                                                                                Opinions of the United
2000 Decisions                                                                                States Court of Appeals
                                                                                for the Third Circuit

10-2-2000

Buncher Co. v. Official Com. of Unsec. Creditors
Precedential or Non-Precedential:

Docket 99-3925 & 99-3950

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Filed October 2, 2000

UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT

Nos. 99-3925 & 99-3950

BUNCHER COMPANY;
FINANCIAL INSTITUTIONAL FUNDING, INC.;
RICHARD SANTUCCI; JOHN T. STABILE

v.

OFFICIAL COMMITTEE OF UNSECURED CREDITORS OF
GENFARM LIMITED PARTNERSHIP IV,
       Cross-Appellants in 99-3950

BUNCHER COMPANY; JOHN T. STABILE,
       Appellants in 99-3925

ON APPEAL FROM THE
UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF PENNSYLVANIA
(D.C. No. 98-cv-00792)
District Judge: Honorable Donetta W. Ambrose

Argued August 8, 2000

Before: BARRY, WEIS and GREENBERG, Circuit Jud ges

Filed: October 2, 2000

       Robert J. Ridge, Esquire (ARGUED)
       Katarincic & Salmon
       2600 CNG Tower
       Pittsburgh, PA 15222

       Attorney for Appellants
       The Buncher Company, D.C. and
       John T. Stabile
       David B. Salzman, Esquire
        (ARGUED)
       Philip E. Milch, Esquire
       Campbell & Levine, LLC
       1700 Grant Building
       Pittsburgh, PA 15219

       Counsel for Appellees/
       Cross-Appellants Official Committee
       of Unsecured Creditors of GenFarm
       Limited Partnership IV

OPINION OF THE COURT

WEIS, Circuit Judge.

In this appeal we conclude that when limited partners
sold their interests to their financially strapped partnership,
the transaction was a constructive fraudulent conveyance,
and as such it was properly declared void by the
bankruptcy judge. Because the ruling by the bankruptcy
judge restored the former partners to their previous status
of equity investors, it was unnecessary for the bankruptcy
judge to rule on the matter of subordination, advanced as
an alternative theory of recovery. We will affirm the
judgment as to the fraudulent conveyance and vacate the
ruling on subordination raised in the cross-appeal.

This is an adversary proceeding brought by the Official
Committee of Unsecured Creditors of GenFarm Limited
Partnership IV against D. C. Guelich Explosive Co., Inc.
and other former limited partners referred to collectively
here as the Buncher Group.1 In 1988, Rodney Bohn
organized GenFarm IV as a limited partnership with himself
as sole general partner for the purpose of establishing and
operating an experimental dairy farm in Florida. The
_________________________________________________________________

1. In the Bankruptcy Court the Buncher Group included the Buncher
Company, Financial Institutional Funding, Inc., John T. Stabile, and
Richard J. Santucci. Financial Institutional, Santucci and Guelich have
since settled their disputes with the Committee and are no longer parties
in this dispute.

                               2
partnership filed a petition under Chapter 11 in June of
1995; and all of the assets were scheduled to be sold to
Ebony Bull Capital Co., an entity controlled by Bohn. The
Buncher Group objected to the sale price as inadequate,
but withdrew its opposition upon payment of $300,000,
now held in escrow, and a promissory note in the amount
of $700,000 from Ebony Bull.

In August 1992, Guelich, the Buncher Group, and
GenFarm IV filed several law suits in state courts against
Ebony Bull and Bohn to remove him as general partner and
recover damages. The allegations against Bohn are
described in detail in the following excerpt from the state
trial judge's opinion overruling preliminary objections:

        "Plaintiffs [GenFarm IV, Guelich, and the Buncher
       Group] claim that Mr. Bohn and Ebony Bull have
       engaged in various acts of fraud and misrepresentation
       to the detriment of the limited partners. They allege
       that prior to the formation of the partnership, Mr.
       Bohn represented that the genetics program was in
       place on other farms even though he knew that it was
       not yet viable; that he failed to describe unfavorable
       information that he had received concerning the
       operations of other dairy farms which he was operating
       through Ebony Bull; that he purchased cows for
       GenFarm IV from his other farms for substantial sums
       of money even though they had no value; that he
       purchased semen from his other farms that was never
       used; that he chose a site for GenFarm IV which he
       knew to have environmental problems without
       furnishing this information to the limited partners; that
       he obtained the limited partners' approval for
       additional borrowing by misrepresenting the condition
       of the business and overstating its value; that he made
       unauthorized payments to Ebony Bull and other
       entities which he operated; and that he engaged in
       fraudulent activities in connection with March 1990
       and November 1991 transactions with banks that
       resulted in a refinancing of the partnership's
       indebtedness and increased indebtedness. Mr. Bohn
       denies these allegations -- he contends that plaintiffs
       cannot produce evidence showing that he breached any
       fiduciary duties."

                               3
GenFarm Limited Partnership IV v. Ebony Bull Capital Corp.,
141 P.L.J. 190, 191 (Pa. Ct. of Common Pleas 1993).

The parties settled the state court suits in June 1993
with each party agreeing to release all claims against the
others. The settlement called for a closing transaction on
October 4, 1993. Bohn had the option to step down and
turn over his interests in the partnership, or remain as
general partner and purchase the interests of Guelich and
the Buncher Group. He chose the latter, but assigned to
GenFarm IV his right to purchase. At the closing, GenFarm
IV bought the limited partnership interests for $3.5 million
in cash and a note secured by a second-priority mortgage
on substantially all the partnership assets. On that same
day, GenFarm IV sold the interests it had purchased from
the Buncher Group and Guelich, together with minor
limited partnership interests that it had previously
acquired, to Bohn and Ebony Bull for $1.705 million.

Simultaneously, GenFarm IV refinanced its obligations to
its bank. Following the closing, GenFarm IV increased the
herd size, but the following summer it began selling cows in
order to pay expenses. The partnership continued its
downward financial spiral, culminating in the Chapter 11
petition.2

In January 1996, the Committee filed this adversary
action against Guelich and the Buncher Group to recover
all payments made pursuant to the 1993 settlement, the
$300,000 escrow fund, and the $700,000 Ebony Bull note.
The complaint alleges claims under theories of fraudulent
conveyance, preferences and subordination.

After a bench trial, the bankruptcy judge found that the
October 4, 1993 transactions rendered the partnership
insolvent and that GenFarm IV did not receive fair
compensation for the Buncher Group limited partnership
interests. He also determined that between October 1993
and the petition date, the Buncher Group received
_________________________________________________________________

2. Other limited partnerships established by Bohn for similar ventures
also went into bankruptcy. Although some relationships between these
entities and GenFarm IV existed, they are not material to the issues
raised on this appeal.

                               4
$822,851.77 in the initial transfer and in payments on the
$2.75 million note of GenFarm IV.

The Bankruptcy Court rejected the contention that the
release of GenFarm IV in the 1993 settlement benefitted the
partnership, pointing out that the Buncher Group had not
asserted any claims against GenFarm IV in the state
litigation. In addition, the Court noted that the retention of
Bohn as general partner was, if anything, a detriment to
GenFarm IV, and that the refinancing with the bank that
was part of the settlement was so restrictive that it did not
provide a benefit to the partnership.

After analyzing the various elements of the 1993
settlement agreement, the Bankruptcy Court decided that
the transaction was voidable under Pennsylvania's Uniform
Fraudulent Conveyance Act. Pa. Stat. Ann. tit. 39,SS 351-
63 (repealed Dec. 3, 1993 and replaced by the Uniform
Fraudulent Transfer Act, 12 Pa. Cons. Stat. Ann.SS 5101-
10 (effective February 1, 1994)). The Court then considered
the question of subordination and determined that in the
circumstances, section 510(b) of the Bankruptcy Code
required that the Buncher Group's claims be subordinated
to the claims of unsecured creditors.

Having determined that the 1993 settlement was a
fraudulent conveyance, the Court declared that the note
and mortgage of that date in the amount of $2.75 million
were void. The Court directed the Buncher Group to turn
over to the debtor's estate the $822,851.77 received from
GenFarm IV pursuant to that note and mortgage, as well as
the $300,000 in the escrow account and the $700,000 note
from Ebony Bull.

On appeal, the District Court held that the bankruptcy
judge did not err in finding that GenFarm IV received no
benefit from the release of claims by the Buncher Group.
Further, the Group's limited partnership interest did not
constitute fair consideration for the cash and note received
from the 1993 settlement.

The District Court, however, concluded that as a result of
the settlement, the Buncher Group did not have an equity
interest in GenFarm IV at the time the Chapter 11 petition
was filed, and therefore the mandatory subordination

                                5
provisions of section 510(b) of the Bankruptcy Code did not
apply. Consequently, the Court reasoned it was necessary
to consider equitable subordination under section 510(c).

The District Court also rejected an additional claim
presented for the first time on appeal by the Buncher
Group. It had argued it was entitled to a lien for the
amount transferred to GenFarm IV in the voided fraudulent
conveyance. Because the Buncher Group had failed to raise
the issue in the Bankruptcy Court, the District Court held
that the claim for a lien had been waived. The Court,
therefore, affirmed the judgment in favor of the Committee
on the fraudulent conversion claim, but reversed and
remanded on the subordination issue.

On appeal to this Court, the Buncher Group argues that
the release of claims against GenFarm IV constituted fair
consideration for the 1993 settlement. In addition, the
Group contends that the bankruptcy judge erred in not
considering the value of the partnership interests
transferred to GenFarm IV and in failing to grant a lien for
that amount. The Committee filed a cross-appeal from the
District Court's reversal of the mandatory subordination
order of the Bankruptcy Court.

I.

The District Court's remand of the subordination issue
raises an issue of finality that must be considered in
connection with our appellate authority. We have
jurisdiction under 28 U.S.C. S 158(d) to review "final
decisions, judgments, orders and decrees entered under
subsections (a) and (b) of this section." Section 158(a) in
turn authorizes district court review of final and
interlocutory orders of bankruptcy judges. The Bankruptcy
Court's disposition of the adversary proceeding here was
unquestionably final, but the District Court's order is not
so readily categorized.

Based on pragmatic considerations unique to this area of
the law, we have traditionally applied a relaxed standard of
finality in bankruptcy cases. United States Trustee v.
Gryphon at the Stone Mansion, Inc., 166 F.3d 552, 556 (3d
Cir. 1999). Under this standard, a partial remand by the

                                6
District Court does not automatically bar us from
considering an appeal. Id.

In deciding whether this Court has jurisdiction, four
factors are pertinent:

       (1) The impact on the assets of the bankrupt estate;

       (2) Necessity for further fact-finding on remand;

       (3) The preclusive effect of our decision on the merits
       of further litigation; and

       (4) The interest of judicial economy.

Official Committee v. Westmoreland County MH/MR., 183
F.3d 273, 277 (3d Cir. 1999). The most important of these
factors is the impact on the bankruptcy estate. In re
Blatstein, 192 F.3d 88, 94 (3d Cir. 1999); In re Meyertech
Corp., 831 F.2d 410, 414 (3d Cir. 1987). See also Commerce
Bank v. Mountain View Village, Inc., 5 F.3d 34, 37 (3d Cir.
1993) (discussing finality); In re Porter, 961 F.2d 1066,
1072 (3d Cir. 1992) (same).

A passing glance at the parties' contentions in this appeal
reveals that a major effect on the estate's assets is at stake.
As a result of the Bankruptcy Court's determination, any
substantial recovery by the unsecured creditors will be
affected by the outcome of this appeal. Furthermore,
because the record from the trial has been fully developed,
it appears unlikely that additional fact-finding would be
required in the Bankruptcy Court. From a pragmatic
standpoint, resolution of this matter must be made at some
point, and expeditious disposition would best serve the
interests of all concerned. We therefore conclude that we
should review the appeal at this juncture.

II.

Our standard of review is set out in Universal Minerals,
Inc. v. C.A. Hughes & Co., 669 F.2d 98, 102 (3d Cir. 1981).
In assessing the trial court's ruling, we apply the clearly
erroneous test to narrative facts and plenary review to
questions of law. Id. Ultimate facts are examined by
applying the appropriate standards to the factual and legal
components. Id.

                               7
The Bankruptcy Code provides that a trustee in a
bankruptcy proceeding "may avoid any transfer of an
interest of the debtor in property or any obligation incurred
by the debtor that is voidable under applicable law by a
creditor holding an unsecured claim . . . ." 11 U.S.C.
S 544(b) (1979). In this case, the applicable law is that of
Pennsylvania as set out in the Uniform Fraudulent
Conveyance Act, the Uniform Fraudulent Transfer Act, and
the Statute of 13 Elizabeth.3See Pa. Stat. Ann. tit. 39,
S 361; 12 Pa. Cons. Stat. Ann. S 5110; Golder v. Bogash,
188 A. 837, 838 (Pa. 1937).

The purpose of fraudulent conveyance law is to make
available to creditors those assets of the debtor that are
rightfully a part of the bankruptcy estate, even if they have
been transferred away. See In re Cybergenics Corp., No. 99-
5592, 2000 WL 1257270, at *3-4 (3d Cir. 2000). When
recovery is sought under section 544(b) of the Bankruptcy
Code, any recovery is for the benefit of all unsecured
creditors, including those who individually had no right to
avoid the transfer. 2 Collier Bankruptcy Manual P 544.09[5]
(Lawrence P. King ed., 3d ed. rev. 1999). The remedy in this
section adopts the longer "reach-back" provisions of state
law. Id. P 544.09[2].

Under section 4 of Pennsylvania's Uniform Fraudulent
Conveyance Act, a conveyance made or obligation incurred
by a person who thereby becomes insolvent is fraudulent as
to creditors, regardless of intent, if the transaction is
without fair consideration. Pa. Stat. Ann. tit. 39,S 354.
Section 5 provides that when a person in business conveys
assets without fair consideration and receives so little in
return that the remaining capital is unreasonably small,
the transaction is fraudulent as to creditors. Pa. Stat. Ann.
tit. 39, S 355. Like section 4, section 5 does not consider
intent. Id.

Fair consideration is given when property of a fair
equivalent is transferred in good faith. Pa. Stat. Ann. tit.
39, S 353(a). A party lacks good faith if it knows that the
_________________________________________________________________

3. The parties do not contend that the differences between the
Fraudulent Conveyance Act and the Fraudulent Transfer Act affect the
outcome in the present case.

                               8
transaction would render the other party insolvent. Id.;
United States v. Tabor Court Realty Corp., 803 F.2d 1288,
1296 (3d Cir. 1986).

Section 4 refers to insolvency immediately before the
conveyance or it can mean "present insolvency after the
conveyance as affected by it." Angier v. Worrell, 31 A.2d 87,
89 (Pa. 1943). In Larrimer v. Feeney, 192 A.2d 351, 353
(Pa. 1963), the Pennsylvania Supreme Court held that the
Uniform Fraudulent Conveyance Act encompassed
insolvency in the bankruptcy sense, i.e., a negative net
worth; and also in the equity sense, i.e., the debtor has
insufficient presently salable assets to pay existing debts as
they come due.

The primary inquiry under a constructive fraud provision
is limited to whether there is a link between the challenged
conveyance and the debtor's insolvency. If insolvency is
established, the burden shifts to the transferee to show
that the assets were transferred for fair consideration.
Elliott v. Kiesewetter, 98 F.3d 47, 56-57 (3d Cir. 1996).

The bankruptcy judge in this case heard conflicting
expert testimony on whether GenFarm IV was rendered
insolvent by the October 1993 transaction. He analyzed the
evidence at some length in his opinion and concluded that
GenFarm IV "was insolvent on October 4, 1993, or became
insolvent as a result of the closing on the Settlement
Agreement."

The Buncher Group does not frontally assault the
insolvency findings. Instead, it argues that the bankruptcy
judge erred in failing to properly evaluate the consideration
the Buncher Group furnished to GenFarm IV in the
settlement. In that connection, the Group says that it
released the partnership from viable claims worth in excess
of $9 million.

In its brief, the Buncher Group states that "the
Committee stipulated that a fraud was being perpetrated on
the [Buncher Group]. Thus, it is entirely uncontradicted
that the [Buncher Group] had valid, viable claims against
GenFarm IV, which they released." The record, however,
does not bear out this statement. During the trial, some
discussion took place about the fraud issues asserted in

                                9
the state litigation by the Buncher Group. The bankruptcy
judge stated, "I think you will all agree that the [Buncher
Group] defendants here believe that Rodney Bohn was
guilty of fraud in formulating and operating this limited
partnership." Committee counsel replied, "And, as I said,
Your Honor, we will stipulate that they believe that." This
exchange is far from a concession that the Buncher Group
had viable claims against GenFarm IV, whatever might
have been the circumstances with respect to claims against
Bohn.

The Buncher Group also argued in the Bankruptcy Court
that part of the $3.5 million it received was in return for
releasing claims against the partnership not asserted in the
state suit. The Buncher Group suggested that the
subsequent sale of the limited partnership interest by
GenFarm IV to Ebony Bull for $1.705 million on the closing
date established the value of those interests. The Buncher
Group pointed out that it received $3.5 million when it
conveyed those same interests to the partnership.
Accordingly, it argued the difference between the two
figures was some measure of the value of the Buncher
Group's release of claims against GenFarm IV.

Although somewhat persuasive on its face, this argument
fails when the terms of the settlement agreement are
examined closely. The settlement was based on the premise
that the Buncher Group and Bohn would go their separate
ways. Between the June agreement date and the October
closing day, Bohn was forced to choose between buying out
the Buncher Group, or turning over his interests in the
partnership. As counsel for the Buncher Group stated at
oral argument before this Court, "the way we[settled the
case] we did not know who [was] going to wind up with
control of this partnership, but whoever does, that's it. . . .
Everyone has to go their separate ways."

Significantly, the $3.5 million obligation agreed to by
Bohn under the buyout option was his alone, although he
was free to assign it to anyone, including GenFarm IV.
Sometime later, but before the October closing date, Bohn
opted to assign to GenFarm IV the right to buy the Buncher
Group shares.

                                10
Thus, the $3.5 million clearly was not based in part on
any previously unasserted claims against the partnership.
The $3.5 million figure was agreed upon in negotiations
between the Buncher Group and Bohn on his own behalf.
If the $3.5 million figure represented any claims other than
the value of the Buncher Group's partnership interest,
these would have been claims against Bohn, not against
GenFarm IV.

If Bohn had not assigned his obligation to GenFarm IV,
the Buncher Group would still have received the $3.5
million and the partnership would have owed nothing to the
Buncher Group. Whatever Bohn's motives for transferring
his obligation to GenFarm IV, the assignment does not
establish the Buncher Group's contention that a portion of
the $3.5 million represents payment for claims against
GenFarm IV.

The Buncher Group failed to persuade the bankruptcy
judge that it had viable claims at the time of the settlement
in any amount, let alone $9 million, a figure which included
treble damages under a theoretical RICO claim. In
dismissing the Buncher Group's arguments, the
bankruptcy judge observed that it had not presented any
claim against GenFarm IV in the state litigation, but that
its fire had been directed solely at Bohn, not the
partnership.

Neither the Bankruptcy Court nor this Court disputes the
Buncher Group's contention that a release of a claim not in
suit may serve as consideration for a settlement, but the
Group failed to establish the reality of such claims. On this
record, the unasserted claims may fairly be considered non-
existent. Consequently, the bankruptcy judge properly
found that no part of the consideration received by the
Buncher Group represented compensation for release of
claims against the partnership.

In scrutinizing the transfer of the Buncher Group's
partnership interest, the Bankruptcy Court correctly
treated the interest of a limited partnership as an equity
security. Under the Bankruptcy Code, the term "equity
security" includes the "interest of a limited partner in a
limited partnership." 11 U.S.C. S 101(16)(B). Citing In re

                                11
Roco Corp., 701 F.2d 978, 982 (1st Cir. 1983), the judge
concluded that a partnership receives less than reasonably
equivalent value when it redeems the equity interest of its
principals. Roco held that in determining whether a stock
redemption is a fraudulent transfer, a transaction in which
the corporation receives nothing but outstanding stock
amounts simply to a reduction in capitalization. Id. From
the perspective of the creditors, there is ordinarily no value
to the corporation in such an exchange.

The Buncher Group argues that "[u]nder [this] rationale,
a valid and legitimate settlement between a debtor and an
equity interest holder, even if it is reached years prior to
bankruptcy, is subject to being set aside." This objection
ignores the fact that it is insolvency which cabins the reach
of fraudulent conveyance law. Therefore, where equity
shareholders inform themselves of the entity's solvency,
this concern is allayed.

In effect, what the Buncher Group sought as a result of
the October 1993 transaction was to transform its failing
investment into a secured creditor relationship, to the
detriment of the partnership's unsecured creditors. We
conclude that the Bankruptcy Court was correct in its
determination that from the creditors' perspective, the
partnership did not receive fair consideration.

The Buncher Group also protests the fact that the
Bankruptcy Court did not award a lien for the value it
transferred to GenFarm IV. In United States v. Tabor Court
Realty, 803 F.2d at 1298-99, we cited section 548(c) of the
Bankruptcy Code providing that a transferee or obligee of a
fraudulent transfer or obligation who takes for value and in
good faith may retain the interest transferred or the
obligation incurred. That provision permits a good faith
transferee or obligee to retain his lien.

We agree with the District Court that the Buncher Group
waived the lien issue by failing to raise it in the Bankruptcy
Court. Not only did the Buncher Group neglect to raise the
issue at trial, but the evidence in the record is insufficient
to permit a court to realistically value the lien.

III.

We come now to the Committee's cross-appeal
challenging the District Court's remand of the

                               12
subordination issue to the Bankruptcy Court. It is helpful
to put the cross-appeal in context. In the adversary
proceeding, the Committee sought relief under several
alternative theories. In its brief at the conclusion of the
trial, the Committee said, "to the extent that the Committee
could establish, either through successful prosecution of
the fraudulent conveyance claim or the equitable
subordination claim, that such claim was not allowable or
alternatively, subject to subordination, the escrow fund
would belong to the estate." In this connection, it is worth
noting again that the Committee had also sought recovery
under a preference theory.

The contingent nature of the subordination claim is
demonstrated in the Committee's response to this Court's
pre-argument inquiry about appellate jurisdiction. The
Committee explained that it had pleaded four alternative
causes of action, three of which were based on theories that
might have been applied had the fraudulent conveyance
count failed. "Once the transfer is avoided," the Committee
wrote, "applicable law mandates Buncher be returned to its
original status as an equity holder. Such a result affords
the Committee complete relief in this matter, inasmuch as
everything received by Buncher in respect of the Transfer
would be avoided and returned to the Debtor's bankruptcy
estate." In short, the cross-appeal was a precautionary
move by the Committee to be considered by this Court only
if the fraudulent conveyance judgment were reversed; if the
fraudulent conveyance claim is affirmed, the Committee
disclaims its cross-appeal.

Once they had upheld the fraudulent conveyance claim,
the Bankruptcy Court and the District Court need not have
addressed the subordination count because it was
academic at that point. In the interest of prudence and
judicial economy, both courts chose to discuss the issue for
the benefit of appellate review. This practice is frequently
followed and is an aid to judicial efficiency. We conclude,
however, at this juncture that the subordination claim is no
longer germane and we need not discuss it.

Accordingly, we will affirm the judgment of the District
Court insofar as it affirms the Bankruptcy Court's ruling on
the fraudulent conveyance action. We will modify the

                               13
District Court's remand to the Bankruptcy Court by
directing that the District Court direct the Bankruptcy
Court to vacate its order on the subordination claim.

A True Copy:
Teste:

       Clerk of the United States Court of Appeals
       for the Third Circuit

                               14


508 F.Supp.2d 518 (2007)
Karen GEARY, et al.
v.
LIFE INVESTORS INSURANCE COMPANY OF AMERICA.
Civil Action No. 4:06-CV-268-Y.
United States District Court, N.D. Texas, Fort Worth Division.
August 13, 2007.
Darrell W. Cook, Patrick C. Patterson, Darrell W. Cook & Associates, Dallas, TX, for Plaintiff.
Jeffrey Jack Wolf, Wolf Law PC, Southlake, TX, Jason L. Wren, Walters Balido & Crain, Dallas, TX, for Defendant.

ORDER GRANTING DEFENDANT'S MOTION FOR SUMMARY JUDGMENT
TERRY R. MEANS, District Judge.
Plaintiff Karen Geary has filed suit on behalf of her mother, Dorothy Lindquist, *519 against defendant Life Investors Insurance Company of America ("Life Investors") asserting various claims all based on Life Investor's failure to pay daily benefits under a long-term-care insurance policy ("the Policy") for Lindquist's stay at The Cottages at Clear Lake ("the Cottages") facility. The question presented to the Court is whether the Cottages qualifies as a nursing-home facility as defined by the Policy. Life Investors has filed a motion (doc. # 25) for summary judgment contending that the Cottages is not a nursing home as defined by the Policy. After review of the pleadings and appendices, the Court concludes that the Cottages is not a nursing home as defined by the Policy and therefore Life Investor's motion should be GRANTED.
I. Factual Background
In March 1991, Life Investors issued a long-term-care insurance policy to Dorothy Lindquist The Policy provides for a "nursing-home benefit" of fifty dollars per day for an inpatient stay in a nursing home for an unlimited period of time after a deductible period of 100 days. (Def.'s App. at 26.) The Policy defines "Nursing Home" as:
A facility or distinctly separate part of a hospital or other institution which is licensed by the appropriate licensing agency to engage primarily in providing nursing care and related services to inpatients and:
 Provides 24 hour a day nursing service under a planned program of policies and procedures which was developed with the advice of, and is periodically reviewed and executed by, a professional group of at least one Doctor and one Nurse; and
 Has a Doctor available to furnish medical care in case of emergency; and
 Has at least one Nurse who is employed there full time . . .; and
 Has a Nurse on duty or on call at all times; and
 Maintains clinical records for all patients; and
 Has appropriate methods and procedures for handling and administering drugs and biologicals.
NOTE: The above requirements are typically met by licensed skilled nursing facilities, comprehensive nursing care facilities and intermediate nursing care facilities as well as some specialized wards, wings and units of hospitals. Those requirements are generally NOT met by: rest homes; homes for the aged; sheltered living accommodations; residence homes; or similar living arrangements.
(Id. at 29.) The Policy does not define the term "nursing care and related services" as used in the Policy's definition of nursing home.
Lindquist currently suffers from Alzheimer's disease and her daughter, Geary, had Lindquist admitted to the Cottages in the Fall of 2005. Geary decided on the Cottages because it "specialized in Alzheimer's, and that's what I was looking for." (Id. at 218.) Geary never inquired into what type of facility the Cottages was, never inquired into what type of license the Cottages had, nor did she inquire into whether the facility qualified as a nursing home as defined by the Policy. (Id. at 218-19, 225-28, 236.) She was "simply looking for the facility that [she] thought was best for [her] mother." (Id. at 218-19.)
The Cottages is licensed as an "assisted-living facility type B small," and is certified as a "facility for Alzheimer's disease and related disorders" under Chapter 247 of the Texas Health and Safety Code. (Id. at 42-45.) It is not licensed as a nursing home under Chapter 242 of the Texas Health and Safety Code.
*520 In its residency agreement, the Cottages agrees to provide the following services to its residents:
a) An unfurnished . . . private or companion room.
b) Use of common areas.
c) Three meals and snacks daily.
d) Daily linen and towel service.
e) Common area housekeeping service.
f) Maintenance of the building and common areas.
g) All utilities.
h) 24-hour staff supervision and caregiver support.
i) Egress door security system.
j) Personal laundry service when staying overnight.
k) Personal housekeeping service.
l) Assistance with personal care as needed for dressing, bathing, and grooming.
m) Assistance with or supervision of medication, storage, and reminders.
n) Social recreation/activities programming.
o) Special programming for memory disorders.
(Id. at 132.) Its disclosure statement refers to the Cottages as a personal-care facility. (Id. at 138.) Under the residency agreement, a resident and a resident's responsible party agree, "To permit the Resident to be transferred as deemed necessary by The Cottages personnel, for the health and safety of the Resident or others." (Id. at 133.) The general provisions of the agreement provide,
If the Resident requires sitters or private duty nurses, the Responsible. Party is free to make arrangements for additional health-related services. The Responsible Party is responsible for negotiating with an appropriate agency for services and payment. . . .
The Cottages Residents must be at least semi-ambulatory, requiring no more than a one-person assist with transfers, not in need of 24-hour nursing care or routine professional or ancillary medical assistance, and not at risk to themselves or others. Failure or inability of a Resident to continue to meet the above criteria is grounds for discharge.
(Id. at 134.) The Cottages disclosure statement also informs potential residents and their responsible party that a medical condition requiring 24-hour nursing care could cause a temporary transfer or a permanent discharge from the facility. (Id. at 140.)
According to the Cottages, it is not a nursing home, and it does not "primarily provide nursing care as opposed to personal care." (Id. at 114, 118, 143.) There is not a registered nurse, licensed practical nurse, or licensed vocational nurse "physically on the Alzheimer's Unit 24-hours per day, 7 days per week providing nursing care and related service[s]." (Id. at 115). The Cottages does have a doctor available to furnish medical care in the case of an emergency, has at least one nurse employed full time, and has a nurse either on duty or on call at all times. (Id.) The facility's nurses are on duty from 8:00 a.m. to 5:00 p.m. weekdays and from 8:00 a.m. to 8:00 p.m. on weekends, and has nurses on, call, between 5:00 p.m. and 8:00 a.m. on weekdays and 8:00 p.m. and 8:00 a.m. on weekends. (Id. at 8.) Under its license, the Cottages can provide continuous nursing care for a short period of time. The Cottages will provide continuous and ongoing nursing care for as long as thirty days. After thirty days, if the resident needs continued nursing care, the resident or the resident's responsible party are required to make arrangements for private nursing care at their own expense, otherwise, the resident will be discharged from the facility. (Id. at 119, 134, 140, 143-44.)
*521 After placing Lindquist in the Cottages, Geary sought benefits from the Policy to pay for Lindquist's stay. (Id. at 6.) After conducting an extensive investigation into the facility's license and services, Life Investors informed Geary that it declined to pay the benefits under the Policy because it believed that the Cottages did not qualify as a nursing home as defined by the Policy. Geary filed suit on behalf of Lindquist in Texas state court alleging that Life Investors beached its contract, engaged in unfair claim settlement practices under section 541.060 of the Texas Insurance Code and section 17.46(b) of the Texas Business and Commerce Code, breached its duty of good faith and fair dealing, and failed to comply with sections 542.055-542.058 of the Texas prompt payment statute. Geary seeks both compensatory and exemplary damages.
II. Analysis
A. Standard
Summary judgment is proper when the record establishes "that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." FED. R. Civ. P. 56(c). An issue is considered "genuine" if "it is real and substantial as opposed to merely formal, pretended, or a sham." Bazan v. Hidalgo Cty., 246 F.3d 481, 489 (5th Cir. 2001). Facts are considered "material" if they "might affect the outcome of the suit under governing law." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). To determine whether there are any genuine issues of material fact, the Court must first consult the applicable substantive law to ascertain what factual issues are material. Lavespere v. Niagara Mach. & Tool Works, 910 F.2d 167, 178 (5th Cir.1990). Next, the Court must review the evidence on those issues, viewing the facts, in the light most favorable to the nonmoving party. Id.; Newell v. Oxford Mgmt. Inc., 912 F.2d 793, 795 (5th Cir.1990).
In making its determination on the motion, the Court must look at the full record including the pleadings, depositions, answers to interrogatories, admissions on file, and affidavits. See FED. R. Civ. P. 56(c); Williams v. Adams, 836 F.2d 958, 961 (5th Cir.1988). Rule 56, however, "does not impose on the district court a duty to sift through the record in search of evidence to support" a party's motion for, or opposition to, summary judgment. Skotak v. Tenneco Resins, Inc., 953 F.2d 909, 915-16 & n. 7 (5th Cir.1992). Thus, parties should "identify specific evidence in the record, and . . . articulate" precisely how that evidence supports their claims. Forsyth v. Barr, 19 F.3d 1527, 1536 (5th Cir.1994). Further, the Court's function is not to weigh the evidence and determine the truth of the matter but to determine whether there is a genuine issue for trial. See Anderson, 477 U.S. at 249, 106 S.Ct. 2505.
When the moving party has carried its summary-judgment burden, the respondent must go beyond the pleadings and produce evidence that sets forth specific facts showing there is a genuine issue for trial. Celotex Corp. v. Catrett, 477 U.S. 317, 324, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986); see also FED. R. Civ. P. 56(e). This burden is not satisfied by creating some metaphysical doubt as to the material facts, by conclusory allegations, by unsubstantiated assertions, or by only a scintilla of evidence. See Little v. Liquid Air Corp., 37 F.3d 1069, 1075 (5th Cir.1994). If the evidence is merely colorable or is not significantly probative, summary judgment may be granted. See Anderson, 477 U.S. at 249-50, 106 S.Ct. 2505.
B. Discussion
In Texas, the rules of interpretation and construction generally applicable *522 to contracts are equally applicable to insurance contracts. See Lynch Properties, Inc. v. Potomac Insurance Company of Illinois, 140 F.3d 622, 625 (5th Cir.1998) (citing National Union Fire Insurance Company v. CBI Industries, Inc., 907 S.W.2d 517, 520 (Tex.1995)). "Effectuating the true intent of the parties as expressed in the insurance policy is the primary concern of the court." Id. at 626 (citing Forbau v. Aetna Life Insurance Company, 876 S.W.2d 132, 133 (Tex.1994)). The Court construes the policy to give effect to each of its provisions and avoids rendering any term a nullity. Id. However, no word, phrase, sentence, or section should be construed in a vacuum; rather, the Court must consider each part of a policy in its proper context. Id. (citing Forbau, 876 S.W.2d at 132-33). The Court should also uniformly interpret policy provisions that are similar across jurisdictional borders. See National Union Fire Insurance Company, 907 S.W.2d at 522 ("Courts usually strive for uniformity in construing insurance provisions, especially where, as here, the contract provisions at issue are identical across the jurisdictions."). "Thus, when no Texas court has interpreted a particular provision, [the Court] look[s] to the courts of other states for guidance . . ." as to how Texas may interpret the provision. Lynch Properties, 140 F.3d at 626 (citing Dickson v. State Farm Lloyds, 944 S.W.2d 666, 668 (Tex. App.-Corpus Christi [13th Dist.] 1997, no pet.)) (looking to other jurisdictions in interpreting same insurance provision)."
Provisions of an insurance contract are not ambiguous if they can be given a "definite and certain legal meaning." National Union Fire Insurance Company, 907 S.W.2d at 520. "Disagreement over the meaning or interpretation of a term is not sufficient to make a provision ambiguous or to create a question of fact." Lynch Properties, 140 F.3d at 626. "If, however, the language of a policy or contract is subject to two or more reasonable interpretations, it is ambiguous." National Union Fire Insurance Company, 907 S.W.2d at 520. Whether an insurance contract is ambiguous is a question of law for the Court to decide. Id. If it is determined that an insurance contract is ambiguous, then the Court "must resolve the uncertainty by adopting the construction that most favors the insured . . . even if the construction urged by the insurer appears to be more reasonable or a more accurate reflection of the parties' intent." National Union Fire Insurance Company v. Hudson Energy Company, 811 S.W.2d 552, 555 (Tex.1991).
Contrary to Geary's assertion, the Policy's definition of the term "nursing home" is not ambiguous. In plain terms, the Policy requires a facility to be "licensed by the appropriate licensing agency to engage primarily in providing nursing care and related services to inpatients," and it lists certain services that, at a minimum, a facility must provide. On its face, the definition is not susceptible to more than one interpretation. Either the facility is licensed by the appropriate state agency to primarily provide nursing care and related services or it is not. And the facility either provides the minimum listed services in the definition or it does not.
Two other courts have reviewed this identical language and concluded that as a matter of law it is not ambiguous. See Gillogly v. General Electric Capital Assurance Company, 430 F.3d 1284, 1291 (10th Cir.2005); Gregg v. IDS Life Insurance Company of New York, 178 Misc.2d 895, 898, 681 N.Y.S.2d 451 (N.Y.Sup.Ct.1998), affirmed, 261 A.D.2d 799, 692 N.Y.S.2d 182 (N.Y.App.Div.1999). Neither party has brought to the Court's attention any Texas court that has interpreted this provision, and the Court is not aware of any. Thus, the Court, being mindful that Texas prefers *523 uniformity in the interpretations of insurance provisions that are identical across jurisdictions, concludes that the definition of what constitutes a nursing home is not ambiguous.
It is undisputed that the Cottages is licensed as an assisted-living facility and not as a nursing home. At the time Lindquist entered into this insurance contract and at the time she submitted her claim for benefits, Texas regulated nursing homes and related institutions and assisted-living facilities in separate, but complementary, statutes. See Chapter 242 of the Texas Health and Safety Code regulating "Convalescent and Nursing Homes and Related Institutions" and Chapter 247 of the Texas Health and Safety Code regulating "Assisted Living Facilities."
It is also undisputed that the Texas Department of Aging and Disability Services ("the Department") is charged with promulgating regulations applicable to nursing homes and assisted-living facilities. Under section 247.026 of the Texas Health and Safety Code, the Department is charged with promulgating regulations that prescribe minimum standards for assisted-living facilities. One of the requirements of the statute is that the Department's minimum standards must "clearly differentiate an assisted-living facility from an institution required to be licensed under Chapter 242." TEX. HEALTH & SAFETY CODE § 247.026(b)(1).
The Department's regulations set out the requirements an institution "must meet in order to be licensed as a nursing facility and also qualify to participate in the Medicaid program." 40 TEX. ADMINISTRATIVE CODE § 19.1(b). The Department defines a "nursing facility/home" as "an institution that provides organized and structured nursing care and service, and is subject to licensure under Health and Safety Code, Chapter 242." 40 TEX. ADMINISTRATIVE CODE § 19.101(90).
On the other hand, an assisted-living facility is defined by the Department as "an establishment that furnishes, in one or more facilities, food and shelter to four or more persons who are unrelated to the proprietor of the establishment; and provides personal care services." 40 TEX. ADMINISTRATIVE CODE § 92.2(b)(1). Personalcare services are defined as:
Assistance with meals, dressing, movement, bathing, or other personal needs or maintenance; the administration of medication or the assistance with or supervision of medication; or general supervision or oversight of the physical and mental well-being of a person who needs assistance to maintain a private and independent residence in the facility or who needs assistance to manage his or her personal life, regardless of whether a guardian has been appointed for the person.
40 TEX. ADMINISTRATIVE CODE § 92.3(32). According to the Department, the general characteristics of an assisted-living resident may include:
(1) exhibit[ing] symptoms of mental or emotional disturbance, but is not considered at risk of imminent harm to self or others;
(2) need[ing] assistance with movement;
(3) requir[ing] assistance with bathing, dressing, and grooming;
(4) requir[ing] assistance with routine skin care, such as application of lotions, or treatment of minor cuts and burns;
(5) need[ing] reminders to encourage toilet routine and prevent incontinence;
(6) requir[ing] temporary services by professional personnel;
(7) need[ing] assistance with medications, supervision of self-medications, *524 or administration of medication;
(8) requir[ing] encouragement to eat or monitoring due to social or psychological reasons of temporary illness;
(9) be[ing] hearing impaired or speech impaired;
(10) be[ing] incontinent without pressure sores;
(11) requir[ing] established therapeutic diets;
(12) requir[ing] self-help devices; and
(13) need[ing] assistance with meals.
40 TEX. ADMINISTRATIVE CODE § 92.2(c) (emphasis added). Notably absent from that list of characteristics is any need for organized and structured nursing care and related services.
While the Department's regulations permit a healthcare professional to provide services within the scope of that professional's practice and license to a resident of an assisted-living facility, "a facility is not authorized to provide ongoing services comparable to the services available in a nursing facility licensed under Chapter 242, Health and Safety Code." 40 TEX. ADMINISTRATIVE CODE § 92.2(b)(2). Residents may, however, contract to have home-health services delivered to them at the assisted-living facility. Id. Thus, the regulations follow the mandate of the Texas statutes in clearly distinguishing a nursing facility/home from an assisted-living facility.
Geary argues that the Department's regulations defining a nursing-home facility and an assisted-living facility should not be considered because the regulations were not in existence at the time the contract was made and because there is no reference to them in the Policy. Geary contends that "subsequent changes to the law cannot defeat [Lindquist's] substantive rights that inured to her when the Policy was issued." (Pls.' Br. at 9.) She urges the Court to accept a definition of "nursing care" provided in Transport Insurance Company v. Polk, 400 S.W.2d 881, 884 (Tex.1966), which she contends was the law when the Policy was issued and is still the law today. Geary argues that since the Cottages' services mirror much of what is contained in the Transport definition, the Court should conclude that the Cottages does primarily engage in nursing care and related services. (Id.)
Geary's argument misses the mark. Even if the Cottages provides all of the services listed in the Transport definition, it is still not a facility that is licensed by the appropriate state agency to primarily engage in providing nursing care and related services. That notwithstanding, assuming, without deciding, that the regulations governing nursing-home facilities and assisted-living facilities were not in effect when Lindquist bought the Policy, the regulations do not confer or alter any substantive right of the contracting parties and do not alter the substance of the Policy. The definition of a nursing home, in the Policy refers to and is dependant on the, license the facility has from the appropriate state licensing agency. That necessarily implies that the regulations issued by an appropriate state licensing agency governing the license a facility may have and governing what services that facility may offer under its license is relevant to the Policy. Moreover, the regulations at issue in this case inform the contracting parties of which facilities in Texas would qualify as a nursing home under the. Policy, which is precisely how they contracted.
The fact that those regulations may have come into existence after the Policy was made and may change while the Policy is in effect is of no moment because the regulations do not substantively alter the definition of a nursing home wider the Policy nor do they substantively alter *525 Lindquist's right to benefits once she is placed into a facility that qualifies as a nursing home under the Policy. That remains unaltered; what may change, however, is what facilities qualify under that definition based on the regulations in effect at the time Lindquist is placed into a facility and applies for benefits under the Policy.
The Cottages is specifically licensed by statute and regulation as an assisted-living facility, and according to the definitions in the regulations, it is licensed to primarily provide personal-care services to its residents  not nursing care or services related to nursing care. The Cottages readily admits that it is not a nursing home and that it does not primarily provide nursing services to its residents. Its disclosure statement informs residents that should they require ongoing nursing services, they may be temporarily removed or permanently discharged from the facility. Its residency agreement lists all of the standard services it agrees to provide, none of which includes providing any kind of nursing service. While the Cottages does have nursing services available, it is intended to only be temporary in nature, lasting no more than thirty days. And its residency agreement allows for its residents to privately contract, at their own expense, for ongoing and continued nursing services should they be in need of such services.
Thus it is clear, in compliance with Texas statutes, regulations, and its license, the primary focus of the Cottages is to provide personal-care services to its residents  not nursing or related services. See also Gillogly, 430 F.3d at 1291 (holding under an identical definition of nursing home, a residential-care home that could not routinely provide nursing care under Oklahoma statutes was not a nursing home); Gregg, 261 A.D.2d at 799, 692 N.Y.S.2d 182 (applying identical definition, holding apartments licensed to provide home-care services was not a nursing home under New York law and thus not a nursing home under policy definition).
Finally, because the Court concludes that the Cottages is not licensed to primarily provide nursing care and related services to its residents, the Court need not decide whether the services the Cottages does provide meet the minimum listed services in the Policy. The Policy allows for facilities to qualify as nursing homes in only one way, it must be both licensed to primarily provide nursing and related services and it must provide the minimum listed services in the Policy. See also Gillogly, 430 F.3d at 1293. Because the Cottages is not licensed by the Department "to engage primarily in providing nursing care and related services" to its residents, it is not a nursing home as defined by the Policy  regardless of whether it provides all of the minimum listed services in the Policy. Accordingly, Life Investors did not breach its contract or its duty of good faith and fair dealing, engage in unfair claim settlement practices, or fail to comply with the Texas prompt payment statute when it denied Geary's request for benefits for Lindquist's stay at the Cottages.
III. Conclusion
For the foregoing reasons, the Court GRANTS Life Investors' motion for summary judgment. Because all of the claims in this case hinge on whether the Cottages is a nursing home as defined by the Policy, and because the Court concludes that, as a matter of law, the Cottages is not a nursing home under Texas law and as defined by the Policy, Life Investors is entitled to JUDGMENT AS A MATTER OF LAW on all of Geary's claims.

FINAL JUDGMENT
In accordance with the order issued this same day, and Federal Rule of Civil Procedure 58,
*526 It is hereby ORDERED, ADJUDGED, and DECREED that defendant Life Investors Insurance Company of America is hereby entitled to JUDGMENT ON ALL CLAIMS AS A MATTER OF LAW. All costs under 28 U.S.C. § 1920 shall be taxed against the plaintiff.


             United States Court of Appeals
                        For the First Circuit

No. 12-1356

                 CHARLES FREEMAN AND DANIELA FREEMAN,

                        Plaintiffs, Appellants,

                                  v.

      TOWN OF HUDSON, TOWN OF HUDSON CONSERVATION COMMITTEE,
         TOWN OF HUDSON POLICE DEPARTMENT, THOMAS CRIPPEN,
     DAVID STEPHENS, RICHARD BRAGA, DEBBIE CRAIG, PAUL BYRNE,
             DAVID ESTEVES, JEFF WOOD, THOMAS THORBURN,
    COMMONWEALTH OF MASSACHUSETTS DEPARTMENT OF ENVIRONMENTAL
                   PROTECTION AND JOSEPH BELLINO,

                        Defendants, Appellees.

             APPEAL FROM THE UNITED STATES DISTRICT COURT

                   FOR THE DISTRICT OF MASSACHUSETTS

            [Hon. Nathaniel M. Gorton, U.S. District Judge]

                                Before

                       Howard, Ripple* and Lipez,
                            Circuit Judges.

     Barry Bachrach, with whom The Law Office of Barry Bachrach was
on brief, for appellants.
     Jonathan M. Silverstein, with whom Janelle M. Austin and
Kopelman and Paige, P.C. were on brief, for appellee Town of
Hudson.
     James A. Sweeney, Assistant Attorney General, with whom Martha
Coakley, Attorney General, and Ronald F. Kehoe, Assistant Attorney
General, were on brief, for appellee Joseph Bellino.

     *
         Of the Seventh Circuit, sitting by designation.
April 15, 2013
             HOWARD, Circuit Judge.               Plaintiffs Charles and Daniela

Freeman appeal the dismissal of their section 1983 suit against the

Town of Hudson, Massachusetts, one of its agencies, and several

state and local officials.             The events giving rise to this suit

grew   out   of     an    allegation    that      the   Freemans   had    breached    a

conservation restriction appurtenant to their Hudson home.                         Like

the magistrate judge and district judge, we conclude that the

Freemans' complaint does not plead facts sufficient to support any

of their federal claims, and we therefore affirm the judgment.

                                     I. Background

             As the dismissal was entered pursuant to Federal Rule of

Civil Procedure 12(b)(6), we take the facts from the Freemans'

complaint and draw all reasonable inferences in their favor.                        San

Juan Cable, LLC v. P.R. Tel. Co., 612 F.3d 25, 28 (1st Cir. 2010).

According    to the        complaint, what         began as a      dispute     between

neighbors turned into a concerted effort by the Town and the

Commonwealth of Massachusetts to deprive the Freemans of their

constitutional           rights.      The    plaintiffs     insinuate      a    common

sentiment,     if    not     a     common   objective,      running      through    the

defendants' actions.          For ease of exposition, however, we dissever

the allegations into smaller episodes.

A. Conservation Commission Defendants

             In late fall of 2009, Hudson Police Sergeant Thomas

Crippen, the Freemans' neighbor, informed the Hudson Conservation

                                            -2-
Commission that the Freemans were building a tree house in a

conservation restriction area ("Parcel B") on their property.    In

response, the Commission ordered the Freemans to cease and desist

from any further activity in Parcel B until a scheduled Commission

meeting in early December 2009.    The property had previously been

subject to an Order of Conditions issued by the Commission in 2007.

          At the December meeting, Mr. Freeman conceded that the

tree house was built in the conservation restriction area and

agreed to move it.    The Commission then questioned whether the

Freemans were complying with state and local land-use laws relating

to their property.   Although the Commission had previously issued

a Certificate of Compliance for the property (7 Freeman Circle) in

2008, a few weeks after the December meeting it determined that the

Freemans had subsequently breached their obligations and that

additional work was necessary to remedy the violations.

          As a consequence, in January 2010 the Freemans' engineer

presented a preliminary plan relating to remediation at 7 Freeman

Circle.   It appears that the Commission viewed this plan as

insufficient, as it warned the Freemans that it would involve the

Massachusetts Department of Environmental Protection ("DEP") if the

Freemans did not comply with its determinations.   In June 2010 the

Commission issued a new Order of Conditions for 7 Freeman Circle

detailing what modifications were required.   The Freemans appealed

this order to DEP.

                                  -3-
           Once involved in the case, DEP indicated that state

enforcement would follow if the Freemans and the Commission could

not resolve the issue at the local level.            In response, the

Freemans terminated their appeal of the Order of Conditions in

September and began compliance work. Unaware that the Freemans had

dropped    the    appeal,   Commission   Administrator   Debbie   Craig,

accompanied by police escort, served Mr. Freeman a cease and desist

order the same day that work began.        For the next several days,

members of the Commission ordered Mr. Freeman not to work on the

property while they ascertained the legal status of the Freemans'

appeal.    On each of these visits to the Freemans' property, the

Commission members were accompanied by Hudson Police officers.

           The Freemans allege that throughout this process the

defendants displayed heavy-handed tactics toward them and their

associates.      At a January meeting, Commission Chairman Paul Byrne

and Commission Member David Esteves spoke with open hostility

toward Mr. Freeman.1    Moreover, Byrne and Craig spoke disparagingly

about Mr. Freeman to third parties during the course of the ongoing

dispute.   Also, Esteves uprooted a portion of a silt fence on the

Freemans' property, claiming that it was installed incorrectly,

although a subsequent determination indicated that the fence met

all installation requirements.       According to the complaint, this

     1
       Byrne made a thinly veiled reference to Mr. Freeman's
dishonesty by stating, "If I was a farmer, I would not put the fox
in charge of the hen house because all the hens will disappear."

                                   -4-
hostile attitude pervaded DEP thinking as well.2                    The complaint

includes emails written by Joseph Bellino, a DEP employee, to show

that       DEP   officials    lacked    impartiality       in   dealing   with    the

Freemans.3

                 The   Freemans   further    contend   that,     while    zealously

enforcing land-use laws against them, the Commission took little or

no action against the Freemans' neighbors -- the Crippens and the

MacPhees.         The Crippens had constructed a pool in the 100-foot

buffer zone adjacent to Parcel B, and the MacPhees had cut down

trees in Parcel B and laid down planks for a walking path.                         In

neither case did the Commission issue an order, and the Freemans

assert that these violations largely went uncorrected.

B.   Police Department Defendants

                 In    retaliation   for   the   Freemans'      dispute   with    the

Crippens, the Police Department defendants purportedly pursued

trumped-up        criminal    charges      against   Mr.    Freeman.      After    an

unpleasant encounter with Mr. Freeman, neighbor Dana MacPhee spoke

with Crippen and Hudson Police Captain David Stephens about Mr.

Freeman's conduct.            Without further investigating the matter,

       2
       The complaint listed DEP as a defendant. The district court
dismissed all claims against DEP, and the Freemans have not
appealed that decision.
       3
       The most provocative email (between Bellino and Craig)
refers to the sale of the Freemans' home in the following terms:
"1.175 million- A Bahgain !!!!! Of course that doesn't include our
$$$$$ [referring to a possible DEP fine]."

                                           -5-
Stephens filed charges against Mr. Freeman for criminal harassment

and threat to commit a crime.     Although Mr. Freeman had committed

no physical acts of violence, Stephens successfully argued to the

court that Mr. Freeman should not be given notice of his probable

cause hearing because he posed an imminent threat of violence to

MacPhee. Stephens and Crippen both spoke with the prosecutor about

the case on separate occasions.    By January 2012, all charges had

been dropped against Mr. Freeman.

C. Building Commissioner Defendant

          Finally,   the   Freemans     claim    that   Hudson   Building

Commissioner Jeff Wood selectively enforced zoning laws against Mr.

Freeman, who had posted a sign advertising his company at a work

site.    The complaint avers that the posting of such signs is

standard practice among contractors, but Wood issued a violation

notice to the property owner for displaying the sign.4

                           II. Discussion

A. Standard of Review

          Our review of a district court's dismissal of a complaint

under Rule 12(b)(6) is de novo.     See Ocasio-Hernández v. Fortuño-

Burset, 640 F.3d 1, 7 (1st Cir. 2011).          As such, we are free to

affirm an order of dismissal on any basis made apparent from the

     4
       The complaint also alleges that Electrical Inspector Thomas
Thorburn selectively enforced licensing requirements against the
Freemans' electrician.     The Freemans have not pursued this
allegation on appeal.

                                  -6-
record.    See Cook v. Gates, 528 F.3d 42, 48 (1st Cir. 2008).   In

order to survive a motion to dismiss, the complaint must include

"enough detail to provide a defendant with 'fair notice of what the

. . . claim is and the grounds upon which it rests.'"       Ocasio-

Hernández, 640 F.3d at 12 (quoting Bell Atlantic Corp. v. Twombly,

550 U.S. 544, 555 (2007)).   While we need not give weight to legal

conclusions contained in the complaint, "[n]on-conclusory factual

allegations must . . . be treated as true."   Id.

B. Scope of the Record

           Before moving to the heart of the Freemans' appeal, we

consider the question of which documents were properly before the

district court when it decided the motion to dismiss.    On a motion

to dismiss, a court ordinarily may only consider facts alleged in

the complaint and exhibits attached thereto, Watterson v. Page, 987

F.2d 1, 3 (1st Cir. 1993), or else convert the motion into one for

summary judgment.   Id.; Fed. R. Civ. P. 12(d).   Here, the Freemans

appended   twenty-five exhibits to their complaint.   Subsequently,

both parties submitted a flurry of extrinsic exhibits for the

district court's consideration on the motion to dismiss. The court

took account of some documents but excluded others.     The Freemans

challenge the court's decision not to consider six documents that

they submitted, while simultaneously suggesting that the court

                                -7-
relied on those very same documents in its order, presumably to the

Freemans' detriment.5

          Under     certain   "narrow     exceptions,"   some   extrinsic

documents may be considered without converting a motion to dismiss

into a motion for summary judgment.         Watterson, 987 F.2d at 3.

These exceptions include "documents, the authenticity of which are

not disputed by the parties; . . . official public records; . . .

documents central to plaintiffs' claim; [and] . . . documents

sufficiently referred to in the complaint."        Id.   The plaintiffs'

submissions do not fit into any of these enumerated categories.

          The Freemans sought to have the court consider excerpts

from the depositions of MacPhee and Stephens, given in connection

with a separate civil suit, as documents sufficiently referred to

in the complaint.    While the complaint does make passing reference

to testimony from MacPhee and Stephens, the proposed exhibits

consist of excerpts that are unrelated to any matter discussed in

the complaint, and therefore cannot be taken as referenced therein.

The mere mention of the depositions in the complaint does not

amount to sufficient reference.         See Goldman v. Belden, 754 F.2d

     5
      We have not previously clarified the standard of review that
governs a court's determination that documents external to the
complaint cannot be relied upon under Rule 12(b)(6). Because we
would uphold the district court's judgment pursuant to either de
novo or abuse of discretion review, we need not reach the issue
here.

                                  -8-
1059, 1066 (2d Cir. 1985) ("[L]imited quotation does not constitute

incorporation by reference.").

               The Freemans also claim that three submissions should

have been considered as public records. These include a transcript

of 911 calls and two Hudson Police incident reports.                         The Freemans

ask us to adopt the expansive view that any document held in a

public repository falls within the category of extrinsic materials

that may be considered.             It is true that, when reviewing a motion

to dismiss for failure to state a claim, a court may "consider

matters of public record."                Haley v. City of Boston, 657 F.3d 39,

46 (1st Cir. 2011).           But there are limits to that license.                   Many

documents in the possession of public agencies simply lack any

indicia of reliability whatsoever. In that regard, they are unlike

official records, such as birth or death certificates and other

similar   records      of     vital       statistics.        The    Freemans     cite   no

authority       --    other        than     Watterson    --         for   their      broad

interpretation,       and     we    have    found    none.         Rather,    the    phrase

"official public records" when used in the present context, appears

limited, or nearly so, to documents or facts subject to judicial

notice under Federal Rule of Evidence 201.                    Watterson, in holding

that a court could consider public records on a motion to dismiss,

relied    on    the   Ninth        Circuit    case    Mack     v.     South    Bay    Beer

Distributors, Inc., 798 F.2d 1279 (9th Cir. 1986), abrogated on

other grounds by Astoria Federal Sav. and Loan Ass'n v. Solimino,

                                             -9-
501 U.S. 104, 107 (1991).    The public record at issue in that case

was a state administrative proceeding, id. at 1282, and the Ninth

Circuit used the term "public records" synonymously with a document

susceptible to judicial notice.     Id. (citing Phillips v. Bureau of

Prisons, 591 F.2d 966, 969 (D.C. Cir. 1979) ("We are mindful, too,

that when passing on a motion attacking the legal efficacy of the

plaintiff's statement of his claim, the court may properly look

beyond the complaint only to items in the record of the case or to

matters of general public record.")).

          Our cases applying Watterson may not have endorsed this

view explicitly, but the results have been consistent with this

approach. See, e.g., San Geronimo Caribe Project, Inc. v. Acevedo-

Vila, 687 F.3d 465, 471 n.2 (1st Cir. 2012) (taking notice of state

court decisions); Gargano v. Liberty Intern. Underwriters, Inc.,

572 F.3d 45, 47 n.1 (1st Cir. 2009) (taking notice of a state court

decision); Parker v. Hurley, 514 F.3d 87, 90-91 (1st Cir. 2008)

(taking notice of statewide curricular standards); Greene v. Rhode

Island, 398 F.3d 45, 49 (1st Cir. 2005) (taking notice of federal

statutes).

          Other than invoking the label "public records," which is

too broad a term to rely on, the Freemans make no developed

argument as to why documents such as the 911 transcripts and police

incident reports, which would not be subject to judicial notice,

are either   categorically   or   in   this   instance   eligible   to   be

                                  -10-
considered on a motion to dismiss.      They thus have waived any other

claim that the documents may be considered.

          The Freemans' brief contains no argument at all with

respect to the final exhibit at issue, which is a photograph.       Any

issue regarding this exhibit is thus also waived.           See   United

States v. Zannino, 895 F.2d 1, 17 (1st Cir. 1990) ("[I]ssues

adverted to in a perfunctory manner, unaccompanied by some effort

at developed argumentation, are deemed waived.").

             We must iron out one more wrinkle on this topic,

involving the Freemans' superficial assertion in their brief that

"the district court mentioned facts from these exhibits in its

decision."     This    simple   allegation   could   have   non-trivial

consequences. Reliance on facts beyond the complaint's allegations

might require converting the motion to dismiss into a motion for

summary judgment.     See Fed. R. Civ. P. 12(d).     Although we could

ignore this question as insufficiently briefed, see Zannino, 895

F.2d at 17, we are also satisfied that neither the magistrate

judge's Report and Recommendation nor the district court's Order

touch on facts outside the complaint.        We therefore proceed to a

12(b)(6) analysis.

C. Freemans' Section 1983 Claims

          42 U.S.C. § 1983 grants individuals the right to sue

those acting "under color of any statute, ordinance, regulation,

custom, or usage, of any State or Territory or the District of

                                 -11-
Columbia . . . [for] the deprivation of any rights, privileges, or

immunities secured by the constitution and laws."               42 U.S.C. §

1983.    To prevail, a plaintiff must show that "the challenged

conduct [is] attributable to a person acting under color of state

law" and that "the conduct must have worked a denial of rights

secured by the Constitution or by federal law."              Soto v. Flores,

103 F.3d 1056, 1061 (1st Cir. 1997).

            1. Municipal Liability

            The Freemans face additional requirements in order to

establish     a   section   1983     claim   against   the    Town   and   the

Commission.6      "A municipality cannot be held liable solely because

it employs a tortfeasor."          Monell v. Dept. of Soc. Servs. of the

City of N.Y., 436 U.S. 658, 691 (1978).         Instead, a plaintiff must

show that the violation occurred as a result of the municipality's

"policy or custom."      Id. at 694.    A single decision by a municipal

policymaker       constitutes   official      policy   "only     where     the

decisionmaker possesses final authority to establish municipal

policy with respect to the action ordered."            Pembaur v. City of

Cincinnati, 475 U.S. 469, 481, (1986).         When determining whether a

decisionmaker exercises final authority, "[c]ourts must look to

state law, including 'valid local ordinances and regulations,' for

     6
       The complaint also listed the Town of Hudson Police
Department as a defendant. The district court, while dismissing
all federal claims, did not specifically discuss the Police
Department's liability. However, the Freemans have also failed to
raise this issue on appeal, and therefore it is waived.

                                      -12-
descriptions of the duties and obligations of putative policymakers

in the relevant area at issue."           Walden v. City of Providence, 596

F.3d   38,   56    (1st   Cir.   2010)    (quoting   City   of   St.   Louis   v.

Praprotnik, 485 U.S. 112, 125, (1988)).

             The Freemans have advanced only a "final authority"

theory of municipal liability.           The complaint, however, references

no state or local laws establishing the policymaking authority of

any individual or group of individuals.               The complaint alleges

misconduct from many separate actors, but gives no guidance about

which acts are properly attributable to the municipal authority.

Absent this information, the complaint fails to state more than

respondeat superior liability on the part of the Town and the

Commission.       This is not enough to support a section 1983 action

against a municipality, Monell, 436 U.S. at 691, and the district

court correctly dismissed the claims against the Town and the

Commission.       We turn, then, to the claims against the individual

defendants.

             2. Equal Protection

             The Freemans allege that Conservation Commission members

Byrne and Esteves, Administrator Craig, and Building Inspector Wood

violated the equal protection clause of the fourteenth amendment by

selectively enforcing local laws against them. An equal protection

claim requires "proof that (1) the person, compared with others

similarly situated, was selectively treated; and (2) that such

                                     -13-
selective treatment was based on impermissible considerations such

as race, religion, intent to inhibit or punish the exercise of

constitutional rights, or malicious or bad faith intent to injure

a person."      Rubinovitz v. Rogato, 60 F.3d 906, 909-10 (1st Cir.

1995) (citations omitted).

              Claiming     no   membership    in   a   protected   class,   the

complaint argues that the defendants arbitrarily and unfavorably

singled out the Freemans as a "class of one."              To prevail on such

a claim, the Freemans must show that they were "intentionally

treated differently from others similarly situated and that there

is no rational basis for the difference in treatment."              Village of

Willowbrook v. Olech, 528 U.S. 562, 564 (2000).                 The complaint

fails    to   meet   the    "similarly   situated"      test,   obviating   any

discussion of the rational basis requirement.              We have held that

class-of-one claims require "an extremely high degree of similarity

between [the plaintiffs] and the persons to whom they compare

themselves."      Cordi-Allen v. Conlon, 494 F.3d 245, 251 (1st Cir.

2007).    In the land-use context, this means more than "point[ing]

to nearby parcels in a vacuum and leav[ing] it to the municipality

to disprove conclusory allegations that the owners of those parcels

are similarly situated."         Id.

              a. Conservation Commission Defendants

              According to the complaint, Craig, Byrne and Esteves

abridged the Freemans' equal protection rights by treating them

                                       -14-
differently from their neighbors, the Crippens and the MacPhees.

While the properties of all three abut the same protected area, the

similarities essentially end there.    Their actions in relation to

Parcel B differed in key respects, making them inapt comparators.

The Commission determined that the Freemans had committed a number

of violations, some of them within Parcel B and specifically

governed by the Conservation Easement.7   By contrast, the complaint

alleges that the Crippens drained pool water into a buffer zone and

that the pool encroached into the buffer zone.    These allegations

fail to demonstrate that the Crippens and Freemans were "similarly

situated in all relevant respects." Barrington Cove Ltd. P'ship v.

Rhode Island Hous. & Mortg. Fin. Corp., 246 F.3d 1, 8 (1st Cir.

2001).   In the same vein, the Freemans' allegations that the

MacPhees were allowed to plant inappropriate flora, cut down

certain trees and install removable planks for a walkway fail to

establish a claim for relief.   The Conservation Easement -- which

the district court considered -- allowed for certain plant cutting

and trail maintenance.    The Freemans, meanwhile, conceded that

their treehouse violated the same Conservation Easement.    Indeed,

the complaint does not allege that either the Crippens or the

MacPhees were in violation of the Conservation Easement.

     7
       The Freemans admit to having constructed a treehouse in
Parcel B.    Additionally, the 2010 Order of Conditions found
numerous violations relating to the placement of fences and walls,
the amount of fill on the property, and the construction of other
unauthorized structures.

                                -15-
            Against this backdrop, the Freemans cannot demonstrate

that they were similarly situated to their neighbors, and their

equal    protection    claim    against      the   Conservation     Commission

defendants necessarily fails.

            b. Building Commissioner Wood

            The complaint also alleges that Building Commissioner

Wood violated Mr. Freeman's equal protection rights by selectively

enforcing   zoning     laws    against   a   customer    who   displayed   Mr.

Freeman's business sign. To the extent that this conduct concerned

not Mr. Freeman's rights but those of Mr. Freeman's customer, the

action   cannot   be   maintained.        While    Mr.   Freeman   conceivably

suffered some economic harm as a result of Wood's actions -- the

lost value of advertising his work in the community -- this alone

typically does not give rise to third-party standing.                True, an

"isthmian exception" does permit one to assert another's rights in

circumstances where "some barrier or practical obstacle deters a

third party from asserting its rights."            Wine & Spirits Retailers,

Inc. v. Rhode Island, 418 F.3d 36, 49 (1st Cir. 2005); see also

Powers v. Ohio, 499 U.S. 400, 411, (1991) (stating that, in order

to assert third-party standing "there must exist some hindrance to

the third party's ability to protect his or her own interest"

(internal quotations and citations omitted)). Here, however, there

is no allegation that the customer is incapable of asserting his or

her own rights, and therefore we lack jurisdiction over this claim.

                                     -16-
                Moreover, to the extent that the complaint may be read to

allege an interference with Mr. Freeman's property interest in a

display license granted him by his customer, the claim does not

fare      any   better.       The      complaint's      failure   to    do    more    than

conclusorily state that the Freemans were both similarly situated

to and treated differently from unspecified "other contractors" is

insufficient to survive the defendants' motion to dismiss.

                3. Substantive Due Process

                The Freemans claim that the conduct of Town officials and

DEP       employee     Bellino      were     so     outrageous    as    to    constitute

substantive due process violations.                    Substantive due process is

said to "protect individuals from particularly offensive actions on

the part of government officials, even when the government employs

facially neutral procedures in carrying out those actions."                          Pagán

v. Calderón, 448 F.3d 16, 32 (1st Cir. 2006).                          Such claims are

limited to government action that, by its very nature, "shock[s]

the conscience," id., and we reserve it for "truly horrendous

situations."          Nestor Colon Medina & Sucesores, Inc. v. Custodio,

964    F.2d     32,    46   (1st    Cir.     1992).      Evidence      that    officials

"exceed[ed] [their] authority under the relevant statutes" does not

automatically trigger the due process clause. Amsden v. Moran, 904

F.2d 748, 757 (1st Cir. 1990). In this case, neither the complaint

as    a    whole     nor    any   of   its    allegations    meet      the    burden   of

establishing a substantive due process violation.

                                             -17-
            a. Conservation Commission Defendants

            Upon review, nothing in the actions of Byrne, Craig and

Esteves reaches the level of conscience-shocking behavior.                  The

Commission retained jurisdiction over Parcel B at all relevant

times and had the power to remedy environmental violations at 7

Freeman Circle.       The Freemans disagree with the legal conclusions

of the Commission and believe that the Commission reached these

erroneous conclusions in bad faith.         Even if this is true, "[s]uch

a claim is too typical of a run of the mill dispute between a

developer   and   a    town   planning   agency,   regardless   .   .   .    of

defendants' alleged mental states, to rise to the level of a due

process violation."      Creative Env'ts, Inc. v. Estabrook, 680 F.2d

822, 833 (1st Cir. 1982).           Our prior cases are replete with

plaintiffs who, alleging comparable conduct, failed to sustain

substantive due process claims.            See, e.g., Mongeau v. City of

Marlborough, 492 F.3d 14 (1st Cir. 2007) (where a town official

interfered in the zoning process for improper reasons); Licari v.

Ferruzzi, 22 F.3d 344 (1st Cir. 1994) (where a town revoked

building permits due to alleged hostility and animus); PFZ Props.,

Inc. v. Rodriguez, 928 F.2d 28 (1st Cir. 1991) (where a planning

board refused to process construction drawings), rev'd on other

grounds en banc, San Geronimo Caribe Project, Inc. v. Acevedo-Vila,

687 F.3d 465 (1st Cir. 2012).              As in those cases, here the

                                    -18-
Freemans' grievances do not support a substantive due process

claim.

           b. Commonwealth of Massachusetts Defendant Bellino

           The   Freemans   contend   that   Bellino,   a   DEP   employee,

exercised the muscle behind the Commission's scheme; the threat of

DEP enforcement "sledgehammer[ed]" the Freemans into compliance.

But DEP is statutorily authorized to enforce applicable laws, see

M.G.L. c. 131, § 40, and the Freemans appealed the June 2010 Order

of Conditions to DEP, thereby ensuring its involvement.               While

DEP's participation might have influenced the Freemans, that does

not   render   such   participation   improper.    Moreover,      Bellino's

conduct throughout this process was not "so shocking or violative

of universal standards of decency" as to give rise to a due process

violation. Amsden, 904 F.2d at 757 (quoting Furtado v. Bishop, 604

F.2d 80, 95 (1st Cir. 1979)). His communications to Town officials

did evince a certain hostility toward the Freemans. The plaintiffs

have not shown, however, that Bellino's third-party communications

affected their constitutional rights.        While these communications

may have been in bad taste, they do not constitute violations of

the Freemans' substantive due process rights.

           c. Police Department Defendants

           Finally, Mr. Freeman claims that the Police Department

defendants violated his substantive due process rights by pushing

unsupported criminal charges against him for personal reasons.

                                  -19-
Sifting through the many aspersions contained in the complaint,

however,   reveals    only   "a   garden-variety   claim   of   malicious

prosecution."     Roche v. John Hancock Mut. Life Ins. Co, 81 F.3d

249, 256 (1st Cir. 1996). "'[S]ubstantive due process may not

furnish the constitutional peg on which to hang' [a malicious

prosecution tort]." Nieves v. McSweeney, 241 F.3d 46, 53 (1st Cir.

2001) (quoting Albright v. Oliver, 510 U.S. 266, 271 n. 4, (1994)).

While the complaint may be read to allege a plot on the part of

Police Department officials and MacPhee to bring charges against

Mr.   Freeman,   it   also   acknowledges   that   these   charges   were

predicated on prior incidents between MacPhee and Mr. Freeman.

Thus, while the Police Department defendants may or may not have

acted with malice, they did not act in the absence of any evidence.

Furthermore, none of the Police Department's subsequent actions --

failing to investigate further, obtaining an ex parte probable

cause hearing, and discussing the case with the prosecutor -- shock

the conscience.       If, as alleged, improper personal motivations

caused the investigation to follow a certain course, that fact may

form the basis for a claim of malicious prosecution, but not a due

process violation.8

      8
       The parties' briefs suggest that a malicious prosecution
claim against the Police Department defendants is pending in state
court.

                                   -20-
                         III. Conclusion

          For the foregoing reasons, the district court's judgment

dismissing the Freemans' section 1983 claims is affirmed.

                              -21-