Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caDC-18-07161/USCOURTS-caDC-18-07161-0/pdf.json

Nature of Suit Code: 380
Nature of Suit: Other Personal Property Damage
Cause of Action: 

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United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued October 7, 2019 Decided February 28, 2020

No. 18-7161

HE DEPU, ET AL.,

APPELLANTS

v.

YAHOO! INC., ET AL.,

APPELLEES

Appeal from the United States District Court

for the District of Columbia

(No. 1:17-cv-00635)

Times Wang argued the cause and filed the briefs for

appellants.

Matthew Allen Fitzgerald argued the cause for appellees. 

With him on the brief were Elizabeth P. Redpath, David I.

Bledsoe, Mikhael D. Charnoff, William D. Blakely, and George

E. Kostel.

Before: SRINIVASAN, Chief Judge,

*

 and GARLAND and

WILKINS, Circuit Judges.

*

 Chief Judge Srinivasan was a member of the panel at the time

the case was argued but did not participate in this opinion. 

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Opinion for the Court filed by Circuit Judge GARLAND.

GARLAND, Circuit Judge: The plaintiffs in this case are

Chinese citizens who were imprisoned for expressing dissent on

the internet. The defendants are Yahoo, a web services provider

now owned by Verizon Media, and associated entities and

individuals. The plaintiffs allege that, as part of the settlement

of an earlier lawsuit, Yahoo established a charitable trust to

provide humanitarian and legal assistance to imprisoned Chinese

dissidents. Thereafter, they charge, the defendants improperly

depleted the trust’s funds and terminated it altogether.

The district court dismissed the plaintiffs’ complaint on the

threshold grounds that they failed to plausibly allege either: (1)

that Yahoo established a charitable trust, or (2) that they have

standing to bring such a claim under the law of the District of

Columbia. We conclude that the plaintiffs plausibly alleged

both. Accordingly, we reverse the dismissal of the complaint.

I

In April 2007, Wang Xiaoning and Shi Tao, two imprisoned

Chinese dissidents, and Wang’s wife, Ling Yu, sued Yahoo for

violations of federal and state law. They alleged that Yahoo had

abetted Wang’s and Shi’s imprisonment by turning over their

Yahoo email account information to the Chinese government,

which used the information to prosecute them for political

dissent. See Second Am. Compl. (SAC) ¶ 2; Wang v. Yahoo!

Inc., No. 07-cv-2151-CW (N.D. Cal. Apr. 18, 2007), 2007 WL

1230526. In late 2007, Yahoo settled the case.

The 2007 Settlement Agreement provided for payments of

$3.2 million each to the families of Wang and Shi, the money

“to be held in trust” by a non-profit organization, the Laogai

Research Foundation (the “Foundation”). Settlement

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Agreement § II.B (J.A. 175). The Agreement also provided for

another payment of $17.3 million to be “made in trust” to the

Foundation, to be maintained “separately from other Foundation

funds” and to be “known as the ‘Yahoo! Human Rights Fund’”

(the “Fund”). Id. § II.C. The Fund was to be used “for three

purposes only:

(a) to provide humanitarian and legal assistance

primarily to persons in or from the People’s Republic

of China who have been imprisoned for expressing

their views through Yahoo! or another medium; (b) to

resolve claims primarily by such persons, or persons

threatened with prosecution or imprisonment, against

the Yahoo! Entities . . . ; and (c) for payment of

Foundation operating expenses and the Foundation’s

educational work conducted in the United States in

support of human rights.

Id. § II.C.2.

In 2017, the plaintiffs here -- seven Chinese citizens, who

allege that China also imprisoned them for their online speech,

again with evidence obtained from their Yahoo accounts -- sued

Yahoo, the Foundation, and the other defendants. Six of the

plaintiffs allege that they received money from the Fund’s

assistance program in the past and remain potential future

recipients. SAC ¶¶ 10-15. The seventh alleges that he applied

for funding but was advised that the program had been

terminated. Id. ¶ 16.

The plaintiffs claim that the 2007 Settlement Agreement

established the Fund as a charitable trust and that the defendants

are its trustees. Id. ¶¶ 1, 17-27. They allege that a purpose of

the Fund was to provide humanitarian and legal assistance to

Chinese dissidents imprisoned for expressing their views online. 

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Id. ¶¶ 1, 39-40. As beneficiaries of that purpose, they also

allege a “special interest” in enforcement of the trust. Id. ¶ 136. 

Finally, they allege that the defendant-trustees violated their

fiduciary duties by improperly depleting the trust’s assets and,

ultimately, terminating the trust’s humanitarian and legal

assistance program altogether. Id. ¶ 151.

Pursuant to Federal Rule of Civil Procedure 12(b)(6), the

district court dismissed the plaintiffs’ first amended complaint

with prejudice for failure to state a claim. The court did not

reach the plaintiffs’ allegations of breach of fiduciary duty. 

Instead, it held that the plaintiffs had failed to plausibly allege

either: (1) that the Settlement Agreement established a

charitable trust, or (2) that the plaintiffs had the kind of “special

interest” standing required to enforce the alleged trust. He Depu

v. Yahoo! Inc., 306 F. Supp. 3d 181, 187-91 (D.D.C. 2018). 

Thereafter, the plaintiffs moved to alter the prejudicial

effect of the court’s order under Federal Rule of Civil Procedure

59(e), and for leave to file a second amended complaint under

Rule 15(a)(2). The court denied both motions, concluding that

no additional allegations consistent with the first amended

complaint could save its claims and that the proposed second

amended complaint was “futile” because it did not cure the two

deficiencies noted in the preceding paragraph. He Depu v.

Yahoo! Inc., 334 F. Supp. 3d 315, 319-21 (D.D.C. 2018). Those

asserted deficiencies are the only issues on this appeal.1

1

 In ruling on the plaintiffs’ Rule 59(e) motion, the district court

“conclude[d] that its finding that plaintiffs lack standing to enforce

any charitable trust [did] not independently warrant dismissal with

prejudice” of the first amended complaint. He Depu, 334 F. Supp. 3d

at 320 n.6. It therefore went on to address (and dismiss) the standing

allegations of the second amended complaint. Id. at 323-24. 

Accordingly, for the allegations of special interest standing, we must

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II

We review a district court’s dismissal of a complaint for

failure to state a claim de novo. Kassem v. Wash. Hosp. Ctr.,

513 F.3d 251, 253 (D.C. Cir. 2008). “To survive a motion to

dismiss, a complaint must contain sufficient factual matter,

accepted as true, to ‘state a claim to relief that is plausible on its

face.’” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting

Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007)). In

deciding a motion to dismiss, a court may (and in this case did)

consider documents “attached to or incorporated in the

complaint.” EEOC v. St. Francis Xavier Parochial Sch., 117

F.3d 621, 624 (D.C. Cir. 1997).

The plaintiffs here invoked the diversity jurisdiction of the

district court, see 28 U.S.C. § 1332(a), which was therefore

charged with applying the substantive law of the District of

Columbia, see Novak v. Capital Mgmt. & Dev. Corp., 452 F.3d

902, 907 (D.C. Cir. 2006). Typically, “to achieve the same

outcome we believe would result if the District of Columbia

Court of Appeals considered this case,” id., we look to that

examine the second amended complaint. With respect to the

establishment of a charitable trust, the district court found that the

second amended complaint merely “repackage[d] identical facts” from

the first amended complaint. Id. at 320 n.7. Thus, for ease of

reference, this opinion will cite to the second amended complaint on

both issues. See also Yahoo Br. 41-43 (advising that there is “no

reason for this Court to address the Rule 59 issue,” id. at 41, because

the district court “considered the[] Second Amended Complaint

anyway” and because “there is no meaningful difference between the

two” complaints, id. at 43). In any event, because we find that both

complaints are sufficient to survive a motion to dismiss, we reverse

the district court’s rulings regarding Rules 59(e) and 15(a)(2).

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court’s published opinions, Metz v. BAE Sys. Tech. Sols. &

Servs. Inc., 774 F.3d 18, 22 (D.C. Cir. 2014).

The challenge here is that only a few D.C. Court of Appeals

cases examine the two issues presented by this appeal, while an

“almost endless variety” of legal relationships can arise from a

transfer of funds. GEORGE G. BOGERT ET AL., THE LAW OF

TRUSTS AND TRUSTEES ch. 2 intro. (3d ed. 2017) [hereinafter

BOGERT ON TRUSTS]. In these circumstances, reasonable minds

may well differ as to the proper application of limited case law

to the factual allegations of a complaint. And because we must

review the dismissal of a complaint de novo, we may be

required to depart from the district court’s conclusions, even if

they are reasonable. 

That is the result we reach here. We conclude that the

complaint in this case plausibly alleges both that Yahoo created

a charitable trust and that the plaintiffs’ “special interest” in the

trust is sufficient to give them standing to enforce it.

A

We begin with the question of whether the plaintiffs

plausibly allege that Yahoo established a charitable trust in

2007.

 As the D.C. Court of Appeals has explained, the elements

of a trust are: “1) a trustee, who holds the trust property and is

subject to equitable duties to deal with it for the benefit of

another; 2) a beneficiary, to whom the trustee owes such duties;

[and] 3) the trust property, which is held by the trustee for the

beneficiary.” Cabaniss v. Cabaniss, 464 A.2d 87, 91 (D.C.

1983) (citing, inter alia, RESTATEMENT (SECOND) OF TRUSTS

§§ 2, 23, 24, 32 [hereinafter RESTATEMENT (SECOND)]). “As

distinguished from a private trust, which is characterized by

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identified beneficiaries, . . . in a charitable trust ‘the obligation

of the trustee is to apply the trust res for some form of public

benefit.’” Hooker v. Edes Home, 579 A.2d 608, 611 (D.C. 1990)

(quoting BOGERT ON TRUSTS § 411).2 

In addition, “there must be proof of the settlor’s intention to

create a trust.” Duggan v. Keto, 554 A.2d 1126, 1133 (D.C.

1989).3

 This intention to create a trust may be manifested “by

written or spoken language or by conduct, in light of all

surrounding circumstances.” Cabaniss, 464 A.2d at 91. No

magic words are required. Id. The principal dispute in this case

centers on whether Yahoo manifested the requisite intention to

create a trust.

1. As evidence of Yahoo’s intention to create a trust, the

plaintiffs point first to the text of the Settlement Agreement

establishing the Fund. As we said in Beckett v. Air Line Pilots

Association, “[a]n expressed intention to create a trust may be

2 Because the D.C. Court of Appeals cites Bogert on Trusts and

the Restatement (Second) of Trusts as authoritative in applying the

common law of the District, we do so as well.

3

 According to the defendants, “the D.C. Court of Appeals has

stated that ‘the intention to create a trust should be clearly

manifested.’” Yahoo Br. 12 (quoting Duggan, 554 A.2d at 1136

(emphasis added)). But the quotation the defendants cite is merely the

D.C. Court of Appeals’ quotation from a Maryland case describing

Maryland law. See Duggan, 554 A.2d at 1136-37 (quoting Moore v.

Layton, 127 A. 756, 757 (Md. 1925)). Noting that the Maryland case

was “not binding,” the D.C. Court of Appeals found it “persuasive

[t]here because its facts [were] very similar.” Id. at 1137 (emphasis

added). And in stating the intention requirement elsewhere in the

opinion, the court did not repeat the word “clearly.” Id. at 1133, 1136. 

In any event, with or without the adverb, we conclude that the

plaintiffs’ complaint plausibly alleges trust intent. 

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revealed by . . . the articulation of the essential elements of a

trust.” 995 F.2d 280, 287 (D.C. Cir. 1993). The Agreement

plausibly identifies all of them: a trustee (the Foundation), trust

property ($17.3 million), and a charitable purpose

(“humanitarian and legal assistance” to persons meeting

specified criteria). Settlement Agreement § II.C.

Moreover, the Settlement Agreement specifically directs

that Yahoo’s payments to the Foundation be “made in trust.” 

Settlement Agreement § II.C. The Bogert treatise, frequently

cited by the D.C. Court of Appeals, states that in the context of

a transfer to a charitable corporation (like the Foundation), if the

transfer “used the words ‘in trust’ . . . , that language may be

used to find an intent to make the corporation a trustee[.]” 

BOGERT ON TRUSTS § 324; see In re Strack, 524 F.3d 493, 499

(4th Cir. 2008) (noting that “the parties’ use of the word ‘trust’

is to be given great weight”).

An intention to create a trust may also be revealed by

articulation of “the specifics necessary to implement and

administer the trust.” Beckett, 995 F.2d at 287 (internal

quotation marks omitted). Here, the Settlement Agreement

subjects the Foundation’s handling of the Fund to trust-like

restrictions, and does so in imperative language. See Cabaniss,

464 A.2d at 91-92 (“Among the . . . factors pertinent to a

determination of a settlor’s intention to create a trust are . . . the

imperative, as distinguished from precatory, nature of the words

used.”).4

 It prohibits the Foundation from commingling Fund

monies with its own general funds, see Settlement Agreement

§ II.C (“[T]hese payments shall be maintained separately from

other Foundation funds.” (emphasis added)), an indicator of trust

4 See also Beckett, 995 F.2d at 287 (relying in part on a settlement

agreement’s use of “the mandatory ‘shall’” to conclude that it created

a trust). 

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intent.5 It provides that the money “may be used for three

purposes only,” “shall not be used” for specified prohibited

purposes, and includes specific mechanisms to remedy “any

disbursements that do not conform with the stated purposes” of

the Fund. Settlement Agreement §§ II.C, II.C.2, II.C.2(iii)

(emphases added). The Agreement also bars the Foundation

from spending more than $1 million per year of the Fund on its

own operating expenses, id. § II.C.2(iii), and requires it to

provide semi-annual reports of its activities, id. § II.C.2(vi). All

of this together plausibly signals the hallmark of a charitable

trust: “a fiduciary relationship with respect to property,

subjecting the person by whom the title to the property is held

to equitable duties to deal with the property for a charitable

purpose.” RESTATEMENT (SECOND) § 348; see Cabaniss, 464

A.2d at 91.6

The complaint also alleges circumstances surrounding the

creation of the Fund that are probative of trust intent. For

example, the complaint alleges that the plaintiffs in the original

Wang lawsuit met with Yahoo’s then-CEO, Jerry Yang, on

November 7, 2007, to discuss settlement. SAC ¶¶ 32-33. At

that meeting, Yang allegedly promised to “finance a trust fund

to provide financial assistance to imprisoned Chinese

dissidents.” Id. ¶ 33. The complaint further alleges that Yahoo

publicly stated that it wanted to go beyond just “provid[ing]

5 See, e.g., In re Strack, 524 F.3d at 499 (holding that a

segregation of funds provision supports a finding of trust intent);

Quaif v. Johnson, 4 F.3d 950, 954 (11th Cir. 1993) (same); In re Prof’l

Air Traffic Controllers Org. (PATCO), 26 B.R. 337, 343-44 (Bankr.

D.D.C. 1982) (same).

6

 The defendants do not dispute that the Foundation appears to

hold legal but not equitable title to the Fund, arguing only that such

evidence is not “probative of charitable trust intent in this context.” 

Yahoo Br. 26. We disagree.

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financial, humanitarian and legal support” to the Wang plaintiffs

through a “private agreement,” and instead wanted to ensure

“our actions match our values” by establishing “a separate

human rights fund to provide humanitarian and legal support to

political dissidents who have been imprisoned for expressing

their views online.” Id. ¶ 42.7

2. In response to these indicia of trust intent, the defendants

levy a barrage of counter-arguments. They are not persuasive.

7

 In the district court, the defendants argued and the court agreed

that dismissal of the first amended complaint with prejudice was

warranted because the “plaintiffs’ only theory for the existence of any

trust relied on the language of the settlement agreement itself,” and

thus they could not -- by further amendment or otherwise -- rely on

“conduct” or other extra-textual support. He Depu, 334 F. Supp. 3d

at 319-20. The defendants did not repeat this argument in their

appellate brief, and rightly so. The plaintiffs’ complaint relied on the

language of the agreement not as a theory of liability but as evidence

of the trust relationship that was the predicate for their theory of

liability. See First Am. Compl. ¶¶ 33-46, 125-31 (J.A. 26-30, 52-54). 

A plaintiff’s proof is not limited to the evidence cited in the complaint. 

See Kingman Park Civic Ass’n v. Williams, 348 F.3d 1033, 1040 (D.C.

Cir. 2003). In any event, the complaint did rely on conduct and other

extra-textual support as well. See First Am. Compl. ¶¶ 33, 41, 43 (J.A.

26, 28-29).

 At oral argument in this court, the defendants suggested that we

could not look outside the four corners of the Settlement Agreement

for evidence of trust intent, presumably as a matter of trust law. 

Recording of Oral Arg. at 35:39. They did not take this position in

their brief, and it directly contradicts District of Columbia precedent,

which expressly authorizes examination of “extrinsic circumstances.” 

Cabaniss, 464 A.2d at 91-92; see Family Fed’n for World Peace v.

Hyun Jin Moon, 129 A.3d 234, 246 (D.C. 2015).

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It is true, as the defendants argue, that the Settlement

Agreement’s use of the words “in trust” is not “determinative.” 

Yahoo Br. 25-26 (citing In re Strack, 524 F.3d at 499; BOGERT

ON TRUSTS § 324). But whether those (or any other) words

conclusively establish the existence of a trust is not before us. 

At the motion-to-dismiss stage, the only question is whether the

words used make the existence of a trust “plausible.” See Iqbal,

556 U.S. at 678.

The defendants also argue that the Settlement Agreement is

merely a settlement “contract -- with no trust document or

announcement of trust intent in sight.” Yahoo Br. 8. The latter

claim is plainly incorrect, given the Agreement’s express use of

the phrase “in trust” as well as the other indicia noted above. As

to the claim that the Agreement is just a settlement contract, “[i]t

is settled that the mere existence of a contractual relationship

does not preclude the existence of a trust relationship.” 

Christiansen v. Nat’l Sav. & Tr. Co., 683 F.2d 520, 530 (D.C.

Cir. 1982); see BOGERT ON TRUSTS § 323 (explaining that a

charitable trust can be created “by the making of a contract by

the settlor in favor of a trustee”). Nor is it unusual for a trust to

be established as part of a settlement agreement.8 The fact that

Yahoo “aimed to resolve claims brought against Yahoo by the

Wang parties,” Yahoo Br. 15 (citing Settlement Agreement

§ I.B.3); He Depu, 306 F. Supp. 3d at 189, does not preclude its

establishment of a charitable trust as part of that settlement. 

The defendants further rely on a provision of the Settlement

Agreement that disclaims the existence of third-party

8

 See, e.g., Beckett, 995 F.2d at 285-86 (holding that a contract

to settle a case “established a trust”); D’Agrosa v. Coniglio, 824

N.Y.S.2d 761 (Sup. Ct. 2006) (analyzing a trust arising in connection

with a settlement); In re Estate of Binder, 386 N.W.2d 910, 913 (N.D.

1986) (same).

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beneficiaries, Settlement Agreement § IV.N, to insist that Yahoo

cannot have intended to create a trust. But such a provision is

not necessarily inconsistent with trust intent. The provision may

bar third parties from suing for breach of contract, but it is

black-letter law that -- with or without such a provision -- a

“trustee who fails to perform his duties as trustee is not liable to

the beneficiary for breach of contract.” RESTATEMENT

(SECOND) § 197 cmt. b. That is so because a trustee’s “duties

are not contractual in nature.” Id. § 169 cmt. c; see id. § 74 cmt.

a (stating that trust beneficiary status arises from the “trust

relation” itself and is not “based . . . upon contract”); see also

Christiansen, 683 F.2d at 530 (distinguishing between a thirdparty beneficiary contract and a trust).

The defendants further point out that, although the

Settlement Agreement lists the first purpose for which the Fund

may be used as “humanitarian and legal assistance,” the second

purpose listed is to resolve claims brought against Yahoo. 

Noting that “not all jurisdictions even recognize ‘mixed trusts’”

with both charitable and private purposes, they maintain that

therefore the Fund cannot constitute a charitable trust. Yahoo

Br. 20. But we apply the law of the District of Columbia, not

the law of “all” jurisdictions. And the D.C. Uniform Trust Code

does recognize the validity of mixed trusts. See D.C. CODE

§ 19-1301.03(3) (defining a charitable trust as “a trust, or

portion of a trust, created for a charitable purpose” (emphasis

added)).9

9

 The district court held that the plaintiffs could not make this

“mixed trust” argument because they had not alleged a “mixed trust”

in their first amended complaint. He Depu, 306 F. Supp. 3d at 189

n.5. But a plaintiff is not required to include in its complaint every

argument that might support its general claims. See Kingman Park

Civic Ass’n, 348 F.3d at 1040. In any event, the second amended

complaint does allege that the Fund is “at least in part, a charitable

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Still, the defendants warn, the Fund’s private claimsresolution purpose could have “theoretically” exhausted the

entire Fund. Yahoo Br. 20. But where a trust has multiple

beneficiaries, trustees must act “impartially in . . . [the

distribution of] trust property,” paying “due regard” to the

“respective interests” of each. D.C. CODE § 19-1308.03. The

Foundation could not have distributed all $17.3 million of the

Fund to fulfill its claims-resolution purpose without running

afoul of this requirement. See also Settlement Agreement

§ II.C.2(i) (requiring the Foundation to use its “best efforts to

maximize the benefits achieved through [ ] use of a portion of

the [ ] Fund for humanitarian and legal assistance” (emphasis

added)).

Finally, the defendants shift focus from the original 2007

Settlement Agreement to Yahoo’s later establishment, in 2009,

of a different trust. They note that the document Yahoo used in

2009 expressly denominated the fund it established there as a

“trust” and the holders of that fund as “trustees.” Agreement &

Decl. of Trust (J.A. 132). This, they assert, is “fatal” to the

plaintiffs’ claim concerning the 2007 Agreement. Yahoo Br. 23. 

But although language like “‘in trust’ or ‘trustee’ in connection

with [a] transfer . . . may be used to find an intent to make the

[transferee] a trustee,” the “failure to use such language is not

conclusive.” BOGERT ON TRUSTS § 324.10 Nor is it dispositive

trust, and/or a mixed trust.” SAC ¶ 1; id. ¶ 40.

10 See In re PATCO, 26 B.R. at 343-44 (holding that “the mere

fact that the terms ‘trust’ or ‘trustee’ were not specifically employed

. . . is not dispositive” of whether there was an intention to create a

trust); In re Timothy Dean Rest. & Bar, 342 B.R. 1, 9-10 (Bankr.

D.D.C. 2006) (holding, under D.C. law, that an arrangement

constituted a trust notwithstanding that the document did not use the

term “trust”).

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of Yahoo’s intent in executing the 2007 Settlement Agreement

that two years later it used more formal documents to create a

different trust.

3. For the above reasons, we conclude that the plaintiffs’

complaint plausibly alleges that the Settlement Agreement

created a charitable trust. 

B

The defendants argue, and the district court agreed, that

even if the complaint plausibly alleges that the Settlement

Agreement created a charitable trust, it does not plausibly allege

that the plaintiffs have standing to enforce that trust under

District of Columbia law.11 Traditionally, “only a public officer,

usually the state Attorney General” could bring an action to

enforce a charitable trust. Family Fed’n for World Peace, 129

A.3d at 244 (quoting Hooker, 579 A.2d at 612). However, in

light of the “exponential expansion of charitable institutions”

and a “busy Attorney General,” the District of Columbia has

“relax[ed]” this rule, granting standing to those with “a ‘special

interest’ in continued performance of the trust distinguishable

from that of the public at large.” Id. (quoting Hooker, 579 A.2d

at 612) (internal quotation marks omitted).

Hooker v. Edes Home is the leading District of Columbia

case on “special interest” standing. The case concerned a

challenge to the closing, sale, and relocation of the Edes Home,

a charitable corporation. Hooker, 579 A.2d at 608. The Home

was established pursuant to the will of Margaret Edes, who

bequeathed the residue of her estate to maintain a free home “for

aged and indigent Widows, residing, or to reside,” in

11 This is distinct from Article III standing, which all parties and

this court agree the plaintiffs have. See Yahoo Br. 29 n.4. 

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Georgetown. Id. at 609. Subsequently, the trustees adopted bylaws that “established additional admission criteria beyond those

set out in the will,” id., requiring that residents be “in good

health” and “have been for at least five years immediately

preceding the date of application residents of Georgetown,” id.

at 615. The D.C. Court of Appeals held that members of a class

of elderly, indigent, and widowed residents of the District of

Columbia had the requisite “special interest” standing to sue. Id.

at 608-09.

Hooker established two requirements for “special interest”

standing: (1) that the action challenge an “extraordinary

measure threatening the existence of the trust,” not just an

“ordinary exercise of discretion” committed to the trustees; and

(2) that the plaintiffs belong to a class of potential beneficiaries

that is “sharply defined” and “limited in number.” Id. at 614-15. 

 The court held that the plaintiff widows met both requirements. 

Id. at 609.

The defendants do not dispute that this case satisfies

Hooker’s first prong. See Recording of Oral Arg. at 26:30. Nor

could they. The plaintiffs challenge the outright termination of

the Fund, SAC ¶¶ 74-75, 151, and there could hardly be

anything more “threatening [to its] existence,” Hooker, 579

A.2d at 615. Instead, the defendants assert that the plaintiffs

cannot meet Hooker’s second prong. We disagree.

1. First, the plaintiffs plausibly allege that they belong to a

class of potential beneficiaries that is “sharply defined.” 

Hooker, 579 A.2d at 614. For a class to meet this description,

there must be “definite criteria . . . identifying its present

members with . . . particularity.” Id. at 615. Here, the plaintiffs’

proffered class includes these defining criteria: (1) Chinese

persons, (2) imprisoned in China, (3) for exercising their

freedom of expression, (4) online. SAC ¶ 136. 

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These criteria are grounded in the language of the

Settlement Agreement, which directs the Fund to assist

“primarily [ ] persons in or from the People’s Republic of China

who have been imprisoned for expressing their views through

Yahoo! or another medium.” Settlement Agreement § II.C.2. 

According to the complaint, Yahoo also repeatedly touted the

Fund as intended for “dissidents who have been imprisoned for

expressing their views online.” SAC ¶¶ 42, 45, 113. And after

the settlement, Yahoo allegedly drafted guidelines for the Fund

that gave the “highest priority” to Chinese persons, imprisoned

(or otherwise subject to “violations of fundamental human

rights”) for the exercise of their freedom of expression using

“Yahoo’s services or other electronic media.” SAC ¶¶ 50-51.12

 The defendants contend that the above-described criteria are

insufficiently narrow. But they are sufficient under Hooker. As

set out above, Hooker found the plaintiffs’ proffered class of

beneficiaries sufficiently narrow because the Edes will and a

subsequent charter required “the beneficiary to be (1) female, (2)

indigent, (3) aged, and (4) widowed,” and because subsequent

“by-laws further require[d] her (5) to ‘be in good health’

(certifiably) and (6) to ‘have been for at least five years

immediately preceding the date of application [a] resident[ ] of

12 The Yahoo defendants maintain that the guidelines the

plaintiffs cite in their complaint were not for the 2007 Fund, but rather

for the 2009 trust, and that the final guidelines for that trust did not use

the terms “‘priority’ or ‘highest priority.’” Yahoo Br. 37. The

plaintiffs disagree, maintaining that the guidelines they cite were for

the 2007 Fund and differ from the later guidelines. Reply Br. 5. 

Needless to say, this is a factual dispute inappropriate for resolution

at the motion-to-dismiss stage. See Iqbal, 556 U.S. at 678 (noting

that, at the motion-to-dismiss stage, the complaint’s factual matter is

“accepted as true”).

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Georgetown.’” 579 A.2d at 615. The Settlement Agreement

and subsequent guidelines have a similar narrowing effect.

The defendants argue that the Fund is not strictly limited to

individuals in China and could extend to online dissidents

anywhere. In Hooker, however, the court approvingly discussed

Alco Gravure, Inc. v. Knapp Found., 479 N.E.2d 752 (N.Y.

1985), in which the New York Court of Appeals granted

standing to plaintiffs “who were entitled to a preference in the

distribution of the foundation’s assets.” Hooker, 579 A.2d at

614 (citing Alco Gravure, 479 N.E.2d at 765). In that case, the

foundation’s “primary purpose was to assist employees of the

founder’s corporations and their families,” although it was

authorized “to benefit a broader class of charitable purposes.” 

Alco Gravure, 479 N.E.2d at 754 (emphasis added). So too

here, where the Settlement Agreement directs that the Fund

“primarily” assist “persons in or from the People’s Republic of

China,” Settlement Agreement § II.C.2, and the subsequent

guidelines allegedly give “highest priority” to Chinese persons,

SAC ¶ 51.

The defendants further insist that the proposed beneficiary

class is “limitless” because it has “tremendous potential” to

grow over time. Yahoo Br. 39. The Hooker court addressed,

and rejected, a similar argument. 579 A.2d at 615. There, the

defendants contended that the “class of potential beneficiaries

includes ‘all women’ and so is limitless because any woman

could [in the future] become poor and widowed” (and,

presumably, move to Georgetown). Id. But the D.C. Court of

Appeals focused instead on the standing of the “present

members” of the class of potential beneficiaries. Id.

13

13 We note that, although D.C. law extends special interest

standing not only to current trust beneficiaries, but also to potential

beneficiaries, see Family Fed’n for World Peace, 129 A.3d at 245, the

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2. The plaintiffs also plausibly allege that the class of

beneficiaries they have described is sufficiently “limited in

number.” Hooker, 579 A.2d at 614-15. Drawing on a U.S.

congressional database of all Chinese political prisoners, SAC

¶ 138, they plausibly estimate that the proposed class (as defined

by the above criteria) currently consists of between 800 and

1,200 individuals, id. ¶ 141. The defendants assert that

conferring standing on a beneficiary class of that size would be

“unprecedented.” Yahoo Br. 34. In Hooker, however, the

complaint alleged a class of potential beneficiaries that

numbered “in the hundreds, if not the thousands.” Hooker, 579

A.2d at 611 (internal quotation marks omitted). Here, as there,

those numbers are not too large to sustain a complaint against a

motion to dismiss.

3. In sum, we conclude that the plaintiffs’ allegations

plausibly satisfy the two prongs of Hooker’s “special interest”

standing test. 

First, the plaintiffs challenge “an extraordinary measure

threatening the existence of the trust, hence raising an issue that,

by its nature, could only be tried once.” Hooker, 579 A.2d at

614-15. Accordingly, unlike a challenge “to an ordinary

exercise of discretion on a matter expressly committed to the

trustees,” the probability of “recurring litigation” is low. Id. at

614-15.

Second, they plausibly satisfy Hooker’s requirement that

they belong to a class of potential beneficiaries that is “sharply

defined and . . . limited in number.” Id. at 614. The “essence of

a ‘special interest’ in a charitable trust is a particularized interest

distinct from that of members of the general public.” Id. at 613. 

plaintiffs in this case are more than just potential beneficiaries. Six

have previously benefited from the Fund. SAC ¶¶ 10-15.

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Just as the members of the Hooker class plausibly alleged “a

present opportunity to enjoy a direct benefit differing markedly

from the incidental and indirect benefit the public realizes from

the housing of indigent elderly widows,” id. at 617, here the

members of the proposed class plausibly allege an opportunity

to benefit from the Fund that differs from the incidental and

indirect benefit the public may realize from the Fund’s

humanitarian and legal assistance program.

III

For the foregoing reasons, we conclude that the plaintiffs

plausibly allege that Yahoo created a charitable trust and that

they have standing to enforce it. Accordingly, their complaint

survives at the pleading stage. As the case proceeds, additional

evidence may come to light that either supports or undermines

those allegations. But “[h]owever the evidence may eventually

turn out to be, we are not persuaded that any decision on this

issue can be based on an inadequacy in the complaint.” Family

Fed’n for World Peace, 129 A.3d at 246.

The judgment of the district court is reversed, and the case

is remanded for further proceedings consistent with this opinion.

So ordered.

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