T hi s di s pos i t i on i s notappr opr i a t e f orpubl i c a t i on and i s notpr e c e de nt * e xc e pta s pr ovi de d by9th C i r . R . 36- 3. NOT F OR P UB L I CAT I ON UN I TE D STATE S C OU RT OF APPE ALS FOR T HE NI NTH CI RC UI T K A Z E N E R C O M T O O ; e t a l., P l ai n t i ffs - A p p el l an t s, v. I B A R D E V E L O P M E N T , L L C ; e t a l., D efen d an t s - A p p el l ees, a nd Y E R K I N A K K U Z O V ; e t a l., T h ir d - p a rty - d e f e n d a n t - A p p el l ees,

________________________________ WE L L S F AR GO B AN K N A, T h ir d - p a rty - d e f e n d a n t. N o. 09- 56329

D . C. N o . 8 : 0 9 - c v - 0 0 0 5 9 - J V SM LG ME MOR AN DU M *

K A Z E N E R C O M T O O ; e t a l., P l ai n t i ffs - A p p el l ees, N o. 10- 55458 D . C. N o . 8 : 0 9 - c v - 0 0 0 5 9 - J V SM LG 

# FI LED DE C 27 2011 M OLLY C. DW Y ER, CLERK U . S. C O U R T OF APPE ALS2

YE R KI N B E KT AY E V, P la in tif

f - c o u n te r - d e f

e n d a n t - A pp el l ee , v. A N A T O L Y V A N E T IK , (“ T O N Y ”) , D e f

e n d a n t - A p p e lla n t,

________________________________ I B A R D E V E L O P M E N T , L L C ; e t a l., D efen d an t s, T U R A N P E T R O L E U M , I N C ., D e f

e n d a n t- c o u n te r - d e f

e n d a n t, a nd KA NE T ME I R MANO V, P l ai nt i ff

-thi rd-party- pl ai nt i ff

, a nd Y E R K I N A K K U Z O V ; e t a l., T h ir d - p a rty - d e f e n d a n t. B E R I K B E K T A Y , N o. 10- 559223

P la in tif

f - A p p e lla n t, Y E R K I N B E K T A Y E V ; e t a l., P la in tif

f - c o u n te r - d e f

e n d a n tth i rd p arty p l ai n t i ff - A p p el l an t s, a nd K A Z E N E R C O M T O O ; e t a l., P l ai n t i ffs, v. T U R A N P E T R O L E U M , I N C ., D e f

e nda nt - c ount e r - de f

e nda nt - A pp el l ee , a nd T R E K R E S O U R C E S , I N C .; e t a l., D efen d an t s, a nd Y E R K I N A K K U Z O V ; e t a l., T h ir d - p a rty - d e f e n d a n ts . D . C. N o . 8 : 0 9 - c v - 0 0 0 5 9 - J V SM LG

A pp ea l fr om the U ni t ed S t at es D i stri ctC ou rt f o rth e C e n tr a l D is tr ic t o f C a lif o rn ia J a m e s V . S e l na , D i s tr i c tJ udge , P r e s i di ngC as e N os. 09 -563 29 and 1 0-55 45 8 w er e argued and subm i tt ed ** D e c e m b e r8 , 2 0 1 1 . T h is p a n e l u n a n im o u s lyc o n c lu d e s C a s e N o . 1 0 - 5 5 9 2 2 is sui t abl e f or deci si on w i tho utoral ar gu m ent , and thatca se i s there fore subm i tt ed w ith o u t o r a l a r g u m e n t. See F e d . R . A p p . P . 3 4 ( a ) ( 2 ) .

T he H onor abl e J a m e s P . J one s , U ni t e d S t a t e s D i s tr i c tJ udge f orthe ** * W e s t e rn D i s tr i c tof

V i r gi ni a , s i tt i ng byde s i gna t i on. 4 A r gue d a nd S ubm i tt e d D e c e m be r8, 2011 **

P a s a d e n a , C a lif

o rn ia B ef ore: P R E G E R S O N and P A E Z , C i rc ui tJudg es , and JO N E S , D i stri ctJudg e. *** W e a ddr e s s thr e e r e l a t e d appe a l s a r i s i ng f r om a n a s s e tpur c ha s e tr a ns a c t i on be tw e e n K a z e ne r c om T O O ( “ K a z e ne r c om ” ) a nd i t s a f f i l i a t e s on one ha nd, a nd T uran P etrol eum , Inc. (“ T uran”) and i t s a ff i l i at es on the other. I K a z e n e r c o m a n d its a f

f ilia te s ap p e a l th e d is tr ic t c o u rt’s d is m is s a l w ith prej ud i ce of thei r V er i fi ed S ec on d A m ended C om pl ai nt(“ S A C ”) and V er i fi ed A m e n d e d T h ir d - P a rtyC o m p la in t ( “A T P C ” ) p u r s u a n t to F e d e r a l R u le s o f C iv il P r oc e dur e 12( b) ( 6) a nd 12( e ) . W e r e vi e w the R ul e 12( e ) di s m i s s a l s f orabus e ofK a z e ne r c om f i l e d m ot i ons f

orj udi c i a l not i c e i n thi s appe a l on M a y26, 1 2 0 1 0 a n d A p r il 2 6 , 2 0 1 1 . W e ta k e ju d ic ia l n o tic e o f th e d o c u m e n ts r e f

e r e n c e d in the M a y 26, 2010 m ot i on be c aus e the ya r i s e f r om the tw o r e l a t e d appe a l s , N os . 10- 5 5 4 5 8 a n d 1 0 - 5 5 9 2 2 . See U . S. exre l. R ob i nson R an cher i a C i t i ze ns C ou nci l

v. B orneo, Inc. , 97 1 F . 2d 24 4, 24 8 (9th C i r. 19 92 ). W e dec l i ne t o t ake j ud i ci al no t i ce of the doc um e nt s i n the A pr i l 26, 2011 m ot i on be c aus e the ya r e i rr e l e va ntt o the is s u e s o n ap p e a l. Se e T r i g u e r o s v . A da ms , 65 8 F . 3d 98 3, 98 7 (9th C i r. 20 11 ).

5 di s c r e t i on, a nd r e vi e w de novo the R ul e 12( b) ( 6) di s m i s s a l s . W e va c a t e the di s m i s s a l s a nd r e m a nd w i th l e a ve t o a m e nd. 1 In di sm i ss i ng the com pl ai nt s pursuantt o R ul e 12(e), the di stri ctcourtst at ed th at“ ev en i f d i sm i ssal i s n o tw arran t ed u n d er R u l e 4 1 (b ), i ti s n o n eth el ess w arrant ed, ata m i ni m um , un der R ul e 12(e) . ” I n so con cl ud i ng , the di stri ctcourt com m i tt ed l egal error by f ai l i ng t o con si der w hether di sm i ss al w as w arrant ed u n d e rF e d e r a l R u le o f

C iv il P r o c e d u r e 4 1 ( b ) . Se e McH e nr yv . R e nne , 84 F . 3d 1 1 7 2 , 1 1 7 9 ( 9 th C ir . 1 9 9 6 ) ; se e al so Ferdi k v . B on ze let , 963 F . 2d 1258, 1260- 61 ( 9 th C ir . 1 9 9 2 ) ( “I n d e te rm in in g w h e th e rto d is m is s ac a s e f o rf a ilu r e to c o m p ly w i th ac ourtor de rthe di s tr i c tc ourtm us tw e i gh f i ve f a c t or s . . . . ” ) . I n thi s c a s e , the R u le 4 1 ( b ) f

a c to r s w e ig h d e c is iv e lya g a in s t d is m is s a l. D is m is s a l h e r e is pa rt i c ul a r l yha r s h gi ve n the vi abi l i tyof K a z e ne r c om ’ s R I C O c l a i m s . I n a ddi t i on, the di stri ctcourtfa i l ed t o con si der l es s s ever e a l t ernat i ves a ft eri tfoun d that K az ener com fa i l ed t o com pl y w i th i t s Rul e 12(e) order. N othi ng i n the re cord s u g g e s ts , m o r e o v e r , th a t th e c o m p la in ts im p e d e d th e c o u rt’s ab ilityto m a n a g e its6

d o ck eto r p rej u d i ced th e d efen d an t s. B ecau se th e d i stri ctco u rto v erl o o k ed th ese fact o rs, w e m u stv acat e th e R u l e 1 2 (e) d i sm i ssal s. N e xt , the di s tr i c tc ourte rr one ous l ydi s m i s s e d the f e de r a l R I C O c l a i m s i n the S A C un der R ul e 12(b)(6). A l tho ug h w e are no tun sy m pathet i c t o the di stri ct court ’ s t edi ou s t as k o f w ee di ng throu gh the op er at i ve com pl ai nt , w e c on cl ud e that th e SA C a d e q u a t e l yp l e a d s ac i v i l RI CO o f f e n s e a n d RI CO c o n s p i r a c y . 1 8 U . S. C. § § 1 9 6 2 (c), (d ). T ak i n g as tru e th e factu al al l eg at i o n s an d reaso n ab l e i n feren ces, the S A C a l l e ge s the c onduc tof a n e nt e rpr i s e thr ough apa tt e rn of r a c ke t e e r i ng a c tiv ity , a n d ac o n s p ir a c yto d o th e s a m e . Se e O dom v . Mi c r os of t C or p. , 486 F . 3d 541, 545 ( 9th C i r . 2007) ( e n ba nc ) . W e the r e f or e va c a t e the di s m i s s a l of the fed eral R IC O cl ai m s. T h e d is tr ic t c o u rt c o rr e c tlyf o u n d , h o w e v e r , th a t th e S A C a n d th e A T P C f a il t o st at e acl ai m un der the fe dera l se curi t i es l aw s. F i rs t , w i th res pectt o the al l eged m is r e p r e s e n ta tio n c o n c e rn in g K a z e n e r c o m ’s m a jo r itys ta k e in T u r a n , b o th c o m p la in ts f

a il to p le a d th e c ir c u m s ta n c e s o f f r au d w ith p a rtic u la r ity . See 15 U . S . C . § 7 8u -4(b); F ed. R . C i v. P . 9(b); Zuc c o P ar tne rs , L L Cv . D i gi m ar c C or

p. , 55 2 F . 3d 98 1, 99 0-91 (9th C i r. 20 09 ). S ec on d, w i th res pectt o the al l eged m i srep resen t at i o n co n cern i n g T u ran ’ s st o ckp ri ce, th e co m p l ai n t s fai l t o al l eg e l o ss c au s a tio n . Se e I

n r e G i le ad Sc i e nc e s Se c ur i t i e s L i t i g. , 5 3 6 F .3 d 1 0 4 9 , 1 0 5 5 ( 9 thTo th e e x t e n tth e SA C a n d A TPC a l l e g e d o th e rf e d e r a l s e c u r i t i e s c l a i ms 2 no taddres se d h er e, K az ener com w ai ved o n app ea l any di sput e w i th the di stri ct co u rt ’ s d i sm i ssal o f su ch cl ai m s. 7 C i r. 20 08 ). T hi rd, the com pl ai nt s f ai l t o st at e an i nsi der tra di ng cl ai m because they do no tal l ege w i th p art i cul ar i ty thatany pl ai nt i ff bo ug htor sol d T uran st ock c o n te m p o r a n e o u s lyw ith th e a lle g e d in s id e r s . See N eubron ner v . Mi lke n , 6 F . 3d 6 6 6 , 6 7 0 (9 th C i r. 1 9 9 3 ). A cco rd i n g l y, th e d i stri ctco u rtp ro p erl y d i sm i ssed th ese cl ai m s. 2 T he di s tr i c tc ourtabus e d i t s di s c r e t i on, how e ve r , i n de ny i ng l e a ve t o a m e nd the S A C a nd A T P C . B e c aus e the V e r i f i e d F i r s tA m e nde d C om pl a i nta nd the V e r if ie d T h ir d - P a rtyC o m p la in t w e r e th e o n lyc o m p la in ts th a t a n yc o u rt p r e v io u s ly ha d di s m i s s e d, the S A C a nd A T P C e a c h c ons t i tut e onl ythe f i r s tf a i l ur e t o c ur e the de f i c i e nc i e s i de nt i f

i e d bythe di s tr i c tc ourt . U nde rthe s e c i r c um s t a nc e s , de ni a l of le a v e to a m e n dw a s im p r o p e r . C f . Zu cco P a rtn ers , 552 F . 3d a t1007 ( a f f i rm i ng d is m is s a l w ith p r e

ju d ic e a f te rr e p e a te d f

a ilu r e s to c u r e d e f

ic ie n c ie s ) . W e the r e f

or e va c a t e the di s m i s s a l s of both c om pl a i nt s , a nd r e m a nd t o the di stri ctcourt . K az ener com and i t s a ff i l i at es shal l have the op po rtun i ty t o repl ea d the i rf e de r a l s e c ur i t i e s l a w c l a i m s a ga i ns ta l l de f e nda nt s . T a ki ng i nt o c ons i de r a t i on any a m ended p l ea di ng s, and the w el l -pl ea ded R IC O cl ai m s i n the S A C , the di stri ct c ourtm us ta l s o r e c ons i de rw he the rt o e xe r c i s e s uppl e m e nt a l j ur i s di c t i on ove ra ny8

s ta te la w c la im s . See E

xx on Mob i l

C orp. v. A l lap at tah Serv i ces, Inc. , 5 4 5 U . S. 54 6, 55 9, 56 4-65 (200 5); Sh am es v. Cal i f orni a T rave l an d T ou rism C om m ’n , 626 F .3 d 1 0 7 9 , 1 0 8 5 ( 9 th C ir . 2 0 1 0 ) . II V a ne t i k appe a l s the di s tr i c tc ourt ’ s de ni a l of s a nc t i ons a ga i ns tK a z e ne r c om a nd i t s c ouns e l unde rthe P S L R A . B e c aus e s om e of K a z e ne r c om ’ s c l a i m s s urvi ve d is m is s a l, th e q u e s tio n o f s a n c tio n s is n o t r ip e f

o rd e te rm in a tio n . 1 5 U .S .C . § 7 8 u - 4 ( c ) ( 1 ) . W e th e r e f o r e v a c a te th e d is tr ic t c o u rt’s o r d e rd e n y in g s a n c tio n s .

II I Y erk i n B ek t ayev , B eri kB ek t ay, an d K an etM ei rm an o v (co l l ect i v el y,

“ B e kt a y e v” ) c ha l l e nge the di s tr i c tc ourt ’ s gr a ntof s um m a ryj udgm e nti n the i nt erpl ea der a ct i on i n favor of T uran. In part i cul ar , they argue thatthe di stri ct courterre d i n g i vi ng prec l usi ve ef fe ctt o the N evada s t at e c ou rt ’ s s um m ary j ud gm entorder f

i nd i ng thatB ekt ay ev and fou r c ol l ea gu es (c ol l ec t i vel y, “ B ekt ay ev B oa r d” ) ne ve rc ons t i tut e d the l e gi t i m a t e boa r d of di r e c t or s of

T ur a n. W e r e vi e w de n o v o th e d is tr ic t c o u rt’s ru lin g o n is s u e p r e c lu s io n , a n d o n c e w e d e te rm in e th a t it isK a z e ne r c om f i l e d m ot i ons f

orj udi c i a l not i c e i n thi s appe a l on M a y24, 3 2 0 1 1 an d N o v em b er 8 , 2 0 1 1 . W e d ecl i n e t o t ak e j u d i ci al n o t i ce o f th ese d o c u m e n ts b e c au s e th e ya r e irr e le v a n t to th e is s u e s o n ap p e a l. Se e T r i gue r os , 658 F . 3d a t987. 9 a v a ilab le , w e r e v ie w th e d e c is io n to ap p lyit f o rab u s e o f

d is c r e tio n . W e a f

f irm in b o th resp ect s. 3 T he N e va daj udgm e nts a t i s f i e s the c r i t e r i af

ori s s ue pr e c l us i on unde rN e va da la w . Fi v e StarCapi tal

C or p. v . R uby , 194 P . 3d 709, 713 ( N e v. 2008) . F i r s t , the s t a t e a nd f

e de r a l a c t i ons c e nt e ron the s a m e i s s ue of w hi c h of

the c om pe t i ng boa r ds l e ga l l y c ontr ol s T ur a n. B e kt a y e v w a i ve d a nya r gum e ntt o the c ontr a rybynot r a is in g it in th e d is tr ic t c o u rt. S ec on d, the N evada j ud gm entw as fi nal and o n the m er i t s. B ekt ay ev cont ends thatthe re l evantj ud gm enti s the st at e c ou rt ’ s pri or i nt er l ocut ory order f in d in g th a t th e B e k ta y e v B o a r d is ille g itim a te ( “I n te r lo c u to ryO r d e r ” ) . T h is ar g u m en t h as n o m er it . A s B ek taye v co n ce d ed in d istrict co u rt, th e N ev ad a c o u rt’s s u m m a ryju d g m e n t o r d e rr e ite r a te d th e I n te r lo c u to ryO r d e r ’s f in d in g s . B ekt ay ev doe s notdi s put e tha tthe N e va dac ourt ’ s s um m a ryj udgm e ntw a s f i na l a nd on the m eri t s. T hi rd, B ekt ay ev w as a party t o the N evada ac t i on . T he re cord confi rm s that he pr e s e nt e d a r gum e nt s a nd e vi de nc e t o s how tha tthe B e kt a y e v B oa r d w a s the10

d u lye le c te d b o a r d o f

T u r a n . F urthe r , the not i c e of appe a l i n the N e va daa c t i on w a s f ile d b yB e k ta y e v o n b e h a lf o f T u r a n . See P arad ise P alm s Cm t y. A ss ’n v. P arad ise H

om es , 505 P . 2d 596, 598 ( N e v. 1 9 7 3 ) ( “A p a rty. . . is o n e w h o is d ir e c tlyin te r e s te d in th e s u b je c t m a tte r , a n d h a d ar ig h t to m a k e d e f e n s e , o rto c ontr ol the pr oc e e di ng, a nd t o appe a l f r om the j udgm e nt . ” ( i nt e rna l quot a t i on m arks om i tt ed)) . F ou rth, the N evada ac t i on w as ac tual l y and nece ss ar i l y l i t i gat ed. B ekt ay ev doe s notdi s put e tha tl i t i ga t i on w a s ne c e s s a ry . R a the r , he a s s e rt s tha the di d not ac tual l y l i t i gat e hi s c l ai m because ( 1) the N evada courtent er ed the Int er l ocut ory O r de rw i thouthol di ng a n e vi de nt i a ryhe a r i ng orpe rm i tt i ng di s c ove ry , a nd ( 2) s ubs e que nt l ye nt e r e d s um m a ryj udgm e ntw i thoutgi vi ng B e kt a y e v f urthe rnot i c e or ah e a r in g . B u t th e e x c lu s io n o f B e k ta y e v a f

te rth e I n te r lo c u to ryO r d e ris in c o n s e q u e n tia l b e c au s e b yth a t p o in t h e h a d a lr e a d yr e c e iv e d af u ll a n d f a ir op po rtun i ty t o argue thatthe B ekt ay ev B oard w as l egi t i m at e. M oreover, w hether N e va dal a w r e qui r e d the s t a t e c ourtt o pe rm i tdi s c ove ryora n e vi de nt i a ryhe a r i ng m aybe an i ss ue for the N evada S up re m e C ou rt , bu ti ti s nota m att erfor thi s c ou rt to d e c id e . A b s e n t a n yin d ic a tio n o f th e N e v a d aju d g m e n t’s s u b s e q u e n t r e v e r s a l, w e a c c e p t it a s v a lid . Se e L aFor ge v . State, U

ni v . and Cm t

y . C ol lege Sys . of N e v ada , 9 9 7 P .2 d 1 3 0 , 1 3 4 n .4 ( N e v . 2 0 0 0 ) .11

B e c aus e the r e qui r e m e nt s f ori s s ue pr e c l us i on a r e m e t , w e hol d tha tthe di s tr i c tc ourtdi d notabus e i t s di s c r e t i on i n f i ndi ng tha tthe N e va daj udgm e nt pr e c l ude s the a r gum e nttha tthe B e kt a y e v B oa r d c ons t i tut e s the l e gi t i m a t e boa r d of T ur a n. W e the r e f

or e a f f i rm the di s tr i c tc ourt ’ s gr a ntof s um m a ryj udgm e nti n f a vor of T ur a n. I n s u m , in ap p e a l N o . 0 9 - 5 6 3 2 9 , w e v a c a te th e d is m is s a ls a n d r e m a n d w ith l ea ve t o repl ea d. In N o. 10 -554 58 , w e vac at e the order denyi ng sanct i on s a s p r e m a tu r e . I n N o . 1 0 - 5 5 9 2 2 , w e a f f irm th e g r a n t o f

s u m m a ryju d g m e n t. A F F IR M E D i n p art, V A C A T E D i n p art, an d R E M A N D E D for f u rt h er p r oc e e d i n gs c on s i s t e n t w i t h t h i s d i s p os i t i on . T h e p ar t i e s s h al lb e ar t h e i r ow n c o s t s o n a p p e a l.