Case Name: John William DAVIS, Plaintiff-Appellant, v. BIRR, WILSON & CO., INC., a California Corporation, et al., Defendants-Appellees
Court: United States Court of Appeals for the Ninth Circuit
Jurisdiction: United States
Decision Date: 1988-02-24
Citations: 839 F.2d 1369
Docket Number: No. 87-1768
Parties: John William DAVIS, Plaintiff-Appellant, v. BIRR, WILSON & CO., INC., a California Corporation, et al., Defendants-Appellees.
Judges: Before ALDISERT, SKOPIL and SCHROEDER, Circuit Judges.
Reporter: Federal Reporter 2d Series
Volume: 839
Pages: 1369–1376

Head Matter:
John William DAVIS, Plaintiff-Appellant, v. BIRR, WILSON & CO., INC., a California Corporation, et al., Defendants-Appellees.
No. 87-1768.
United States Court of Appeals, Ninth Circuit.
Argued and Submitted Jan. 15, 1988.
Decided Feb. 24, 1988.
William N. Woodson, III, Palo Alto, Cal., for plaintiff-appellant.
Robert J. Stumpf, San Francisco, Cal., for defendants-appellees.
Before ALDISERT, SKOPIL and SCHROEDER, Circuit Judges.
Honorable Ruggero J. Aldisert, Senior United States Circuit Judge for the Third Circuit, sitting by designation.

Opinion:
PER CURIAM:
Davis appeals from the district court's grant of summary judgment in favor of Birr, Wilson & Company. The single issue on appeal is whether Davis' section 10(b) action is barred by the statute of limitations. We affirm.
These claimed violations of section 10(b) of the Securities Exchange Act of 1934, 15 U.S.C. § 78j(b), are subject to California's three-year statute of limitations for fraud, Cal.Civ.Proc.Code § 338(4). Robuck v. Dean Witter & Co., Inc., 649 F.2d 641, 643 (9th Cir.1980). The statute of limitations begins to run when the plaintiff has actual knowledge of the fraud or knowledge of facts sufficient to put a reasonable person on notice. Id. at 644.
In April 1981, Davis transferred his investment account from Merrill Lynch to Birr, Wilson in order to retain his current sales representative, who was transferring to Birr, Wilson. In the same year, the challenged investments occurred. During that year, Davis received confirmation slips, accountings, and monthly reports. Further, Davis was aware that these investments resulted in losses. However, Davis claims that he did not suspect fraud until 1985, when he received legal advice that his Birr, Wilson account had been improperly handled. He did not file suit until March 1986. The district court found that:
each of the challenged transactions occurred in 1981, and the defendants supplied the plaintiff with monthly statements, confirmation slips and a Current Portfolio Statement for 1981. Each one of those reports accurately reflected the performance of the plaintiff's managed account_ The plaintiff filed this lawsuit on March 5, 1986. He knew or should have known of the alleged fraud during or before February 1983. The plaintiff fails to demonstrate facts sufficient to lead this Court to conclude that the statute of limitations should be tolled in this matter.
We have observed that parties seeking summary disposition have a difficult burden in showing there are no material issues of fact regarding notice. S.E.C. v. Seaboard Corp., 677 F.2d 1289, 1294 (9th Cir.1982). "However, reasonable diligence is tested by an objective standard, [citation omitted] and when uncontroverted evidence irrefutably demonstrates plaintiff discovered or should have discovered the fraudulent conduct, the issue may be resolved by summary judgment." Kramas v. Security Gas & Oil, Inc., 672 F.2d 766, 770 (9th Cir.), cert. denied, 459 U.S. 1035, 103 S.Ct. 444, 74 L.Ed.2d 600 (1982).
In this case Davis was well-educated and had recently invested large sums of money with other brokers. He received monthly statements of his account, followed his investments, and made suggestions concerning them. In connection with one of his investments, Davis acknowledged that he was "an experienced and sophisticated investor." This is not a case like Vucinich v. Paine, Webber, Jackson & Curtis, Inc., 803 F.2d 454 (9th Cir.1986), in which we held there were questions of fact concerning the tolling of a statute for a naive investor who claimed that she was lulled into inaction by the defendant.
The summary judgment entered below is affirmed.