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NOT FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

In re: KSL MEDIA, INC., 

Debtor, 

______________________________ 

DAVID K. GOTTLIEB, as Chapter 7 

Trustee for KSL Media, Inc., 

Plaintiff-Appellant, 

 v. 

KALMAN S. LIEBOWITZ; et al., 

Defendants-Appellees.

No. 16-56738 

D.C. No. 

2:15-cv-02143-AB-GJS 

MEMORANDUM*

Appeal from the United States District Court

for the Central District of California

Andre Birotte, Jr., District Judge, Presiding

Argued and Submitted April 10, 2018

Pasadena, California

Before: SCHROEDER and M. SMITH, Circuit Judges, and DRAIN,**

District Judge.

 * This disposition is not appropriate for publication and is not 

precedent except as provided by Ninth Circuit Rule 36-3.

** The Honorable Gershwin A. Drain, United States District Judge 

for the Eastern District of Michigan, sitting by designation.

FILED

APR 30 2018

MOLLY C. DWYER, CLERK

U.S. COURT OF APPEALS
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Plaintiff-Appellant David Gottlieb, as Chapter 7 Trustee for KSL 

Media, Inc. (“KSL”), brought the instant action alleging that DefendantsAppellees Kalman Liebowitz, Harold Cohen, and Russell Meisels violated 

their fiduciary duties and caused KSL to file for bankruptcy. DefendantsAppellees moved for summary judgment, arguing that Plaintiff-Appellant’s 

complaint was a Caremark1 claim under Delaware law and that PlaintiffAppellant did not allege bad faith, a component necessary to hold them 

liable under Caremark. The district court granted Defendants-Appellees’

motion, finding that Plaintiff-Appellant asserted a Caremark claim and made 

no showing of bad faith.2 Plaintiff-Appellant timely appealed. 

We review the district court’s grant of summary judgment de novo. 

Brunozzi v. Cable Commc’ns, Inc., 851 F.3d 990, 995 (9th Cir. 2017). We 

likewise review the district court’s interpretation of state law de novo. Id. 

We have jurisdiction pursuant to 28 U.S.C. § 1291, and we affirm. 

The parties agree that Delaware law governs this case, as KSL was 

incorporated in Delaware. 

Plaintiff-Appellant first argues that a Caremark claim for lack of 

oversight applies only to corporate directors, and not officers. He argues that 

 1 In re Caremark Int’l Inc. Derivative Litig., 698 A.2d 959 (Del. Ch. 1996)

(“Caremark”). 2 Plaintiff-Appellant conceded in the district court that Defendants did not 

act in bad faith. 
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Caremark is therefore inapplicable here because Defendants-Appellees were

sued in their capacity as officers. We disagree. Under Delaware law, the 

fiduciary duties of officers are identical to the fiduciary duties of directors. 

Gantler v. Stephens, 965 A.2d 695, 708–09 (Del. 2009); In re World Health 

Alternatives, Inc., 385 B.R. 576, 592 (Bankr. D. Del. 2008) (applying 

Delaware law). The World Health court also observed that “the Caremark

decision itself suggests that the [Caremark] test would be applicable to 

officers.” World Health, 385 B.R. at 592. Specifically, the Caremark court 

reasoned that “neither corporate boards nor senior officers can be charged 

with wrongdoing simply for assuming the integrity of employees and the 

honesty of their dealings on the company’s behalf.” Caremark, 698 A.2d at 

969 (emphasis added). Plaintiff-Appellant has cited no authority holding that 

officers cannot be held liable under Caremark. 

Plaintiff-Appellant further argues that the district court incorrectly 

characterized his complaint as a Caremark claim rather than a claim for 

breach of the duty of care. A Caremark claim alleges that the “directors 

allowed a situation to develop and continue which exposed the corporation 

to enormous legal liability and that in so doing they violated a duty to be 

active monitors of corporate performance.” Id. at 967. The majority of the

complaint’s allegations amount to purported failures to oversee and actively 
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monitor, which unmistakably fall within the ambit of a Caremark claim. For 

instance, the complaint alleges that Defendants-Appellees implemented 

reporting systems, but failed to oversee KSL’s operations, thus disabling 

them from being informed. The complaint also alleges that DefendantsAppellees failed to implement proper oversight procedures. These are 

characteristic Caremark claims.

In contrast, a claim for breach of the duty of care asserts that directors 

or officers made an uninformed business decision. See In re Walt Disney Co. 

Derivative Litig., 906 A.2d 27, 52 (Del. 2006) (requiring breach of duty of 

care claims to rebut the presumption that “in making a business decision the 

directors of a corporation acted on an informed basis”) (citation omitted);

see also In re Fedders N. Am., Inc., 405 B.R. 527, 539 (Bankr. D. Del. 2009)

(holding that a breach of the duty of care “generally requires directors and 

officers to fail to inform themselves fully and in a deliberate manner.”)

(citing Cede & Co. v. Technicolor, Inc., 634 A.2d 345, 368 (Del. 1993)).

Absent from the complaint is any allegation that DefendantsAppellees made an uninformed business decision. To the contrary, the 

complaint criticizes Cohen’s decision to use client prepayments to fund

KSL’s operations after he had all of the material information necessary to 

make an informed decision.
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Plaintiff-Appellant’s list of genuine issues of disputed fact asserts that 

Liebowitz did not fully apprise himself of all material information related to 

KSL. However, Plaintiff-Appellant did not link this failure to any specific 

business decision. Plaintiff-Appellant’s list of facts amount to a claim that 

Liebowitz failed to adequately oversee KSL’s business as a result of his 

failure to inform himself. This, too, is effectively a Caremark claim.

The complaint’s claims against Meisels also fail to persuade. These 

allegations assert Caremark violations rather than violations of the duty of 

care. The complaint alleges that Meisels failed to oversee KSL’s business 

performance adequately, which are characteristic Caremark claims.

AFFIRMED.