N O T FO R PUB L ICAT IO N UNITED STATES C OUR T OF APPEALS FOR THE NINTH C IR C UIT
ANDER S KARLSSON,

Pla i ntiff-Appe lla

nt,
v. JOHN LEO M ANGAN III; e t a l.,

De fe nda n ts-Appe lle e s,
and AR T FOR C E, LLC ; e t a l.,

De fe nda n ts. No. 16-55175 D.C . No. 2:14-c v-04514-R -JPR
M EM O R ANDUM *

Appe a l from

the Unite d

Stat e s Distric t C ourt for the C e ntra l Distric t of C a lifornia M anue l L. R e a l , Distric t Judge , Pre siding Argue d and Subm itte d August 7, 2018 Pa sa de n a , C a l ifornia B e fore : M c K EOW

N, C A LLAHAN, a

nd NGUYEN, C irc uit Judge s. 

# FIL ED AUG 23 2018 M OLLY C. DW Y ER, CLERK U

. S. CO URT O F APPEALS

* This disposition is not a ppropria te for public a t 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.Ande rs Ka rlsson a gre e d to inve st in a num be r of e xpe n sive pie c e s of a rtwork inc l uding pa intings by Ja c kson Polloc k and a sc ulpture by

M a x Ernst. He file d this la wsuit in the

Distric t C ourt for the C e ntra l Distric t of C a l ifornia a lle ging tha

t a
num be r of de fe nda

nts wrongfully

induc e d him

to purc ha se a

num b e r of works of
art, som e of whic h we re ove rpric e d a nd som e of whic h we re not a uthe n tic , and a l so to purc ha se an ove rpric e d m otor ple a s ure y a c ht. The distric t c ourt dismisse d, with le ave to a m e nd, Ka rlsson’ s First Am e nde d C om pla int (FAC ) a s se riously de fic ie nt for fa iling to inform

the de fe nda

nts of the spe c ific a c ts tha t e xpose d the m to lia bility . Ka rlsson file d a

Se c ond Am e nde d C om

p la int (SAC ). The distric t c ourt found tha t the SAC wa s a lso se riously de fic ie nt a nd dism isse d the SAC without le ave to a m e nd. The c ourt a lso a

warde d de fe nda

nts $91,670.16 in a

ttorne y s’ fe e s. Karlsson a

ppe a ls. W e a ffirm

the distric t c o urt’ s dism issa l of the SAC , va c a te the de nia l of le av e to a

m e nd, a nd va c a te the award of a

ttorne y s’ fe e s. 1 1. A dism issa l of a

c om pla int for fa ilure to sta

te a c la i m for re lie f is
re vie we d de nov o . C

arlin v . Dairy

Ame ric a Inc
. , 705 F.3d 856, 866 (9th C ir. 2013). A c om

pla int m ust give the de fe nda

nts fa ir notic e of the c la im and the ground upon whic h it re s ts. Be ll Atl. C orp. v . Tw ombly , 550 U.S. 544, 555 (2007).

1 B e c a

use the pa rtie s a re fam ilia r with the fa c t

ua l a nd proc e dura l history of the c a se , we ne e d not re c ount it he re . 2A re vie w of the SAC c onfirm s tha t a lthough Ka

rlsson m ay

have be e n m isle d or de fraude d by

som e or a ll of the de fe nda nts, the distric t c ourt c orre c tly de te rm ine d that the SAC ’ s a lle gations “ la c k spe c ific ity , a re de v oid of pa

rtic ula rity , a nd a re
c om prise d of va gue and c onc lusory sta te m e nts” suc h tha

t the de fe nda

nts “ do not have fa ir notic e of the a c c usat ions a ga inst the m . ” Ac c ordingly , the distric t c ourt’ s dism issa l of the SAC is a ffirm e d. 2. A de nia l of le ave to a

m e nd is re v ie we d for a

buse of disc re tion. Ec ologic al Rights Found. v . Pac . Gas & Ele c . C

o. , 713 F.3d 502, 507 (9th C ir. 2013). Le ave t o am e nd should be grante d unle ss the ple a dings c ould not possibly be c ure d by

am e ndm e n t or whe re the pla intiff “ ha s fa i le d to c ure the c om pla int’ s de fic ie nc ie s de spite re pe a te d opportunitie s.” A E e x re l He rnande

z v . C ounty of Tulare , 666 F.3d 631, 636 (9th C ir. 2012). B e c a use Ka rlsson file d his FAC be fore the d e fe nda

nts’ initia l m otion to dism iss c ould be c onside re d , the SAC wa s his first
e ffort to a ddre ss the de fic ie nc ie s note d by the distric t c ourt whe n it dism isse d his FAC . Although the

SAC fa ils to sta

te a c la im for re lie f, it a

p pe ars tha

t Ka rlsson
m ay be a ble to sta te a c la im a ga inst one or m ore of the de fe nda nts who ha

ve
a lle ge dly re c e ive d ove r two m illion dolla rs from Ka rlsson. As the Supre m e C ourt ha s c ounse le d tha

t le a ve to a m e nd should be

fre e ly give n, F o man v . Dav is , 371 U.S. 178, 182 (1962), the de nia l of le ave to a

m e n d is va c a te d a

nd Ka rlsson is
3gran te d le ave to file a third a m e nde d c om

pla int tha t c orre c ts the de fic ie nc ie s in the SAC tha t le d the distric t c ourt to dism iss it. 3. B e c a use we grant Ka

rlsson le ave to a

m e nd, the de fe n d ants, a

t this time , are n o longe r the pre va iling pa rtie s a nd the attorne y s’ fe e award is a c c ordingly
va c a te d. Should de fe nda

nts a ga in se e k attorne y s ’ fe e s, the y would be we ll a dvise d to a v oid the m at

he m a tic a l proble m s the y a c knowle dge d at ora l argum e nt a nd to pre s e nt a furthe r c ontra c t

ua l ba sis for a

n award tha

t c ove rs a ll the c la im s in the
c om pla i nt. The distric t c ourt’ s dism i ssa l of Ka rlsson’ s Se c ond Am e nde d C om pla int is AFFIRM E D , the de nia l of le ave to a m e nd is V ACAT E D , a

n d the award of
a ttorne y s’ fe e s is V A C AT E D . The pa rtie s sha ll be ar the ir own c osts.

4