criminal sentence. For the reasons below, we affirm the district court.

I.

Fletcher pleaded guilty in August 2012 to one count of possession of a firearm by a felon, in violation of 18 U.S.C. § 922(g)(1). He was sentenced under the Armed Career Criminal Act (“ACCA”), 18 U.S.C. § 924(e), to 210 months’ imprisonment. Fletcher did not appeal the judgment, and his conviction became final fourteen days later when the time to appeal expired. See Fed. R. App. P. 4(b)(1)(A); Never Misses A Shot v. United States, 413 F.3d 781, 782 (8th Cir. 2005) (per curiam) (noting that a conviction becomes final in the absence of an appeal on the date the time to appeal expires). The district court subsequently reduced Fletcher’s sentence to 158 months’ imprisonment under Federal Rule of Criminal Procedure 35(b). His ACCA predicate offenses consisted of possession with intent to distribute crack cocaine and two Nebraska felony convictions for making terroristic threats (one as a juvenile and one as an adult). At sentencing, Fletcher did not object to the revised presentence investigation report’s ACCA classification. Thus, the district court did not have occasion to articulate how Fletcher’s terroristic threats convictions qualified as ACCA predicate offenses. Fletcher filed a motion to vacate, set aside, or correct his sentence pursuant to 28 U.S.C. § 2255 on November 13, 2015 after the Supreme Court invalidated the residual clause of the ACCA. See Johnson v. United States, — U.S. -, 135 S.Ct. 2551, 2563, 192 L.Ed.2d 569 (2015); Welch v. United States, — U.S.-, 136 S.Ct. 1257, 1268, 194 L.Ed.2d 387 (2016) (applying Johnson retroactively). The district court denied Fletcher’s motion, determining that his prior convictions for making terroristic threats qualify under the force clause. Fletcher appeals.

II.

We review de novo a “district court’s determination of whether [a] conviction qualifies as a violent felony under the ACCA.” United States v. Schaffer, 818 F.3d 796, 798 (8th Cir. 2016) (citation omitted). Under the ACCA, a person convicted of being a felon in possession of a firearm is subject to a mandatory minimum sentence of fifteen years if he has three prior convictions for violent felonies or serious drug offenses. 18 U.S.C. § 924(e)(1). Fletcher does not dispute that he has been convicted of a qualifying serious drug offense. Thus, the only question is whether his two Nebraska felony convictions for making terroristic threats qualify as violent felonies.

The ACCA defines a violent felony as:

[A]ny crime punishable by imprisonment for a term exceeding one year, or any act of juvenile delinquency involving the use or carrying of a firearm, knife, or destructive device that would be punishable by imprisonment for such term if committed by an adult that—
(i) has as an element the use, attempted use, or threatened use of physical force against the person of another; or
(ii) is burglary, arson, or extortion, [or] involves the use of explosives. .. .

Id. at § 924(e)(2)(B).

The key question in this case is whether a conviction under the Nebraska terroristic threats statute qualifies as a violent felony under the ACCA without the residual clause. However, Fletcher also challenges whether a juvenile conviction for making terroristic threats can meet the preliminary requirement that a qualifying juvenile offense “involv[e] the use or carrying of a firearm, knife, or destructive device.” See id. The parties have generally assumed that this question is part of a single Johnson claim, but we disagree. An act of juvenile delinquency cannot qualify as a violent felony under any clause of the ACCA, including the residual clause, unless the court first determines that it involved the use or carrying of a firearm, knife, or destructive device. In this way, the question of whether a juvenile conviction involved the use or carrying of a firearm, knife, or destructive device is completely separate from the question of whether the juvenile conviction is an enumerated offense or qualifies under the force clause. See 924(e)(2)(B)(i), (ii). Indeed, the only way in which the residual clause could have affected a juvenile conviction is if the offense first met the preliminary condition that it involve a firearm, knife, or destructive device. Thus, Fletcher’s contention that his juvenile conviction did not involve the use or carrying of a firearm, knife, or destructive device is a separate claim distinct from his Johnson claim. As a result, it must be timely and not procedurally defaulted on its own. See DeCoteau v. Schweitzer, 774 F.3d 1190, 1192 (8th Cir. 2014) (explaining that timeliness must be assessed on a claim-by-claim basis); Keithley v. Hopkins, 43 F.3d 1216, 1217-18 (8th Cir. 1995) (analyzing procedural default on a claim-by-claim basis).

The Government conceded that Fletcher’s § 2255 motion was timely and did not raise procedural default either below or on appeal. However, we have the authority to raise either issue sua sponte. Wood v. Milyard, 566 U.S. 463, 471-72, 132 S.Ct. 1826, 182 L.Ed.2d 733 (2012); King v. Kemna, 266 F.3d 816, 822 (8th Cir. 2001) (en banc). Usually, we consider the case as the parties present it, but we may choose to raise procedural default or timeliness sua sponte in “exceptional cases” where the Government has not intentionally or strategically chosen not to raise the issues. Wood, 566 U.S. at 471, 132 S.Ct. 1826 (quotation and citation omitted); see Jones v. Norman, 633 F.3d 661, 666 (8th Cir. 2011) (“We have discretion to do so and have done so to correct an obviously inadvertent omission or an obvious computational error.” (quotations and citations omitted)). In this case, the Government’s failure to raise procedural default was not intentional or strategic but rather came from the mistaken assumption held by both parties (as well as the district court) that the question of whether the jqvenile conviction involved the use or carrying of a firearm, knife, or destructive device is part of Fletcher’s Johnson claim. In these circumstances, we consider it appropriate to raise procedural default sua sponte. Having provided the parties notice and the opportunity to be heard through supplemental briefing, see Dansby v. Hobbs, 766 F.3d 809, 824 (8th Cir. 2014), we determine that Fletcher’s claim that his juvenile offense did not involve the use or carrying of a firearm, knife, or destructive device is procedurally defaulted.

“Habeas review is an extraordinary remedy and will not be allowed to do service for an appeal. Thus, a petitioner may not raise an issue before the district court for the first time in a § 2255 motion if the issue was not presented on direct appeal from the conviction.” Jennings v. United States, 696 F.3d 759, 762 (8th Cir. 2012) (quotations and citations omitted). In his § 2255 motion and throughout the appeal, Fletcher argues that Descamps v. United States, — U.S. -, 133 S.Ct. 2276, 186 L.Ed.2d 438 (2013), prevents a court from looking beyond the elements of the offense in determining whether his juvenile conviction involved the use or carrying of a firearm, knife, or destructive device. However, as Descamps did not create a “new rule,” Headbird v. United States, 813 F.3d 1092, 1097 (8th Cir. 2016), Fletcher had the opportunity to raise this argument before the district court and on direct appeal based on existing precedent. Because he failed to do so, the claim is procedurally defaulted unless Fletcher can demonstrate “either cause and actual prejudice, or that he is actually innocent.” See Lindsey v. United States, 615 F.3d 998, 1000 (8th Cir. 2010) (quoting Bousley v. United States, 523 U.S. 614, 622, 118 S.Ct. 1604, 140 L.Ed.2d 828 (1998)); Bell v. Norris, 586 F.3d 624, 633-34 (8th Cir. 2009). Fletcher has not demonstrated that he meets either requirement as to this claim. Therefore, the claim that his juvenile conviction did not involve a firearm, knife, or destructive device is procedurally defaulted.

Accordingly, we proceed to the central question of this case: whether Fletcher’s Nebraska convictions for making terroristic threats qualify under an ACCA clause other than the residual clause. If the convictions cannot qualify under an ACCA provision other than the residual clause, then Johnson requires resentencing. However, if the convictions qualify under another clause, then Johnson does not affect Fletcher’s sentence. Making terroristic threats is not one of the crimes enumerated in § 924(e)(2)(B)(ii). Therefore, our analysis turns on whether the Nebraska terroristic threats statute qualifies under the ACCA force clause, § 924(e)(2)(B)®.

The ACCA force clause encompasses crimes that “ha[ve] as an element the use, attempted use, or threatened use of physical force against the person of another.” 18 U.S.C. § 924(e)(2)(B)®. The Nebraska terroristic threats statute provides as follows:

A person commits terroristic threats if he or she threatens to commit any crime of violence:
(a) With the intent to terrorize another;
(b) With the intent of causing the evacuation of a building, place of assembly, or facility of public transportation; or
(c) In reckless disregard of the risk of causing such terror or evacuation.

Neb. Rev. Stat. § 28-311.01(1). Nebraska does not statutorily define “crime of violence.” However, the Nebraska Supreme Court has defined the term “crime of violence” as “an act which injures or abuses through the use of physical force and which subjects the actor to punishment by public authority.” State v. Palmer, 224 Neb. 282, 399 N.W.2d 706, 717 (1986); see also State v. Rye, 14 Neb.App. 133, 705 N.W.2d 236, 238-39 (2005) (approving the use of this definition in jury instructions). Fletcher argues that the terroristic threats statute does not qualify under the force clause because it can encompass threats against property.

We disagree. The categorical approach “requires a realistic probability, not a theoretical possibility, that the State would apply its statute to conduct that falls outside the generic definition of a crime.” Gonzales v. Duenas-Alvarez, 549 U.S. 188, 193, 127 S.Ct. 815, 166 L.Ed.2d 683 (2007) (applying the categorical approach in the immigration context); see also United States v. Bell, 840- F.3d 963, 966 (8th Cir. 2016) (applying Gonzales in the ACCA context). In order “[t]o show that realistic probability, an offender ... must at least point to his own case or other cases in which the state courts in fact did apply the statute in the special (nongeneric) manner for which he argues.” Gonzales, 549 U.S. at 193, 127 S.Ct. 815. Fletcher does not provide, nor can we find, a case where Nebraska applied the terroristic threats statute to a threat to property alone. This makes sense because the phrase “an act which injures or abuses through the use of physical force,” Palmer, 399 N.W.2d at 717, standing alone, is most naturally taken to refer to the injury or abuse of a person. See generally United States v. Kydney, No. 8:13CR165, 2013 WL 4774727, at *11 (D. Neb. Sept. 5, 2013) (unreported) (“The cases [under the Nebraska terroristic threats statute] involve threats to kill, hurt, or maim, and most fact patterns show either an attempted battery, an actual physical battery, or a bodily injury.”).

Fletcher emphasizes that a threat of arson, which he argues entails only force against property, could possibly qualify as a terroristic threat. However, the only case Fletcher cites in support is State v. Smith, No. A-02-1482, 2003 WL 22769284 (Neb. Ct. App. Nov. 25, 2003), an unpublished decision finding that third degree assault is not a lesser included offense of terroristic threats. It makes passing, hypothetical reference to arson in its reasoning. Id. at *5 (“[I]t it is possible to threaten to commit a violent crime, such as arson, with the intent to terrorize another person without ever threatening any person in a menacing manner. Thus, the elements of the crime make it possible to commit the offense of terroristic threats without committing third degree assault.”). The Nebraska Supreme Court did not adopt this reasoning on appeal. State v. Smith, 267 Neb. 917, 678 N.W.2d 733, 737 (2004) (finding third degree assault not a lesser included offense of terroristic threats because the former requires proof of the victim’s actual state of mind while the latter requires proof only of the defendant’s intent). Indeed, not all arson is limited to force against property, because arson of an occupied building exerts force against the occupants. “ ‘[T]hat the harm occurs indirectly, rather than directly (as with a kick or punch), does not matter,’ because otherwise ‘one could say that pulling the trigger on a gun is not a use of force because it is the bullet, not the trigger, that actually strikes the victim.’” United States v. Rice, 813 F.3d 704, 706 (8th Cir. 2016) (quoting United States v. Castleman, — U.S.-, 134 S.Ct. 1405, 1415, 188 L.Ed.2d 426 (2014)). Arson of an unoccupied building, in contrast, does not involve force against a person. United States v. Sanchez-Martinez, 633 F.3d 658, 660 (8th Cir. 2011). Fletcher points to no case in which Nebraska has applied the terroristic threats statute to a threat to commit arson of an unoccupied building. As a result, even if the theoretical possibility exists that the Nebraska terroristic threats statute could encompass threats only to property, Fletcher has not demonstrated a realistic probability that Nebraska would apply the statute in that manner.

Finally, the Nebraska terroristic threats statute is not analogous to the Minnesota terroristic threats statute at issue in United States v. Sanchez-Martinez, 633 F.3d at 660, as Fletcher contends. Although the text of the Minnesota terroristic threats statute is similar to Nebraska’s, Minnesota defined “crime of violence” to include crimes like “sale of more than ten grams of cocaine in a ninety-day period, manufacturing methamphetamine in the presence of a child, arson of an unoccupied building, and shooting at an unoccupied transit vehicle,” which the court described as not having as an element the use of physical force against the person of another. Id. (citation omitted). Thus, the Minnesota terroristic threats statute did not qualify under the ACCA force clause. However, the Nebraska definition is narrower, and, as a result, Sanchez-Martinez does not compel the same conclusion.

III.

For the foregoing reasons, Fletcher’s convictions for making terroristic threats categorically qualify under the ACCA’s force clause and Johnson provides no relief. Therefore, we affirm the district court’s denial of Fletcher’s motion to vacate, set aside, or correct his sentence.

      .- The Honorable Richard G. Kopf, United States District Judge for the District of Nebraska.

      . The residual clause Johnson invalidated is omitted.

      . Even if the claim had not been procedurally defaulted, the one-year time period to file a § 2255 motion has long since expired as to this claim. See 28 U.S.C. § 2255(f)(1) (setting the time to file a § 2255 motion, as relevant here, to within one year after "the date on which the judgment of conviction becomes final").

      . Fletcher contends that Taylor v. United States requires us to rely solely on statutory definitions. See 495 U.S. 575, 600, 110 S.Ct. 2143, 109 L.Ed.2d 607 (1990). However, Taylor does not require us to ignore common law definitions, especially given that the Supreme Court's subsequent opinion in Descamps expressly left open that possibility. 133 S.Ct. at 2291 ("We may reserve the question whether, in determining a crime's elements, a sentencing court should take account not only of the relevant statute's text, but of judicial rulings interpreting it.”). By looking to the Nebraska Supreme Court's definition of “crime of violence,” we do not engage in a broad survey of judicial rulings interpreting and applying that term to synthesize a definition out of whole cloth. Rather, we merely accept the definition provided by the Nebraska Supreme Court.

      . The Government relies on United States v. Clinkscale, 559 F.3d 815, 817-18 (8th Cir. 2009), and United States v. Flannigan, 367 Fed.Appx. 732, 733 (8th Cir. 2010), but both cases concerned the Minnesota terroristic threats statute, which, as we explain below, materially differs from the Nebraska terroristic threats statute. Moreover, the defendant in Flannigan conceded that his convictions qualified as violent felonies under the ACCA. Fletcher does not so concede.

      . The district court assumed without deciding that the categorical approach was required. Because the statute categorically qualifies under the force clause, we likewise need not determine whether the statute's construction permits the modified categorical approach. See Descamps, 133 S.Ct. at 2283, 2293 (requiring the categorical approach to analyze indivisible statutes, but allowing the modified categorical approach to analyze divisible statutes).

      . Notably, the Minnesota definition of "crime of violence” also included arson of an occupied building, see Minn. Stat. § 609.1095(l)(d) (listing Minn. Stat. § 609.561 (arson in the first degree)), but Sanchez-Martinez only characterized arson of an unoccupied building as not involving the use of force against a person. 633 F.3d at 660.


author: SCHREIER, District Judge. GRUENDER, Circuit Judge,

text:
    Michael BLAES, Plaintiff-Appellee v. JOHNSON & JOHNSON; Johnson & Johnson Consumer Companies, Inc.; Imerys Talc America, Inc., formerly known as Luzenac America, Defendants-Appellants
    No. 16-2080
    United States Court of Appeals, Eighth Circuit.
    Submitted: March 9, 2017
    Filed: May 26, 2017
    Rehearing and Rehearing En Banc Denied June 28, 2017

      William W. Blair, James G. Onder, Stephanie L. Rados, ONDER & SHELTON, Saint Louis, MO, Robert Allen Smith, Jr., SMITH LAW FIRM, PLLC, Ridgeland, MS, for Plaintiff-Appellee.
    Beth Ann Bauer, David M. Bays, HE-PLER & BROOM, Edwardsville, IL, Kathleen A. Frazier, Ethel J. Johnson, Gene M. Williams, SHOOK & HARDY, Houston, TX, Mark C. Hegarty, Sarah E. Lynch, SHOOK & HARDY, Kansas City, MO, for Defendants-Appellants Johnson & Johnson, Johnson & Johnson Consumer Companies, Inc.
    Leslie Benitez, GORDON & REES, Austin, TX, Nancy M. Erfle, Samantha L. Gamboa, GORDON & REES, Portland, OR, Mary Anne Mellow, Mark A. Prost, Timothy Charles Sansone, SANDBERG & PHOENIX, Saint Louis, MO, Susan Ford Robertson, THE ROBERTSON LAW GROUP, Kansas City, MO, for Defendant-Appellant Imerys Talc America, Inc.
    Before RILEY, Chief Judge, GRUENDER, Circuit Judge, and SCHREIER, District Judge.

       Judge Benton and Judge Kelly did not participate in the consideration or decision of this matter.

      . The Honorable William Jay Riley stepped down as Chief Judge of the United States Court of Appeals for the Eighth Circuit at the close of business on March 10, 2017. He has been succeeded by the Honorable Lavenski R. Smith.

      . The Honorable Karen E. Schreier, United States District Judge for the District of South Dakota, sitting by designation.

   SCHREIER, District Judge.

Defendants appeal from the district court’s order dismissing without prejudice Michael Blaes’s products liability action. Defendants claim that the court should not have granted the dismissal because Blaes was forum shopping. In the alternative, defendants contend that dismissal should have been conditioned on the payment by Blaes of defendants’ costs and fees. We find that the district court did not abuse its discretion when it dismissed the complaint without prejudice, but the district court should have analyzed whether costs and fees should have been awarded. We affirm in part, reverse in part, and remand with instructions.

I. Background

Shawn Blaes passed away from ovarian cancer on January 12, 2011. Her husband, Michael Blaes, contends that Shawn’s death was caused by her regular and prolonged use of talcum-based products known as JOHNSON’S Baby Powder® and Shower-to-Shower®. On January 10, 2014, Blaes filed a complaint in Missouri state court in St. Louis County against Johnson & Johnson, Johnson & Johnson Consumer Companies, Inc. (Johnson & Johnson); Imerys Talc America, Inc. (Imerys); Personal Care Products Council; Schnucks, Inc.; Schnucks Supermarkets, Inc.; Schnucks Food & Drugs, Inc.; Schnucks Super Centers, Inc.; and Walgreen Co.

Defendants timely removed the case to the United States District Court, Eastern District of Missouri. Blaes later voluntarily dismissed the Schnuck defendants, Walgreen Co., and Personal Care Products Council. On October 24, 2014, the district court scheduled the case for a two-week jury trial to start on March 7, 2016. On February 12, 2016, the district court held a status conference during which Blaes orally requested a continuance of the March 7, 2016, trial date. Blaes advised the court that a case with similar facts (Fox trial) was currently in progress in the Circuit Court of the City of St. Louis and would take longer than two weeks to complete. Thus, Blaes believed that his trial would take longer than two weeks and would need to be moved to a new date to accommodate a longer trial. The court denied the oral request for a continuance, but stated that it would monitor the progress of the ongoing Fox trial. On February 18, 2016, the district court entered an order resetting the trial date to July 6, 2016, to accommodate a longer trial. On February 22, 2016, the jury in the Fox trial awarded Fox $10 million in compensatory damages and $62 million in punitive damages.

On March 9, 2016, defendants moved to reset the July 6, 2016, trial date because it. conflicted with another talcum powder case that had previously been scheduled for trial in New Jersey. Defendants explained that, in total, counsel were scheduled for six talcum powder trials starting in April 2016 and running through February 2017, so they would be unavailable for trial in this case until after February 2017. One of the trials defendants listed was Swann v. Johnson & Johnson that was scheduled for trial in January 2017 in the Circuit Court of the City of St. Louis. On March 11, 2016, Blaes filed a Motion to Voluntarily Dismiss this action. Defendants opposed the motion asserting that Blaes was improperly forum shopping. Defendants argued that Blaes was seeking to refile in the Circuit Court of the City of St. Louis because a St. Louis jury had just awarded a large plaintiffs verdict and the district court in this case had made several unfavorable Daubert rulings against Blaes. On March 25, 2016, Blaes filed a Reply in Support of his Motion to Voluntarily Dismiss in which he explained that he planned to refile the case in the Circuit Court of the City of St. Louis and stated that the case could be tried “starting January 9, 2017, as one of multiple consolidated trial plaintiffs in Swann v. Johnson & Johnson.” On March 29, 2016, the district court granted Blaes’s motion to dismiss finding that dismissal was proper “because this case will likely be refilled and consolidated with Swann v. Johnson & Johnson, et al.”

II. Discussion

“We review a district court’s decision to allow a plaintiff to voluntarily dismiss an action for an abuse of discretion.” Donner v. Alcoa, Inc., 709 F.3d 694, 697 (8th Cir. 2013). The district court “has a range of choice, and [ ] its decision will not be disturbed as long as it stays within that range and is not influenced by any mistake of law.” Kern v. TXO Prod. Corp., 738 F.2d 968, 970 (8th Cir. 1984). When deciding whether to grant a motion for voluntary dismissal, the “district court should consider ... ‘whether the party has presented a proper explanation for its desire to dismiss; whether a dismissal would result in a waste of judicial time and effort; and whether a dismissal will prejudice the defendants.’ ” Donner, 709 F.3d at 697 (quoting Thatcher v. Hanover Ins. Grp., Inc., 659 F.3d 1212, 1213-14 (8th Cir. 2011)). A plaintiff cannot use a motion to voluntarily dismiss to seek a more favorable forum. Id.

Defendants contend the district court abused its discretion in granting the voluntary dismissal because the dismissal wasted judicial time and effort and prejudiced the defendants, did not address whether the motion was improper forum shopping or whether Blaes’s basis for dismissal had a reasonable basis in fact and law, and should have included an award of costs in favor of defendants. Defendants also argue that the court abused its discretion when it considered Blaes’s arguments for voluntary dismissal because they were .raised for the first time in his reply brief.

First, this court must analyze whether the district court abused its discretion in concluding that dismissal would not waste judicial time and effort and would not prejudice defendants. This court has previously held that when a court dismisses an action to be refiled in state court, judicial time and effort are not wasted where much of the evidence may be used in state court See Kern, 738 F.2d at 971 (dismissing a case after the trial began so it could be refiled in state court). Legal prejudice is more than the fact that a defendant might have to defend another action. Id. at 970. Neither “the expense and effort of drafting and responding to discovery” nor the loss of a tactical advantage constitute legal prejudice. Mullen v. Heinkel Filtering Sys., Inc., 770 F.3d 724, 728 (8th Cir. 2014).

Defendants argue that the dismissal was a waste of judicial time and effort because the parties had prepared for trial for over two years, and the court had already overseen discovery and considered some pretrial motions. Defendants also argue that they were substantially prejudiced by the dismissal because they were deprived of benefitting from the work they had already completed, the favorable rulings the district court had already issued, and access to a federal forum. In Kern, the plaintiff filed a motion to voluntarily dismiss prior to trial, and the district court informed counsel that it would grant the motion, but “only upon the express condition that, if the case is refíled in any court, the defendant will be awarded all costs.” Kern, 738 F.2d at 969. Plaintiff then withdrew her motion. Id. At trial, the court and counsel conferred with each other prior to calling plaintiffs final witness, and the court “informally indicated the view that plaintiff would be unable to make out a submissible fact question for the jury.” Id. at 970. The plaintiff then renewed her motion to dismiss without prejudice, and the court granted the motion without any conditions as to costs and expenses. Id. We upheld the district court’s dismissal because plaintiff had not rested, the defendant had not moved for a directed verdict, and the dismissal allowed for a .state-law issue to be decided by a state court. Id. at 971.

In Mullen, after the plaintiffs failed to meet the expert disclosure deadline and the court ruled that the deadline would not be extended, plaintiffs filed a motion to dismiss without prejudice stating that they intended to add defendants who would “more than likely” destroy diversity. Mullen, 770 F.3d at 726-27. The judge granted the motion to dismiss without stating a reason for the dismissal but indicated that the case was plagued with discovery disputes. Id. at 727. The court did not award any fees to the defendants and ordered the parties to bear their own costs. Id. We upheld the district court’s decision because the parties had completed very little discovery, and after the dismissal, the plaintiffs did refile the suit in state court adding a diversity destroying defendant. Id.

Here, the district court reasoned that it would be more efficient to add this case to the multi-plaintiff Swann case with the same issues. The district court did not abuse its discretion in reaching that conclusion. The trial in this case had not commenced, the district court had not ruled on several Dauberb and other pre-trial motions, much of the discovery and evidence could be used in state court, and the Swann case apparently dealt with the same type of ovarian cancer as this case and involved much of the same evidence.

Also, the district court observed that defendants had moved to reset the July 2016 trial date, but defendants were unavailable for the remainder of 2016. Thus, the trial would have to be rescheduled for sometime in early 2017. In their motion, defendants indicated that “no party will be prejudiced by moving the trial date.” Docket 261. And defendants identified the Swann trial as one of the previously scheduled trials that created a conflict for defendants. Thus, the district court reasonably concluded that the case would likely be tried at an earlier date in state court, and the dismissal would not prejudice defendants because Blaes’s case would be consolidated with a previously scheduled trial. We find that the district court’s reasoning fell within its range of choices and was not an abuse of discretion.

Second, this court must determine whether the district court properly considered Blaes’s motivation behind his motion to dismiss. This court has previously held that it was an abuse of discretion when the district court failed to consider whether a motion to dismiss was being used for the improper purpose of avoiding an unfavorable ruling and seeking a more favorable forum. Thatcher, 659 F.3d at 1215. To consider whether a motion to dismiss is improper, the district court must address the plaintiffs purported reason for the voluntary motion to dismiss. Donner, 709 F.3d at 697.

Defendants argue that the district court did not consider whether Blaes was engaging in improper forum shopping, and thus, it abused its discretion. As support, defendants rely on this court’s decisions in Donner and Thatcher. In Thatcher, plaintiff filed a motion to voluntarily dismiss without prejudice stating that he intended to refile in state court with an amended complaint that would avoid federal jurisdiction. Thatcher, 659 F.3d at 1213. The district court granted the motion to dismiss without addressing plaintiffs stated reason for the dismissal. Id. This court found that the district court abused its discretion because the plaintiff stated that he intended to try to avoid federal jurisdiction by amending his complaint and the district court did not discuss it. Id. at 1214-15. We reasoned that the district court should have addressed plaintiffs purpose in seeking dismissal because “[i]f the trial court had done so, it could have concluded that Thatcher was dismissing so he could return to the more favorable state forum.” Id.

In Donner, the plaintiff filed a motion to dismiss stating that he planned to add a diversity-destroying defendant and refile in state court. Donner, 709 F.3d at 696. Because the plaintiff did not have a viable claim against the proposed diversity destroying defendant, we concluded that the plaintiffs true purpose was to seek a more favorable forum. Id. at 697. Thus, the district court abused its discretion when it did not analyze whether the plaintiffs claim against the diversity-destroying defendant had any basis in fact and law. Id.

Here, the district court specifically addressed Blaes’s proposed reason for dismissing the action—in contrast to thé court in Thatcher. The district court stated that Blaes’s reason was proper, would not waste judicial time and effort, and would not prejudice defendants. But defendants argue that, because the court did not specifically state that Blaes was not forum shopping, the court did not consider whether Blaes was forum shopping. “An appellate court must be mindful that the district courts are closer to the facts and the parties, and that not everything that is important about a lawsuit comes through on the printed page.” Kern, 738 F.2d at 970. Where the parties have submitted arguments opposing and supporting the motion to voluntarily dismiss, the relevant factors are before the court. Mullen, 770 F.3d at 728. In defendants’ response to the motion to dismiss, defendants argued that Blaes’s purpose behind the motion was to refile in a more favorable forum. Thus, the district court considered both Blaes’s stated reason for wanting to dismiss the action and refile in state court and defendants’ argument that Blaes was forum shopping. By finding that Blaes’s stated purpose was proper, the district court implicitly rejected defendants’ argument that Blaes was forum shopping. Thus, we find that the district court properly considered Blaes’s purpose for dismissal and did not abuse its discretion.

Defendants contend that this case is similar to Dormer because the City of St. Louis is not a proper venue for Blaes’s case, and therefore the district court abused its discretion by not considering whether Blaes’s plan to refile had any basis in fact or law. But unlike the facts in Dormer where plaintiff did not have a valid claim against the diversity-destroying defendant, Blaes is currently joined with the Swarm case in the City of St. Louis. Thus, it was not an abuse of discretion for the district court to come to the same conclusion. Furthermore, if there is a dispute as to the interpretation of Missouri’s venue statutes, then granting Blaes’s motion to dismiss allowed the parties to seek a binding state-court decision on the disputed interpretation.

Defendants allege that they were prejudiced because they were deprived of their right to a federal forum. Defendants rely on B.S. ex rel. Soderberg v. Forest Laboratories, Inc., No. 2:15-cv-4002-NKL, 2015 WL 4135508 (W.D. Mo. July 8, 2015), and Wingo v. State Farm Fire & Cas. Co., 2013 WL 4041477 (W.D. Mo. August 8, 2013), as support. But in both of those cases the courts denied the motions to dismiss because they found that the plaintiffs purpose was improper, not because the plaintiff had a right to a federal forum. Defendants do not cite any support for their contention that a motion to dismiss should be denied only because the defendants would be deprived of a federal forum. The law allows a court to grant a voluntary motion to dismiss so long as it is not wasteful or prejudicial or for the purpose of forum shopping. Thatcher, 659 F.3d at 1213-14.

Defendants also argue that Blaes’s motion should have been denied because Blaes did not provide a reason for seeking voluntary dismissal until his reply brief. One factor that the district court should consider when deciding a motion to dismiss is whether the plaintiff has presented a proper explanation for his reason to dismiss. Id. Blaes did not offer an explanation for his motion to dismiss until his reply brief. In general, the purpose of a reply brief is to “respond to the statement of facts and arguments of the appellee’s brief.” 5 Am. Jur. 2d Appellate Review § 517 (2017). It was not improper for the district court to consider the reasons stated in Blaes’s reply brief because Blaes was responding to defendants’ arguments against granting the motion. Thus, it was not an abuse of discretion for the district court to consider the information presented in Blaes’s reply brief.

Finally, this court must decide whether the district court abused its discretion because it did not address whether its grant of dismissal should be conditioned on Blaes paying defendants’, costs and expenses. “[P]ayment to the defendant of the expenses and a reasonable attorney fee may properly be a condition for dismissal without prejudice under Rule 41(a).” Kern, 738 F.2d at 972. “The time and effort invested by the parties, and the stage to which the case had progressed” are the most important factors to consider when the court decides whether to grant a dismissal with conditions. Id. In Kern, this court found that it was an abuse of discretion not to award defendant costs and fees when the trial had already commenced. Id. at 972.

Here, the parties spent two years working on the case and the court had ruled on several Daubert motions. Defendants argue that they requested the .district court to at least condition the dismissal on Blaes paying defendants’ costs and fees, but the district court failed to address the request, which amounts to an abuse of discretion. We agree that the amount of effort invested and the stage to which the case had progressed required an analysis of whether costs and expenses should be awarded. Thus, we remand to the district court for an evaluation of whether costs and fees should be assessed and the amount, if any.

Finally, there are several motions pending before this court. Blaes’s motion to supplement the record, Blaes’s motion to take judicial notice, and Johnson and Johnson’s motion to supplement the record are granted. Johnson and Johnson’s emergency motion to enjoin is denied as moot.

III. Conclusion

The order of the district court, to the extent that it dismissed the complaint without prejudice, is affirmed. The decision not to impose conditions is reversed, and we remand to the district court to analyze whether costs and fees should be assessed and the amount, if any.

Also, Blaes’s motion to supplement the record, Blaes’s motion to take judicial notice, and Johnson and Johnson’s motion to supplement the record are granted. Johnson and Johnson’s emergency motion to enjoin is denied as moot.

GRUENDER, Circuit Judge,

concurring in part and dissenting in part.

Because I believe the district court abused its discretion by failing to address the issue of forum shopping in its grant of voluntary dismissal, I respectfully dissent from the bulk of the court’s opinion. While I would find it unnecessary to reach the alternative question of whether the district court likewise abused its discretion in granting dismissal without explaining why costs and fees were not awarded, given the court’s holding on the first issue, I agree that it was impermissible for the district court to ignore this consideration and, thus, join that portion of the opinion.

Appellee Michael Blaes initially brought this product-liability action against nine corporate defendants in the Circuit Court of St. Louis. County, alleging that his wife died from ovarian cancer caused by various products containing talcum powder. The defendants were served on January 24, 2014 and timely removed the case to federal district court. After initially moving to remand based on a lack of complete diversity, Blaes conceded that his claims against the diversity-destroying defendants were barred by the Innocent Seller Statute, dismissed these claims, and withdrew his request to return to state court. See Mo. Rev. Stat. § 537.762. Thereafter, the only remaining defendants were two Johnson & Johnson entities and Imerys Talc America, Inc. (collectively, “J&J”). The district court then entered a case-management order, setting a jury trial to begin on March 7, 2016. Over the intervening months, the parties completed twenty-four depositions, fully briefed J&J’s Dau-bert and summary judgment motions, and resolved several other issues through motions practice. Of note, the district court denied Blaes’s motion to compel entry to several J&J facilities and granted J&J’s motions to strike two of Blaes’s expert witnesses.

On January 28, 2016, the attorneys in this matter began a separate multi-plaintiff trial involving similar talcum-power product-liability claims in the Circuit Court of the City of St. Louis. The case, Hogans v. Johnson &Johnson, joined sixty-four unrelated individuals from twenty-nine states with one St. Louis City resident. No. 1422-CC09012-01 (Mo. Cir. Ct. 22d Sept. 29, 2014). Because the first trial focused on Alabama resident Jacqueline Fox’s claims, this litigation is often associated with her name. After the Fox trial was underway, Blaes’s counsel approached J&J with multiple requests to postpone the trial date. The defendants refused, however, insisting that the case was ready for trial.

Blaes then requested—and the district court ordered—a status conference to occur on February 12, 2016. At the meeting, the court informed Blaes’s counsel that they would be allowed only two or three expert witnesses and that, in light of prior talcum-powder trials, the case should be streamlined. The court also noted that Blaes should not elicit repetitive testimony on the same issues. After receiving this guidance, Blaes asked for a continuance with leave to reopen discovery. The district court granted this request and entered an order resetting trial for July 6, 2016.

On March 9, 2016, J&J moved to reset Blaes’s trial date due to a scheduling conflict with another talcum-powder trial setting in New Jersey. Blaes responded with a motion to voluntarily dismiss the case without prejudice, pursuant to Federal Rule of Civil Procedure 41(a)(2). The motion failed to include any justification as to why dismissal was appropriate, but it is telling that the Fox jury found against J&J only two weeks earlier and awarded Fox $10 million in compensatory damages and $62 million in punitive damages. J&J opposed dismissal, arguing that the case was ready for trial, that the court had already excluded two experts, and that Blaes’s primary reason for dismissing the case was forum shopping. J&J alternatively requested that the district court impose several conditions on dismissal, including that Blaes pay its fees and costs. In his reply brief, Blaes confirmed that he intended to refile in state court, stating that he “believe[d] he [could] try his case starting January 9, 2017 as one of multiple consolidated trial plaintiffs” in Swann v. Johnson & Johnson—another multi-plaintiff talcum-powder case pending in the St. Louis City Circuit Court. See No. 1422-CC09326-01 (Mo. Cir. Ct. 22d Dec. 5, 2014).

Four days later, before J&J could seek leave to file a sur-reply, see E.D. Mo. L.R. 4.01(C), the district court granted Blaes’s motion to dismiss. In a two-page memorandum, the court suggested that dismissal was proper “because this case will likely be refiled and consolidated with Swann ... [and] it makes sense for the state court to hear a multi-plaintiff trial regarding the same type of ovarian cancer.” Yet the court failed to mention J&J’s forum-shopping claim, and it discussed only scheduling considerations in concluding that dismissal would not prejudice J&J.

J&J timely appealed this order. Meanwhile, the St. Louis City Circuit Court granted the Swann plaintiffs leave to file an amended petition adding Blaes and eleven other non-residents as intervenors. As J&J notes, however, the Swann court also ordered that the January 9, 2017 trial would be a single-plaintiff trial chosen by defendants, thereby undermining Blaes’s efficiency rationale for dismissal of this case. To date, nearly fourteen months after the district court granted Blaes’s motion to dismiss, his trial still has not commenced in the St. Louis City Circuit Court.

My primary concern with the court’s approach is that it harkens back to an overly permissive standard for voluntary dismissals that we long ago abandoned. “At common law, dismissals without prejudice were, in general, freely allowed at any time before the case was ready for decision.” Kern v. TXO Prod. Corp., 738 F.2d 968, 970 (8th Cir. 1984). However, “[t]he adoption of Rule 41(a) in 1938 completely changed this practice. The rule limits the right of dismissal at the behest of the plaintiff to the early stages of the proceedings, thus curbing the abuses of this right that commonly had occurred under [the earlier approach].” 9 Charles Alan Wright et al., Federal Practice and Procedure § 2363 (3d ed. 2017). Thus, the current version of Rule 41(a)(2) provides that, after a defendant serves its answer, “an action may be dismissed at the plaintiffs request only by court order, on terms that the court considers proper.” We have previously held that district courts entertaining such requests must consider: “[1] whether the party has presented a proper explanation for its desire to dismiss; [2] whether a dismissal would result in a waste of judicial time and effort; and [3] whether a dismissal will prejudice the defendants.” Donner v. Alcoa, Inc., 709 F.3d 694, 697 (8th Cir. 2013) (citation omitted).

J&J’s main argument is that the district court abused its discretion in granting dismissal without sufficiently examining the first of these factors—whether Blaes had presented a proper explanation for his request. Specifically, J&J contends that the district court was required to examine the viability of Blaes’s plan to dismiss and refile and whether his real motive was to defeat its attempt to remove the case to a federal forum, particularly in light of the $72 million judgment in Fox and Missouri’s relatively lax expert-witness standard. See State Bd. of Registration for the Healing Arts v. McDonagh, 123 S.W.3d 146, 153, 155-56 (Mo. 2003) (en banc) (holding that Mo. Rev. Stat. § 490.065, rather than Daubert, supplies the standard for the admission of expert testimony in civil cases in Missouri). I share this concern and believe that, at the very least, the district court should have addressed J&J’s forum-shopping argument.

We have repeatedly held that “a party is not permitted to dismiss merely to escape an adverse decision nor to seek a more favorable forum,” Dormer, 709 F.3d at 697 (citations omitted), and we have reversed a number of orders granting motions for voluntary dismissal when the overall circumstances indicate forum shopping as a motive, see, e.g., id. at 699 (listing cases). As we explained in Thatcher v. Hanover Insurance Group, Inc., this rule is particularly important in the removal context because the rule against voluntary dismissal for a more favorable forum “coincides with other measures which strike a balance between the plaintiffs right to select a particular forum and the defendant’s right to remove the case to federal court.” See 659 F.3d 1212, 1214 (8th Cir. 2011) (citations and internal quotation marks omitted). Thus, given that the district court’s decision to grant dismissal effectively overrode J&J’s right to remove this case to federal court, it is especially problematic that the district court failed to address J&J’s forum-shopping claim.

The court avoids this difficulty by suggesting that “the district court implicitly rejected defendants’ argument that Blaes was forum shopping,” apparently by finding that dismissal would advance both parties’ interest in a speedy trial. Ante, at 514. As an initial matter, I note that Blaes provided absolutely no reason for dismissal in his initial motion. See Donner, 709 F.3d at 699. Only in reply to J&J’s motion in opposition to dismissal did Blaes finally assert his timeliness and efficiency justifications for allowing him to refile in state court. However, I am not convinced that, “[b]y finding that Blaes’s stated purpose was proper,” the district court was entitled to conclude that he necessarily was not forum shopping. Id. A plaintiff certainly could assert a legitimate reason for voluntary dismissal while his or her true motive lay in securing a more favorable forum. Further, I reject the notion that we automatically should deem an argument to have been considered by a district court simply because it was raised in briefing. Otherwise, it is unclear to me how we ever could find that the court had abused its discretion by failing to consider “a relevant factor that should have been given significant weight.” See Mullen v. Heinkel Filtering Sys., Inc., 770 F.3d 724, 727-28 (8th Cir. 2014).

Most importantly, however, even assuming that allowing Blaes to refile in state court would result in a faster and more efficient trial, the court fails to recognize that granting dismissal also defeated J&J’s right to a federal forum. Based on the jurisdictional nature of this consideration, we have previously held that district courts must address forum-shopping concerns before granting a motion to dismiss:

[T]he determination of whether the motion to dismiss was an improper forum-shopping measure, by its very nature, called into question the trial court’s subject matter jurisdiction. Defendants exercised their right to removal under [diversity jurisdiction], and [the plaintiff] appears to have sought dismissal merely to deprive the federal court of jurisdiction. As a result, determining whether the district court had subject matter jurisdiction was at the crux of the issue of whether the motion to dismiss was being used for the improper purpose of seeking a more favorable forum. The district court erred in failing to take up the jurisdictional question, thereby necessitating remand of this matter.

Thatcher, 659 F.3d at 1215. Indeed, if there is any question about the importance of an out-of-state defendant’s right to remove a ease from state court or the fundamental nature of federal diversity jurisdiction, one need look no further than Article III of the Constitution and the ratification debates.

See U.S. Const, art. III, § 2 (creating diversity jurisdiction); The Federalist No. 80 (Alexander Hamilton).

Given its failure to address this weighty concern, I would find that the district court abused its discretion and would remand for consideration of J&J’s forum-shopping argument. Although I believe this alone is a sufficient basis for reversal, I also question whether the district court sufficiently addressed the other two mandatory considerations for granting voluntary dismissal under Rule 41(a)(2)—wheth-er dismissal would result in a waste of judicial time and effort and whether it would prejudice the defendants. See Donner, 709 F.3d at 697. While the court is correct that a loss of tactical advantage is by itself insufficient to defeat a motion for voluntary dismissal, see Mullen, 770 F.3d at 728, it is equally true that “a party is not permitted to dismiss merely to escape an adverse decision,” Donner, 709 F.3d at 697 (citation and internal quotation marks omitted). As noted above, Blaes encountered various setbacks in more than two years of litigation before the district court, including the denial of his motion to compel entry and the grant of J&J’s motions to strike two of his expert witnesses. Thus, just as the court concluded with respect to costs and fees, I believe a fuller explanation was required to conclude that dismissal would not waste judicial resources or impermissibly prejudice J&J.

Accordingly, I respectfully dissent from the court’s decision to affirm voluntary dismissal and concur in its reversal as to the denial of J&J’s motion for costs and fees.

        .Hogans v. Johnson & Johnson, 1422-CC09012-01. In Hogans, 64 individuals and one St. Louis City resident joined and filed suit in the Circuit Court of the City of St. Louis. The first trial was of Jacqueline Fox’s claims. Thus, this trial is referred to as the Fox trial.

      . In Soderberg, the plaintiffs filed their case in the District Court in the District of New Jersey. Soderberg, 2015 WL 4135508, at *1. The plaintiffs then filed a motion to voluntarily dismiss without prejudice, and the court granted the dismissal over the defendants' objections. Id. The plaintiffs then filed in the Circuit Court of Cole County in Missouri, and defendants removed it to the District Court in the Western District of Missouri. Id. The plaintiffs filed another motion to voluntarily dismiss without prejudice stating that they planned to proceed as part of consolidated litigation, but they did not state where they planned to refile. Id. at *2. The district court noted that there was consolidated litigation about the same pharmaceutical drug in two counties in New Jersey and in St. Louis, Missouri, but the plaintiffs had not refiled in either place. Id. Thus, the district court reasoned that the true motivation behind the second motion to dismiss was to refile in a more favorable forum, and the district court denied the motion. Id.

      In Wingo, the plaintiff filed a motion to dismiss stating that he could refile in state court with an amended complaint that would avoid federal jurisdiction. Wingo, 2013 WL 4041477, at *1. The district court compared the posture of the case to the posture in Thatcher. Id. The court stated that "[i]n Thatcher, as here, the expressed intent of the plaintiff was to amend his complaint in order to avoid federal jurisdiction,” and that the voluntary motion to dismiss was improper forum shopping. Id. Thus, the court in Wingo denied the motion to dismiss because it was made with the intent to seek a more favorable forum. Id.

      . The court reads this filing to suggest that J&J "would be unavailable for trial in this case until after February 2017.” Ante, at 512. Yet the basis for this conclusion is unclear to me; as it appears that J&J’s schedule left sufficient time for a three-week trial in August and September or October through December of 2016.

      . Our previous opinions in Kern v. TXO Production Corp. and Mullen v. Heinkel Filtering

        Systems, Inc. appear to support the court’s position at first glance. However, there was no forum-shopping concern raised in Kern, and our decision in Thatcher controls as an earlier-in-time opinion to the extent it conflicts with Mullen. See Mader v. United States, 654 F.3d 794, 800 (8th Cir. 2011) (en banc) ("It is a cardinal rule in our circuit that one panel is bound by the decision of a prior panel ... [and as such,] when faced with conflicting panel opinions, the earliest opinion must be followed....” (citations and internal quotation marks omitted)).