NOT FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT

CERVANTES ORCHARDS & VINEYARDS, LLC, a Washington limited liability corporation; et al.,

Plaintiffs

- Appellants,

v. DEERE & COMPANY, a corporation; et al.,

Defendants

- Appellees. No. 15

- 35675
D.C. No. 1:14

- cv - 03125

- RMP

MEMORANDUM *

CERVANTES ORCHARDS & VINEYARDS, LLC, a Washington limited liability corporation; et al.,

Plaintiffs

- Appellants,
DEAN BROWNING WEBB and SCOTT ERIK STAFNE,

Appellants,

v. DEERE & COMPANY, a corporation; et al.,

Defendants

- Appellees. No. 16

- 35220
D.C. No. 1:14

- cv - 03125

- RMP

* This disposition is not appropriate for publication and is not precedent except as provided by Ninth Circuit Rule 36

- 3. 

# FILED

DEC 15 2017
MOLLY C. DWYER, CLER K U.S. COURT OF APPEAL S1 Appeal from the United States District Court for the Eastern District of Washington Rosanna Malouf Peterson, District Judge, Presiding

Submitted December 5, 2017 ** Seattle, Washington Before: HAWKINS, McKEOWN, and CHRISTEN, Circuit Judges. Cervantes Orchards and Vineyards , along with Cervantes Nurseries, Cervantes Packing & Storage, Manchego Real, Jose G. Cervantes, and Cynthia C.
Cervantes , ( collectively “C ervantes ”) , 1 appeal s the district court’s dismissal of its
RICO and civil rights claims against Deere & Company , Deere Credit , John Deere Capital Corporation , John Deere Financial , FKA FPC Financial, and Deere Credit
Services (“Deere”), American West Bank , T

- 16 Management Company (“T

- 16”) , Gary and Linda Johnson (“the Johnsons”), Robert and Michelle Wyles (“ the Wyles”) , Northwest Management & Realty Service s (“NWFM”) , and SKBHC
Holdi ngs , (collectively “defendants”)

. Dean Webb and Scott Stafne appeal the district court’s order sanctioning them under Federal Rule of Civil Procedure 11 and assessing attorney’s fees

. Because the parties are familiar with the facts , we
do not recite them here. We have jurisdiction under 28 U.S.C. § 1291. We affirm

** The panel unanimously concludes this case is suitable for decision without oral argument. See Fed. R. App. P. 34(a)(2).

1 For simplicity’s sake, we refer to these collective entities in the singular as “Cervantes.”2

in part, vacate in part, and remand to the district court for further findings

. 1. Dismissal of RICO and civil rights claims
Cervantes argues that the district court erred in dismissing its claims of racketeering, extortion, and bankruptcy fraud in violation of the Racketeer Influenced and Corrupt Organizations Act (“RICO”), and for civil rights violations
based on racial discrimination. S ee 18 U.S.C. § § 196 1, 19 6 2; 42 U.S.C. §§ 1981, 1982, and 1985(3 ). “We review de novo the district court’s decision to grant [a] motion to dismiss under Federal Rule of Civil Procedure 12(b)(6).” Manzarek v. St. Paul
Fire & Marine Ins. Co. , 519 F.3d 1025, 1030 (9th Cir. 2008). We review for abuse of discretion a district court’s decision to dismiss with prejudice. Okwu v. McKim , 682 F.3d 841, 844 (9th Cir. 2012)

. The district court did not err in dismissing Cervantes’ extortion

- based RICO
claims

. Cervantes failed to allege specific facts to support its extortion allegations

. See Ashcroft v. Iqbal , 556 U.S. 662, 678 (2009)

. The defendants did not acquire
Cervantes’ property through fear, threatened force, or coercion, but foreclosed after
Cervantes missed payment deadlines

. See United Bhd. of Carpenters & Joiners of Am. v. Bldg. & Const. Trades Dep’t, AFL

- CIO , 770 F.3d 834, 838 (9th Cir. 2014) (“ Courts must

. . . differentiate between legitimate use of economic fear

– hard bargaining

– and wrongful use of such fear

– extor tion .” ). The defendants3

complied with a bankruptcy plan that Cervantes itself proposed, and provided forbearance opportunities to Cervantes before foreclosing

. 2
Nor did the district court err in dismissing Cervantes’ fraud

- based RICO
claims. RICO predicate fraud claims must satisfy the heightened pleading standards of Federal Rule of Civil Procedure 9(b). See Moore v. Kayport Package Exp, Inc. , 885 F.2d 531, 541 (9th Cir. 1989). Cervantes fail ed to allege specific facts that would support i ts allegations that the defendants committed bankruptcy
fraud

. Cervantes claimed that defendant NWFM “filed a false sworn declaration in the bankruptcy proceeding , ” but Cervantes failed to specify the contents of the
declaration , or explain in what way the declaration was false

. Cervantes’ implausible theory that the defendants conspired to conceal from the bankruptcy court a settlement agreement that would have revealed a plan to decrease the value
of the defendant s’ own collateral was sim ilarly unsupported by specific s
. The district court did not err in dismissing Cervantes’ discrimination claims.
C ervantes alleged “ no facts supporting [its] conclusion that the [defendants’] actions were driven by discrimination.” In “ the face of [the defendants’] obvious

2 That the defendants informed Cervantes that it w ould face “immediate problems,” if it did not pay its debts was not extortion but a demand for lawful payment of an overdue obligation. “ Threats of economic harm made to obtain property from another , are not generally considered ‘wrongful,’” as required t o establish RICO liability, “where the alleged extortioner has a legitimate claim to the property obtained.” Levitt v. Yelp! Inc. , 765 F.3d 1123, 1130 (9th Cir. 2014) (citation and inte rnal quotation marks omitted).4

explanations for their actions in attempting to collect payment from [Cervantes] for outstanding debts, [Cervantes] offered only conclusory all egations [of discrimination].”
2. Judicial bias
Cervantes’ claims of judicial bias are unavailing

. C ervantes fails to offer evidence that the district judge’s “impartiality might reasonably be questioned.”
Pau v. Yosemite Park and Curry Co. , 928 F.2d 880, 884 (9th Cir. 1991).
C ervantes also failed to move for disqualification below. See E & J Gallo Winery
v. Gallo Cattle Co. , 967 F.2d 1280, 1295 (9th Cir. 1992). Indeed, Cervantes

appear s to rely entirely on the judge’s adverse rulings in claiming bias, and we
have held that judicial rulings alone “almost neve r constitute valid basis for a bias or partiality motion.” United States v. Hernandez , 109 F.3d 1450, 1454 (9th Cir. 1997) (citation omitted)

. 3. Rule 11 sanctions
We review for abuse of discretion the district court’s decision to impose
Rule 11 sanctions. Cooter & Gell v. Hartmarx Corp. , 496 U.S. 384, 405 (1990)

. Rule 11 prohibits attorneys from filing complaints for “any improper purpose, such as to harass, cause unnecessary delay, or needlessly increase the cost of litigation.” Fed. R. Civ. P. 11(b)(1). “ The district court is bes t acquainted with the local bar’ s litigation practices and thus best situated to determine when a sanction is warranted5

to serve Rule 11 ’ s goal of specific and general deterrence .” Cooter , 496 U.S. at
404.
The district court did not abuse its discretion in ordering sanctions “to deter [Webb and Stafne] from again filing such a baseless lawsuit.” Webb and Stafne began this lawsuit in district court by filing a 337

- page complaint asserting 60
claims for relie f against over 30 defendants. Webb and Stafne filed nearly 1000 pages of complaint papers in total , including a 143

- page First Amended Complaint accompanied by a 469

- page RICO case statement. The district court described the original complaint as a “quag mire of wo rdy and repetitious verbiage.” Webb and Stafne’s filings were “both baseless and made without a reasonable and competent inquiry

. ” Townsend v. Holman Consulting Corp. , 929 F.2d 1358, 1362 (9th Cir. 1990) (en banc)

. Webb and Stafne have been litigating
on behalf of Cervantes against the defendants for over a decade in the bankruptcy
and district court s , and in this litigation ha ve consistently failed to support their claims with specific facts . The defendants have spent “ hundreds of tho usands of dollars in legal fees ” defending against Webb and Stafne’s allegations. The Wyles and Deere defendants complied with Rule 11’s safe harbor requirements. And the
district court notified Webb and Stafne in December, 2014 that “they may be held liable for unreasonably and vexatiously multiplying the proceedings of this case.”6

Webb and Stafne subsequently asserted claims in their Second Amended Complaint that were plainly barred by applicable statute s of limitations. 3
Webb and Stafne claim that the district court abused its discretion in limiting their Second Amended Complaint to thirty pages , but fail to identify facts that they would have alleged to support their allegations had they been given more space

. 4

E ven in 3 0 pages, they should have been able to state the key predicate facts to support their RICO claims, and their prior prolix complaints lacked such facts. Webb and Stafne were warned repeatedly that they could face sanctions if they failed to allege specific facts to support their claims, and they failed to furnish such specifics in nearly 1000 pages of complaint papers.
4. Conduct beyond the Second Amended Complaint and a mount of fees
We review for abuse of discretion the district court’s decision to award attorney’s fees as part of a Rule 11 sanction

. Cooter , 496 U.S. at 405. “ Generally,
a district court’ s order on attorney’ s fees may be set aside if the court fails to state
reasons for its decision.” Mattel, Inc. v. Walking Mountain Prods. , 353 F.3d 792 , 815 (9th Cir. 2003)

. And “ Rule 11 sanctions are limited to ‘paper[s]’ signed in

3 We deny the Wyles’ request to sanctio n Webb and Stafne again on appeal. 4 Webb and Stafne’s argument that they were “not afforded due process before the imposition of sanctions . . . itself borders on the frivolous.” Buster v. Greisen , 104 F.3d 1186, 1190 (9th Cir. 1997). Webb and Stafne received “notice that the court [was] considering sanctions and [had] an opportunity to be heard in opposition.” Id . Due process required no more. Pan

- Pacific and Low Ball Cable Television Co. v. Pacific Union Co. , 987 F.2d 594, 597 (9th Cir. 1993).7

violation of the rule. Conduct in depositions, discovery meetings of counsel, oral representations at hearings, and behavior in prior proceedings do not fall within the
amb it of Rule 11

. ” See Christian v. Mattel, Inc. , 286 F.3d 1118, 1131 (9th Cir. 2002)

. Here, the district court failed to adequately explain its reasons for awarding $18,744.00 to the Wyles defendants, and $111,771.53 to the Deere defendants

. T he record does not illuminate why these amounts were appropriate ; notably, the sanctions award includes fees incurred prior to the filing of the Second Amended Complaint, and incurred for issues on which Cervantes prevailed. Because the
district court awarded fees that did not result from the Second Amended Complaint and did not explain why the sanction it awarded was “limited to what suffices to
deter” frivolous filings in the futu re, Fed. R. Civ. P. 11(c)(4), we must vacate the
district court’ s attorney’s fees award

. Id. We remand for further explanation regarding the basis, amount , and reasonableness of the attorney’s fees

. AFFIRMED in part, VACATED in part, and REMANDED

. Each party
shall bear i ts own costs and fees on appeal.