                 United States Court of Appeals
                             For the Eighth Circuit
                         ___________________________

                                 No. 14-2107
                         ___________________________

                         Matthew Jaakola; Kristin Jaakola

                       lllllllllllllllllllll Plaintiffs - Appellants

                                            v.

    US Bank National Trust Association, as Trustee for LSF7 NPL VII Trust;
        Mortgage Electronic Registration Systems, Inc.; MERSCORP

                      lllllllllllllllllllll Defendants - Appellees
                                       ____________

                     Appeal from United States District Court
                    for the District of Minnesota - Minneapolis
                                   ____________

                          Submitted: November 17, 2014
                              Filed: April 3, 2014
                                 [Unpublished]
                                 ____________

Before MURPHY, SHEPHERD, and KELLY, Circuit Judges.
                          ____________

PER CURIAM.

      This is the third time Matthew and Kristin Jaakola have been party to a lawsuit
challenging foreclosure of a mortgage secured by the real property where they reside.
The district court,1 finding res judicata applied, granted the defendants’ Rule 12(b)(6)
motion and dismissed the case with prejudice. Having jurisdiction under 28 U.S.C.
§ 1291, we affirm.

      On September 26, 2005, the Jaakolas executed a promissory note, payable to
The Lending Group, Inc., to purchase a residential property. The note was secured
by a mortgage on the property in favor of Mortgage Electronic Registration System
(MERS) as mortgagee. The Jaakolas defaulted on the note, and foreclosure
proceedings commenced. The property was sold in a sheriff’s sale to US Bank. The
Jaakolas did not redeem the property prior to the expiration of their redemption
period.

       The Jaakolas and 19 other homeowners filed a lawsuit against CitiMortgage,
Inc., MERSCORP, MERS, and several other defendants (Jaakola I). After the case
was removed to federal court, Jaakola I was voluntarily dismissed without prejudice.
The Jaakolas then joined with 33 other homeowners in filing a lawsuit against
CitiMortgage, MERSCORP, MERS, and other defendants challenging foreclosures
(Jaakola II). After the case was removed to federal court on August 18, 2011, the
district court dismissed it with prejudice on May 30, 2012.2 Jaakola II involved,
among other claims, quiet-title claims related to the real property involved in this
case. With regard to the financial-institution defendants, the district court found
“[n]one of Plaintiffs’ claims against the bank Defendants has any merit. Plaintiffs’
Complaint therefore fails to state a claim on which relief can be granted as against the



      1
       The Honorable Joan N. Ericksen, United States District Judge for the District
of Minnesota, adopting the report and recommendation of the Honorable Jeffrey J.
Keyes, United States Magistrate Judge for the District of Minnesota.
      2
      On October 11, 2011, an assignment of mortgage was recorded assigning the
mortgage and any interest MERS had in the Jaakolas’ note to US Bank.

                                          -2-
bank Defendants.” We affirmed that decision. See Peterson v. CitiMortgage, Inc.,
704 F.3d 548, 550 (8th Cir. 2013).

      On December 21, 2012, the Jaakolas filed the instant suit, this time against
MERS, MERSCORP, and US Bank. Count I of the Complaint asked for
determination of the adverse interests in the real estate, and Count II asked for a
declaration regarding the validity of the assignment of mortgage, power of attorney,
and sheriff’s certificate of sale. After removing the case to federal court, US Bank,
MERS, and MERSCORP moved to dismiss the complaint pursuant to Federal Rule
of Civil Procedure 12(b)(6) for failure to state a claim upon which relief could be
granted. The motion was denied to allow the Jaakolas to conduct limited discovery
on the issues of res judicata and power of attorney but only with the court’s prior
approval. The Jaakolas submitted written discovery requests, and US Bank, MERS,
and MERSCORP objected. The magistrate judge3 determined the discovery requests
were overbroad and not narrowly tailored to the issues identified by the district court
and ruled that US Bank, MERS, and MERSCORP were not required to respond to the
requests. The district court accepted the magistrate judge’s order.

       US Bank, MERS, and MERSCORP then filed a second motion to dismiss,
asserting the Jaakolas’ claims were barred by “res judicata and collateral estoppel.”4
The Jaakolas argued that res judicata did not bar this action because US Bank’s title
to the property presented a claim and an issue not fully litigated in Jaakola II. The
district court dismissed the Jaakolas’ complaint on claim preclusion grounds, finding
Jaakola II barred this suit. The Jaakolas appeal, arguing the district court erred in
denying their discovery requests and in dismissing the complaint.


      3
       The Honorable Jeanne J. Graham, United States Magistrate Judge for the
District of Minnesota.
      4
       These doctrines are also known as “claim preclusion” and “issue preclusion.”
Taylor v. Sturgell, 553 U.S. 880, 892 (2008).

                                         -3-
       We review district court discovery decisions for abuse of discretion. United
States ex rel. Kraxberger v. Kansas City Power and Light Co., 756 F.3d 1075, 1082
(8th Cir. 2014). “A district court has very wide discretion in handling pretrial
discovery and [this court is] most unlikely to fault its judgment unless, in the totality
of the circumstances, its rulings are seen to be a gross abuse of discretion resulting
in fundamental unfairness in the trial of the case.” Id. (quotation omitted) (alteration
in original). The Jaakolas’ discovery requests were denied because they failed to
follow the procedures set forth by the district court when submitting those requests,
including the requirement that “legal arguments support[] each discovery request,”
and because the requested discovery was not “targeted to address the limited issues
allegedly requiring more discovery.” The district court did not abuse its discretion
in denying additional discovery.

        “We review de novo the district court’s grant of a motion to dismiss for failure
to state a claim based on res judicata.” C.H. Robinson Worldwide, Inc. v. Lobrano,
695 F.3d 758, 763 (8th Cir. 2012) (quotation omitted). “The preclusive effect of a
judgment is defined by claim preclusion and issue preclusion, which are collectively
referred to as ‘res judicata.’” Taylor v. Sturgell, 553 U.S. 880, 892 (2008) (footnote
omitted). “Under the doctrine of claim preclusion, a final judgment forecloses
successive litigation of the very same claim, whether or not relitigation of the claim
raises the same issues as the earlier suit.” Id. (quotation omitted). A complaint may
be dismissed at the pleading stage, based on the face of the complaint, if it is apparent
that claim preclusion applies. C.H. Robinson, 695 F.3d at 763–64. We have
previously held that the “face of the complaint . . . include[s] public records and
materials embraced by the complaint, and material[s] attached to the complaint.”
Id. at 764 (alterations in original) (internal quotations and citations omitted).

       “For judgments in diversity cases, federal law incorporates the rules of
preclusion applied by the State in which the rendering court sits.” Taylor, 553 U.S.
at 891 n.4. In Minnesota, claim preclusion “applies as an absolute bar to a subsequent

                                          -4-
claim when: (1) the earlier claim involved the same set of factual circumstances;
(2) the earlier claim involved the same parties or their privies; (3) there was a final
judgment on the merits; and (4) the estopped party had a full and fair opportunity to
litigate the matter.” Rucker v. Schmidt, 794 N.W.2d 114, 117 (Minn. 2011) (footnote
omitted). Neither party disputes Jaakola II was a final judgment on the merits.

       We agree with the district court that claim preclusion bars the Jaakolas from
challenging the foreclosure of the residential property at issue here. First, Jaakola II
involved the same set of factual circumstances. Both cases involve the foreclosure
of the same residential property. Both cases assert theories that the foreclosure was
invalid and did not comply with all statutory requirements. We conclude the first
element is satisfied because this case “arises out of the same nucleus of operative
facts as” Jaakola II. See Banks v. Int’l Union Elec., Elec., Tech., Salaried & Mach.
Workers, 390 F.3d 1049, 1052–53 (8th Cir. 2004) (quotation omitted); see also
Hauschildt v. Beckingham, 686 N.W.2d 829, 840 (Minn. 2004).

       Second, this claim involves the same parties or their privies. “Privies to a
judgment are those who are so connected with the parties in estate or in blood or in
law as to be identified with them in interest, and consequently to be affected with
them by the litigation.” Rucker, 794 N.W.2d at 118 (quotation omitted). Although
US Bank was not a party in Jaakola II, it obtained its interest by assignment from
MERS and as successor mortgage servicer to CitiMortgage, both of whom were
parties in Jaakola II. US Bank’s interests with respect to the validity of the mortgage
are aligned with those of both MERS and CitiMortgage.

      Third, the Jaakolas had a full and fair opportunity to litigate this matter against
US Bank. The assignment giving an interest to US Bank was recorded during the
Jaakola II litigation. The Jaakolas could have added US Bank as a defendant in




                                          -5-
Jaakola II by amendment. To the extent the Jaakolas now seek to raise new legal
theories against US Bank, they are foreclosed from doing so.5 See Ashanti v. City of
Golden Valley, 666 F.3d 1148, 1153–54 (8th Cir. 2012) (res judicata bars claims
“‘arising from the original circumstances’ but ‘under new legal theories’” (quoting
Hauschildt, 686 N.W.2d at 837)).

      For the reasons set forth above, we affirm the judgment of the district court.
                   ______________________________




      5
       Because it found claim preclusion applied in this case, the district court
declined to address the issue of issue preclusion. Because we agree the Jaakolas’
claims are barred by claim preclusion, we likewise decline to address the issue.

                                        -6-
