HRH LLC v. Teton County et al

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IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF WYOMING
HRH, LLC, a Wyoming limited liability
company,
Plaintiff,
vs. 	Case No. 18-CV-104-SWS
TETON COUNTY, WYOMING, a
political subdivision of the state of
Wyoming, et al.,
Defendants.
ORDER ON BENCH TRIAL
This matter comes before the Court on a bench trial conducted June 21 through June
29, 2021, in Jackson, Wyoming. The parties have presented their evidence, fully briefed
the issues and submitted thorough proposed findings of fact and conclusions of law. (See
ECF Nos. 188, 193.) Having reviewed the evidence and arguments presented by the parties,
the Court finds and orders as follows.
BACKGROUND
In 2020 the overall median price for residential sales (including single family
homes, condominiums, townhouses and undeveloped land) in Teton County, Wyoming
was $1.59 million, representing a 45 percent increase from 2019.1 The mean/average price
1 The Implications of Jackson Hole’s 2020 Real Estate Market, Jonathan Schechter, February 2021.
https://cothrive.earth/the-implications-of-jackson-holes-2020-real-estate-market/
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was $2.54 million, a 53 percent increase. Id. It is an understatement to say homes and land
in Teton County Wyoming are valuable, let alone undeveloped land. Thus, the catalyst for
the issues presented in this case.
This case involves a three-year-long dispute concerning an alleged improper
interference with the purchase and proposed land development of real estate in Teton
County, Wyoming. After passage of time, various dismissals of claims, and dismissals of
parties for various reasons including partial settlement, one claim remained before this
Court on a bench trial for tortious interference with a contract/prospective economic
advantage against Alliance Route of 390 Neighbors (“the Alliance”), James M. Speyer,
Gerald J. Kitchen, and Diana Kitchen (“the Kitchens”). The morning of closing arguments,
counsel for HRH indicated HRH had settled the matter with Defendant James M. Speyer.
Mr. Speyer’s counsel confirmed the parties’ resolution on the matter. (See ECF No. 200.)
Accordingly, the sole remaining claim left for this Court to determine endures only against
the Alliance and Mr. and Mrs. Kitchen (“the Defendants”).
APPLICABLE LAW
Following a bench trial, the Court must separately issue findings of fact and
conclusions of law. Fed. R. Civ. P. 52(a). The Court may do so orally at the conclusion of
evidence or in a subsequent opinion or memorandum of decision. Id. The Court’s findings
of fact should be sufficient to indicate the factual basis for its conclusion, indicate the legal
standards against which the evidence was measured, and be broad enough to cover all
material issues. Otero v. Mesa Cnty. Valley Sch. Dist, 568 F.2d 1312, 1316 (10th Cir.
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1977). At the same time, however, the Court does not need to make “inordinately detailed
findings.” Colo. Flying Acad., Inc. v. United States, 724 F.2d 871, 877 (10th Cir. 1984).
FINDINGS OF FACT
After considering the testimony and exhibits admitted at trial, the Court makes the
following Findings of Fact in accordance with Rule 52 of the Federal Rules of Civil
Procedure.
The Parties
HRH, LLC (“HRH”) is a Wyoming limited liability company. Steve Hancock and
Tom Reynolds are the sole members of HRH. (Exhibit A-1). The Alliance is a Wyoming
unincorporated nonprofit association formed by a group of Teton County landowners in
November of 2015, comprised of approximately two hundred members. (Exhibit I-9)
Defendants Gerald J. Kitchen and Diana Kitchen are members of the Alliance. Former
Defendants Richard D. Jaquith, Patricia P. Jaquith, and James M. Speyer are also members
of the Alliance, but have been dismissed from this case upon notice of settlement. (See
Joint Stipulated Facts, ECF No. 153, see also ECF Nos. 162, 200.)
Bar J Option Property and Agreement
On April 19, 2015, HRH entered into a written option agreement with Humphrey,
LLC, which provided HRH the right to purchase 21.2 acres of land on Wyoming Highway
390 in Teton County, Wyoming, known as “the Bar J Property.” Babe Humphrey owned
and operated the Bar J Ranch and, therefore, executed the option agreement on behalf of
Humphrey, LLC. Mr. Humphrey was approached by Mr. Hancock and Mr. Reynolds in
early 2015 about selling the Bar J Property and having it developed. The 2015 Bar J Option
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Agreement required HRH to pay for the cost of obtaining entitlements for redevelopment
of the property, but the agreement did not require any consideration for the option to
purchase, nor did it require HRH to obtain entitlements at all. (See Ex. 4.) The Bar J
Property operated as the Bar J Chuckwagon dinner theater in Teton County, Wyoming for
44 years. It is one of only a handful of “special projects” recognized under Teton County’s
Comprehensive Plan and Land Development Regulations, subject to a “Master Plan”
approved by Teton County in 1977.
HRH’s original 2015 Bar J Option Agreement was set to expire May 1, 2016. (Ex.
4.) On April 29, 2016, HRH and Mr. Humphrey executed an “Amended and Restated
Option to Purchase Agreement” (“2016 Bar J Option Agreement”). The 2016 Bar J Option
Agreement extended HRH’s option to December 31, 2016. On February 2, 2017, HRH and
Mr. Humphrey agreed in writing to extend HRH’s option period for a second time under
the 2016 Bar J Option Agreement to September 30, 2017 (“2017 Extension Agreement”).
(Ex. 5.) This extension had an effective date of December 31, 2016. (See Joint Stipulated
Facts, ECF No. 153, id.) The 2017 Extension Agreement expressly stated that the purpose
of the extension was “to allow for the achieving of necessary development approvals as
required by the contemplated development of the property by HRH . . .” (See Ex. 5 at 1.)
Mr. Humphrey testified that Hancock and Reynolds didn’t have any money so the price for
the property under the option was increased.
HRH’s Organization and Preliminary Efforts to Develop the Bar J Property
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In pursuit of the venture to purchase the Bar J Property, Mr. Hancock organized
HRH, LLC, filing Articles of Organization with the Wyoming Secretary of State on
February 11, 2015. (Ex. A-1.) Mr. Reynolds and Mr. Hancock testified, despite having
three initials, HRH has never had any other members. Mr. Hancock is a realtor with
considerable experience in buying and selling real estate in Teton County, but had limited
experience as a commercial real estate developer. In 2015 and thereafter, his personal
financial condition was at best poor, having various creditors with outstanding judgments
against him. (See Exs. B-1, B-2, B-3.) Mr. Reynolds has no real estate development
experience. Despite their lack of real estate development experience, Mr. Hancock and Mr.
Reynolds 	combined 	and 	contributed 	their 	sweat 	equity 	and 	strategizing 	to 	pursue
development of the Bar J Property.
Neither Mr. Hancock nor Mr. Reynolds made any capital contributions to HRH. To
fund the cost of preparing plans and pursuing the Bar J Property purchase and development,
HRH entered into an agreement to borrow $400,000 on the terms that the lenders/investors
would receive threefold return if the project was approved, and the developed parcels sold.
(Ex. A-14.) As was testified to by Nannette Hinkley, if the project was never approved,
and thus, never developed, the lenders/investors would receive nothing. (Id. at 2; see also
Exhibit Z-2.1, Nannette Beckley depo transcript at 220-28).
In September 2013, Mr. Hancock hired professional land use planner, Scott Pierson,
to design and seek approval for the Bar J project development. Mr. Pierson continued to
serve in that role until HRH abandoned its development plans in the fall of 2017.
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After signing the initial 2015 Bar J Option Agreement, Mr. Hancock testified HRH
investigated development of the Bar J Property through the acquisition of unused
development rights from the Teton Pines Limited Liability Company (“Teton Pines”),
intending to incorporate the Bar J Property into the adjoining Teton Pines planned unit
development (“PUD”). A PUD zone is intended to permit “variation from the strict
application of the zones in order to achieve specific community goals that enhance the
community’s implementation of the Jackson/Teton County Comprehensive Plan.” (Ex. C-
19 at 7.)
On June 30, 2015, HRH submitted a Zoning Compliance Verification (“ZCV”)
application to Teton County for a determination of whether there were unused development
rights for Teton Pines. (Ex. D-3 at 14.) The County responded on August 14, 2015 with the
requested documentation, providing information about the Bar J Property including its
allowed use and development potential. (Id. at 1-5.) Mr. Hancock testified on cross-
examination, that the County informed him the Teton Pines’ unused development rights
would not be a feasible option for development of the Bar J Property. After receiving this
information, 	HRH 	altered 	its 	development 	strategy. 	Instead 	of 	pursuing 	unused
development rights pertaining to Teton Pines, HRH determined instead to amend the Bar J
Master Plan to facilitate its intended development proposal.
The Bar J Master Plan was first approved in 1977. (Ex. D-2). The plan developed
slowly over the following forty years to meet the growing needs of the Bar J Chuckwagon
operation, which offers seasonal dinner theater shows throughout the summer months. The
Bar J Chuckwagon is considered a commercial use on the Moose Wilson Road next to
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Teton Pines County Club. The Bar J is one of only seven permitted master plans or special
projects existing in Teton County. (Ex. C-19 at 2.)
The 2015 Land Development Regulations (“LDRs”) provided in Section 8.2.13.D
that any amendment to a master plan “shall . . . [c]omply with the requirements of the
underlying base zoning to the maximum extent practicable.” (See id. at 12.) The underlying
zoning of the 21.2-acre Bar J Property was classified as Neighborhood Conservation
(“NC”) which restricts residential development to one residence per three acres. HRH
never sought to rezone or apply to change the Bar J Property’s underlying zoning.
Additionally, a small portion of the Bar J Property was situated within the Natural
Resources Overlay (“NRO”). (Ex. D-3 at 1.)
On April 1, 2016, HRH met with Teton County for a pre-application conference on
the subject of its intended forthcoming application to amend the Bar J Master Plan.
Following that meeting, Teton County’s Principal Planner, Roby Hurley, sent an email to
those attending the meeting (“pre-application conference summary”). (See Joint Stipulated
Facts, ECF No. 153, see also Ex. 23.) The email included a statement that “a master plan
amendment would take Bar J out of the Specially Named Project Section 1.8.2.C.3 and
would become a PUD under Section 1.8.2.C.1.” (Ex. 23 at 1.)
The First Appeal
In the fall of 2015, residents who lived primarily on the Teton Pines Country Club
property which adjoins the Bar J Property, began expressing concerns about the rumors of
the sale and redevelopment of the property. (See Ex. H-5.) Joining in their concern, the
residents formed “The Alliance of Route 390 Neighbors” to better understand the
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development process. (See Ex. I-9 and I-12.) The Alliance also sought professionals to
advise them regarding HRH’s proposed development of the Bar J Property. They ultimately
hired legal counsel, Matt Kim-Miller of Holland & Hart, LLP, and Bill Collins, a former
Teton County Planning director and author of the LDR sections related to special projects
in Teton County. (Id.) At all relevant times, the Defendants relied on legal counsel and Mr.
Collins to explain the LDRs and the manner in which the Bar J Property might be lawfully
developed. The Defendants learned from Mr. Collins (Ex. 24) that PUDs were expressly
prohibited under the 2015 amendment to the LDRs. Mr. Matt Kim-Miller agreed and
conveyed this to the Teton County Attorney. (Ex. K-11). This meant that the County’s
email concerning the pre-application conference summary, which indicated the Bar J
Property would become a PUD, contradicted the LDRs.
Shortly after HRH received the pre-application conference summary from the
County concerning its intended application to amend the Bar J Master Plan, on May 2,
2016, the Alliance filed an appeal (“the first appeal”) under Teton County LDR 8.8.3 of
Teton County’s April 1, 2016 pre-application conference summary. (Ex. 43.) The first
appeal took issue with the Teton County Planning Director’s interpretation of the LDRs
contained in the pre-application conference summary issued on April 1, 2016. Specifically,
the Alliance disagreed with the County’s assessment that the LDRs provided that an
amendment to the Bar J Master Plan would transform the master plan into a PUD. (Id. at
3; see also Ex. K-11.) Conversely, the Alliance argued, once the Bar J terminated its
traditional chuckwagon use permitted by the special project, the master plan could not be
amended or transformed into a PUD, as no new PUDs were permitted in the County under
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the current LDRs. (Ex. 43 at 6 fn. 2). Thus, the Alliance believed, once the Bar J Property’s
special use was abandoned—in other words, once it was sold for development—the LDRs
mandated the property would revert back to its underlying zoning, NC, which only allowed
for seven units on the property. Id.
The basis the Alliance relied on for its first appeal was LDR 8.3.3.A, which at the
time, allowed an “aggrieved person affected by any decision or interpretation by the
Planning Director or County Engineer to appeal the decision or interpretation to the Board
of County Commissions for a review of whether the decision or interpretation complies
with the requirements of [the] LDRs.” (Ex. C-19 at 30.) Similarly, LDR 8.3.3.B provided
that an “appeal may be filed for any decision or interpretation of the Planning Director or
County Engineer” and that the appealed decision “must be formally documented.” (Id.)
Relying on those LDRs, Mr. Kim-Miller, counsel for the Alliance, advised the Alliance
that any representation by the County that the Bar J Property could be developed as a PUD
was legally unsupportable and encouraged them to file an appeal. Mr. Kim-Miller also
communicated these concerns directly to the County prior to filing the first appeal. (See
Exs. K-11, K-12.)
After Teton County received the first appeal, acting through its Planning Director,
Tyler Sinclair, the County applied an automatic stay pursuant to LDR 8.8.3.C, which
provided, “[a]n appeal shall stay all further action related to the subject of the appeal, unless
a stay would cause imminent peril to life or land.” (Id., see also Ex. 26. ) On May 23, 2016,
Teton County filed a motion to dismiss the first appeal. (Ex. 44.) HRH intervened in the
first appeal and, on July 14, 2016, filed a motion seeking to have Teton County lift the
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automatic stay it had imposed under LDR 8.8.3.C. (See Joint Stipulated Facts, ECF No.
153 at 2.)
On July 25, 2016, the parties filed a Stipulated Motion to Dismiss the first appeal,
signed by attorneys of the Alliance, Teton County, HRH, and Teton County’s Hearing
Officer, 	Andrew 	Salter, 	who 	recommended 	the 	Teton 	County 	Board 	of 	County
Commissioners order dismissal. (Ex. L-18.) The stipulation provided that Teton County
Planning Director would amend portions of the pre-application conference summary and
reissue the pre-application summary form, both to remove any references to the Bar J
Property becoming a PUD and to acknowledge the underlying zoning as NC. (See id., see
also Ex. H-24.)
On August 2, 2016, the Teton County Board of County Commissioners (the
“Board”) issued its order of dismissal of the first appeal based on the parties’ stipulation.
(See Joint Stipulated Facts, ECF No. 153 at 3.) The same day, the County lifted the
automatic stay. Due to the parties’ settlement of the matter, the County did not issue any
recommendations concerning the merits of the first appeal.
HRH’s Application to Amend the Bar J Master Plan
Despite effort to avoid the costs and delay, HRH learned in February of 2016 that it
would need to conduct an Environmental Assessment (“EA”) of the Bar J Property prior
to filing any application to amend the Bar J Master Plan. (Ex. E-62 at 2.) HRH conducted
the EA later in 2016 and submitted it on February 24, 2017. (See Ex. N-4.) On February
28, 2017, Mr. Hurley issued a letter in connection with HRH’s EA, which notified HRH,
in contravention with the parties’ prior settlement, that HRH was “free to apply for a
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Planned Unit Development”—a PUD permit. (See id.) HRH filed its application to amend
the Bar J Master Plan with the County on March 2, 2017. (Ex. 52 and M-4.)
At this time, HRH had entered into its 2017 Extension Agreement with Mr.
Humphrey, extending its option to purchase for $16,000,000 until September 30, 2017,
effective on December 31, 2016. (See Ex. 5.) The Alliance became aware of HRH’s
application to amend the Bar J Master Plan on or about March 2, 2017 and obtained a copy
of the application around the same time. The plan under HRH’s application was for
development of 46 free-market townhouse units and 23 affordable-living condominiums
for a total of 69 residences on the former Bar J Property. This proposed development
reflected a nearly ten-fold increase in density beyond the seven homes permitted according
to the property’s underlying NC zoning base. The 23 affordable units were proposed as
required by the LDRs to meet the 25% allocation of the total population generated by new
development at that time.
Teton County identified HRH’s application for an amendment to the Bar J Master
Plan as PUD2017-0002 and Sketch Plan, SKC2017-0003. (See Joint Stipulated Facts, ECF
No. 153 at 3.) Teton County identified the EA as EVA2016-0008. In a letter dated March
3, 2017, Mr. Hurley, Principal Planner for Teton County in the Planning & Development
Department, deemed EVA2016-0008 sufficient under LDR 8.2.5. (Ex. 28.) On March 16,
2017, Mr. Hurley deemed PUD2017-0002 and Sketch Plan, SKC2017-0003 sufficient
under the LDRs. (Ex. 29.) Mr. Hurley’s two letters shall be hereinafter referred to as “the
sufficiency determinations.” At the time he wrote and sent the sufficiency determinations,
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Mr. Hurley was the Principal Planner for Teton County and Mr. Sinclair was the Planning
Director.
The Second Appeal
On March 30, 2017, the Alliance2 filed an appeal (“the second appeal”) of the
sufficiency determinations of the 	EA 	(EVA2016-0008) 	and the 	application for an
amendment to the Bar J Master Plan (PUD2017-0002) and Sketch Plan (SKC2017-0003).
(Ex. 30.) The second appeal challenged the County’s sufficiency determinations pertaining
to HRH’s application to amend the Bar J Master Plan and the corresponding EA. (See id.)
Specifically, the Alliance argued the sufficiency determinations corresponding to both the
application to amend and the EA did not properly evaluate, apply, or interpret the correct
LDRs, thereby rendering erroneous interpretations of LDR standards. (Id. at 7-14.)
Ultimately, the Alliance argued, the application to amend the Bar J Master Plan did not
comply with any applicable LDR which governed the development of the proposal,
asserting the application “seeks development that is so far beyond the realm of possible or
plausible under the provisions of the LDRs, that the Application cannot be deemed
‘sufficient.’” (Id. at 14.) The second appeal also challenged the County’s finding in the EA
sufficiency determination that the Bar J Property was not within the NRO, which conflicted
with the County’s August 14, 2015 response to HRH’s ZCV request that stated a portion
2 Mr. and Mrs. Jaquith and Mr. Speyer also signed on as individual parties to the second appeal alongside the
Alliance. (See Ex. 30 at 2). Both the Jaquiths and Mr. Speyer have been dismissed from the suit upon notice of
settlement (see ECF Nos. 150, 162, 200), so for purposes of this Order, the discussion of the second appeal will only
concern the Alliance.
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of the Bar J Property was within the NRO. (Id. at 9; see also Ex. D-3 at 1.) (emphases
added).
On April 11, 2017, Teton County and the Alliance stipulated that HRH could
intervene in the second appeal and, on the same day, the Board granted HRH permission
to intervene. (See Joint Stipulated Facts, ECF No. 153 at 3.) On May 1, 2017, Teton County
and HRH each filed a motion to dismiss the second appeal. (Exs. 47-48.) The Alliance
received and read HRH’s and Teton County’s motions to dismiss the second appeal.
On June 27, 2017, after receiving the recommendations of the appointed hearing
officer, the Board granted the motions to dismiss of Teton County and HRH, dismissing
the second appeal. (Ex. 31.) In its order dismissing the second appeal, the Board found, as
a matter of law, the Defendants had no right to appeal the sufficiency determinations, as
there were “no final decisions, binding interpretations, or agency actions associated with
either of the two sufficiency determination letters.” (Ex. 31 at 16.) The Board also found
the Defendants were not aggrieved parties and lacked standing to appeal the sufficiency
determinations. (Id. at 16-18.). Based upon these findings, the Board dismissed the second
appeal under Wyoming Rules of Civil Procedure 12(b)(1) and 12(b)(6), for failure to state
a claim upon which relief can be granted. The Alliance received and read the Board’s order
granting the motions to dismiss. The Alliance did not appeal the Board’s dismissal of the
second appeal to the Teton County District Court.
The Third Appeal
On March 15, 2017, prior to the Alliance’s filing of the second appeal, the Alliance
and the Kitchens submitted a written request to Teton County seeking a ZCV and/or a
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formal interpretation of the LDRs as they related to the Bar J Master Plan (“the letter
requests”). (See Joint Stipulated Facts, ECF No. 153 at 3-4, see also Exs. 54, K-60.) Nine
days later, the County declined to process the two letter requests and rejected them through
a written letter. (Ex. 22.)
At the time, LDR 8.6.2 provided “[a] zoning compliance verification may be
requested for any property, portion of a property, or attribute of a property’s physical
development, use, development options, or subdivision” and “a zoning compliance
verification application may be submitted by any member of the public.” (Ex. C-19 at 20-
21) (emphases added). LDR 8.6.2 also provided that the Planning Director shall issue or
issue with conditions a zoning compliance verification within 45 days of the request being
deemed sufficient. (Id. at 21) Further, LDR 8.6.1 provided that “[a] formal interpretation
may be requested to interpret any provision of these LDRs” and “a formal interpretation
may be submitted by any landowner or resident of the County.” (Id. at 18-19.) (emphasis
added). 	LDR 	8.6.1 	also 	stated 	that 	the 	Planning 	Director 	shall 	make 	the 	formal
interpretation within 60 days of submittal of the request. Under LDRs 8.6.1 and 8.6.2, a
Planning Director held the exclusive authority to render a “formal interpretation” and a
“zoning compliance verification.” (See id. at 18-21.) Appeals of Planning Director
decisions to the Board proceed under LDR 8.8.3.A and B. Id.
Sometime after receiving the rejection letter, Mr. Kim-Miller notified his clients that
the Planning Director was declining to process the two letter requests and had rejected both
requests. Mr. Kim-Miller further advised his clients his office would file an appeal of the
rejection. On April 21, 2017, the Alliance and the Kitchens appealed the County’s rejection
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letter (“the third appeal”). (Ex. 33, see also Ex. H-47.) The third appeal challenged the
County’s decision to deny the Defendants’ letter requests relating to the Bar J Property.
The Defendants argued the rejection letter, which rejected the two applications submitted
by the Defendants, violated the Defendants’ rights under the applicable LDRs. (Ex. 33 at
1.) Specifically, the Defendants argued the Planning Director did not have the authority or
the right to reject the Defendants’ requests under LDR §§ 8.6.1 and 8.6.2. (Id. at 5.)
The Defendants maintained the third appeal was not an action taken with respect to
the HRH application, relying on LDR 8.8.3.C, which provides that a stay only applies to
“further action related to the subject appeal . . .” (Ex. C-19 at 30.) Defendants relied on this
provision in maintaining their position that the County did not need to place an additional
stay on HRH’s application during the pendency of the third appeal relating to the
Defendants’ own requests. Nevertheless, on April 26, 2017, Teton County notified HRH
that, as a result of the second and third appeals, pursuant to LDR 8.8.3.C, it had stayed any
further county action on HRH’s application to amend the Bar J Master Plan. (See Joint
Stipulated Facts, ECF No. 153 at 4; Ex. 34).
On May 8, 2017, Teton County and the Defendants stipulated that HRH could
intervene in the third appeal and, on the same day, the Board granted HRH the permission
to intervene. (Id.) On May 12, 2017, Teton County and HRH each filed motions to dismiss
the third appeal. (Exs. 49, 51.) The Defendants received and read HRH’s and Teton
County’s motions to dismiss the third appeal.
On July 10, 2017, after receiving the recommendations of the appointed Hearing
Officer, the Board granted the motions to dismiss of Teton County and HRH. (Ex. 35.) In
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its order dismissing the third appeal, the Board found, as a matter of law, the County’s
rejection letter was not a “final agency action” and not appealable. The Board also found
the Defendants were not aggrieved parties and lacked standing to appeal the rejection letter.
Based upon these findings, the Board dismissed the appeal under Wyoming Rules of Civil
Procedure 12(b)(1) and 12(b)(6), for failure to state a claim upon which relief can be
granted. (Id. at 6-14.) The Defendants received and read the Board’s order granting the
motions to dismiss. The Defendants did not appeal the Board’s dismissal of the third appeal
to the Teton County District Court. At the time the Board dismissed the third appeal, HRH
had eighty-two days remaining on its option to purchase the Bar J Property. (See Joint
Stipulated Facts, ECF No. 153 at 4.)
The Expiration of the Bar J Option Agreement
On August 14, 2017, HRH requested an additional extension to the option
agreement from Mr. Humphrey. (See Joint Stipulated Facts, ECF No. 153 at 4.) Mr.
Humphrey refused to grant an extension of the option beyond the then-current expiration
date of September 30, 2017, as he had previously granted two extensions of the option
period. (Id., see also Ex. 7.) Accordingly, pursuant to the 2017 Extension Agreement, and
without any further extensions, the option expired per its own terms on September 30,
2017. (Id., see also Ex. 5.) Under the 2017 Extension Agreement, the purchase price of the
Bar J Property as of September 30, 2017 was $16,000,000. (Ex. 5.) After the option contract
expired per its terms, HRH withdrew its application to amend the Bar J Master Plan on or
around October 2, 2017. (See Joint Stipulated Facts, ECF No. 153 at 5.)
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The Likelihood of Success of HRH’s Application to Amend the Bar J Master Plan
The evidence presented at trial indicated HRH did not expect success from the
application as it was submitted, specifically due to the categorization and numerosity of
the units proposed. Nannette Beckley, Teton County realtor and a lender/investor in HRH’s
project development efforts, testified in her deposition that she and HRH understood “[the
County] would never approve what we presented because we were – we put high numbers
in to negotiate it to a lower scale.” (Ex. Z-2-1 at 72.) Similarly, she testified, “[w]e never
thought we were going to do 69 units on the property. . . There was never consideration of
that many units. It was all a negotiating tactic with the county.” (Id. at 33.) She also testified
she understood the application would not have been approved as it was submitted on March
2, 2017. (Id. at 72.) Despite these statements, HRH never offered or even expressed an
intent to decrease the density of their proposed development to be less than 69, as it was
financially more profitable to keep the number of units higher. (See, e.g., Exs. F-9, E-81
(“I want to cram as many units as possible into the site plan given the wetlands.”), I-29
(“Developer Steve Hancock made clear that the objective was to make the development as
profitable as possible.”).)
This testimony is further supported by the statements of land use planner, Scott
Pierson, who HRH hired to design and seek approval of its proposed development. Mr.
Pierson indicated only five months before the application was withdrawn and two months
after it was submitted, that it was unlikely HRH could get the application approved as it
was submitted. He stated in an email to HRH, “When this started I asked Susan Johnson
senior planner what she thought we could get through. She said 50/50 split may make it.
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Two weeks ago I asked her again and she said, ‘well the outright base density is 6 units.’ I
corrected her and said 7 units.” (Ex. E-98 at 2.) Mr. Pierson’s email reflects the opposition
HRH was likely to face with its application which anticipated 69 units on the Bar J Property
upon completion of its development.
Furthermore, the County had expressed issues concerning HRH’s application to
amend the Bar J Master Plan to HRH throughout the summer of 2017. Principal Planner
Mr. Hurley advised HRH of “a number of issues” he wished to address before moving
forward. (Ex. P-13.) These issues concerned water and sewer systems for the property,
traffic impacts, Housing Department concerns, and problems with the density of the
development specifically with respect to wildlife migration. (See Exs. P-12, P-20, P-8, P-
13.)
On August 23, 2017, Mr. Hurley informed HRH that August 25, 2017 was his
deadline for sending out the neighborhood notices of a hearing, but he suggested
postponing the hearing, explaining, “Given the uncertainties in the application, it would be
advisable to postpone the hearings and the mailings. Please let me know if you wish to
postpone and for how long.” (Ex. P-15.) Mr. Hurley’s statements leading up to the
expiration of HRH’s option agreement indicated the County was not inclined to approve
HRH’s application without significant amendments and adjustments. HRH did not present
any evidence of its willingness or efforts to mitigate the issues brought forth by the
County—before, during, or after the pendency of any appeals.
On August 25, 2017, Mr. Hurley met with HRH to discuss its pending application.
Shortly after the meeting, Mr. Pierson’s office informed the County that HRH needed to
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postpone its next scheduled meeting for the Bar J Project until at least October. (See Ex. P-
24, see also Ex. P-17 at 2.) Despite this, on that same day, Mr. Hancock advised Mr.
Humphrey of HRH’s “encouraging meeting” with the County, explained the “positive tone
of the meeting” and requested an additional extension of the option to March 31, 2018.
(Ex. 36.) Mr. Hancock indicated the application had “a few clerical and clarification
points” but that there was “no push back with regard to the number of units and the overall
request to amend the Bar J master plan from commercial to residential.” (Id.) No action
was taken by HRH to address the deficiencies highlighted by the County in the application
to amend the Bar J Property Master Plan.
Finally, Mr. Collins, former Teton County Planning Director and the Defendants’
retained expert on the LDRs concerning the Bar J Property, testified to his knowledge of a
draft staff report completed by Mr. Hurley concerning HRH’s application which ultimately
recommended a denial of the application. By way of background, Mr. Pierson testified that
Teton County’s Planning Staff prepares a staff report once an application is submitted and
deemed sufficient. (See also C-19 at 15.) After a determination of sufficiency, the Planning
Staff collects information and feedback from other staff members and relevant agencies
concerning the application. After receiving the feedback, the Planning Staff prepares a staff
report which contains a staff recommendation. Mr. Collins explained that staff reports are
typically prepared and disseminated to the public, the Planning Commission, and the
applicant a week to ten days prior to a Planning Commission meeting which would address
the given application. In this case, Mr. Collins testified he was provided a draft of Mr.
Hurley’s staff report, which was never submitted to the Planning Commission because of
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HRH’s eventual withdrawal of its application. Mr. Collins testified he understood the draft
staff report to contain the opinion of the likelihood of success of HRH’s pending
application, even though it was never finalized. He testified the draft report contained a
statement near the bottom recommending denial of HRH’s application, and statements
within the body of the report indicating the proposed application was not in compliance
with various LDRs.
This cumulative evidence presented at trial support the fact that approval of HRH’s
application to amend the Bar J Master Plan was unlikely, at best. After the September 30,
2017 expiration of the 2017 Extension Agreement, Mr. Reynolds drafted a letter, written
as if it was authored by Mr. Humphrey and sent to HRH, declining to extend the option for
a third time. (See Ex. 7.) Sometime on or around October 2, 2017, HRH withdrew its
application to amend the Bar J Master Plan. (See Joint Stipulated Facts, ECF No. 153 at 4.)
In April of 2021, Mr. Humphrey listed the Bar J Property for sale through a local
real estate agent at a list price of $14,000,000. In May 2020, the agent emailed Mr. Hancock
to inform him the Bar J Property was listed and encouraged him to make an offer. Mr.
Hancock did not respond, and HRH made no subsequent bids to purchase the Bar J
Property. In January 2021, the Bar J Property sold for $13,000,000.
CONCLUSIONS OF LAW
To the extent the above stated Finding of Fact contain any conclusions of law they
are hereby incorporated herein.
The Court has diversity jurisdiction under 28 U.S.C. § 1332(a). Venue is proper
under 28 U.S.C. § 1391(b)(2). As a federal court sitting in diversity, the law of the forum
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state applies to substantive issues and federal law applies to procedural issues. Herrera v.
Lufkin Industries, Inc., 474 F.3d 675, 683 (10th Cir. 2007). Wyoming is the forum state in
this case, so Wyoming law will apply to the issues currently before the Court.
Applicable Law—Tortious Interference
The parties generally agree as to the elements of a claim for intentional or tortious
interference with a contract or business expectancy (hereinafter, “tortious interference
claim”) under Wyoming law.
The Wyoming Supreme Court has adopted the general description of tortious
interference from Restatement (Second) of Torts § 766B (Am. L. Inst. 1979), which
provides:
One 	who 	intentionally 	and 	improperly 	interferes 	with 	another's
prospective contractual relation (except a contract to marry) is subject to
liability to the other for the pecuniary harm resulting from loss of the benefits
of the relation, whether the interference consists of
(a) inducing or otherwise causing a third person not to enter into or
continue the prospective relation or
(b) preventing the other from acquiring or continuing the prospective
relation.
See Downs v. Homax Oil Sales, Inc., 2018 WY 71, ¶ 21, 421 P.3d 518, 523-24 (Wyo. 2018)
(citing Ahrenholtz v. Laramie Econ. Dev. Corp., 2003 WY 149, ¶ 17, 79 P.3d 511, 515
(Wyo. 2003)).
To succeed on a claim for tortious interference, the Plaintiff must prove the
following elements: (1) the existence of a valid contractual relationship or business
expectancy; (2) knowledge of the relationship or expectancy on the part of the defendant,
(3) intentional and improper interference by defendant who is a nonparty to the contract,
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and (4) resultant damage to the party whose relationship or expectancy has been disrupted.
Gore v. Sherard, 50 P.3d 705, 710 (Wyo. 2002), see also Court’s Order on Summary
Judgment, ECF No. 105 at 20. Whether interference with a contract was improper is a
question of fact. See Basic Elec. Power Co-Op—Missouri Basin Power Project v. Howton,
603 P.2d 402, 405 (Wyo 1979); First Wyoming Bank, Casper v. Mudge, 748 P.2d 713, 717
(Wyo. 1988). This Court found on summary judgment there was a disputed fact as to the
“improper” element specifically. (ECF No. 105 at 20-21.)
While the Wyoming Supreme Court has adopted Restatement (Second) of Torts §
766 (“Intentional Interference with Performance of Contract by Third Person”) and § 766B
(“Intentional Interference with Prospective Economic Relations”), it has declined to adopt
§ 766A (“Intentional Interference with Another’s Performance of His Own Contract”). See
Price v. Sorrell, 784 P.2d 614 (Wyo. 1989). In clarifying the difference between the three
Restatement sections, the Wyoming Supreme Court explained,
[Section] 766 deals with the situation where A may be liable to B for causing
C not to perform a contract between B and C; § 766A deals with the situation
where A may be liable to B for preventing B from performing a contract
between B and C; and § 766B deals with the situation where A may be liable
to B for causing C not to enter into or continue a prospective contractual
relationship with B or for preventing B from entering into or continuing a
prospective contractual relationship with C.
Birt v. Wells Fargo Home Mortg., Inc., 2003 WY 102, ¶¶ 72-73, 75 P.3d 640, 663 (Wyo.
2003). The Wyoming Supreme Court further found the difference between § 766 and §
766A—which it has not recognized—is significant. In Price, the Court explained, § 766
requires improper interference with a contract which induced or caused a third party not to
perform and § 766B requires for recovery that a prospective contractual relation was lost
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because of the interference. See 784 P.2d at 616. Unlike those sections, though, § 766A
allows a plaintiff to recover by showing only that his own performance was made more
expensive or burdensome by the interference. Id.
In this case, HRH’s tortious interference claim against the Defendants falls squarely
under § 766B. (See Plaintiff’s Proposed Findings of Fact, Conclusions of Law, ECF No.
188 at 22-25.) HRH alleges the appeals Defendants filed with Teton County—which, in
response, issued automatic stays pursuant to the applicable LDRs—intentionally and
improperly interfered with its option agreement to purchase the Bar J Property. In short,
HRH argues the delays caused by the Defendants’ appeals effectively prevented HRH from
ever exercising the option, which also made it so HRH could never develop the property
according to its application to amend the Bar J Property Master Plan. Therefore, HRH seeks
damages to recover both the lost profits from the 69-unit development proposal, the amount
of the option contract itself, and the amount it expended in pursuing in development
proposal.
1. 	Existence of a Valid Contractual Relationship or Business Expectancy
In turning to the elements of a tortious interference claim under Wyoming law, this
Court finds HRH has failed to meet its burden to prove all elements by a preponderance of
the evidence. See Gore, 50 P.3d at 710 (“The plaintiff has the burden of proving the four
elements of intentional or tortious interference with a contract.”).
First, the Court finds that the option contract between HRH and Mr. Humphrey is
sufficient evidence of a valid contractual relationship. Both members of HRH and Mr.
Humphrey testified as to their shared understanding of the terms of the option contract. The
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parties do not dispute there existed a valid option contract between HRH and Mr.
Humphrey to purchase the Bar J Property. Defendants contend, however that HRH’s
alleged expectancy from the option contract was based upon situations which were so
unlikely that the business expectancy of the contract was sheerly speculative. (See
Defendants’ Corrected Proposed Findings of Fact, Conclusions of Law, ECF No. 193 at
30-31.) While this could be true, the option contract itself was a valid contract according
to the parties, as was their contractual relationship. Accordingly, the Court finds the first
element, that there exists “a valid contractual relationship or business expectancy” is
satisfied. See Gore, 50 P.3d at 710 (emphasis added).
2. 	Knowledge of the Relationship or Expectancy on the Part of the Defendants
The Defendants conceded at trial that, at some point in time, they became aware of
the option contract between HRH and Mr. Humphrey to purchase the Bar J Property. Mr.
Braddy, the representative for the Alliance, testified that he learned about HRH’s proposed
development of the Bar J Property sometime in the summer of 2015. Mr. Braddy also
testified that he learned sometime in May of 2016 that HRH had an option to purchase the
Bar J Property. The Alliance communicated this information to its members, which
included Mr. and Mrs. Kitchen. (See Ex. I-17.) Mr. and Mrs. Kitchen both testified to
learning sometime in May of 2016 that HRH had an option to purchase the Bar J Property.
Defendants testified as of May 2016 they were unaware of the nature of the option
agreement and business relationship between HRH and Mr. Humphrey, despite their
understanding one existed. The Alliance filed its first appeal on May 2, 2016, before it
realized HRH had an option to purchase the Bar J Property.
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On July 23, 2016, the Defendants discussed their understanding of the 2016 Option
Contract’s expiration of December 31, 2016. (Ex. 55.) The Defendants all testified they
were unaware of the September 30, 2017 extension granted by the 2017 Extension
Agreement until after they had filed the second and third appeals in March and April of
2017.
Even so, all Defendants conceded—and the evidence at trial showed—that at some
relevant point in time, the Defendants understood HRH to have an option to purchase the
Bar J Property. See Furr v. Ridgewood Surgery and Endoscopy Center, LLC, 192
F.Supp.3d 1215, 1228 (D. Kan. 2016) (finding, in a tortious interference claim with similar
elements, that the law does not require that defendants know the details of the contract.)
Accordingly, the second element, that the Defendants knew of the contractual relationship
between HRH and Mr. Humphrey, is satisfied. See Gore, 50 P.3d at 710.
3. 	Intentional and Improper Interference by the Defendants
HRH alleges the Defendants, by filing their appeals, intentionally and improperly
interfered with HRH’s option contract to purchase the Bar J Property. Defendants allege
the interference was not intentional under the meaning of the Restatement since the
Defendants were not aware of the 2017 Option Extension, and therefore, they were not
aware the appeals would bring about an end to the contractual relationship between HRH
and Mr. Humphrey. Similarly, the Defendants assert their alleged interference, done
through filing the appeals, was not “improper” under the Restatement factors. The Court
agrees.
a. 	No Intentional Interference
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Under Restatement (Second) of Torts § 766B, an interference is intentional if “the
actor desires to bring it about or if he knows that the interference is certain or substantially
certain to occur as a result of his action.” See cmt. d. (Am. L. Inst. 1979). The Court heard
evidence from the Defendants that they were aware of the option contract, but were not
necessarily aware of the expiration or terms of the option at the time of the filing of the
appeals. Therefore, HRH failed to establish the Defendants, by filing their appeals with the
County, desired to interfere with HRH’s option contract. See id.
Similarly, the Court finds the Defendants did not know the termination of the option
agreement was a “certain or substantially certain” result of their appeals. Id. All Defendants
testified to understanding the County would impose automatic stays under the LDRs when
an appeal was filed. However, the Defendants also testified the appeals were not filed to
initiate the automatic stays. Rather, the automatic stays were a collateral consequence of
the appeals. Evidence at trial also supported this, as various emails concerning the appeals
and the Defendants’ strategy in filing their appeals demonstrated a desire to ensure the
County was correctly following the LDRs, not a desire to stall HRH’s application, despite
it being a consequence of the appeals. (See, e.g., Exs. 20 at 2 (“our objection in filing an
appeal was to preserve the right to appeal the [Planning Director’s] decision . . .”, ), 21 at
1 (“Would the P&D this time be willing to tell us there has been no final administrative
action, so we don’t have to file suit against as we did last time? I assume we will learn
more at the Feb 9 meeting, but we don’t want to lose any time. . .”), 24 at 1, see also Ex. I-
15 (“The Alliance is not opposed to the sale or the development of the Bar J property so
long 	as 	any 	such 	development 	conforms 	to 	existing 	zoning 	and 	to 	the 	County
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Comprehensive Plan.”, Ex. I-17 (“We have said earlier, and it bears repeating, that the
Alliance is not opposed to redevelopment of the Bar J property. We would support
reasonable development consistent with the character of the neighborhood; . . .”).)
Additionally, evidence at trial showed the first appeal filed by the Alliance was
dismissed upon stipulation of the parties. (See Ex. L-18.) This conflicts with HRH’s
position that the Alliance intended to stall the application process with the understanding
HRH would lose the time to exercise its option to purchase the Bar J Property. True,
Defendants were aware the appeals would likely initiate county-imposed stays. However,
Defendants’ stipulated dismissal removed that stay. Similarly, the evidence at trial
indicated Defendants objected HRH’s development of the Bar J Property, at least the
development proposal presented in the application to amend the Bar J Master Plan. (See,
e.g., Exs. I-17, I-29, I-31, 55.) However, HRH fails to establish the Defendants intended
their appeals, or even knew their appeals, would result in HRH losing time to exercise its
option. Therefore, the Court finds the Defendants’ interference—filing the three appeals of
the County’s decisions regarding the application to amend the Bar J Master Plan—was not
done with the intent to interfere with HRH’s option contract.
b. No Improper Interference
Even if this Court were to find that Defendants intentionally interfered with HRH’s
option contract, the Court finds that Defendants’ have shown that their interference was
not improper. See Restatement (Second) of Torts § 767 cmt. a (“there is a requirement that
the interference be both intentional and improper.”) (emphasis added).
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The Wyoming Supreme Court has avoided crafting a mechanical rule to determine
whether conduct causing interference with a contract or expectancy is improper or
unjustified. See, Basin Elec. Power Co-op.-Missouri Basin Power Project v. Howton, 603
P.2d 402, 404 (Wyo. 1979). Instead, it has relied on the Restatement’s definition of
improper interference, laying out the determinative factors from § 767. Factors to be
considered for determining whether interference was improper are:
(a) the nature of the actor's conduct, (b) the actor's motive, (c) the interests
of the other with which the actor's conduct interferes, (d) the interests sought
to be advanced by the actor, (e) the social interests in protecting the freedom
of action of the actor and the contractual interests of the other, (f) the
proximity or remoteness of the actor's conduct to the interference and (g) the
relations between the parties.
Toltec Watershed Improvement Dist. v. Johnston, 717 P.2d 808, 814 (Wyo. 1986) (citing
Restatement (Second) of Torts § 7663 (Am. L. Inst. 1979)) (internal quotations omitted).
No one factor is dispositive on the issue of improper conduct and the comparative weight
of the factors may vary considerably depending on the consideration of the facts. See
Restatement (Second) of Torts § 767 cmt. a. (Am. L. Inst. 1979). In analyzing the factors
under § 767, the Court finds the factors weigh in favor of the Defendants and establish that
Defendants did not act improperly in filing their appeals with the County.
Beginning with the nature of the actors’ conduct, HRH argues the Defendants’
wrongful conduct was the filing of the objectively groundless appeals, noting this Court
had already characterized them as such on summary judgment. As an aside, this Court is
3 Despite the reference to Section 766, these factors are enumerated in Section 767 of the Restatement (Second) of
Torts (Am. L. Inst. 1979).
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not bound by its prior categorization of the Alliance Defendant’s appeals from summary
judgment for the matter of a final order following a bench trial. See Lieberman v.
Mossbrook, 2009 WY 65, ¶ 29, 208 P.3d 1296, 1305-06 (Wyo. 2009) (finding the law of
the case doctrine is subject to exception when evidence in a subsequent trial is substantially
different from that presented in an earlier proceeding).
Here, evidence was presented at trial not previously before the Court on summary
judgment which demonstrated the appeals filed by the Alliance and the Kitchens were not
objectively baseless. The issues raised and appeals taken by Defendant, based upon the
testimony and exhibits, presented good faith concerns under the LDRs, as to the applicable
zoning requirements. In addition, Defendants had a good faith basis to have concerns with
potential waiver of their objections and justifiably filed appeals to at a minimum preserve
those objections. The Court heard evidence about the Defendants’ diligent efforts to select
the appropriate course of action prior to filing their appeals, obtaining counsel and Mr.
Collins to assist in comparing the development proposal to the existing LDRs.
The Court also learned from HRH’s land planning expert, Mr. Pierson, that HRH’s
application, without substantive changes, was extremely unlikely to be approved by the
Board. This finding had nothing to do with the Defendants’ appeals. Similarly, the Court
heard evidence about HRH’s complete lack of and inability to obtain funding to develop
the project if and when it ever was approved. The evidence learned at trial about the
conscientious efforts of the Defendants prior to filing the appeals, was substantially
different than what was presented on summary judgment, and this Court is not bound by
its prior finding that the three appeals were objectively baseless.
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Turning then to the first factor under § 767, the nature of the Defendants’ conduct
is a chief factor in determining whether the conduct was improper or not. Id. at cmt. c. The
Alliance filed three appeals of three separate decisions by Teton County related, at least in
part, to the Bar J development proposal. The Kitchens individually joined only the third of
the three appeals which the Alliance filed. (See Ex. 33.) All three appeals were filed at the
direction of legal counsel and all three appeals were defensible under the then-existing
language of the LDR Section 8.8.3.A which permitted aggrieved persons affected by “any
decision or interpretation by the Planning Director . . . to appeal the decision or
interpretation[.]” (Ex. C-19 at 30.) Importantly, the Defendants’ conduct never involved
speaking to Mr. Humphrey, the other party to HRH’s option contract. Nor did it ever
involve the Defendants filing competing applications or proposals for development.
Instead, the Defendants filed the appeals to try to ensure the County was properly applying
the LDRs when it considered HRH’s application to amend the Bar J Master Plan.
Moreover, communications sent out by the Alliance to its members reflect thorough and
well-considered efforts to understand the applicable provisions and to engage in a process
it believed was of its own right. (See Exs. I-12, I-15, I-17, I-20, I-25, I-29-31.) This conduct,
which certainly resulted in collateral consequences leading to delays in the application
approval process, does not demonstrate improper action on behalf of Defendants.
The second factor considers the Defendants’ motive in filing the appeals. Since
intentional interference with a contract is an intentional tort, “the injured party must show
that the interference with his contractual relations was either desired by the actor or known
by him to be a substantially certain result of his conduct.” Restatement (Second) of Torts
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§ 767 cmt. d. While certainly self-serving, all Defendants testified at trial their motivation
was to ensure the County adhered to the LDRs applicable to new development proposals.
Aside 	from 	the 	testimony, 	the 	evidence 	presented 	supports 	Defendants’ 	assertion.
Defendants sought to stop HRH’s proposed development since, in Defendants’ minds and
that of their legal counsel, it egregiously failed to comply with the applicable LDRs. (See
Exs. 57-62, I-17, I-31.) However, as this Court determined as to Defendants’ intent, HRH
failed to present evidence that the Defendants’ motivation was to prevent HRH from
exercising its option to purchase the Bar J Property, or that the Defendants were
substantially certain the option contract would no longer be viable due to their appeals with
the County.
All Defendants testified they were not aware of the September 30, 2017 expiration
date until after all three appeals were resolved. Though they at one time knew the option
was set to expire in December of 2016, there was no evidence the Defendants had any level
of certainty that their appeals would result in Mr. Humphrey declining to issue a third
extension on the option contract with HRH.
The same analysis follows with respect to the fourth factor, the interests sought to
be advanced by the actor. Restatement (Second) of Torts § 767(d), see also id. at cmt. d
(“There is obviously a very intimate relation between the factors of motive and of the
interests that the actor is trying to promote by his conduct. . . [T]he factor of motive is
concerned with the issue of whether the actor desired to bring about the interference as the
sole or a partial reason for his conduct, while the factor of the actor's interests is concerned
with the individual and social value or significance of any interests that he is seeking to
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promote.”). In this case, the Defendants’ shared interest was to ensure the Bar J Property
was developed in accordance with the applicable LDRs. (See, e.g. I-17, I-20, I-31.) The
Defendants lived in close proximity to the property and, therefore, had an interest in
ensuring surrounding properties were properly developed. HRH failed to present any
evidence that the Defendants’ interest was, either in part or in full, to prevent HRH from
exercising its option to purchase the Bar J Property.
The third factor concerns HRH’s interest in exercising the option contract to
purchase the Bar J Property. See Restatement (Second) of Torts § 767(c). Evidence
presented at trial indicated HRH’s interest in purchasing the property was purely
financial—an unsurprising finding in a land development contract. Even so, evidence also
established HRH’s interest was so purely financial that it prevented HRH from diligently
working with the County to ensure its application met the requirements set forth in the
applicable LDRs. (See, e.g., Exs. E-92, F-9.) In any event, HRH’s interest in purchasing
the Bar J Property does not weigh heavily in favor or against any one party, as HRH’s
interest in the option contract was valid, notwithstanding its unrealistic proposal with the
County to develop the property.
The fifth factor in the Restatement explores the social interests in protecting the
freedom of the Defendants’ filing of appeals compared with the contractual interests of
HRH. Restatement (Second) of Torts § 767(e). In this case, the Court finds the interests
between the parties are fairly balanced. The Defendants undertook a public process through
means identified in County regulations, which presents an important interest in active
participation in local government. Similarly, the right to transact and develop land freely
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is also an important social interest, so HRH’s opportunity to purchase the Bar J Property—
notwithstanding 	the feasibility of 	any proposed development—is an interest worth
protecting. See Thar v. Edwin N. Noram Revocable Trust, 905 P.2d 413, 415 (Wyo. 1995)
(explaining how the law favors alienability of property interests because social interests
are promoted by greater utilization of property rights) (citing Restatement of Property §
489 (Am. L. Inst. 1944)).
The sixth factor looks at the proximity of the Defendants’ conduct to the interference
with HRH’s option contract. Restatement (Second) of Torts § 767(f). The Court finds this
factor weighs in favor of the Defendants. The Defendants’ three appeals undisputedly did
cause some period of delay in the County’s processing of HRH’s application to amend the
Bar J Master Plan. (See, e.g., Ex. W-6.) However, Mr. Humphrey’s choice not to extend
the option agreement for a third time was not “an immediate consequence of the
[Defendants’ appeals].” See Restatement (Second) Torts § 767 cmt. h. HRH argued the
letter from Mr. Humphrey declining to extend the option was evidence that the appeals
were the reason for Mr. Humphrey’s choice not to extend. (See Ex. 7.) While it could be
true, the statements made by Mr. Humphrey in his letter are less persuasive since Mr.
Humphrey testified that Mr. Reynolds, one of the two members of HRH, actually drafted
the letter for Mr. Humphrey to sign. Additionally, even if Mr. Humphrey was fed up with
the delays resulting from the appeals filed by the Defendants, evidence showed HRH could
have still exercised its option to purchase at any time before the expiration of the option on
September 30, 2017. (See Ex. 5.) Additionally, the delays from the appeals were not the
only delays in the process of HRH’s application, as the stays from the appeals only
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encompassed approximately twenty one percent of the duration of the option contract. (See
Ex. W-6.) There were many delays resulting from deficiencies and other issues with HRH’s
application, including the need to conduct an EA. (See Exs. E-86, E-91, E-92, E-98.)
Accordingly, HRH failed to establish Mr. Humphrey’s choice not to extend the option
contract for the third time was “an immediate consequence” of the Defendants’ appeals.
The final factor considers the relations between the parties, including the third-party
to the contract who is not a party to the case. Restatement (Second) of Torts § 767(g), see
also id. at cmt. I (“In a case where A is the actor, B is the injured party and C is the third
party influenced by A's conduct, the significant relationship may be between any two of
the three parties.”). In this case, there is no significant relationship between the Defendants
and HRH or the Defendants and Mr. Humphrey. The parties testified to having minimal
interaction with one another during relevant time period. Similarly, Mr. Humphrey and the
Defendants consistently testified they had no interaction during the relevant time period.
HRH and Mr. Humphrey did have a meaningful business relationship, as the parties had
entered into the option contract to transact the Bar J Property. However, this factor is not
material to this Court’s analysis of the impropriety of the Defendants’ conduct.
Overall, the Court finds the majority of the factors enumerated in § 767 weigh in
favor of finding Defendants’ conduct was not improper. The determination of whether the
Defendants’ conduct was improper seeks to ask whether the conduct was fair and
reasonably justified under the circumstances. See Toltec, 717 P.2d at 814. This Court finds
that it was.
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The appeals process, the specific and unique provisions of the Teton County LDRs,
and local practices were unknown to Defendants before they engaged legal counsel. (See
Ex. I-12 (“[A] group of concerned Teton Pines homeowners retained counsel and . . . also
retained other consultants and subsequently, among other things, met with legal counsel
and county planning officials to better understand the proposal and the processes.”).) While
the appeals may have suffered from procedural deficiencies based upon principles of
administrative law, Defendants’ counsel advised the Defendants that the appeals were ripe
under the LDRs and necessary to avoid waiver. (See Ex. I-17 at 2, I-20, I-30 at 1.)
Defendants’ engagement of legal counsel and Mr. Kim-Miller’s role and advice in
preparing the appeals based on his evaluation of the LDRs is highly relevant evidence and
tends to negate the “improper interference” element—even if the legal advice was wrong.
See Sysdyne Corp. v. Rousslang, 860 N.W. 2d 347 (Minn. 2015) (“a defendant’s
interference with a contract may be justified by reliance on advice of counsel.”); 22 Am.
Jur. 2d Damages § 582 (2016) (“The fact that a defendant sought the advice of counsel
before acting is relevant to the defendant’s knowledge and intent.”).
The Wyoming Supreme Court has further recognized that “one who interferes with
a contract asserting a bona fide claim in good faith is not liable for tortious interference
with a contract[.]” Sunshine Custom Paints & Body, Inc. v. S. Douglas Highway Water &
Sewer Dist., 173 P.3d 398, 404 (Wyo. 2007); see also Toltec, 717 P.2d at 814-15 (“The
defendant is also permitted to interfere with another's contractual relations to protect his
own present existing economic interests, such as the ownership or condition of property,
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or a prior contract of his own, or a financial interest in the affairs of the person persuaded.”)
(citing Prosser and Keeton, Law of Torts § 129, p. 986 (5th ed. 1984)).
Consistent with these principles, in Toltec, the Wyoming Supreme Court rejected
tortious interference claims where the defendants had instituted repeated unsuccessful
litigation against the plaintiff, but did so to raise valid property interests based on plaintiff’s
efforts to construct a dam on one of the defendant’s properties. See 717 P.2d at 813-15
(Wyo. 1986) (observing that while defendants’ motives “were anything but virtuous” there
was no basis to sustain claims for abuse of process or malicious prosecution and defendants
were not liable for tortious interference because they were only trying to protect their
property interests.). A similar situation existed here, landowners surrounding the proposed
development site sought to protect their valid property interests based on HRH’s proposed
development which Defendants believed was ultimately not allowed under the applicable
regulations, and would negatively affect their property.
The first appeal was filed based on Defendants’ legitimate understanding informed
by their legal counsel and Mr. Collins that HRH’s contemplated development as a PUD
was contrary to the LDRs. The first appeal therefore had the effect of promoting a
framework under which HRH’s application would properly be submitted and considered
based on the agreement of all parties, including HRH. Given this, and because HRH did
not even submit its application to amend the Bar J Master Plan until March 2, 2017, over
eight months after the stipulated dismissal of the first appeal, the first appeal does not
constitute improper interference. Furthermore, the stipulated dismissal signed by the
Alliance and HRH conflicts with HRH’s position that the Defendants’ primary or even
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partial intention was to delay HRH’s application with the County. Upon assurance that the
application would not be treated as conversion to a PUD and that the underlying NC zoning
would apply the Alliance agreed to a more expedient resolution of the first appeal.
As for the second and third appeals, Defendants’ conduct was not intended “only to
harass.” Rather, as influenced and informed by the advice of legal counsel, Defendants
held “good faith” beliefs that the appeals were authorized under LDR Sections 8.8.3.A and
8.8.3.B (allowing appeals of “any decision or interpretation of the Planning Director”).
(See Ex. C-19 at 30.) Further, Defendants subjectively believed the appeals had substantive
merit based on the County’s position changes and its apparent ongoing disregard of the
PUD prohibition and the property’s zoning. The second appeal challenged the County’s
determination of sufficiency of HRH’s application and corresponding EA. (See Ex. 30.)
Relying on applicable LDRs and counsel, The Alliance believed a “Determination of
Sufficiency” was a specific decision point in the administrative process, enabling the
Alliance to appeal such a determination. Similarly, the third appeal challenged the
County’s 	determination 	to 	deny 	the 	Defendants’ 	request 	for 	a 	ZCV 	and 	Formal
Interpretation. (See Ex. 33.) The letter requests were made based on concerns of the
Sufficiency Determinations issued by the County. Again, relying on applicable LDRs
Sections 8.6.1, 8.6.2 and counsel, the Defendants believed they were entitled to their
requested documents. (See C-19 at 18-21.)
At no time did any of the Defendants directly contact either of the contracting parties
so as to thwart the underlying deal between them or otherwise prevent HRH from
purchasing the Bar J Property. In sum, seeking to voice their concerns based upon their
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valid property interest, Defendants did not improperly set out to harm the HRH or Mr.
Humphrey or even to stop HRH’s development of the Bar J Property. Given the location
of their property and interests Defendants sought to uphold community-endorsed standards
and 	zoning 	laws 	bearing 	on 	Defendants’ 	property 	rights 	and 	legitimate 	concerns
surrounding HRH’s efforts to achieve a tenfold increase in density beyond what they
justifiably believed zoning permitted. In addition, Defendants believed such an outcome
would have adversely impacted traffic, wildlife, property values, and the general quality of
life along Teton Village Road. See Four Nines Gold, Inc. v. 71 Const., Inc., 809 P.2d 236,
244 (Wyo. 1991) (Urbigkit, C.J. dissenting) (“whether a defendant has acted improperly []
generally is determined by weighing the social importance of the interest the defendant
seeks to advance against the interest invaded.”).
Ultimately, this Court finds Defendants’ conduct in the filing of appeals does not
constitute improper interference. Accordingly, Plaintiff4 has failed to prove the four
elements of tortious interference with a contract. Gore v. Sherard, 50 P.3d 705, 710 (Wyo.
2002) (burden is upon Plaintiff to prove the four elements of intentional or tortious
interference with a contract).
4. 	Resultant Damage to HRH
Even if this Court was found to be in error as to the intentional and improper
elements HRH has failed to prove that it was or would have suffered damages as a result
of the alleged interference. Additionally, the damages HRH claims are purely speculative
4 To the extent Wyoming caselaw might suggest that the burden of proving sufficient justification for its interference
rests with the party defending its conduct, (see Examination Management Services, Inc. v. Kirschbaum, 927 P.2d
686, 698 (Wyo. 1996), the Court would expressly find that Defendants have done so.
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and unsupported by the evidence, such that they have not been proven to a reasonable
degree of certainty.
Causation
First, Defendants can be held liable for a tortious interference claim “only if [they]
cause[d] the loss.” Spurlock v. Ely, 707 P.2d 188, 190 (Wyo. 1985) (citing Prosser &
Keeton, Torts, § 129, p. 989 (5th ed. 1984); First Wyoming Bank, Casper v. Mudge, 748
P.2d 713, 717 (Wyo. 1988) (“A party is entitled to all damages which will compensate for
all the detriment proximately caused by the breach of duty.”). Therefore, a claim for
intentional 	interference 	with 	prospective 	economic 	advantage/business 	expectancy
requires proof of causation. See Texas W. Oil & Gas Corp. v. Fitzgerald, 726 P.2d 1056,
1064 (Wyo. 1986) (“We have previously held that the measure of damages for intentional
interference is the amount which will compensate for all of the detriment proximately
caused by the breach of duty.”). The essence of proximate cause is foreseeability of the
risk presented by the actor’s conduct. Wood v. CRST Expedited, Inc., 2018 WY 62, ¶ 9,
419 P.3d 503, 506 (Wyo. 2018). To establish causation under Wyoming law, a plaintiff is
entitled to rely upon circumstantial evidence. Bettencourt v. Pride Well Serv., Inc., 735
P.2d 722, 727 (Wyo. 1987).
Here, the parties agree HRH failed to exercise its option on or before September 30,
2017. The parties also agree Mr. Humphrey declined to extend a third extension to HRH,
which may or may not have provided HRH the time to continue with its proposed
development with the County. (See Exs. 7, 8.) The parties to the option contract testified
at trial, that despite the option contract not containing such a clause, the parties understood
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the option contract would only be exercised if HRH received the necessary “entitlements”5
from the County to develop the project according to its proposal. In other words, HRH and
Mr. Humphrey understood the County had to approve of HRH’s application to amend the
Bar J Master Plan in order for HRH to exercise its option with Mr. Humphrey to purchase
the property.
Here, HRH argues that Defendants’ filing of appeals, specifically the second and
third appeals, caused HRH to lose its business relationship with Mr. Humphrey since the
appeals were the stated reason Mr. Humphrey refused a further extension on the option
contract. (ECF No. 188 at 31, see Ex. 7.) To connect this point, HRH explains the appeals
prevented HRH from obtaining approval for its application from the County, which in turn,
caused Mr. Humphrey to refuse the extension. (Id.) The evidence presented at trial does
not support such a finding.
First and foremost, HRH’s position is predicated on the idea that its application
would have been approved “but for” the Defendants’ filing of the appeals. See First
Wyoming Bank, 748 P.2d at 717 (finding the jury’s decision on damages was correct,
considering “but for the Bank’s improper interference” the other party would not have
incurred the consequent expenses and costs). Aside from any financial means, the evidence
presented at trial plainly invalidates this point. HRH had many barriers to its application
being approved by the County, especially within the timeframe under the 2017 Extension
Agreement set to expire on September 30, 2017.
5 Mr. Hancock confirmed in his testimony that “entitled” meant approval of the application HRH submitted to the
County calling for 46 free-market units and 23 affordable housing units.
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HRH proposed a 69-unit development on a parcel of property zoned for seven units.
Moreover, the ratio of affordable housing to free-market housing provided for two thirds
free-market and one third affordable units, which HRH and Scott Pierson knew would be
an issue with the County. (See Exs. E-86 at 1 (identifying segregation of affordable and
free-market homes to be an item the County was considering), E-91 (“I believe that this
project has little chance of positive vote by the Board of County Commissioners unless the
ratio is about 50-50 or higher.”), E-98 at 2 (“When this started I asked Susan Jonson [sic]
senior planner what she thought we could get through. She said 50/50 split may make it.
Two weeks ago I asked here [sic] again and she said, ‘well the outright base density is 6
units.’ I corrected her and said it is 7 units.”).)
Aside from the potential issues with the overall density of the project increasing the
underlying zoning by almost tenfold, HRH was advised of other problems with its
application to amend the Bar J Master Plan. Mr. Hurley, the County Planning Director,
advised Mr. Pierson of several issues with the application. First, HRH learned in February
of 2016 that it would need to conduct an EA in connection with any development
application that might be filed. (Ex. E-62 at 2.) This information followed HRH’s filing for
an “EA exemption” on December 24, 2015, which the County denied. (Id.) HRH knew as
early as October of 2015 it would be required to apply for an EA exemption, but it did not
do so until December of 2015. (See Ex. E-70 (Mr. Hancock states, “It was not until late
December that we applied for such exemption . . . This delay cost 60 days.”). It was
confirmed HRH would need an EA corresponding to its application in the County’s letter
on February 17, 2016. (E-62.) Importantly, at the time HRH learned it was required to
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conduct an EA on the property, HRH’s current option was set to expire less than two
months later on May 1, 2016. (See Ex. 4.)
Furthermore, as early as March of 2016, HRH was aware it might need to amend its
application to “meet the expectations of the County Staff, Planning Commission and the
Board of Commissioners.” (Ex. E-73.) It declined to make any amendments. On April 29,
2016, the option was extended to December 31, 2016. The EA was not actually completed
and submitted until February 24, 2017, over a year after HRH learned it would need to
conduct one. (See Ex. N-4.) HRH fails to establish how the Alliance’s first appeal on May
2, 2016—which ended in a stipulation by all parties—had any effect on HRH’s ability to
expediently apply for an EA exemption and later conduct an EA once it was confirmed by
the County to be necessary.
Next, Mr. Pierson communicated to HRH that he had spoken with Mr. Hurley about
issues with HRH’s planned proposal, prior to the filing of its application, as early as
January of 2017. (See Ex. E-86.) Mr. Pierson explained that the company who conducted
the EA had not been paid, there were cabins6 which might need to be eliminated to
accommodate for wetland impacts, the segregation of affordable and free-market units was
problematic, there were too many units on the site altogether, and there could be more work
to be done concerning aquatic resources. (Id.) This information came months after the
Alliance’s first appeal was dismissed, and two months before the second and third appeals
were filed. Moreover, this information was known to HRH prior to its filing of the March
6 Mr. Pierson explained in his testimony the County tended to use the word “cabin” when they were referencing the
free-market units.
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2, 2017 application. However, HRH was unable to articulate at trial any action it took to
address these concerns, by way of amending its application or otherwise. HRH never
proposed to change the number or ratio of units prior to filing its application or after.
Additionally, Mr. Hurley, Teton County Planning Director, informed HRH of
several issues in its application unrelated to the Defendants’ appeals very close to the
expiration of the 2017 Extension Agreement. (See Exs. P-13 “(We are concluding our
review of your applications and there are a number of issues that I wish to advise you of as
we move forward.”, P-15.) Specifically, there were issues concerning the water and sewer
systems from Teton County Engineering Department (Ex. P-12.), traffic impacts which
would require a more robust traffic impact study than was provided (Ex. P-20), and issues
concerning the Housing Department Rules and Regulations, with which the application did
not comply (Ex. P-8 (identifying “a number of deficiencies” regarding the Housing
Department).) While HRH lays blame on the delays from the appeals as the justification
for not being able to resolve these issues and exercise its option, many, if not all of the
issues were known to HRH prior to the Defendants’ filing of the second and third appeals.
The evidence shows it was extremely unlikely HRH’s application would have been
approved by the County, even had Defendants not filed their appeals. Such a finding is also
supported by Mr. Pierson’s testimony. Mr. Pierson explained it would take approximately
seven-and-a half months from the time an application is filed until a “sketch plan” would
be approved. According to the LDRs, Section 8.3.1 states that a sketch plan presents the
opportunity 	for 	the 	County 	to 	“publicly 	review 	a 	large 	physical 	development 	or
development option for general consistency with these LDRs at a preliminary, conceptual
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level of detail before the development is fully designed.” (Ex. C-19 at 14.) After a sketch
plan is approved, the applicant may submit a development plan, but sketch plan approval
“does not permit actual physical development or subdivision of land.” (Id.) Therefore,
according to Mr. Pierson’s testimony, even assuming a quick application review process
with little to no issues, it would take seven-and-a-half months for the County to approve
the sketch plan corresponding with HRH’s application. Mr. Pierson also testified it was
possible that the process for sketch plan approval could be drawn out over eight or nine
months beyond the filing of the application, especially if there was significant public input
on an application, as there was here.
HRH’s application was filed on March 2, 2017, which is less than seven months
from the September 30, 2017 expiration of the option agreement. Accordingly, it is unlikely
HRH would have even received sketch plan approval of its application prior to the
expiration of its option contract, not even considering the second and third appeal of the
Defendants.
Additionally, when asked by the Court whether he believed, to a reasonable degree
of certainty, that HRH’s application would have been approved as it was submitted, Mr.
Pierson answered, “No.” He indicated the major obstructions in the application were the
access points to the proposed development, which was already in a high-traffic area, and
the inclusion of six units which did not accommodate for existing wildlife migration
pathways. Then, the Court asked Mr. Pierson when he believed the project would have
been entitled to move forward, given the existing issues with the application. Mr. Pierson
indicated he could not speculate as to that timing, nor could he speculate to the timing of
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the approval of the application even if the appeals were taken out of the timeline.
Ultimately, the Court finds Mr. Pierson’s testimony reflective of the extremely low
likelihood that HRH’s application would ever have been approved by the County without
periods of significant delay due to necessary amendments and addressing of the issues
highlighted by the County—none of which were impacted by Defendants’ appeals.
In sum, HRH has failed to establish, that “but for” the actions of the Defendants in
filing the three appeals which led to County-imposed stays, the County would have
approved its application to amend the Bar J Master Plan, enabling HRH to exercise its
option to purchase the Bar J Property on or before September 30, 2017. Certainly, the
Defendants’ appeals did cause delay in the pendency of HRH’s application process.
However, the Court finds that the appeals were not a proximate cause of HRH’s loss of the
option contract. Accordingly, the fourth element, that a Defendants’ intentional and
improper interference resulted in—in other words, cause—damage to HRH, is not satisfied.
Damages
Finally, even if HRH could establish the Defendants’ appeals resulted in HRH’s loss
of the option contract to purchase the Bar J Property, HRH has failed to prove its damages
to a reasonable degree of certainty. HRH claims three categories of damages in this case:
(1) the damages incurred by HRH in pursuing its development of the Bar J Property in the
amount of $356,931.65, (2) the lost profit damages HRH suffered from its lost opportunity
to develop the Bar J Property according to its March 2, 2017 application to amend the Bar
J Master Plan in the amount of $21,869,289, and (3) the loss of HRH’s option agreement
with Mr. Humphrey, which HRH values at $1,300,000 to account for the difference in the
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price of the option versus the appraisal value of the land as entitled. (See Plaintiff’s
Proposed Findings of Fact, Conclusions of Law, ECF No. 188 at 34.)
HRH’s claimed damages are wholly speculative and unsupported, as they are
primarily founded on the assumption that HRH’s application would have been approved
by the County as it was submitted on March 2, 2017. However, the overwhelming evidence
established that the County’s approval was highly improbable.
Beginning with the claimed costs of pursuing development in the amount of
$356,931.65, these costs were not actually costs incurred by HRH. Mr. Hancock and Mr.
Reynolds confirmed as much in their testimony, where they each testified neither member
ever contributed any funds to the LLC. Instead, those funds were financed exclusively by
private loans on terms in which the lenders understood the inherent risks associated with
the entitlement process and agreed to forego repayment unless the project was approved,
which it was not. HRH itself—including its members Mr. Reynolds and Mr. Hancock—
did not spend any money pursuing the development proposal. Ultimately, HRH failed to
show it sustained any damages associated with its failed application.
Next, HRH alleges it has proven, to a reasonable degree of certainty, it lost over $21
million dollars in expected profits from the proposed development. Again, such a finding
is fatally flawed because it is based upon the false assumption that the application to amend
the Bar J Master Plan would have been approved by the County. “The general rule in
Wyoming is that remote, uncertain and conjectural or speculative damages are not
allowed.” Chrysler Corp. v. Todorovich, 580 P.2d 1123, 1134 (Wyo. 1978). This rule
extends to lost profits, which require proof that: “(1) net profits were lost; (2) the amount
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of those profits can be determined with a reasonable degree of certainty; and (3) the
defendant’s breach was the proximate cause of the lost profits.” WSP, Inc. v. Wyoming
Steel Fabricators & Erectors, Inc., 2007 WY 80, ¶ 20, 158 P.3d 651, 655 (Wyo. 2007).
In HRH’s case, it cannot meet its burden to prove net profits were lost with a
reasonable degree of certainty because the status of its pending application with the County
was so uncertain—even without the appeals filed by Defendants. In a tortious interference
claim, “lost profits” means the “expected gains from transactions which the injured party
expected to complete” had it not been for the tortious interference. Downs v. Homax Oil
Sales, Inc., 2018 WY 71, ¶ 22, 421 P.3d 518, 524 (Wyo. 2018) (citing 22 Am.Jur.2d
Damages § 64) (internal quotations omitted). However, HRH cannot establish it ever
expected gains from its proposed development because all evidence pointed to the County
declining to approve the application. HRH’s own land planning expert, Mr. Pierson,
acknowledged HRH’s application, as it was submitted on March 2, 2017, would not have
been approved. HRH expressed no intention to delineate from that application, nor did it
demonstrate any efforts to make the significant amendments necessary to gain County
approval. Therefore, any damages calculation would be based upon speculation and
conjecture, which is insufficient. See B&P Holdings I, LLC. v. Grand Sasso, Inc., 114 F.
App’x 461, 466 (3d Cir. 2004) (affirming exclusion of evidence regarding lost profits
where “the number of approvals (zoning, planning, environmental, etc.) that would have
been required, even if a final agreement had been reached, is daunting”), see also Sun Val,
LLC v. Comm’r of Transp., 193 A.3d 1192, 1201, 330 Conn. 316, 330 (Conn. 2018) (“The
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plaintiff cannot recover for the mere possibility of making a profit.”) (internal citations
omitted).
HRH’s damages calculation is also predicated on unfounded assumptions regarding
the expected costs of the project and project financing. For example, Mr. Hancock and Mr.
Reynolds testified that HRH would have received a necessary $75 million construction
loan at six percent annual interest from First Interstate Bank. HRH purportedly reached
these financing assumptions after discussions with Frank Lyons, Vice President of First
Interstate Bank’s Jackson, Wyoming office. Yet, Mr. Lyons testified at trial he would never
have approved of a loan to HRH if Mr. Hancock was a participant in the project due to Mr.
Hancock’s history with the bank. Mr. Hancock previously failed to pay back a loan from
First Interstate bank, and First Interstate bank had an outstanding judgment against him.
(See Exs. B-2.) Mr. Lyons testified he only had preliminary conversations with Mr.
Reynolds about financing a development project, but that the conversations never
amounted to anything. Mr. Lyons also stated First Interstate would not have been interested
or able to loan $75 million to HRH to construct its project.
Additionally, Mr. Hancock and Mr. Reynolds testified they planned to receive
personal financing from a friend and colleague, Clarke Nelson. However, these statements
were not substantiated by any other witness, nor was there documentation to support the
statements. Mr. Nelson passed away in 2019. In fact, evidence seemed to conflict with
those 	statements, 	as 	Nannette 	Beckley, 	one 	personal 	investor 	in 	HRH’s 	proposed
development, was never aware of Clarke Nelson being a potential donor. (See Ex. Z-2-1 at
53, 56, 57-59, 77.) In any event, the assumptions concerning funding of the project
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proposed by HRH are just as speculative as the project’s approval by the County,
compounding the uncertainty surrounding the lost profits amount claimed.
Finally, turning to HRH’s claimed damages for the cost of the option contract itself,
HRH alleges it is entitled to an additional $1.3 million to account for the difference between
the final option price of $16,000,000 (see Ex. 5.) and the value of the land with its
entitlements according to HRH’s application, which was determined by an appraisal to be
$17,300,000. (See Ex. 101.) The valuation of the land was presented by expert appraiser
Allison Free, who valued the land “As Entitled” as of the September 30, 2017 option
expiration date. (Id. at 1. (“The “As Entitled” value is based on a hypothetical condition
that the property received approval from Teton County to construct 69 residential units as
of the effective date.”).) Thus, Ms. Free’s valuation suffers from the same fatal defect as
the lost profits’ valuations presented by experts Mr. Hampton and Mr. Duncan, as the
amount depends on HRH’s application being approved by the County. Because this Court
has already determined that evidence at trial established HRH’s application was highly
unlikely to have been approved by the County, HRH’s damages amount based on the
entitled land is flawed due to its reliance on speculative and uncertain events. See Roden v.
State, 173 P.3d 639, 372 (Wyo. 2002) (“We have said that damages must be susceptible of
ascertainment with a reasonable degree of certainty, and that a court may not speculate or
engage in conjecture in awarding damages.”) (citing Reiman Construction Company v.
Jerry Hiller Company, 709 P.2d 1271 (Wyo. 1985), Broyles v. Broyles, 711 P.2d 1119
(Wyo. 1985)).
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HRH’s damages are contingent on at least two key events: County approval of its
March 2, 2017 application with enough time to exercise the September 30, 2017-expiring
option agreement, and a guaranteed ability to obtain the requisite funding of $75,000,000
from various third parties. The evidence failed to show, by a preponderance of the
evidence, that either of these events were reasonably or remotely likely to occur. Thus,
there is no basis for the speculative assumptions on which HRH’s damages claims are
predicated. The alleged damages are too hypothetical to sustain an award. See Giuliano v.
Gawrylewski, 40 Misc.3d 1210(A), 2013 WL 3497611, at *10 (Sup.Ct. N.Y. Cnty. 2013),
aff'd, 122 A.D.3d 477, 997 N.Y.S.2d 20 (1st Dept 2014) (citing RNK Capital LLC v.
Natsource LLC, 76 A.D.3d 840, 842 (N.Y. App. Div. 2010) (“dismissing claim for lost
profits arising out of alleged breach of fiduciary duty where ‘plaintiffs’ ability to realize
profits from the allegedly usurped investment opportunity was contingent on certain
conduct by third parties and authorization from a government-sanctioned oversight entity,
both of which were highly uncertain and well beyond the scope of defendants' influence or
control’.”). Given these uncertainties HRH’s claimed damages are purely speculative and
fail to satisfy the reasonable degree of certainty required under Wyoming law.
Finally, having found that HRH has failed to prove the elements on its underlying
tortious interference claim, its claim for punitive damages is effectively disposed. See Cook
v. Shoshone First Bank, 126 P.3d 886, 897 (Wyo. 2006).
CONCLUSION
In accordance with the foregoing findings of fact and conclusions of law this Court
finds Plaintiff HRH, LLC has not satisfied his burden of proving, by a preponderance of
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the evidence, the elements of a tortious interference claim against Defendants under
Wyoming law and Defendants are entitled to a judgment in their favor. See Downs v.
Homax Oil Sales, Inc., 2018 WY 71, ¶ 21, 421 P.3d 518, 524 (Wyo. 2018). Therefore, it
is hereby
ORDERED that judgment be entered against Plaintiff HRH, LLC and in favor of
Defendants Alliance of Route 390 Neighbors, Gerald J Kitchen, individually and as trustee
of the Gerald J Kitchen and Diana Kitchen Family Trust dated July 10, 2007, and Diana
Kitchen, individually and as trustee of the Gerald J Kitchen and Diana Kitchen Family
Trust dated July 10, 2007 on Plaintiff’s claim for tortious interference.
Dated this 31st day of March, 2022.
Scott W. Skavdahl
United States District Judge
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