Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca9-15-55106/USCOURTS-ca9-15-55106-0/pdf.json

Nature of Suit Code: 890
Nature of Suit: Other Statutory Actions
Cause of Action: 

---

FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

DEAN BEAVER, Husband; LAURIE

BEAVER, Wife; STEVEN ADELMAN,

an individual; ABRAM AGHACHI, an

individual; DINESH GAUBA, an

individual; KEVIN KENNA, husband

and wife, on behalf of themselves

and all others similarly situated;

VERONICA KENNA, husband and

wife, on behalf of themselves and all

others similarly situated,

Plaintiffs-Appellees,

v.

TARSADIA HOTELS, a California

corporation; TUSHAR PATEL, an

individual; B.U. PATEL, an

individual; GREGORY CASSERLY, an

individual; 5TH ROCK LLC, a

Delaware limited liability company;

MKP ONE, LLC, a California limited

liability company; GASLAMP

HOLDINGS, LLC, a California limited

liability company,

Defendants-Appellants.

No. 15-55106

D.C. No.

3:11-cv-01842-

GPC-KSC

OPINION

Appeal from the United States District Court

for the Southern District of California

Gonzalo P. Curiel, District Judge, Presiding

 Case: 15-55106, 03/10/2016, ID: 9896529, DktEntry: 36-1, Page 1 of 34
2 BEAVER V. TARSADIA HOTELS

Argued and Submitted

January 4, 2016—Pasadena, California

Filed March 10, 2016

Before: MILAN D. SMITH, JR., PAUL J. WATFORD,

and MICHELLE T. FRIEDLAND, Circuit Judges.

Opinion by Judge Milan D. Smith, Jr.

SUMMARY*

California Unfair Competition Law

The panel affirmed the district court’s partial grant of

summary judgment in favor of purchasers of non-residential

condominiums who claimed that a group of developers and

their agents or affiliates committed unlawful business

practices in violation of California’s Unfair Competition Law

(UCL) by failing to make certain disclosures in the course of

sale transactions, as required by the Interstate Land Sales Full

Disclosure Act (ILSA).

Defendants conceded that they failed to comply with

ILSA’s disclosure requirements, but raised a series of

affirmative defenses, which the district court rejected.

The panel held that the UCL’s four-year statute of

limitations applied, and was not preempted, and ILSA’s

* This summary constitutes no part of the opinion of the court. It has

been prepared by court staff for the convenience of the reader.

 Case: 15-55106, 03/10/2016, ID: 9896529, DktEntry: 36-1, Page 2 of 34
BEAVER V. TARSADIA HOTELS 3

three-year statute of limitations did not bar plaintiffs’ UCL

claim.

The panel rejected defendants’ argument that ILSA did

not apply because plaintiffs’ condominium units were not

qualifying “lots” under ILSA. Guided by agency

interpretations of ILSA, the panel concluded that plaintiffs

had “exclusive repeated use” of their units, which therefore

qualified as “lots.”

The panel held that the condominium units were not

exempt under ILSA’s Improved Lot Exemption.

The panel held that a 2014 amendment to ILSA, passed

after the commencement of these proceedings, and exempting

condominium sales from ILSA’s disclosure requirements, did

not operate to extinguish defendants’ liability. The panel held

that the amendment was a substantive change in the law,

rather than a clarification, and did not operate retroactively.

COUNSEL

Frederick H. Kranz (argued) and Lynn Therese Galuppo,

Cox, Castle & Nicholson, LLP, Irvine, California; David

Wesley Moon, Stroock & Stroock & Lavan LLP, Los

Angeles, California, for Defendants-Appellants.

Michael Rubin (argued), Altshuler Berzon LLP, San

Francisco, California; Donald E. Chomiak, Talisman Law,

P.C., Glendale, California; Tyler R. Meade, The Meade Firm

P.C., Berkeley, California; Michael L. Schrag, Gibbs Law

Group LLP, Oakland, California, for Plaintiffs-Appellees.

 Case: 15-55106, 03/10/2016, ID: 9896529, DktEntry: 36-1, Page 3 of 34
4 BEAVER V. TARSADIA HOTELS

OPINION

M. SMITH, Circuit Judge:

Plaintiffs Dean Beaver, Laurie Beaver, Steven Adelman,

Abram Aghachi, Dinesh Gauba, Kevin Kenna, and Veronica

Kenna are the purchasers of non-residential condominium

units in San Diego’s Hard Rock Hotel & Condominium

Project (the Hard Rock Project). Plaintiffs brought this

putative class action against Defendants,1a group of

developers and their agents or affiliates who allegedly

participated in the sale of the condominium units. Plaintiffs

claimed, inter alia, that Defendants’ business practices

violated California’s Unfair Competition Law (UCL), Cal.

Bus. & Prof. Code § 17200 et seq.

Specifically, Plaintiffs alleged that Defendants failed to

make certain disclosures in the course of the sale transactions,

as required by the Interstate Land Sales Full Disclosure Act

(ILSA), 15 U.S.C. § 1701 et seq., which applies in this case

by operation of the UCL’s prohibition against “unlawful”

business practices. Cal. Bus. & Prof. Code §§ 17200.

Defendants concede that they failed to comply with

ILSA’s disclosure requirements. They instead raise a series

of affirmative defenses, contending that (1) ILSA’s statute of

limitations, 15 U.S.C. § 1711, bars Plaintiffs’ UCL claim; (2)

ILSA does not apply because Plaintiffs’ condominium units

1 Defendants include the following business entities and individuals: 5th

Rock, LLC; Tarsadia Hotels; MKP One, LLC (MKP); Gregory Casserly;

Tushar Patel; B.U. Patel; and Gaslamp Holdings. Plaintiffs, however, did

not seek summary judgment against Defendants Gaslamp Holdings, LLC,

or B.U. Patel with respect to the issues now on appeal.

 Case: 15-55106, 03/10/2016, ID: 9896529, DktEntry: 36-1, Page 4 of 34
BEAVER V. TARSADIA HOTELS 5

are not considered qualifying “lots” under ILSA, see 12

C.F.R. § 1010.1(b); (3) the condominium units are exempt

under ILSA’s Improved Lot Exemption, 15 U.S.C.

§ 1702(a)(2); and (4) a 2014 amendment to ILSA, 15 U.S.C.

§ 1702(a)(2), passed after the commencement of the current

proceedings, operates to extinguish Defendants’ liability in

connection with the condominium sales.

The district court rejected each of these four arguments

and granted partial summary judgment in favor of Plaintiffs

on the portion of their UCL claim that was premised on the

existence of an “unlawful” business practice under ILSA.

Nonetheless, the district court certified these four issues for

interlocutory appeal, pursuant to 28 U.S.C. § 1292(b). We

granted Defendants’ petition for interlocutory appeal, and we

now affirm the district court’s partial summary judgment

order with respect to the certified issues.2

2 Defendants also claim that the district court’s summary judgment order

was in error with respect to Defendants MKP, Gregory Casserly, and

Tushar Patel because they did not exercise the requisite control over the

alleged unlawful conduct. This issue was not certified by the district court

for interlocutory appeal. While we retain jurisdiction to review claims not

certified by the district court, see Yamaha Motor Corp. v. Calhoun,

516 U.S. 199, 204 (1996), we decline Plaintiffs’ invitation to address this

issue on interlocutory appeal. Instead, we direct the district court to

examine the fact-bound question of UCL liability with respect to

Defendants MKP, Tushar Patel, and Gregory Casserly when it resumes

jurisdiction over the proceedings following the conclusion of this appeal.

See Merritt v. Countrywide Fin. Corp., 759 F.3d 1023, 1034 (9th Cir.

2014). Furthermore, Defendants contend, and Plaintiffs agree, that the

district court’s entry ofsummary judgment against Defendants B.U. Patel

and Gaslamp Holdings, LLC, was in error because Plaintiffs did not move

for partial summary judgment against these two entities. The district court

has not had the opportunity to rectify any alleged error in the liability of

these Defendants because it denied Defendants’ motion to reconsider

 Case: 15-55106, 03/10/2016, ID: 9896529, DktEntry: 36-1, Page 5 of 34
6 BEAVER V. TARSADIA HOTELS

FACTS AND PRIOR PROCEEDINGS

A. The Parties

The Hard Rock Project, located at 205 Fifth Avenue in

downtown San Diego, is a mixed-use development that

includes the Hard Rock Hotel and 420 commercial

condominium units. Plaintiffs are a group of individual

purchasers of non-residential condominium units in the Hard

Rock Project. Defendant 5th Rock, LLC (5th Rock) was the

developer of the condominium units and sold these units to

Plaintiffs. Defendant MKP operated as the managingmember

of 5th Rock and signed the condominium purchase contracts

on 5th Rock’s behalf. 5th Rock enlisted the assistance of

Defendant Tarsadia Hotels (Tarsadia) in the development and

subsequent management and operation of the properties.

Defendant Greg Casserly served as Tarsadia’s president, and

Defendant Tushar Patel served as Tarsadia’s chairman.

B. The Purchase Transactions

Plaintiffs purchased the condominium units from 5th

Rock before construction of the Hard Rock Project was

completed. The condominium purchase contractswere signed

in May 2006 by one set of Plaintiffs, and in December 2006

by the remaining Plaintiffs. These purchase contracts called

for estimated completion dates between August 2007 and

September 2007, and a closing date of no later than

December 29, 2007. In addition, the purchase contracts

contained clauses specifying that “except for delays caused

by circumstances beyond Seller’s reasonable control or the

pending the outcome of this interlocutory appeal. Accordingly, we direct

the district court to also resolve this issue on remand.

 Case: 15-55106, 03/10/2016, ID: 9896529, DktEntry: 36-1, Page 6 of 34
BEAVER V. TARSADIA HOTELS 7

failure to complete due to a permitted excuse, Seller shall use

commercially reasonable efforts to complete the construction

of the Unit by the Estimated Completion Date.”

One of the “permitted excuses” to timely completion was

contained in a pre-sale contingency clause, which gave

Defendants the “unilateral right” to terminate the contract if

less than 75% of the condominium units were sold or under

contract by the closing date. By December 2006, more than

75% of the condominium units at the Hard Rock Project were

under contract.

The purchase contracts also required that Plaintiffs

execute a unit maintenance and operation agreement (UMA)

as part of the sale transaction. The UMA contained several

restrictions on Plaintiffs’ use of the units. The UMA limited

Plaintiffs’ rights to occupy the condominium units to a

maximum of twenty-eight days per year. Moreover, the UMA

mandated that the properties could only be resold as nonresidential condominium units, required that the properties be

managed as part of the Hard Rock Hotel, and granted the

Hard Rock Hotel a right of first refusal in the event that a

Plaintiff wished to sell his condominium unit. Plaintiffs also

agreed that the hotel would control the room furnishings and

other routine housekeeping and maintenance services in the

units.

C. Post-Transaction Events

Separately, in 2007, Plaintiffs entered into Rental

Management Agreements (RMAs) that appointed Tarsadia as

property manager with the “sole and exclusive authority to

manage, operate, market and rent” the condominium units.

The terms of the RMA gave Tarsadia the right to “enter the

 Case: 15-55106, 03/10/2016, ID: 9896529, DktEntry: 36-1, Page 7 of 34
8 BEAVER V. TARSADIA HOTELS

Unit, without Notice to Owner, from time to time, and at any

time, for any purpose set forth in this Agreement.”

Construction of the condominium units was completed

around October of 2007. Between October and December of

2007, Plaintiffs closed escrow on their respective

condominium units. Plaintiffs contend that they would have

cancelled the purchase contracts prior to closing escrow had

Defendants complied with their disclosure obligations and

made Plaintiffs aware of their statutory rescission rights

under ILSA.

D. Procedural History

On May 18, 2011, Plaintiffs brought a putative class

action in California state court against Defendants, alleging

violations of federal and state laws, including the UCL, in

connection with the sale of the condominium units.

Defendants later removed the action to federal court in the

Southern District of California under the Class Action

Fairness Act, 28 U.S.C. § 1332(d).

Plaintiffs’ claims were predicated, in part, on allegations

of unlawful conduct through Defendants’ failure to comply

with ILSA. The parties filed cross-motions for partial

summary judgment on those UCL claims arising from

Defendants’ failure to comply with ILSA’s disclosure

requirements. The district court initially granted summary

judgment to Defendants on the basis that Plaintiffs’ UCL

claim was time-barred, but later reversed its holding after

Plaintiffs filed a motion for reconsideration. The district court

ultimately issued a new order, allowing Plaintiffs’ UCLclaim

to proceed and awarding partial summary judgment in

Plaintiffs’ favor.

 Case: 15-55106, 03/10/2016, ID: 9896529, DktEntry: 36-1, Page 8 of 34
BEAVER V. TARSADIA HOTELS 9

In 2014, while a motion for reconsideration from

Defendants was pending before the district court, Congress

passed an amendment to ILSA (the 2014 Amendment),

codified at 15 U.S.C. § 1702(b)(9). This amendment exempts

condominium sales from the same ILSA disclosure

requirements upon which Plaintiffs had predicated their UCL

claim. After additional briefing from the parties, the district

court concluded that the 2014 Amendment had no

retrospective application in the present action.

Nonetheless, the district court certified the issue, as well

as other issues of law involved in its partial summary

judgment order, for interlocutory appeal pursuant to

28 U.S.C. § 1292(b). We granted Defendants’ petition for

interlocutory appeal.

STANDARD OF REVIEW

We review a district court’s grant of summary judgment

de novo. See Orr v. Bank of Am., NT & SA, 285 F.3d 764, 772

(9th Cir. 2002). We view the evidence in the light most

favorable to the non-moving party. Id. Where disputed facts

exist, the plaintiff’s representations of these facts are assumed

to be correct for the purposes of deciding the summary

judgment motion. Id. The district court’s determinations on

questions of law are reviewed de novo. See Highmark Inc. v.

Allcare Health Mgmt. Sys., Inc., 134 S. Ct. 1744, 1748

(2014).

 Case: 15-55106, 03/10/2016, ID: 9896529, DktEntry: 36-1, Page 9 of 34
10 BEAVER V. TARSADIA HOTELS

DISCUSSION

I. The Statute of Limitations

The UCL is a California consumer protection statute that

broadly proscribes the use of any “unlawful, unfair or

fraudulent business act or practice.” Cal. Bus. & Prof. Code.

§ 17200. The UCL operates as a three-pronged statute: “Each

of these three adjectives [unlawful, unfair, or fraudulent]

captures a ‘separate and distinct theory of liability.’” Rubio v.

Capital One Bank, 613 F.3d 1195, 1203 (9th Cir. 2010)

(quotingKearns v. Ford Motor Co., 567 F.3d 1120, 1127 (9th

Cir. 2009)). Plaintiffs alleged theories of liability under each

of the three prongs, but only moved for partial summary

judgment on the UCL’s “unlawful” prong. The UCL’s

“unlawful” prong looks to other sources of substantive law,

such as ILSA, to proscribe the kinds of unlawful business

practices punishable under the statute. See Prakashpalan v.

Engstrom, Lipscomb and Lack, 167 Cal. Rptr. 3d 832, 855–56

(Cal. Ct. App. 2014). In doing so, the UCL “borrows

violations of other laws and treats them as unlawful practices

that the unfair competition law makes independently

actionable.” Cel–Tech Commc’ns, Inc. v. L.A. Cellular Tel.

Co., 973 P.2d 527, 539–40 (Cal. 1999) (citations omitted).

A. State or Federal Law?

As a threshold matter, the parties dispute the appropriate

limitations period to be applied to a UCL claim premised on

a violation of federal law, specifically in this case ILSA. 

California courts have adopted two principles that inform our

analysis. First, as a general matter, the UCL statute of

limitations will apply to a UCL claim, even when that claim

is based on an underlying law with its own separate statute of

 Case: 15-55106, 03/10/2016, ID: 9896529, DktEntry: 36-1, Page 10 of 34
BEAVER V. TARSADIA HOTELS 11

limitations. See Cortez v. Purolator Air Filtration Prods. Co.,

999 P.2d 706, 716 (Cal. 2000).3 Second, a UCL claim

generally accrues when each of the elements of the cause of

action is satisfied. See Aryeh v. Canon Bus. Solutions, Inc.,

292 P.3d 871, 878 (Cal. 2013).

In this case, the district court granted partial summary

judgment on Plaintiffs’ claim under the “unlawful” prong of

the UCL. Plaintiffs’ claim under this particular prong of the

statute is predicated on Defendants’ failure to comply with

ILSA’s disclosure requirements, set forth in 15 U.S.C.

§§ 1703(a)(1)(A), 1703(a)(1)(B), and 1703(d).4ILSA

includes a three-year statute of limitations, which accrues

from the date the purchase contract is signed. 15 U.S.C.

§ 1711. Were ILSA’s statute of limitations to apply to

Plaintiffs’ UCL claim, their claim would be time-barred

because it was brought on May 18, 2011, approximately five

years after the signing of the purchase contracts in May and

December of 2006. The UCL, however, includes a more

generous four-year statute of limitations. Because Plaintiffs

have pled a claim under the UCL, this four-year period

applies. Cal. Bus. & Prof. Code § 17208; see Cortez, 999 P.2d

at 716.

Importantly, the UCL statute of limitations is “governed

by common law accrual rules.” Aryeh, 292 P.3d at 878.

3 Although the parties were unable to point us to a case that expressly

discussed whether this principle extends to UCL claims predicated on

violations of federal law, we read Cortez as announcing a general rule for

all UCL claims regardless of the source of the law allegedly violated.

4 For brevity, we will refer to Plaintiffs’ UCL claim brought under the

“unlawful” prong of the statute as “the UCL claim.”

 Case: 15-55106, 03/10/2016, ID: 9896529, DktEntry: 36-1, Page 11 of 34
12 BEAVER V. TARSADIA HOTELS

Common law rules provide that a cause of action ordinarily

accrues when each of the elements of the cause of action

(wrongdoing, causation, and harm) has been satisified. See id.

at 879. Therefore, under the UCL’s statute of limitations, the

cause of action accrued when the harm was completed.

Plaintiffs allege that the harm became complete in the fall of

2007 when they were required to close escrow on their

respective properties. Because Plaintiffs suffered cognizable

financial harm upon the closing of escrow, we find this

calculation of the accrual date to be sound. Although the

alleged wrongdoing, i.e. Defendants’ failure to disclose,

occurred at or around the date of contract signing, the

financial harm—which gives standing to Plaintiffs under the

UCL—occurred at a later date. Under the UCL, only the

government or “a person who has suffered injury in fact and

has lost money or property as a result” may bring a claim.

Cal. Bus. & Prof. Code § 17204. Plaintiffs’ UCLclaim hinges

on their lack of awareness of their two-year recission right

under 15 U.S.C. § 1703(c), a right which was not disclosed to

Plaintiffs prior to closing escrow on their units.

Particularly in light of the remedial purposes of the UCL,

we agree that Plaintiffs’ claim accrued at the time of “injury

in fact”—and not upon the commission of a technical

violation of the underlying ILSA disclosure provision. As the

appropriate statute of limitations and the accrual date are part

and parcel of the same procedural determination, our

resolution of both issues is drawn from the same body of

law—here, state law. As the California Supreme Court

recently confirmed in Rose v. Bank of America, N.A., a UCL

claim based on violations of a federal statute is

“independently actionable” under the UCL, which contains

“its own distinct and limited equitable remedies.” 304 P.3d

181, 185 (Cal. 2013). Because the UCL’s four-year statute of

 Case: 15-55106, 03/10/2016, ID: 9896529, DktEntry: 36-1, Page 12 of 34
BEAVER V. TARSADIA HOTELS 13

limitations and its accompanying accrual rules apply, the

district court properly concluded that Plaintiffs’ UCL claim

is not time-barred.

B. Federal Preemption of the State Statute of

Limitations 

The remaining question is whether the application of the

UCL’s more generous statute of limitations period is

preempted by federal law. The Supremacy Clause provides

the constitutional foundation for federal authority to preempt

state law. See U.S. Const. art. VI, cl. 2 (federal law “shall be

the supreme Law of the Land . . . any Thing in the

Constitution or Laws of any State to the Contrary

notwithstanding.”); Kurns v. R.R. Friction Prods. Corp.,

132 S. Ct. 1261, 1265 (2012). Preemption of state law, by

operation of the Supremacy Clause, can occur in one of

several ways: express, field, or conflict preemption. Kurns,

132 S. Ct. at 1265–66. Defendants have argued that the

UCL’s statute of limitations presents a case of conflict

preemption. Conflict preemption occurs when a state law

conflicts with federal law, such that the state law “stands as

an obstacle to the accomplishment and execution of the full

purposes and objectives of Congress.” Crosby v. Nat’l

Foreign Trade Council, 530 U.S. 363, 372–73 (2000)

(quoting Hines v. Davidowitz, 312 U.S. 52, 67 (1941)).

Our preemption analysis is driven by the presumption that

“the historic police powers of the States were not to be

superseded by the Federal Act unless that was the clear and

manifest purpose of Congress.” Wyeth v. Levine, 555 U.S.

555, 565 (2009) (quoting Medtronic, Inc. v. Lohr, 518 U.S.

470, 485 (1996)). This presumption carries the “greatest

force” when federal legislation encroaches on an area

 Case: 15-55106, 03/10/2016, ID: 9896529, DktEntry: 36-1, Page 13 of 34
14 BEAVER V. TARSADIA HOTELS

traditionally occupied by the states, such as the field of

property law. CTS Corp. v. Waldburger, 134 S. Ct. 2175,

2189 (2014). “The case for federal pre-emption is particularly

weak where Congress has indicated its awareness of the

operation of state law in a field of federal interest, and has

nonetheless decided to stand by both concepts and to tolerate

whatever tension there [is] between them.” Wyeth, 555 U.S.

at 575 (alteration in original) (quoting Bonito Boats v.

Thunder Craft Boats, Inc., 489 U.S. 141, 166–67 (1989)).

Accordingly, “when the text of a pre-emption clause is

susceptible of more than one plausible reading, courts

ordinarily ‘accept the reading that disfavors pre-emption.’”

CTS Corp., 134 S. Ct. at 2188 (quoting Altria Group, Inc. v.

Good, 555 U.S. 70, 77 (2008)).

In making their conflict preemption argument,Defendants

portray ILSA’s statute of limitations, 15 U.S.C. § 1711, as a

statute of repose, whose purpose was to shield developers and

their agents from liability after a strict cut-off period of three

years. Unlike a statute of limitations, a statute of repose

reflects a congressional “judgment that a defendant should be

free from liability after the legislatively determined period of

time.” See CTS Corp, 134 S. Ct. at 2183 (internal quotations

omitted).

In support of this argument, Defendants point to a

distinction between the language of ILSA’s statute of

limitations for disclosure violations, such as the violations

alleged in this case, and ILSA’s separate statute of limitations

governing claims alleging fraudulent activity. The text of the

limitations statute for ILSA disclosure violations provides

that “[n]o action shall be maintained . . . more than three

years after the date of signing of the contract of sale or lease.”

15 U.S.C. § 1711(a)(1). The statute oflimitations for an ILSA

 Case: 15-55106, 03/10/2016, ID: 9896529, DktEntry: 36-1, Page 14 of 34
BEAVER V. TARSADIA HOTELS 15

claim alleging fraudulent activity, in contrast, accrues at the

time of discovery of such activity. 15 U.S.C. § 1711(a)(2).

This statutory distinction does not indicate that Congress

wished to turn ILSA’s limitations period into a statute of

repose for disclosure violations.

Rather, this distinction merely suggests that Congress

wished to provide a different accrual period to ILSA’s fraudbased claims than to ILSA’s disclosure provisions. This

choice is hardly unusual in light of the fact that fraud, by its

very nature, begins unknown to the victim. See Cal. Civ.

Proc. Code § 338(d) (fraud claims do not accrue “until the

discovery, by the aggrieved party, of the facts constituting the

fraud”). Given that we read ILSA as having a limitations

period for disclosure violations, and not a statute of repose,

there is no statute of repose that would potentially preempt

state consumer protection laws’ longer limitations periods.

Nor does ILSA otherwise preempt Plaintiffs’ UCL claim.

Crosby instructs us to consider issues of conflict preemption

“by examining the federal statute as a whole and identifying

its purpose and intended effects.” 530 U.S. at 373. Here, no

congressional purpose to preempt the application of state

consumer protection statutes can be divined from the text or

history of ILSA. To the contrary, ILSA provides that its

“rights and remedies . . . shall be in addition to any and all

other rights and remedies that may exist at law or in equity.”

15 U.S.C. § 1713. ILSA also contains a saving clause, stating

that “[n]othing in this chapter may be construed to prevent or

limit the authority of any State or local government to enact

and enforce with regard to the sale of land any law,

ordinance, or code not in conflict with this chapter.”

15 U.S.C. § 1708(e). Moreover, ILSA offers a procedure

where state disclosure laws that are “substantiallyequivalent”

 Case: 15-55106, 03/10/2016, ID: 9896529, DktEntry: 36-1, Page 15 of 34
16 BEAVER V. TARSADIA HOTELS

to ILSA’s disclosure provisions may be formally certified as

such to facilitate compliance and enforcement. See 15 U.S.C.

§ 1708. These parts of the statute all expressly allow for

states to supplement ILSA’s provisions with their own

requirements. See Williamson v. Mazda Motors of Am., Inc.,

562 U.S. 323, 335 (2011) (finding no conflict preemption in

light of “statutory saving clause that foresees the likelihood

of a continued meaningful role for state tort law”); cf. Geier

v. Am. Honda Motor Co., 529 U.S. 861, 870 (2000) (declining

to “give broad effect to saving clauses where doing so would

upset the careful regulatory scheme established by federal

law”).

Finally, Defendants rely on Silvas v. E*Trade Mortg.

Corp., 514 F.3d 1001, 1007 n.3 (9th Cir. 2008) to argue that

Plaintiffs cannot avoid the application of ILSA’s statute of

limitations by invoking the UCL. Silvas involved a case of

field preemption, in which the court held that the Home

Owners’ Loan Act (HOLA), 12 U.S.C. §§ 1461–1470,

“preempted the entire field of lending regulation” to the

exclusion of any state regulation. Silvas, 514 F.3d at 1008. In

footnote 3 of the opinion, the Silvas Court commented on an

issue that it explicitly stated it was not reaching. Id. at 1006.

The footnote reads: “[T]o take advantage of the longer statute

of limitations under [the] UCL . . . . is an attempt to enforce

a state regulation in an area expressly preempted by federal

law.” Id. at 1007 n.3. This footnote, to the extent it is relevant

at all in this case, appears to be limited to cases involving

field preemption under HOLA.5

5 A number of district courts have adopted an unnecessarily broad

reading of footnote 3 in Silvas by extending its reasoning outside of

HOLA’s field preemption context. See, e.g., Jones v. Wells Fargo Bank,

NA, No. 13-cv-903 NC, 2013 WL 2355447, at *4 (N.D. Cal. May 29,

 Case: 15-55106, 03/10/2016, ID: 9896529, DktEntry: 36-1, Page 16 of 34
BEAVER V. TARSADIA HOTELS 17

We conclude that Defendants fail to overcome the strong

presumption against preemption, and that ILSA’s three-year

statute of limitations does not bar Plaintiffs’ UCL claim.

II. ILSA’s Disclosure Provisions

Once Plaintiffs have surpassed the statute of limitations

hurdle, they must show that ILSA’s disclosure provisions

apply to the condominium units they purchased. Collectively,

these provisions mandate that sellers file a statement of

record with the Department of Housing and Urban

Development (HUD); provide buyers with a property report;

include a twenty-daycure provision in the purchase contracts;

and offer buyers a two-year right to rescind the contracts

when sellers fail to meet these statutory disclosure

requirements. 15U.S.C. §§ 1703(a)(1)(A), 1703(a)(1)(B), and

1703(d)(2).

2013) (holding that TILA claims that are time-barred cannot be recast as

UCL claims subject to a longer limitations period); Rodriguez v. U.S.

Bank Nat’l Ass’n, No. C 12-00989 WHA, 2012 WL 1996929, at *2 (N.D.

Cal. June 4, 2012) (same); Newsom v. Countrywide Home Loans, Inc.,

714 F. Supp. 2d 1000, 1014 (N.D. Cal. 2010) (same); Champlaie v. BAC

Home Loans Serv., LP, 706 F. Supp. 2d 1029, 1045 (E.D. Cal. 2009)

(same); Distor v. U.S. Bank NA, No. C 09-02086 SI, 2009 WL 3429700,

at *8 (N.D. Cal. Oct. 22, 2009) (same); Santos v. Countrywide Home

Loan, No. 1:09-cv-00912-AWI-SM, 2009 WL 2500710, at *7 (E.D. Cal.

Aug. 14, 2009) (same); Adams v. SCME Mortg. Bankers Inc., No. CV F

09-0501 LJO SMS, 2009 WL 1451715, at *10 (E.D. Cal. May 22, 2009)

(same); see also O’Donovan v. Cashcall, Inc., No. C 08-03174 MEJ, 2012

WL 2568174, at *3 (N.D. Cal. July 2, 2012) (UCL claim predicated on

violation of the Electronic Funds Transfer Act was subject to federal

statute of limitations). But see Sonoda v. Amerisave Mortg. Corp., No. C11-1803 EMC, 2011 WL 2690451, at *8–9 (N.D. Cal. July 8, 2011)

(holding that Silvas was properly limited to cases of HOLA preemption).

 Case: 15-55106, 03/10/2016, ID: 9896529, DktEntry: 36-1, Page 17 of 34
18 BEAVER V. TARSADIA HOTELS

Defendants do not dispute that they failed to satisfy

ILSA’s disclosure requirements. Rather, they maintain that

ILSA is inapplicable, and thus no disclosures are required,

because Plaintiffs did not have “exclusive use” of the

properties pursuant to 12 C.F.R. § 1010.1(b), and because the

condominiums were exempted from ILSA’s requirements

pursuant to the Improved Lot Exemption, 15 U.S.C.

§ 1702(a)(2). We address each of these arguments in turn.

A. Exclusive Use

ILSA’s disclosure requirements applyto “lots,” a term not

defined by the statute itself. See, e.g., 15 U.S.C. § 1701. The

companion regulations to ILSA, promulgated by HUD in

1973, and later adopted by its successor agency, the

Consumer Financial Protection Bureau, provide that a “lot”

refers to “any portion, piece, division, unit or undivided

interest in land . . . if the interest includes the right to the

exclusive use of a specific portion of the land.” 12 C.F.R.

§ 1010.1(b) (emphasis added); see Berlin v. Renaissance

Rental Partners, LLC, 723 F.3d 119, 121 n.2 (2d Cir. 2013).

For decades, a long line of cases has consistently held that

condominiums may be considered “lots” under ILSA. See

Berlin, 723 F.3d at 126–27; Winter v. Hollingsworth Props.,

Inc., 777 F.2d 1444, 1447 (11th Cir. 1985). Indeed, “‘the

application of [ILSA] to condominiums has been consistent

[with HUD] policy since the issue was first raised in

1969’—the year that ILSA took effect.” Berlin, 723 F.3d at

124 (first alteration in original) (quoting Land Registration,

Formal Procedures, & Advert. Sales Practices, & Posting of

Notices of Suspension, 38 Fed. Reg. 23,866 (Sept. 4, 1973)

(to be codified at 24 C.F.R. pts. 1700, 1710, 1715, 1720)).

 Case: 15-55106, 03/10/2016, ID: 9896529, DktEntry: 36-1, Page 18 of 34
BEAVER V. TARSADIA HOTELS 19

Under Chevron, we must defer to an administering

agency’s “reasonable interpretation of an ambiguous statute”

when that interpretation is the result of the agency’s formal

rulemaking procedures. See Chevron, U.S.A., Inc. v. Nat. Res.

Def. Council, Inc., 467 U.S. 837, 843–44 (1984). Here, the

agency regulation requiring “exclusive use” is a reasonable

interpretation of the word “lot,” and it is entitled to Chevron

deference. Indeed, the agency’s regulation gives effect to

Congress’s purpose in enacting ILSA to protect general

“interests in realty,” which included condominiums. See

Winter, 777 F.2d at 1448.

In 1996, HUD issued additional guidance clarifying its

earlier definition of “exclusive use” in the context of lots:

If the purchaser of an undivided interest or a

membership has exclusive repeated use or

possession of a specific designated lot even

for a portion of the year, a lot, as defined by

the regulations, exists. For purposes of

definition, if the purchaser has been assigned

a specific lot on a recurring basis for a defined

period of time and could eject another person

during the time he has the right to use that lot,

then the purchaser has an exclusive use.

61 Fed. Reg. 13,596, 13,602 (Mar. 27, 1996) (to be codified

at 24 C.F.R. pts. 1700, 1710, 1715)).

Because this interpretative guidance was not subject to a

formal agency adjudication or rulemaking process, it is

entitled to a lesser form of deference under Skidmore,

according to its power to persuade. See Skidmore v. Swift &

Co., 323 U.S. 134, 139–40 (1944). Under Skidmore, the

 Case: 15-55106, 03/10/2016, ID: 9896529, DktEntry: 36-1, Page 19 of 34
20 BEAVER V. TARSADIA HOTELS

persuasiveness of the agency’s interpretation is determined in

part by “the thoroughness evident in its consideration, the

validity of its reasoning, [and] its consistencywith earlier and

later pronouncements.” Id. Here, the agency’s detailed

clarification of the term “exclusive use” conforms to the

historic purposes of ILSA by extending its disclosure

protections to certain real estate interests, provided that the

owner possesses a right to use the unit “on a recurring basis

for a defined period of time” during the year. Moreover, the

agency’s understanding of “exclusive use,” as demonstrated

through the core right of a property owner to “eject another

person,” is fully consistent with the statutory text. As a result,

we find the agency’s gloss on the meaning of “exclusive use”

to be persuasive under Skidmore, and entitled to deference on

review.

Guided by these agency interpretations, we next examine

whether Plaintiffs had “exclusive repeated use” of their units.

61 Fed. Reg. 13,602. Defendants contend that Plaintiffs’

specific purchase contracts did not provide Plaintiffs with

exclusive use of the condominiums due to a series of use

restrictions on the properties. They cite Becherer v. Merrill

Lynch, Pierce, Fenner & Smith, Inc., a Sixth Circuit case, in

support of their claim. 127 F.3d 478 (6th Cir. 1997). In

Becherer, the court held that ILSA’s disclosure provisions did

not apply when buyers purchased commercial condominium

units as investment properties that were so laden with use

restrictions that the owners could not be said to have had

“exclusive” use of those properties. Id. at 482. Specifically,

the Becherer Court relied on facts indicating that, “when the

units were purchased, they were already restricted for use as

a hotel as a business investment, and thus were never

available for use at the discretion of the unit owners.” Id. In

particular, the owners in Becherer were only given

 Case: 15-55106, 03/10/2016, ID: 9896529, DktEntry: 36-1, Page 20 of 34
BEAVER V. TARSADIA HOTELS 21

permission to occupy the units for fourteen days per year. Id.

Moreover, their rights to eject tenants were assigned to the

property manager through the purchase contracts and so

“never truly resided with the unit owners.” Id.

Defendants attempt to analogize the facts of the present

case to those in Becherer. First, Defendants point to

contractual restrictions that limited Plaintiffs’ rights to stay in

the condominiums to a maximum of twenty-eight days per

year. In addition, the condominiums could only be resold as

non-residential condominium units, managed as part of the

Hard Rock Hotel, which possessed a right of first refusal in

case of sale. These use restrictions were memorialized in the

UMAs. Under the terms of the UMAs, the Hard Rock Hotel

also controlled the room furnishings as well as routine

maintenance and cleaning services in the units.

Nonetheless, the provisions of the purchase contracts did

entitle Plaintiffs to the use of a “specific lot on a recurring

basis for a defined period of time.” 61 Fed. Reg. 13,602. The

use restrictions were of a more limited nature than in

Becherer and, importantly, did not directly interfere with

Plaintiffs’ ownership right to eject tenants during the

designated period of use.

The Hard Rock Hotel’s provision of routine maintenance,

cleaning, and management services is not dispositive either.

In this respect, Plaintiffs’ position is akin to that of an

apartment owner who retains exclusive use of the apartment,

but contracts with a third party for the provision of room

furnishings and maid service, or engages a third party to rent

out the unit for a portion of the year. The “exclusive use”

inquiry focuses on the basic right of the owner to “eject

another person during the time he has the right to use that

 Case: 15-55106, 03/10/2016, ID: 9896529, DktEntry: 36-1, Page 21 of 34
22 BEAVER V. TARSADIA HOTELS

lot.” Id. Under the terms of the purchase agreements,

Plaintiffs retain the exclusive use of the units during that

“defined period of time.” Id.

6

Finally, Defendants point to Plaintiffs’ separate

agreements in an RMA. The RMA delegated to Tarsadia the

“sole and exclusive authority to manage, operate, market and

rent” the units. The RMA also gave Tarsadia the right to 

“enter the Unit, without Notice to Owner, from time to time,

and at any time, for any purpose set forth in this Agreement.”

These use restrictions were relatively sweeping, permitting

Tarsadia to “vary the frequency and length of the rental of the

Unit for any reason.”

However, the RMA was a voluntary agreement that

Plaintiffs executed in 2007, subsequent to the closing of the

condominium sales. As a result, its use restrictions are not

determinative of whether Plaintiffs had “exclusive use” under

the relevant purchase contracts. Becherer, in contrast,

involved curtailed rights of ownership to which the buyers

had agreed in the original sale contracts, rather than

provisions that were voluntarily adopted at a later date. In the

present case, Plaintiffs could freely choose whether to

execute the RMA. Because the RMA was not executed until

later, and because none of the use restrictions embedded in

the original purchase contract interfered with the owner’s

6 Defendants did not argue in their opening brief that an owner

occupying a unit lacked the authority to eject cleaning personnel, or that

any such lack of authority deprived owners of a right to exclusive use. We

decline to make that argument for them. See Int’l Union of Bricklayers &

Allied Craftsman Local Union No. 20, AFL-CIO v. Martin Jaska, Inc.,

752 F.2d 1401, 1404 (9th Cir. 1985) (“[M]atters on appeal that are not

specifically and distinctly raised and argued in appellant’s opening brief,”

“will not ordinarily [be] consider[ed].”).

 Case: 15-55106, 03/10/2016, ID: 9896529, DktEntry: 36-1, Page 22 of 34
BEAVER V. TARSADIA HOTELS 23

exclusive use of the property “on a recurring basis for a

defined period of time,” we conclude that Plaintiffs’ units are

“lots” and therefore subject to ILSA’s disclosure

requirements. 61 Fed. Reg. 13,602.

B. The Improved Lot Exemption

Defendants argue that even if the condominiums are lots,

the Improved Lot Exemption applies. The Improved Lot

Exemption provides an exception to ILSA’s disclosure

provisions in cases involving “the sale or lease of any

improved land on which there is a residential, commercial,

condominium, or industrial building” or “the sale or lease of

land under a contract obligating the seller or lessor to erect

such a building thereon within a period of two years.”

15 U.S.C. § 1702(a)(2). As the relevant contracts involved the

sale of properties under construction, we must determine

whether the purchase contracts “obligated” the seller to

complete construction of the condominiums within two years,

such that the promise to build was not at the discretion of the

seller, or otherwise “illusory.” See Baroi v. Platinum Condo.

Dev., LLC, 874 F. Supp. 2d 980, 984 (D. Nev. 2012).

Defendants argue that this requirement was met because

the purchase contracts provided estimated completion dates

that occurred prior to December 2007. The purchase contracts

were signed in May and December of 2006. The estimated

completion dates for each of the relevant contracts therefore

preceded the two-year deadline set by the Improved Lot

Exemption. Defendants further highlight specific language in

the purchase contracts, providing that “Seller shall use

commercially reasonable efforts to complete the

construction” by the estimated completion dates.

 Case: 15-55106, 03/10/2016, ID: 9896529, DktEntry: 36-1, Page 23 of 34
24 BEAVER V. TARSADIA HOTELS

Importantly, however, the purchase contracts contained a

pre-sale contingency clause that allowed the seller to

terminate the contract “without liability” if less than 75% of

the condominium units to be constructed were sold, or under

contract to be sold, by the closing date. This provision

therefore allowed Defendants to potentially rescind the

agreements on the closing dates, which took place about one

year after Plaintiffs signed the purchase contracts.

According to agency regulations, pre-sale contingency

clauses are permissible under the Improved Lot Exemption,

so long as they are operative for 180 days or less. See 12

C.F.R. § 1010.5. Specifically, HUD guidelines clarify that

“[t]he presale period cannot exceed 180 days from the date

the first purchaser signs a contract in the project.” 61 Fed.

Reg. 13,603.

The agency’s interpretation of the statute is reasonable, as

it allows sellers a modest period in which to make a final

business determination on whether to construct the property,

rather than automatically subject all sellers to ILSA’s

disclosure regime. Under these circumstances, the agency

reasonably determined that the use of a limited pre-sale

contingency clause would not render the seller’s commitment

to construct illusory. Because the regulations promulgated by

HUD are a reasonable interpretation of an ambiguous

provision in a statute HUD is charged with administering, we

accord it Chevron deference on review. See Chevron,

467 U.S. at 843. Furthermore, the agency’s interpretive

guidelines, setting the beginning of the pre-sale period as the

date of contract signing, are consistent with the timeframes

adopted in the rest of the statute, cf. 15 U.S.C. § 1711 (a)(1),

and serve as persuasive guidance under Skidmore. See

Skidmore, 323 U.S. at 140.

 Case: 15-55106, 03/10/2016, ID: 9896529, DktEntry: 36-1, Page 24 of 34
BEAVER V. TARSADIA HOTELS 25

Here, the relevant pre-sale contingency clause does not

limit the cancellation period to 180 days after the signing of

the contract, as required by 12 C.F.R. § 1010.5. Defendants

argue, however, that they never had reason to exercise the

pre-sale contingency clause after this period because the

condominium units were nearly all under contract by

December 2006. Nonetheless, we analyze the rights

Defendants possessed at the time of the signing of the

contracts to determine whether the terms of the contract

obligated construction of the properties within two years,

pursuant to 15 U.S.C. § 1702(a)(2). The purchase contract

contained a pre-sale contingencyclause that could be invoked

at the time of the closing if 75% or more of the units

remained unsold. Therefore, by its terms, the contract failed

to limit the pre-sale contingency period to 180 days or less, as

provided by agency regulation. 12 C.F.R. § 1010.5.

Accordingly, the Improved Lot Exemption does not

extinguish Plaintiffs’ claims because the pre-sale contingency

clause is not limited to a period of 180 days or less and the

purchase contracts do not obligate the seller to complete

construction within two years pursuant to 15 U.S.C.

§ 1702(a)(2).

III. The 2014 Amendment

In September of 2014, during the pendency of the district

court proceedings, Congress passed an amendment to ILSA,

exempting condominium sales from ILSA’s disclosure

requirements, but allowing condominiums to remain subject

to ILSA’s fraud provisions. See Pub. L. No. 113-167,

128 Stat. 1882. The 2014 Amendment, codified at 15 U.S.C.

§ 1702(b)(9), did not purport to amend the definition of a

“lot,” as that word is used throughout the statute. Instead, it

 Case: 15-55106, 03/10/2016, ID: 9896529, DktEntry: 36-1, Page 25 of 34
26 BEAVER V. TARSADIA HOTELS

created a statutory carve-out by including “the sale or lease of

any improved land on which there is a . . . condominium” or

“the sale or lease of land under a contract obligating . . . [the

construction of] such a building thereon within a period of

two years” among a list of exemptions to ILSA’s disclosure

provisions. 15 U.S.C. § 1702(a)(2).

ILSA was designed to regulate unfair practices in the sale

of unimproved parcels of land. See Winter, 777 F.2d

1446–47. It offers procedural safeguards, including pre-sale

disclosures, to protect buyers against unscrupulous

developers and their agents. The term “lot,” as it is used in the

statute, has come to include condominiums. See id. at 1447.

As discussed earlier, supra Section II.A, this reading is the

product of a longstanding interpretation of ILSA adopted for

decades by the governing agencies and by the courts. See

38 Fed. Reg. 23,866. We regard this agency interpretation of

the word “lot” as a reasonable one and subject to Chevron

deference on review.

The Eleventh Circuit reached the same result in Winter,

finding the agency’s definition of the word “lot” to be “the

only defensible interpretation given subsequent events.”

Winter, 777 F.2d at 1448. The court went on to state that:

It is reasonable to conclude, as HUD did, that

the term “lot” was used to refer generally to

interests in realty. The legislative history

supports this construction, employing the

terms “lot,” “land,” and “real estate” in

discussing the Act. This construction is also

reasonable in terms of the purpose of the

statute. A fraudulent out-of-state sale of land

 Case: 15-55106, 03/10/2016, ID: 9896529, DktEntry: 36-1, Page 26 of 34
BEAVER V. TARSADIA HOTELS 27

is not rendered any less fraudulent if the

condominium form of ownership is utilized.

Id.

Moreover, a second clue that ILSA’s protections extended

to condominiums is the specific mention of “condominiums”

in the Improved Lot Exemption, 15 U.S.C. § 1702(b)(9),

which was added in 1978. See id. at 1447 n.7. As the Winter

court reasoned, the fact that Congress specifically listed

“condominiums” as among those types of improved lots that

may be exempt from ILSA’s disclosure requirements strongly

implies that Congress had envisioned condominiums to be

within the original scope of the statute. Id. at 1448–49.

Otherwise, the use of such language in the exemption would

be superfluous. See Lamie v. U.S. Tr., 540 U.S. 526, 536

(2004).

Cumulatively, therefore, the text and interpretive history

of the statute lead to the conclusion that the agency’s

interpretation of “lot” is reasonable and entitled to deference

under Chevron. See Berlin, 723 F.3d at 126–27.

A. A Substantive Change Rather than a Clarification

of the Law

Despite this legislative history, Defendants claim that the

2014 Amendment, exempting condominiums from ILSA’s

disclosure provisions, should apply to the present action,

which was commenced in 2011. If this were true, Plaintiffs’

UCL claim would fail as a matter of law. The retroactive

application of a new law to events that transpired prior to its

passage requires that we conduct an analysis under Landgraf

to ensure that such application reflects longstanding

 Case: 15-55106, 03/10/2016, ID: 9896529, DktEntry: 36-1, Page 27 of 34
28 BEAVER V. TARSADIA HOTELS

principles of fairness and respect for the parties’ settled

expectations of the law. Landgraf v. USI Film Prods.,

511 U.S 244, 265 (1994).

However, no Landgraf analysis is required if an

amendment merely serves to clarify rather than change the

substance of existing law. See ABKCO Music, Inc. v. LaVere,

217 F.3d 684, 689–90 (9th Cir. 2000). Defendants argue that

the 2014 Amendment is a clarification of the original

meaning of the statute, and not a substantive change in the

law. Defendants cite to Beverly Community Hospital

Association v. Belshe, 132 F.3d 1259 (9th Cir. 1997), for the

proposition that Congress acts to clarify the meaning of the

law when courts have found “extraordinary difficulty . . . in

divining the intent of the original Congress.” Id. at 1266. Yet

this is not the case here, as the agency’s interpretation of “lot”

prevailed for decades and was readily adopted by both courts

and policymakers during this interval. See supra Section II.A.

Defendants also emphasize remarks made by the bill’s

sponsor, Representative Carolyn Maloney, and other

members of Congress prior to a vote in the House of

Representatives. While we place little value on the statements

of individual legislators in connection with the enactment of

a bill, we nevertheless consider them in our analysis. See

Brock v. Pierce Cty., 476 U.S. 253, 263 (1986) (“[S]tatements

by individual legislators should not be given controlling

effect, but when they are consistent with the statutory

language and other legislative history, they provide evidence

of Congress’ intent.”).

Representative Maloney declared that the 2014

Amendment was meant to provide a “technical fix” for

condominium sales. 159 Cong. Rec. H5822 (daily ed. Sept.

 Case: 15-55106, 03/10/2016, ID: 9896529, DktEntry: 36-1, Page 28 of 34
BEAVER V. TARSADIA HOTELS 29

25, 2013) (statement of Rep. Maloney). Other legislators

claimed that the amendment would help align the statute to its

intended purposes, as some of ILSA’s disclosure

requirements did not make sense when applied to

condominium properties, but instead permitted owners

suffering from “buyer’s remorse” to rescind their purchase

agreements after the properties plummeted in value during

the economic recession. Id. at H5822 (statement of Rep.

McHenry). As Representative Maloney noted, “during the

economic downturn in 2008, some buyers used the recording

requirements of ILSA to rescind otherwise valid contracts for

economic reasons, an unintended consequence of the act and

its intent.” Id. at H5822. Echoing the title of the act, one

legislator stated that the bill provides a “commonsense

clarification to [ILSA] to preserve consumer protections

while keeping our economic recovery on track.” Id. at H5822

(statement of Rep. Nadler).

Considered in the light of recent events, the 2014

Amendment serves to address a new issue that arose

concerning the proper scope of ILSA disclosure. As one

legislator acknowledged, “ILSA was rarely an issue in private

condo sales until the economy collapsed in 2008.” Id. at 

H5823 (statement of Rep. Nadler). Subsequent changes in the

economic and business landscape following the recession and

real estate market crash of the late 2000s led purchasers to

engage in overzealous use of ILSA’s disclosure provisions to

cure cases of condominium buyer’s remorse. A change in the

law was therefore required to address the new realities of the

real estate market and to tailor ILSA’s scope to “the unique

conditions under which these units are sold in today’s

market.” Id. at H5822 (statement of Rep. Maloney).

 Case: 15-55106, 03/10/2016, ID: 9896529, DktEntry: 36-1, Page 29 of 34
30 BEAVER V. TARSADIA HOTELS

Because the bill passed unanimously in both houses

without debate, such remarks constitute the “legislative

history” of the 2014 Amendment, such as it is. Post-hoc

labeling as a “clarification” by bill supporters of what

otherwise appears to be a change, however, is not controlling

given the long interpretative history of the statute.

Defendants’ heavy reliance on the title of the 2014

Amendment, “An act to amend the Interstate Land Sales Full

Disclosure Act to clarify how the Act applies to

condominiums,” is similarly misplaced. Although the title

notes that this is a clarification, the lapse between the

enactment of the bill and the bill’s effective date (180 days),

coupled with the bill’s silence on the issue of retroactivity,

suggests that this was actually a change in the law. See Logan

v. U.S. Bank Nat’l Ass’n, 722 F.3d 1163, 1172 (9th Cir. 2013)

(“Though a statute’s title ‘can be used to resolve[]

ambiguity,’ it ‘cannot control the plain meaning of a statute.’”

(quoting Or. Pub. Util. Comm’n v. Interstate Commerce

Comm’n, 979 F.2d 778, 780 (9th Cir. 1992)).

In the present case, Congress appears to have adopted a

substantive change in the law by discarding an old application

that no longer served ILSA’s purposes, or that was

outweighed by considerations arising from changed

circumstances. This reading of the 2014 Amendment is borne

out by the text and interpretive history of the statute.

Congress’ decision to “legislatively overrule” earlier

interpretations of a statute does not necessarily imply that

these earlier interpretations were inconsistent with

congressional intent at the time or even “wrongly decided.”

Rivers v. Roadway Express, Inc., 511 U.S. 298, 304–05

(1994). Rather, “[a]ltering statutory definitions, or adding

new definitions of terms previously undefined, is a common

 Case: 15-55106, 03/10/2016, ID: 9896529, DktEntry: 36-1, Page 30 of 34
BEAVER V. TARSADIA HOTELS 31

way of amending statutes” so that Congress can refine and

sharpen old statutory meanings. Id. at 308.

B. The Landgraf Analysis

Since the amendment is a substantive change in law, and

not just a clarification of existing law, we must determine

whether its application to the present case is proper under

Landgraf. Landgraf provides a framework for deciding when

the retroactive application of the law is warranted and when,

conversely, it would violate principles of “fairness dictat[ing]

that individuals should have an opportunity to know what the

law is and to conform their conduct accordingly.” 511 U.S. at

265. “[T]he presumption against retroactive legislation is

deeply rooted in our jurisprudence, and embodies a legal

doctrine centuries older than our Republic. . . . In a free,

dynamic society, creativity in both commercial and artistic

endeavors is fostered by a rule of law that gives people

confidence about the legal consequences of their actions.” Id.

at 256–66.

The first step in the Landgraf analysis is a determination

of whether the statute contains an express statement on its

proper temporal reach. Id. at 280. The district court correctly

found that no such pronouncement is contained in the bill

itself. Indeed, the 180-day delay in the bill’s effective date

suggests that the amendment ought to be applied

prospectively, so that actors may adjust their behavior to

conform to the new legislation. See Fitzgerald v. Century

Park, Inc., 642 F.2d 356, 359 (9th Cir. 1981).

Second, when the law contains no “express command”

concerning its temporal scope, we must examine whether its

application would have a retroactive effect in this case.

 Case: 15-55106, 03/10/2016, ID: 9896529, DktEntry: 36-1, Page 31 of 34
32 BEAVER V. TARSADIA HOTELS

Landgraf, 511 U.S. at 280. Retroactive effect, in this context,

refers to an application that would “impair rights a party

possessed when he acted, increase a party’s liability for past

conduct, or impose new duties with respect to transactions

already completed.” Id. Here, the 2014 Amendment would

have retroactive effect because it would extinguish

Defendants’ liability under ILSA, and by extension the UCL,

thus depriving Plaintiffs of a pre-existing cause of action. In

TwoRivers v. Lewis, 174 F.3d 987 (9th Cir. 1999), we held

that the application of a new amendment to shorten the statute

of limitations would “deprive [Plaintiff] of his right to file

suit” by “foreclosing a cause of action which existed prior to

the amendment.” Id. at 995. Similarly, in Scott v. Boos,

215 F.3d 940 (9th Cir. 2000), we concluded that a statute had

retroactive effect when “the intent was substantive—to

deprive plaintiffs of the right to bring securities fraud based

RICO claims.” Id. at 945. There, we noted that such an effect

would “impair[] rights a party once possessed.” Id. at 946.

Defendants’ argument that Plaintiffs’ rights are not

subject to Landgraf because those rights have not vested is

unavailing. In Scott, we rejected a similar argument, stating

that “[t]his reading of the Landgraf test is misleading.” Id. at

947. We instead held that the Landgraf Court did not restrict

its analysis of “rights a party possessed” to “vested rights”

only. Id. If applied to the present case, the 2014 Amendment

would impair Plaintiffs’ right to bring suit—a right that

Plaintiffs possessed and exercised prior to the amendment’s

passage—which is enough to show the Amendment would

 Case: 15-55106, 03/10/2016, ID: 9896529, DktEntry: 36-1, Page 32 of 34
BEAVER V. TARSADIA HOTELS 33

have retroactive effect within the meaning of Landgraf

whether or not this qualifies the rights as “vested.”7

If a statute is determined to have retroactive effect, we

proceed to the final step of the Landgraf analysis and assess

whether “clear congressional intent” nonetheless counsels in

favor of retroactive application. See Landgraf, 511 U.S. at

280. We employ a presumption that Congress did not intend

for legislation to operate retroactively. Id. This presumption

has particular weight in the circumstances of the present case,

which concerns “contractual or property rights, matters in

which predictability and stability are of prime importance.”

Id. at 271.

As we determined earlier, there is no clear congressional

intent to have the 2014 Amendment apply retroactively to

events prior to its passage. See supra Section III.B. The

Landgraf Court concluded that “[a] statement that a statute

will become effective on a certain date does not even

arguably suggest that it has any application to conduct that

occurred at an earlier date.” Id. at 257. Neither are the title of

the statute, or the statements of its supporters, adequate to

conclude that Congress specifically intended to reach prior

conduct, or that it “affirmatively considered the potential

unfairness of retroactive application and determined that it is

7 Defendants also cite to Lyon v. Augusta, S.P.A., 252 F.3d 1078 (9th

Cir. 2001), for the proposition that retroactive application would not

impair Plaintiffs’ rights under Landgraf because a “property right in any

cause of action does not vest until a final unreviewable judgment.” Id. at

1086 (quoting Grimesy v. Huff, 876 F.2d 738, 743–44 (9th Cir. 1989)).

The Lyon Court’s statement, however, was made in the context of a

substantive due process analysis, conducted to determine whether the

plaintiffs had been “deprived of a vested property right in their cause of

action.” Id.

 Case: 15-55106, 03/10/2016, ID: 9896529, DktEntry: 36-1, Page 33 of 34
34 BEAVER V. TARSADIA HOTELS

an acceptable price to pay for the countervailing benefits.” Id.

at 272–73. In light of the lengthy interpretative history of the

statute and the use of the 180-day effective date provision, we

hold that Congress did not express a clear intent that the 2014

Amendment operate retroactively to deprive Plaintiffs of a

pre-existing cause of action.

Accordingly, ILSA’s disclosure requirements apply to the

condominium units purchased byPlaintiffs. Since Defendants

concede that they have failed to comply with those disclosure

requirements, the district court properly granted summary

judgment to Plaintiffs on their UCL claim.

CONCLUSION

The district court’s grant of partial summary judgment is

AFFIRMED with respect to those issues certified for

interlocutory appeal.8

8 We express no opinion, however, as to whether the district court

properly included all Defendants within the scope of its partial summary

judgment order. See supra n.2.

 Case: 15-55106, 03/10/2016, ID: 9896529, DktEntry: 36-1, Page 34 of 34