N O T FO R PUB L ICAT IO N UNITED STATES C OUR T OF APPEALS FOR THE NINTH C IR C UIT
U.S. SEC UR ITIES & EXC HANGE C OM M ISSION,

Pla i ntiff-Appe lle e , v. EDW IN YOSHIHIR O FUJINAGA; e t a l.,

De fe nda n ts,
and THE YUNJU TR

UST, R e lie f De fe nda

nt and JUNE FUJINAGA, Re lie f De fe nda n t, De fe nda n ts-Appe lla

nts,

______________________________ R OB B EVANS & ASSOC IATES LLC ,

R e c e ive r-Appe lle e . No. 16-15623 D.C . No. 2:13-c v-01658-JC M -C W H
M EM O R ANDUM *

Appe a l from

the Unite d

Stat e s Distric t C ourt for the Distric t of Ne v a da Jam e s C . M aha

n, Distric t Judge , Pre siding 

# F IL ED J UN 07 2017 M OLLY C. DW Y E R, CLERK U. S. CO URT O F APPEALS

* This disposition is not a ppropria te for public at ion a

nd is not pre c e de nt e xc e pt a s provide d

by Ninth C irc uit R

ule 36-3.Subm itte d April 21, 2017 ** San Fran c isc o , C a lifornia B e fore : TASHIM A a

n d PAEZ, C irc uit Judge s , a nd AM ON, *** Distric t

Judge
. June Fujina ga

and a trust within he

r c ontrol, TheYunju Trust (c olle c tive ly ,

“ June ” ), we re a d de d a s re l ie f de fe nda nts in a c a se brought by the Se c uritie s and Exc ha nge C om m ission (the“ SEC ” ) a ga inst June Fujina ga ’ s husba nd, Edwin Fujina ga (“ Edwin” ). The SEC sought to disgorge the funds tha

t June re c e ive d from Edwin. Afte r the distric t c ourt found Edwin lia ble for se c uritie s viola

tions, the SEC m ove d for sum

m a ry judgm e nt a

nd disgorge m e nt a ga i nst June
. R e l y ing in pa rt on June Fujina ga ’ s a sse rtion of he r Fifth Am e ndm e nt privile ge a ga inst se lfinc rim ination, the distric t c ourt gra nte d the SEC ’ s m otion for sum m ary judgm e nt
and orde re d June to disgorge$2.383 million. June file d a m otion for
re c o nside ra tion, whic h the distric t c ourt gra nte d in pa rt a nd de n ie d in pa

rt. The distric t c o urt ultim a te ly

orde re d June to disgorge$2.333 million. June a ppe a ls. W e re vie w de novo a n a ward of sum

m a ry judgm e nt. Mc C ormac k v . He rzog , 788 F.3d 1017, 1029 (9th C ir. 2015). W e re vie wfor a buse of disc re tion a

n orde r of disgorge m e nt, SEC v . Platforms W

ire le ss Int’l C orp. , 617

* * The pa

ne l una nim ously c onc lude s this c a se is suita ble for de c ision without ora l a

rgum e nt. Se e Fe d. R . App. P. 34(a )(2).

* * * The Honora

ble C arol B a gle y

Am on, Unite d State s Distric t Judge for the E a s te rn Distric t of Ne w York, sitting by de signa tion. 2F.3d 1072, 1096 (9th C ir. 2010), a n orde r de ny i ng a m otion for re c onside ra tion, K ona Ente rs., Inc . v . Estate of Bishop , 229 F.3d 877, 883 (9th C ir. 2000), a n d “ a distric t c o urt’ s de c ision to dra w a n a dve rse infe re nc e from

a pa rty ’ s invoc ation in a
c ivil c a se of the Fifth Am e ndm e nt privile ge a g a inst se lf-inc rim ination,” N ationw ideLifeIns. C

o. v . Ric hards , 541 F.3d 903, 909 (9th C ir. 2008). W e
a ffirm
. June argue s tha

t sum m ary judgm e n t wa s im

prope r be c a

use (1) the distric t
c ourt c ould not dra

w a n a dve rse infe re nc e from

June Fujina ga ’ s a sse rtion of he r Fifth Am e ndm e nt privile ge a s she ha d wa ive d he r privile ge a s a re sult of c e rta in disc ove ry disc l osure s, (2) the distric t c ourt a buse d its disc re tion in dra wing a n
a dve rse infe re n c e from

June Fujina ga ’ s a s se rtion of he r Fifth Am e ndm e nt privile ge , (3) June ’ s produc tion of W -2s a nd tax re turns in re sponse to disc ove ry
re que s ts c re a te d

a ge n uine issue of m ate ria l fa c t a s to whe the r June ha d a le gitim ate
c la im to som e of the funds a

t issue , a nd (4) the re c o rd wa s ina de quate ly de ve lope d. June a l so c ha lle nge s the am ount of disgorgem e nt orde re d by the distric t c ourt, a

nd the d e nia l of he r m otion for re c onside ra tion. June ’ s argum e nts a re una va iling. 1. June did not properly ra ise the prim ary

argum e nt she a sse rts on
a ppe a l— that June ’ s disc ove ry

disc losure s wa ive d June Fujina ga ’ s Fifth Am e ndm e nt privile g e . June first ra ise d this a rgum e nt in a

re ply in support of the
3m otion for re c onside ration, a t whic h tim e it wa s untim e ly . “ A R ule 59(e ) m otion [to re c onside r] m ay not be use d to ra ise argum e nts or pre se nt e vide n c e for the first tim e whe n the y

c ould re a sona

bly have be e n ra i se d e a

rlie r in the litiga

tion.” K ona Ente rs. , 229 F.3d a

t 890. As a

re sult, be c a

use June did not “

prope rly ” ra ise the issue in the distric t c ourt, we will not c onside r it. S e e O’Rourk

e v . Se aboard Sur. C o. (In reE.R. Fe

ge rt, Inc .) , 887 F.2d 955, 957 (9th C ir. 1989). 2. “ Whe n a

pa rty a sse rts the privile ge a ga inst se lf-inc rim ination in a c ivil
c a se , the distric t

c ourt ha s disc re tion to dra w a n a d ve rse infe re nc e from

suc h
a sse rtion.” N

ationw ideLifeIns. C

o. , 541 F.3d a

t 911. “ The infe re nc e m ay not be draw n ‘ unle ss the re is a

substa ntia l ne e d for the inform ation a n d the re is not
anothe r le ss burde nsom e wa y of obta i ning tha

t inform ation.’ ” Id. at 912 (quoting Doee x re l. Rudy -Glanze r v . Glanze r , 232 F.3d 1258, 1265 (9th C ir. 2000)).

“ M ore ove r, the infe re nc e m a y be drawn only

whe n the re is indepe nde nt e vide nc e of the fa c t a

bout whic h the pa

rty re fuse s to te stify .” Id. June Fujina g a ’ s te stim ony
wa s ne c e s sa

ry to de te rm ine whe the r June ha d a le gitim ate c la im

to the funds a

t issue . June Fujina ga wa s the only pe rson in posse ssion of theinform ation
re ga rding the le gitim a c y of June ’ s c la im to the funds; howe ve r, she re fuse d to te stify re g arding tha

t issue , de p riving theSEC of its opportunity to obta in e vide n c e on tha t que stion. Additiona

lly , the re wa s inde pe nde nt e vide n c e of June ’ s re c e ipt of

4illic it funds. The distric t c ourt thus did not a buse its disc re tion in dra

wing a n
a dve rse infe re n c e from

June Fujina ga ’ s a s se rtion of he r Fifth Am e ndm e nt privile ge
a ga inst se lf-inc rim ination. S e e SEC v . C o le llo , 139 F.3d 674, 678 (9th C ir. 1998) (holding tha

t the distric t c ourt did not a b use its disc re tion in dra

wing a n a dve rse infe re n c e whe re the re lie f de fe nda n t “ re fuse d to giveinform ation ne c e ssa ry to de te rm i ne whe t

h e r he still posse sse d a

ny of the funds or whe t

he r he ha d a le gitim ate c la im to the m ” ). 3. Onc e the SEC c arrie d its burde n unde r Fe de ra l R ule of C ivil Proc e d ure 56(c ), June wa s re quire d to “ c om e forward with ‘ spe c ific fa c ts showing the re is a ge nuine

issue for trial .’ ” Matsushita Elec . Indus. C o. v . Ze nith Radio C orp. , 475 U.S. 574, 587 (1986) (quoting Fe d. R . C iv. P. 56(e )). M e re ly produc ing doc um e nts during disc ove ry , a s June did, doe s not sa tisfy tha t burde n. M ore o ve r, e ve n if June ha d atta c he d the W -2s a nd tax re turns to theopposition to the SEC ’ s m o tion for sum m ary judgm e nt, a

ge nuine issue of m at e ria l fa c t would not ha ve e xiste d. Those doc um e nts de m o nstra te m e re ly tha t June Fujina ga
re c e ive d funds from

Edwin’ s c om

pa nie s, but do not ra

ise a ge nuine issue re ga

rding whe the r she pe rform e d le gitim a te se rvic e s in e xc ha nge for those funds. 4. The re c ord in this c a se wa s suffic ie ntly de ve lope d to support a

grant of sum m a ry judgm e nt. C

f. Tov ar v . U.S. Postal Serv . , 3 F.3d 1271, 1278–79 (9th

5C ir. 1993) (disc ussing thene c e ssity of a n a de quate fa c tua l re c ord for de c iding

“ im porta nt” and “ far-re a c hing” que stions). To the e xte nt tha

t the distric t c ourt la c ke d the im

m a te ria l inform a tion Junec ite s on a p pe a l, tha t c irc um sta

nc e wa s
oc c a sione d not by

an ina de quate re c ord, but ra the r, by June ’ s fa ilure to submit the
e vide nc e in opposition to the SEC ’ s m otion for sum

m ary judgm e nt. 5. June ’ s a

rgum e nt tha

t the distric t c ourt a

b use d its disc re t ion in orde ring disgorge m e nt fa

re s no be tte r. “ The SEC be a rs the ultim ate burde n of pe rsua sion that its disgorgem e nt figure re a sona bly a pproxim at e s the am ount of unjust
e nric hm e nt.” P latforms W ire le ss , 617 F.3d a

t 1096 (inte rna l quota

t ion m arks
om i tte d). “ Onc e the SEC e s ta blishe s a re a sona

ble a pproxim ation of de fe nda

nts’
a c tua l profits, howe ve r, . . . the burde n shifts to the

de fe nda nts to de m onstra

te tha t the d isgorge m e nt figure wa s not a re a sona ble a pproxim at ion.” Id. (inte rna l quota t ion m arks om itte d). The SEC a pproxim ate d June ’ s profits by a ggre gating the funds June re c e ive d from Edwin a nd his c om

pa nie s during there le va

nt tim e pe riod. In light of June

Fujina ga ’ s re fusa l to te s tify , the SEC ha d no be tte r
m e c ha nism for c a lc u lat ing the disgorge m e nt figure , a n d the distric t c ourt did not
a buse i ts disc re tion in de e m i n g tha t c a lc ulation re a sona

ble . In turn, Junefa i le d to
re but the SEC ’ s c a lc ulation. Se e id. at 1097 (“ [G] ive n this fa ilure of proof from de fe nda n ts, it wa s not a

n a buse of disc re tion for thedistric t c ourt to c onc lude tha t
6the e ntire proc e e ds from the sa le we re a ‘ re a sona

ble a p p roxim ation’ of the profits from the transa c t ions.” ). 6. Fina lly , June argue s tha t the distric t

c o urt a buse d its disc re tion in de ny ing in pa

rt the m otion for re c onside ration. Howe ve r, “ [o] ur a buse of disc re tion re vie w pre c lude s re ve rsing the distric t c ourt for de c lining to addre ss a n issue ra ise d for the first tim e in a m otion for re c onside ra tion.” 389 Orange St. Partne rs v . Arnold

, 179 F.3d 656, 665 (9th C ir. 1999). AFFIRM E D.

7