Justia U.S. 9th Circuit Court of Appeals Opinion Summaries

Articles Posted in Civil Procedure
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The United States (“the Government”) initiated a civil forfeiture suit in federal district court against a $380 million arbitration award fund, the majority of which is held in the United Kingdom. The fund belongs to PetroSaudi Oil Services (Venezuela) Ltd. (“PetroSaudi”), a private oil company incorporated in Barbados. PetroSaudi won the award in an arbitration proceeding against Petróleos de Venezuela, S.A. (“PDVSA”), a Venezuelan state energy company. The portion of the fund held in the United Kingdom (“the fund”) is held in an account controlled by the High Court of England and Wales (“the High Court”). The Government seeks forfeiture of the fund on the ground that it derives from proceeds of an illegal scheme to steal one billion dollars from the Malaysian sovereign wealth fund 1Malaysia Development Berhad (“1MDB”). PetroSaudi challenged two orders entered by the district court.   The Ninth Circuit affirmed the district court’s interlocutory orders. The panel held that PetroSaudi’s appeal from the district court’s protective order under 18 U.S.C. Section 983 fell within this exception. Accordingly, the court had jurisdiction to consider the appeals of the two orders. The panel concluded that the sovereign immunity of the United Kingdom, as codified in the FSIA, did not protect the arbitration award fund from the two orders issued by the district court. The panel held that because the district court had in rem jurisdiction over the fund, it did not need in personam jurisdiction over PetroSaudi to issue an order preserving the fund. View "USA V. PETROSAUDI OIL SERV. (VENEZUELA) LTD., ET AL" on Justia Law

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Defendant and his attorney created publicly-traded shell corporations and sold them to privately-held companies. The Securities and Exchange Commission (SEC) filed suit against Defendants for violations of the Securities Act of 1933 (Securities Act), the Securities Exchange Act of 1934 (Exchange Act), and SEC Rule 10b5. On cross-motions for summary judgment, the district court held that Defendant had violated the securities laws and imposed equitable statutory remedies, including a civil penalty of $1,757,000. The district court found that, as a matter of undisputed fact, Defendant had received $1,757,000 in gross pecuniary gain from his violations and used that amount for the civil penalty. On appeal, Defendant challenged the amount of that penalty.   The Ninth Circuit reversed the district court’s imposition of the civil penalty. The panel held that Defendant’s declaration that legal fees of $287,500 were paid from the proceeds from the sale of five shell companies established a genuine issue of material fact whether such proceeds should be attributed to his—rather than his attorney’s—gross pecuniary gain. Because Defendant established a genuine issue of material fact whether he received or controlled the entire amount of the proceeds, the district court erred in finding on summary judgment that his gross pecuniary gain was $1,757,000. The panel further held that Defendant identified genuine issues of material fact on two additional factors that the district court considered in imposing the civil penalty: the degree of Defendant’s scienter and his recognition of the wrongful nature of his conduct. View "USSEC V. IMRAN HUSAIN, ET AL" on Justia Law

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The Ninth Circuit reversed the district court’s judgment reversing the bankruptcy court’s order requiring a standing Chapter 13 trustee to return her percentage fee when the case was dismissed prior to confirmation. Joining the Tenth Circuit, the panel held that the trustee was not entitled to a percentage fee of plan payments as compensation for her work in the Chapter 13 case. 28 U.S.C. Section 586(e)(2) provides that the trustee shall “collect” the percentage fee from “payments . . . under plans” that she receives. 11 U.S.C. Section 1326(a)(1) provides for the debtor to make payments in the amount “proposed by the plan to the trustee.” Section 1326(a)(2) provides that the trustee shall retain these payments “until confirmation or denial of confirmation.” This section further provides that if a plan is not confirmed, the trustee shall return to the debtor any payments not previously paid to creditors and not yet due and owing to them. Section 1326(b) provides that, before or at the time of each payment to creditors under the plan, the trustee shall be paid the percentage fee under Section 586(e)(2).   The panel held that, reading these statutes together, “payments . . . under plans” in § 586 refers only to payments under confirmed plans. Prior to confirmation a trustee does not “collect” or “collect and hold” fees under Section 586 but instead “retains” payments “proposed by the plan” pursuant to Section 1326(a)(2). If a plan is not confirmed, then Section 1326(a)(2) requires a return to the debtor of payments “proposed by the plan.” View "IN RE: ROGER EVANS, ET AL V. KATHLEEN MCCALLISTER" on Justia Law

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Plaintiff contended that P&G’s packaging “represents that the Products are natural, when, in fact, they contain nonnatural and synthetic ingredients, harsh and potentially harmful ingredients, and are substantially unnatural.” Plaintiff stated that if he had known when he purchased them that the products were not “from nature or otherwise natural,” he would not have purchased the products or paid a price premium for the products. Plaintiff asserted claims under California’s Unfair Competition Law (“UCL”), California’s False Advertising Law (“FAL”), and California’s Consumers Legal Remedies Act (“CLRA”).   The Ninth Circuit affirmed the district court’s Fed. R. Civ. P. 12(b)(6) dismissal of Plaintiff’s action alleging that P&G violated California consumer protection laws by labeling some of its products with the words “Nature Fusion” in bold, capitalized text, with an image of an avocado on a green leaf. The panel held that there was some ambiguity as to what “Nature Fusion” means in the context of its packaging, and it must consider what additional information other than the front label was available to consumers of the P&G products. Here, the front label containing the words “Nature Fusion” was not misleading— rather, it was ambiguous. Upon seeing the back label, it would be clear to a reasonable consumer that avocado oil is the natural ingredient emphasized in P&G’s labeling and marketing. With the entire product in hand, the panel concluded that no reasonable consumer would think that the products were either completely or substantially natural. The survey results did not make plausible the allegation that the phrase “Nature Fusion” was misleading. View "SEAN MCGINITY V. THE PROCTER & GAMBLE COMPANY" on Justia Law

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Petitioner was born in 1967 in Western Samoa to a Western Samoan father and an American Samoan mother. His mother is now a non-citizen national, but she only became eligible under the 1986 amendments and did not attain her status until after Petitioner was born. Petitioner sought a declaration that his mother’s status qualifies him to be a non-citizen national. The district court held that Petitioner’s mother’s status as a national commenced only on the date it was conferred and was not retroactive to her date of birth. The court, therefore, found Petitioner did not qualify to be a non-citizen national.   The Ninth Circuit reversed the district court’s grant of the Government’s motion to dismiss. The panel explained that Congress has extended citizenship to individuals born in every United States territory except American Samoa, meaning that those with ties to American Samoa are the only group eligible for noncitizen national status. The status of an American Samoan is a hybrid. The panel concluded that the text of the 1986 amendments makes clear that Congress intended for the addition to apply retroactively and to bestow the same status on those born before, on, or after the date of enactment: “national, but not citizen, of the United States at birth.” The panel concluded that Petitioner’s mother’s non-citizen national status extends back to her birth and, as a result, that Petitioner qualifies for non-citizen national status too. View "ILAI KOONWAIYOU V. ANTONY BLINKEN, ET AL" on Justia Law

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Counsel filed a class action lawsuit on behalf of copyright holders of musical compositions and recovered a little over $50,000 for the class members from Defendant Rhapsody International, Inc. (now rebranded as Napster), a music streaming service. The class members obtained no meaningful injunctive or nonmonetary relief in the settlement of their action. The district court nonetheless authorized $1.7 in attorneys’ fees under the “lodestar” method.   The Ninth Circuit reversed the district court’s award of attorneys’ fees to Plaintiffs’ counsel and remanded. The panel held that the touchstone for determining the reasonableness of attorneys’ fees in a class action under Federal Rule of Civil Procedure 23 is the benefit to the class. Here, the benefit was minimal. The panel held that the district court erred in failing to calculate the settlement’s actual benefit to the class members who submitted settlement claims, as opposed to a hypothetical $20 million cap agreed on by the parties. The panel held that district courts awarding attorneys’ fees in class actions under the Copyright Act must still generally consider the proportion between the award and the benefit to the class to ensure that the award is reasonable. The panel recognized that a fee award may exceed the monetary benefit provided to the class in certain copyright cases, such as when a copyright infringement litigation leads to substantial nonmonetary relief or provides a meaningful benefit to society, but this was not such a case. The panel instructed that, on remand, the district court should rigorously evaluate the actual benefit provided to the class and award reasonable attorneys’ fees considering that benefit. View "DAVID LOWERY, ET AL V. RHAPSODY INTERNATIONAL, INC." on Justia Law

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Petitioner testified that she was afraid to return to Guatemala because a woman had attempted to rob her after she withdrew money from a bank. The woman told Petitioner that she targeted her because Petitioner had family in the United States and a lot of money. The woman also threatened that Petitioner’s son would “pay for it” due to Petitioner’s refusal to give her the money. Petitioner and her son asserted that she had suffered past persecution and had a well-founded fear of future persecution on account of her political opinion of refusing to submit to violence by criminal groups or gangs and their claimed membership in three particular social groups: “Guatemalan families that lack an immediate family male protector,” “Guatemalan women,” and “immediate family members of Petitioner.”   The Ninth Circuit denied Petitioner and her son’s petition for review of the Board of Immigration Appeals’ dismissal of their appeal of an immigration judge’s denial of asylum and related relief. The panel held that Petitioner failed to show that the agency erred in concluding that her proposed social group comprised of “Guatemalan families that lack an immediate family male protector” was not cognizable. The panel also concluded that substantial evidence supported the agency’s determination that Petitioner had not expressed a political opinion. The panel explained that Petitioner’s refusal to give money to the threatening robber was not evidence of a “conscious and deliberate” decision that would naturally result in attributing a political position to her and that she instead simply reacted to being robbed. View "DORIS RODRIGUEZ-ZUNIGA, ET AL V. MERRICK GARLAND" on Justia Law

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Plaintiff brought an action against The Gap, Inc. and its directors “derivatively on behalf of Gap.” Plaintiff’s action alleged that Gap violated Section 14(a) of the Securities Exchange Act of 1934 (the Exchange Act) and Securities and Exchange Commission (SEC) Rule 14a-9 by making false or misleading statements to shareholders about its commitment to diversity. Gap’s bylaws contain a forum-selection clause stating that the Delaware Court of Chancery “shall be the sole and exclusive forum for . . . any derivative action or proceeding brought on behalf of the Corporation.” Lee nevertheless brought her putative derivative action in a California district court. The district court granted Gap’s motion to dismiss Lee’s complaint on forum nonconveniens ground.   The Ninth Circuit affirmed the district court’s judgment. The en banc court rejected Plaintiff’s argument that her right to bring a derivative Section 14(a) action is stymied by Gap’s forum-selection clause, which alone amounts to Gap “waiving compliance with a provision of [the Exchange Act] or of any rule or regulation thereunder.” The en banc court explained that the Supreme Court made clear in Shearson/American Express, Inc. v. McMahon, 482 U.S. 220 (1987), that Section 29(a) forbids only the waiver of substantive obligations imposed by the Exchange Act, not the waiver of a particular procedure for enforcing such duties. McMahon also disposes of Plaintiff’s argument that Gap’s forum-selection clause is void under Section 29(a) because it waives compliance with Section 27(a) of the Exchange Act, which gives federal courts exclusive jurisdiction over Section 14(a) claims. View "NOELLE LEE V. ROBERT FISHER, ET AL" on Justia Law

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Several organizations sought to intervene as defendants in a lawsuit against the Bureau of Land Management challenging the grant of two rights-of-way. The district court denied intervention, and the proposed intervenors filed this appeal. While the appeal was pending, the district court held that the decision to grant the rights-of-way was arbitrary and capricious, vacated it, and remanded the matter to the agency.   The Ninth Circuit dismissed for lack of jurisdiction and held that the district court’s ruling mooted the intervention dispute. Generally, if the underlying litigation is complete, an appeal of a denial of intervention is moot and must be dismissed. The panel held that an intervention dispute would remain alive if this court could grant effectual relief or if there were some other way for the proposed intervenors to obtain their desired relief. Here, the district court’s proceedings are complete. No party has filed an appeal of the district court’s merits order, and under Alsea Valley Alliance v. Department of Commerce, 358 F.3d 1181 (9th Cir. 2004), the court would not have jurisdiction over such an appeal brought by Appellants even if they were granted intervention. View "CENTER FOR BIOLOGICAL DIVERSITY, ET AL V. BLM, ET AL" on Justia Law

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Petitioner petitioned for review of the Board of Immigration Appeals (“BIA”) order upholding the immigration judge’s (“IJ”) denial of asylum, withholding of removal, and protection under the Convention Against Torture (“CAT”). He also challenged the BIA’s determination that defects in the Notice to Appear (“NTA”) did not require termination of his proceedings and that the BIA lacked authority to administratively close his case.   The Ninth Circuit filed: 1) an order withdrawing the opinion filed March 17, 2023, and reported at 62 F.4th 1223 (9th Cir. 2023), replacing that opinion with a concurrently filed amended opinion and, with these amendments, denying the government’s motion to amend; and 2) an amended opinion denying in part and granting in part Petitioner’s petition for review. In the amended opinion, the panel: (1) denied the petition as to Petitioner’s unexhausted argument that the omission of required time and place information in his NTA amounted to a claim-processing error; (2) remanded Petitioner’s administrative closure claim for further consideration in light of intervening precedent; and (3) remanded Petitioner’s asylum and withholding claims because the BIA erroneously reviewed the immigration judge’s nexus determination for clear error, rather than de novo. The panel concluded that substantial evidence supported the agency’s determination that Petitioner failed to establish the requisite government involvement or government acquiescence to any torture. View "JOSUE UMANA-ESCOBAR V. MERRICK GARLAND" on Justia Law