NOT FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

DEBRA POWELL, an individual, 

Plaintiff-Appellee, 

 v. 

JOHN DENNIS RASMUSSEN, an 

individual, 

Defendant-Appellant, 

and 

COLTON RASMUSSEN, an individual; 

HEIDI RASMUSSEN, an individual; IAN 

RASMUSSEN, an individual; TERRAMAGIC, INC., an Oregon corporation; 

Nominal Defendant; TERRA-MAGIC 

SEEDS, LTD., an Oregon corporation; 

Nominal Defendant, 

Defendants.

No. 22-35361 

D.C. No. 2:19-cv-01077-JR 

MEMORANDUM*

DEBRA POWELL, an individual, 

Plaintiff-Appellee, 

 v. 

No. 22-35362 

D.C. No. 2:19-cv-01077-JR 

* This disposition is not appropriate for publication and is not precedent 

except as provided by Ninth Circuit Rule 36-3.

FILED

AUG 31 2023

MOLLY C. DWYER, CLERK

U.S. COURT OF APPEALS
2 

COLTON RASMUSSEN, an individual; 

HEIDI RASMUSSEN, an individual, 

Defendants-Appellants, 

and 

JOHN DENNIS RASMUSSEN, an 

individual; IAN RASMUSSEN, an 

individual; TERRA-MAGIC, INC., an 

Oregon corporation; Nominal Defendant; 

TERRA-MAGIC SEEDS, LTD., an Oregon 

corporation; Nominal Defendant, 

Defendants.

Appeal from the United States District Court

for the District of Oregon

Jolie A. Russo, Magistrate Judge, Presiding

Argued and Submitted August 21, 2023

Portland, Oregon

Before: BENNETT, VANDYKE, and H.A. THOMAS, Circuit Judges.

Defendant John Dennis Rasmussen (Rasmussen) appeals the district court’s

Limited Judgment. Rasmussen appeals the district court’s decisions (i) not to apply 

a marketability discount in determining the fair value of Plaintiff Debra Powell’s 

shares in Terra-Magic, Inc. and Terra-Magic Seeds, Ltd. (collectively, TerraMagic), (ii) to reject Rasmussen’s proposed terms of purchase for the purchase of

Powell’s shares, (iii) to appoint a custodian to liquidate Terra-Magic’s assets, and 

(iv) to allow the custodian to retain control over Terra-Magic until the conclusion 
3 

of all related proceedings. Rasmussen also appeals the district court’s decision to 

allow Powell to continue litigating some of her claims after Rasmussen elected to 

purchase Powell’s shares under Oregon Revised Statute (O.R.S.) Section 60.952.

Defendants Colton Rasmussen (Colton) and Heidi Rasmussen (Heidi) also appeal 

the district court’s Limited Judgment, although they limit their appeal to the court’s 

decision to allow Powell to continue litigating some of her claims against Colton 

and Heidi after Rasmussen’s election to purchase Powell’s shares. We have 

jurisdiction under 28 U.S.C. § 1292. We affirm in part and remand in part for 

further proceedings consistent with this opinion.

We review questions of law and mixed questions of law and fact de novo, 

and we review findings of fact for clear error. Heavenly Hana LLC v. Hotel Union 

& Hotel Indus. of Haw. Pension Plan, 891 F.3d 839, 844 (9th Cir. 2018). “In cases 

where state law applies, [we] must ‘ascertain from all the available data what the 

state law is and apply it.’” Lawson v. Grubhub, Inc., 13 F.4th 908, 913 (9th Cir. 

2021) (quoting West v. Am. Tel. & Tel. Co., 311 U.S. 223, 237 (1940)). We review 

the appointment of a custodian for abuse of discretion. Canada Life Assur. Co. v. 

LaPeter, 563 F.3d 837, 844 (9th Cir. 2009).1

1. Under Oregon law, “in the absence of a finding of oppression, the court 

may, but need not, apply a marketability discount, depending on the particular 

1 Because the parties are familiar with the facts, we do not recount them here. 
4 

circumstances of the case.” Ybarra v. Dominguez Fam. Enters., Inc., 521 P.3d 834, 

838 (Or. Ct. App. 2022). The district court therefore had discretion not to apply a 

marketability discount, based on Powell’s lack of control and knowledge 

concerning Terra-Magic’s management and finances.

2. Rasmussen argues that O.R.S. Section 60.952 did not provide the district

court with discretion to reject his proposal to complete the share purchase in 

installments and instead require him to have all funds immediately available for the 

purchase. In his view, the district court should have accepted his proposal under

subsection (5) of the statute, which specifies that “[i]f the court orders a share 

purchase, the court shall: . . . [s]pecify the terms of the purchase, including, if 

appropriate, terms for installment payments.” O.R.S. § 60.952(5)(a)(C). But the

text of this subsection plainly permits courts to authorize installment payments if 

appropriate, without requiring that they do so. Here, the district court reasonably 

determined that Rasmussen’s installment proposal was not appropriate, based upon 

his failed attempt to sell assets in order to complete the share purchase 

independently. See O.R.S. § 60.952(5)(a)(B) (if a court orders a share purchase, it 

must “[c]onsider any financial . . . constraints on the ability of the . . . purchasing 

shareholder to purchase the shares).

3. The district court did not abuse its discretion in appointing a custodian “to 

oversee the sale of sufficient [Terra-Magic] assets to pay [Powell] the fair value of 
5 

her shares.” Federal courts consider “a variety of factors” in deciding whether to 

appoint a custodian, including (i) “whether the party seeking the appointment has a 

valid claim,” (ii) whether the relevant “property is in imminent danger of being 

lost, concealed, injured, diminished in value, or squandered,” and (iii) “the 

possibility of irreparable injury to [the] plaintiff’s interest in the property.” Canada 

Life, 563 F.3d at 844 (cleaned up). Given Rasmussen’s failure to secure the funds 

for an immediate share purchase, and given the district court’s finding that 

Rasmussen could not be trusted to complete a share purchase in installments, the 

district court did not abuse its discretion when it appointed a custodian to oversee 

the sale. For the same reasons, the district court did not abuse its discretion in 

permitting the custodian to retain control over Terra-Magic’s assets until the 

conclusion of all related proceedings.

4. Rasmussen contends that the district court erred in permitting Powell to 

continue pursuing her remaining direct claims against him for allegedly

participating in or aiding and abetting Colton’s allegedly tortious conduct. He also 

contends that the court erred in permitting Powell to pursue her derivative claims 

against Rasmussen as direct claims. Rasmussen argues that his election to purchase 

Powell’s shares under O.R.S. Section 60.952(6) eliminated Powell’s right to 

continue litigating these claims. Colton and Heidi similarly contend that the district 
6 

court erred in allowing Powell to continue pursuing her derivative claims against 

them as direct claims.

This appeal raises interesting and difficult questions regarding the scope of a 

court’s authority under O.R.S. Section 60.952. Both the language of the statute and 

the Oregon Supreme Court’s decision in Graydog Internet Inc. v. Giller, 406 P.3d 

45 (2017), however, could be read to suggest that, under the circumstances 

presented here, the district court should not have permitted Powell to continue 

litigating her remaining claims against Rasmussen. We therefore remand for the 

district court to reopen these proceedings and redetermine the fair value of 

Powell’s shares, while accounting for the impact of Rasmussen’s alleged conduct 

upon the value of those shares, pursuant to O.R.S. Section 60.952(5)(a)(A).

The conduct Powell complains of—Rasmussen’s alleged conversion, unjust 

enrichment, breach of fiduciary duty, and waste of corporate assets—is precisely 

the conduct “giving rise to [Powell’s] proceeding under subsection (1)” of the 

statute. See O.R.S. § 60.952(5)(a)(A). And the statute directs that, when the court 

orders a share purchase, it shall “[d]etermine the fair value of the shares . . . taking 

into account any impact on the value of the shares resulting from” such actions.2

Id. (emphasis added). Allowing resolution of Powell’s claims against Rasmussen

2 This is, indeed, how Powell anticipated the court would proceed, as her counsel

acknowledged at oral argument.
7 

via further litigation, rather than by including them in the valuation of the share 

purchase, may thus run contrary to the Oregon Supreme Court’s admonition that 

the statute was designed to “[r]educ[e] litigation between shareholders” and 

“provid[e] a shortcut to a remedy.” See Graydog, 406 P.3d at 56.

Upon remand, the district court should also factor Powell’s derivative claims

against Colton and Heidi into its fair value determination under O.R.S. Section 

60.952.3 As the Oregon Supreme Court stated in Graydog, when a shareholder files 

a proceeding under subsection (1) of O.R.S. Section 60.952, she “in effect makes 

an offer to sell all of [her] shares, for fair value, to the corporation or another 

shareholder, without resolving the merits of the complaint . . . that [she] filed,” 

Graydog, 406 P.3d at 48 (emphasis added). Because the district court must resolve 

the allegations against Colton and Heidi in order to address Powell’s allegations 

against Rasmussen, those allegations are best viewed as an essential part of the 

events giving rise to the proceeding Powell filed under subsection (1) of the 

statute. We express no view regarding how the district court may organize the 

factfinding process; our holding is only that a unified proceeding is required in this 

matter.

3 Colton and Heidi have not appealed the district court’s decision to let Powell 

continue litigating her direct claims against them.
8 

5. Finally, Powell contends that the procedures set forth in O.R.S. Section 

60.952 violate her right to a jury trial. By invoking O.R.S. Section 60.952, 

however, she waived the right to obtain a resolution of her claims under subsection 

(1) outside of the procedures provided for by the statute. See Graydog, 406 P.3d at 

48; see also Horton v. Oregon Health & Sci. Univ., 376 P.3d 998, 1044 (Or. 2016) 

(“Neither the text nor the history of the jury trial right suggests that it was intended 

to place a substantive limitation on the legislature’s authority to alter or adjust a 

party’s rights and remedies.”). While nothing in this opinion should be taken to 

limit the district court’s discretion to employ an advisory jury if it so wishes, the 

fact that this case was filed in federal, rather than state court, does not alter the fact 

that Powell is no longer entitled to a resolution of the merits of her claims under 

subsection (1). Given Rasmussen’s election to purchase Powell’s shares under 

O.R.S. Section 60.952(6), the only thing Powell is entitled to is the purchase of her 

shares, pursuant to the terms set by the court under O.R.S. Section 60.952(5). See 

O.R.S. § 60.952(6)(f).

* * * 

For the reasons set forth above, we remand in part in order for the district 

court to reopen proceedings under O.R.S. Section 60.952 and redetermine the fair 

value and terms of purchase of Powell’s shares under subsection (5) of that statute, 
9 

while “taking into account any impact on the value of the shares resulting from the 

actions giving rise to” this proceeding. See O.R.S. § 60.952(5)(a)(A), (6)(f); 

Graydog, 406 P.3d at 48.

AFFIRMED in part and REMANDED in part for further proceedings 

consistent with this opinion. Each party is to bear its own costs and fees on 

appeal.