N O T FO R PUB L ICAT IO N UNITED STATES C OUR T OF APPEALS FOR THE NINTH C IR C UIT IGUAÇ U, INC ., Plaintiff-Appe lle e , v. ANTONIO C A B RER

A M ANO FILHO, De fe nda

nt-Appe lla

nt. No. 13-17544

D.C . No. 3:09-c v-00380-R S M EM O R ANDUM *

IGUAÇ U, INC ., Plaintiff-Appe lle e , v. ANTONIO C A B RER

A M ANO FILHO, De fe nda

nt-Appe lla

nt. No. 14-17099

D.C . No. 3:09-c v-00380-R S

On Appe a l from

the Unite d State s Distric t C ourt for the Northe rn Distric t of C a lifornia R ic ha rd Se e borg, Distric t Judge , Pre siding 

# FIL ED FEB 24 2016 M OLLY C. DW Y ER, 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 9th C ir. R . 36-3.Argue d a nd Subm itte d Fe brua

ry 10, 2016 B e fore : HAW K INS and M UR GUIA, C i rc uit Judge s; a nd M URPHY, ** Distric t Judge . Pla intiff Igua ç u, Inc . sue d De fe n da nt Antonio C a

bre ra for unpa id c om m issions on a

c ontra c t . C a

b re ra argue d tha t Igua ç u ha d a c te d a s a

n unre giste re d broke r of se c uritie s, m ak ing thea gre e m e nt void for ille ga lity . The distric t c o urt, howe ve r, found tha t the inte re sts sold by

C a bre ra we re not se c uritie s and tha t the e c onom ic re a lity of the tra nsa c tion wa s the purc ha se of a pa rtic ipatory inte re s t in a

joint venture , not thekind of pa s sive inve stm e nt tha t c ha ra c t e riz e s se c uritie s. C a

bre ra a p pe a le d. W e a ffirm . The inte re sts purc ha se d

in the proje c ts we re quota s, or m e m be rship inte re sts, in limita da s , the B ra z ilia

n e quiva le nt of a

n LLC . The tra

n sa c tions re s ulte d in joint ve nture s in whic h

a l l m e m be rs we re a c tive ly

e nga ge d in m a

n a ge m e nt. C a

bre ra a dm its tha

t the tra nsa c tions’ re sulting inte

re sts we re not se c uritie s, y e t urge s us to c onside r the inte re sts a s se c uritie s during the tim e Igua ç u wa s se e k ing out inve stm e nt pa

rtne rs. B ut “ [t] he Supre m e C ourt ha s long instruc te d tha t se c uritie s la w pla c e s e m

pha sis on e c onom ic re a lity and disre ga

rds form for substa

nc e .” S.E.C . v . M& A W ., Inc . , 538 F.3d 1043, 1053 (9th C ir. 2008). Thus, we m ust vie w transa c tions a s a

whole . Doing so, it is a

ppa re nt tha t the tra nsa c tions he re are not of

** The Honora

ble Ste phe n Joseph M urphy , III, Unite d State s Distric t Judge for the Ea ste rn Distric t of M ic higa n, sitting by

de signa t ion.the k ind c onte m p l ate d by the se c uritie s la

ws. The e c onom ic re a lity

of the tra nsa c tions wa s the inve stm e nt in lim ita da s with full e xpe c tation of sha re d m ana ge m e nt a

nd ope ration the re of. The re c ord indic ate s tha

t Igua ç u wa s not a

tte m pting to find m

e re buy e rs of sha

re s of C a bre ra ’ s prope rtie s, but to introduc e inve stors who c ould se rve a s a c tive pa rtne rs: pa rtne rs who a t the ve ry le a st would beobliga

te d to a rrange m arke ting of theve nture ’ s produc t. The se c uritie s la

ws we re not inte nde d to a pply to thosetra

nsa c tions. The Supre m e C ourt ha s c onsiste ntly re c ogniz e d tha

t inve stm e nts re sulting in ac tive m ana ge m e nt a

re not to bec onside re d se c uritie s a nd ha s de fine d a

n inve stm e nt c ontra c t “ for purpose s of the Se c uritie s Ac t [a s] a c ontra c t, tra

nsa c tion or sc he m e whe re by a pe rson inve s ts his mone y in a c om m on e nte rprise and is le d to e xpe c t profits sole ly

from the e fforts of the prom ote r or a third pa rty .” S .E.C . v . W .J . How e y C o. , 328 U.S. 293, 298–99 (1946). Ac tive m ana ge m e nt is c ontra ste d with pure “profit-se e king busine ss ve nture ” inve stm e nt, whe n “ i nve stors providethe c a pita l a nd sha re in the e arnings a

nd profits; the

prom ote rs m ana g e , c ontrol a nd ope rat e the e nte rprise .” Id. at 300. To hold Igua c u lia

ble for broke ring se c uritie s on theba s is tha t, at one point, the i nte re sts it he lpe d to se ll c onsiste d of a c orporat ion-a

na logue 's stoc k, would 3 1 3 - 1 7 5 4 4ignore the purpose , re sult a n d substa nc e of the tra

nsa c tion – whic h wa s a

n a c tive inve stm e nt in a

joint venture . AFFIRM E D.

4 1 3 - 1 7 5 4 4