Court Opinion

ID: 3047507
Source: CourtListenerOpinion
Date Created: 2015-10-13 23:21:39.303472+00
Date Added: 2024-06-11T11:49:14.114067
License: Public Domain

FOR PUBLICATION
  UNITED STATES COURT OF APPEALS
       FOR THE NINTH CIRCUIT

JERRY DAVIS,                             
                   Plaintiff-Appellee,
DUX CAPITAL MANAGEMENT
CORPORATION,
                  Plaintiff-Appellee,
                v.                           No. 04-16911
YAGEO CORPORATION; YAGEO                      D.C. No.
                                             CV-03-00539-
HOLDING (BERMUDA) LIMITED; YAN
SHENG CHAN; AN-EHR CHEN; CHENG-                 WHA
LING LEE,
             Defendants-Appellants,
EQUITY PLUS SECURITIES, LIMITED;
REX Y.C. YANG; WEN-CHIN YEH,
             Defendants-Appellants.      
DUX CAPITAL MANAGEMENT                   
CORPORATION; JERRY DAVIS,
                Plaintiffs-Appellants,
                 v.
                                             No. 04-16973
YAGEO CORPORATION; YAGEO
HOLDING (BERMUDA) LIMITED; YAN                D.C. No.
                                             CV-03-00539-
SHENG CHAN; AN-EHR CHEN; EQUITY
PLUS SECURITIES, LIMITED; CHENG-                WHA
LING LEE; REX Y.C. YANG; WEN-
CHIN YEH; REXTRON INTERNATIONAL
LIMITED,
               Defendants-Appellees.     

                            2327
2328          DUX CAPITAL MGMT v. YAGEO CORP.

DUX CAPITAL MANAGEMENT                   
CORPORATION; JERRY DAVIS,
                Plaintiffs-Appellants,
                 v.
                                             No. 04-17272
YAGEO CORPORATION; YAGEO
HOLDING (BERMUDA) LIMITED; YAN                D.C. No.
                                             CV-03-00539-
SHENG CHAN; AN-EHR CHEN; EQUITY
PLUS SECURITIES, LIMITED; CHENG-                WHA
LING LEE; REX Y.C. YANG; WEN-
CHIN YEH; REXTRON INTERNATIONAL
LIMITED,
               Defendants-Appellees.     
DUX CAPITAL MANAGEMENT                   
CORPORATION,
                 Plaintiff-Appellant,
               and
JERRY DAVIS,
                            Plaintiff,
                v.                           No. 05-16497
                                               D.C. No.
E. LYNN SCHOENMANN,
                Defendant-Appellee,         CV-05-01364-
                                                WHA
GEORGE Q. CHEN,
                            Appellee,         OPINION
YAGEO CORPORATION; YAGEO
HOLDING (BERMUDA) LIMITED; PIERRE
T.M. CHEN; REXTRON INTERNATIONAL
LIMITED; AN-EHR CHEN; YAN SHENG
CHAN; CHENG-LING LEE,
                         Intervenors.    
               DUX CAPITAL MGMT v. YAGEO CORP.                  2329
         Appeal from the United States District Court
           for the Northern District of California
         William H. Alsup, District Judge, Presiding

                  Argued and Submitted
       September 12, 2006—San Francisco, California

                       Filed March 2, 2007

      Before: Betty B. Fletcher and Marsha S. Berzon,
Circuit Judges, and David G. Trager,* Senior District Judge.

                 Opinion by Judge B. Fletcher

   *The Honorable David G. Trager, Senior United States District Judge
for the Eastern District of New York, sitting by designation.
2332        DUX CAPITAL MGMT v. YAGEO CORP.

                      COUNSEL

Robin Meadow (argued), Alison M. Turner, Eric R. Cioffi,
Cynthia E. Tobisman, Greines, Martin, Stein & Richland
LLP, Los Angeles, California, and William McGrane, Mau-
              DUX CAPITAL MGMT v. YAGEO CORP.             2333
reen A. Harrington, McGrane, Greenfield, Hannon & Har-
rington, San Francisco, California, for defendants-
appellants-cross-appellees-intervenors Yageo Corp., Yageo
Holding (Bermuda) Ltd., An-Ehr Chen, Yan Sheng Chan,
Cheng-Ling Lee, and Pierre Chen.

Rodney R. Patula (argued), Eric G. S. Marcks, Daniel T. Bal-
mat, and Penn A. Butler, Squire, Sanders & Dempsey LLP,
San Francisco, California, for plaintiffs-appellees-cross-
appellants and plaintiffs-appellants Dux Capital Management
Corp. and Jerry Davis.

Merle C. Meyers (argued), Kathy L. Quon, Goldberg, Stin-
nett, Meyers & Davis, San Francisco, California, for
defendant-appellee E. Lynn Schoenmann.

K. John Shaffer, Stutman, Treister & Glatt, PC, Los Angeles,
California, for cross-appellee-intervenor Rextron International
Ltd.

Iain A. Macdonald, MacDonald & Associates, San Francisco,
California, for appellee George Chen.

Jon R. Vaught, Vaught & Bourtris LLP, Oakland, California,
for cross-appellees Equity Plus Securities, Ltd., Rex Y.C.
Yang, and Wen-Chin Yeh.

                         OPINION

B. FLETCHER, Circuit Judge:

   These consolidated cases arise out of a corporate dispute
between majority and minority shareholders over the minority
shareholder’s right to elect two of the five directors to the
Long Life Noodle Company, Inc.’s board of directors. Plain-
tiffs Dux Capital Management Corp. and its agent, Jerry
2334           DUX CAPITAL MGMT v. YAGEO CORP.
Davis, alleged that: Defendants, Yageo Corp. and certain of
its subsidiaries and employees who controlled the Long Life
Noodle Company’s board of directors, placed the corporation
into bankruptcy without considering other alternatives that
may have yielded greater value for the corporation and its
shareholders. Defendants petitioned for bankruptcy in order to
prevent plaintiffs, who were minority shareholders, from par-
ticipating in the governance of the corporation. In bankruptcy,
the equity of the minority shareholders was wiped out and the
assets of the corporation were sold to one of defendant Yageo
Corp.’s subsidiaries, Equity Plus Securities, Ltd., a secured
creditor of LLNC.

   In a jury trial, the jury found defendants Yageo Corp.,
Yageo Corp. subsidiaries Yageo Holding (Bermuda) Ltd. and
Rextron International Ltd., and Yageo Corp. employees An-
Ehr Chen, Yan Sheng Chan, and Cheng-Ling Lee1 liable for
breach of fiduciary duty. On appeal, defendants argue that
plaintiffs lack standing to sue as assignees of the corporate
claim and that their breach of fiduciary duty claims are pre-
empted by federal bankruptcy law and barred by res judicata.
The district court held that plaintiffs have standing and that
their claims are neither preempted nor barred by res judicata.
Plaintiffs cross-appeal the district court’s damages calcula-
tions and its determination that they did not have standing to
assert the claims of minority shareholders. Plaintiffs filed a
separate appeal of the district court’s refusal to entertain their
Fed. R. Civ. P. 60(b) motion for post-judgment relief. In a
related case, plaintiffs appeal from the district court’s order
affirming the bankruptcy court decision in an adversary pro-
ceeding against debtor George Chen (a founder of Long Life
Noodle Company) and the Trustee of Chen’s bankruptcy
estate, E. Lynn Schoenmann. We affirm the district court on
all issues.
  1
   We refer to them collectively as the “Yageo defendants.”
              DUX CAPITAL MGMT v. YAGEO CORP.             2335
       I.   FACTS AND PROCEDURAL HISTORY

  A.   Yageo’s Investment in LLNC

   Long Life Noodle Company, Inc. (“LLNC”), was formed
in 1996 by George Chen and George “Geordy” Murphy. In
1998, George Chen approached Pierre Chen, director and gen-
eral manager/president of defendant Yageo Corp. (“Yageo”)
in Taiwan, about investing in LLNC. Pierre Chen directed
An-Ehr Chen, his assistant, to investigate this investment
opportunity. An-Ehr Chen recommended that Yageo invest
through Rextron International Ltd. (“Rextron”), a wholly-
owned subsidiary of another subsidiary, Yageo Holding (Ber-
muda) Ltd. (“Yageo Holding”), and Equity Plus Securities
Ltd. (“Equity Plus”), another Yageo affiliate. Yageo Holding
and Rextron were merely holding companies, and their invest-
ments were determined by Pierre Chen as general manager of
Yageo.

   In late 1998, Rextron invested approximately $1.2 million
in LLNC in return for all of the preferred stock and some of
the common stock and thereby became the majority share-
holder. Murphy and George Chen owned the balance of the
common stock as minority shareholders. After Rextron’s ini-
tial investment, LLNC borrowed approximately one million
dollars from Equity Plus. These loans were secured by all of
LLNC’s assets. The loans were negotiated by attorney Gayle
Chan, whom LLNC hired to handle these transactions. She
was Rextron’s corporate counsel and she did not inform
LLNC of this conflict of interest.

   Under LLNC’s Articles of Incorporation, Rextron could
elect three of the five directors of the board. Rextron elected
defendants An-Ehr Chen, Cheng-Ling Lee, and Yan Sheng
Chan to the board, all of whom were Yageo employees. An-
Ehr Chen was the assistant to the president of Yageo and a
director of Rextron, Lee succeeded Pierre Chen as general
manager/president of Yageo in 2000, and Chan was the vice-
2336             DUX CAPITAL MGMT v. YAGEO CORP.
president of Yageo. Murphy and George Chen at that point
controlled two of the five seats on the board.

   In February 2001, George Chen resigned as an officer and
director of LLNC. Murphy resigned in March 2001. Their
seats remained vacant after their resignations; this left control
of the LLNC board of directors to Rextron. The LLNC By-
Laws provided that board actions had to be unanimous, and
unanimity could be achieved since only Rextron-controlled
directors remained on the board.

  B.    Chen-Dux Settlement

   Around the same time period, George Chen was involved
in separate litigation with Dux Capital Management Corp.
(“Dux”) and Jerry Davis, Dux’s agent.2 In September 1998,
Dux lent Chen $150,000, for which Chen executed a promis-
sory note to Dux secured by Chen’s stock in LLNC. Chen
defaulted on the loan, and Dux demanded repayment. In
March 2000, Chen sued Dux in California state court for
declaratory relief, alleging that he never received the
$150,000. Dux cross-claimed. On April 25, 2001, Chen and
Dux entered into a settlement agreement. Pursuant to the set-
tlement agreement, Chen was to transfer 200,000 shares of
common stock in LLNC and voting proxies for all of his
411,538 shares (including the 200,000 transferred) to Dux.
These shares were to be held in escrow for Dux “pending the
expiration of the right of first refusal described in the Long
Life Noodle Company Shareholder Agreement.”3 Settlement
Agreement and Mutual General Release (“Settlement Agree-
ment”) ¶ 1. Dux had the right to vote the 200,000 shares
pending expiration or exercise of the right of first refusal.
Moreover, Paragraph 12.18 of the Settlement Agreement
expressly provided, “A finding by the court that this Agree-
  2
     Jerry Davis holds an unlimited power of attorney from Dux for all mat-
ters related to Dux’s interest in LLNC.
   3
     LLNC and other shareholders had the right of first refusal.
              DUX CAPITAL MGMT v. YAGEO CORP.            2337
ment is in good faith under [California] Code of Civil Proce-
dure Section 877.6 is a condition to the validity and
enforceability of this Agreement.” Id. ¶ 12.18. The California
superior court made this good faith determination on July 25,
2001 and approved the settlement agreement. Chen trans-
ferred 200,000 of his shares and voting proxies for all his
shares to Dux.

  C.   LLNC Directors’ Decision to File Bankruptcy

   On April 26, 2001, the day after Chen and Dux reached
their settlement agreement, Dux and Davis demanded a meet-
ing of the shareholders to elect directors to the two vacant
seats on the board. Dux’s counsel, Lorne Polger, sent a formal
demand letter on April 30, 2001. After receiving plaintiffs’
demand, Rextron and its representatives, particularly An-Ehr
Chen and Gayle Chan, discussed ways to prevent plaintiffs
from voting directors to the board and participating in the
management of the corporation. Defendants began to consider
bankruptcy at the end of April or beginning of May 2001.

   The LLNC By-Laws provided that shareholders were to
elect directors at the annual meeting on May 1. No meeting
was held on May 1, 2001. From May 1 to May 3, the directors
and Rextron attorneys continued to discuss options for pre-
venting the minority shareholders from electing their two
directors. On May 3, 2001, the board of directors (consisting
of three directors elected by Rextron) unanimously voted to
petition for bankruptcy. The By-Laws required any action
taken by the board to be unanimous.

   On May 4, Polger faxed another letter to LLNC and Rex-
tron attorneys demanding a meeting and an inspection of
LLNC’s books and records. Rextron counsel Gayle Chan
denied this request on May 7, 2001, and even though she
knew of the board’s resolution to pursue bankruptcy, she
stated that she would try to arrange for an inspection on May
15. Also on May 7, 2001, An-Ehr Chen, on behalf of Rextron,
2338           DUX CAPITAL MGMT v. YAGEO CORP.
requested that LLNC’s board convert 700,000 of Rextron’s
preferred shares to common. The LLNC board granted this
request by unanimous written consent. On May 9, 2001,
LLNC filed its petition for bankruptcy.

  D.   Proceedings in Bankruptcy Court

   On July 9, 2001, Dux moved for appointment of a Chapter
11 trustee for cause “on the grounds of dishonesty, gross mis-
management and breach of fiduciary duty.” Dux Capital’s
Mot. to Appoint Chapter 11 Trustee at 1. Among other things,
Dux alleged that Rextron “orchestrated and carried out a sys-
tematic plan to control the Debtor [LLNC] in order to ensure
that its interests were protected to the detriment of the Debt-
or’s legitimate creditors, including Dux,” id., that Rextron
refused to hold the annual shareholder meeting in order to
prevent Dux from filling the two vacant seats on the board of
directors, and that Rextron, through its control of LLNC,
breached its fiduciary duty to creditors and the estate and
committed fraud by failing to give full and honest disclosure
of its financial condition.

   On August 29, 2001, LLNC filed its Chapter 11 plan of
reorganization. In October 2001, Dux filed an objection to
confirmation of the plan. Dux asserted that Rextron had
breached its fiduciary duty by not holding a shareholder meet-
ing according to the By-Laws. At a hearing on October 11,
2001, the bankruptcy court appointed a Trustee to address
whether any amendments to the plan were necessary in order
for the plan to be considered fair. The Trustee, David Brad-
low, recommended adoption of the plan with some modifica-
tions. The bankruptcy court confirmed the plan with minor
modifications. The court’s order provided, “All claims,
defenses, causes of action, and objections to claims are
reserved for the benefit of the estate and may be asserted by
the Disbursing Agent.”4 Order Confirming Debtor’s Chapter
  4
   The Disbursing Agent was David Bradlow, the former Trustee.
              DUX CAPITAL MGMT v. YAGEO CORP.               2339
11 Plan of Reorganization Dated August 29, 2001
(“Confirmation Order”) ¶ 10 (emphasis added). Rextron and
Equity Plus objected to the Trustee’s report and recommenda-
tion, but the bankruptcy court overruled their objections.

   Under the plan, Equity Plus acquired the assets of LLNC.
As a primary unsecured creditor, Rextron received cash for its
loans. The equity of the minority shareholders was eliminated.
However, the bankruptcy court approved an assignment to
Dux and Davis of all pre-petition claims for relief LLNC
owned against the majority shareholder, its directors, and
affiliates. The Disbursing Agent negotiated this assignment
with Dux and Davis in exchange for their waiver of all their
general unsecured claims against the estate except for admin-
istrative expenses. Rextron and Equity Plus objected to this
assignment. The bankruptcy court overruled these objections
and stated in its order:

    The Disbursing Agent is authorized to transfer and
    assign to Davis/Dux certain of Debtor’s claims that
    existed on May 9, 2001 (i.e., immediately prior to
    the Chapter 11 filing), as described in and according
    to the terms of the Letter Agreement. The Disbursing
    Agent makes no representation that the Debtor had
    any valid claims, rights or causes of action on May
    9, 2001, and nothing contained in this Order shall be
    deemed to constitute a finding as to the existence of
    any such[ ] cla[i]ms, rights or causes of action.

Order Authorizing Compromise of Controversy and Assign-
ment of Claims (“Order Authorizing Compromise”) ¶ 6.

  E.   Proceedings in the District Court

   In early 2002, Geordy Murphy, Davis, and Dux filed suit
against the Yageo defendants in California state court. They
alleged, among other things, breach of fiduciary duty, RICO
violations, fraud, conspiracy to commit fraud, violation of the
2340          DUX CAPITAL MGMT v. YAGEO CORP.
state unfair competition law, breach of contract, and malicious
prosecution. Plaintiffs sued on the assigned corporate claim
(“LLNC claim”) in place of the corporation, alleging that the
directors had breached their duty to the corporation and its
shareholders by causing loss in value of all the corporation’s
stock. Plaintiffs sued on their own claims as minority share-
holder (“Minority Shareholder claim”) in a direct action
against the majority shareholder, Rextron, for breaching its
fiduciary duty to them by preventing them from electing their
two directors to the board and causing loss in share value.

  Dux and Davis also filed a separate complaint containing
similar allegations in California superior court. Both cases
were removed to the federal district court in 2003 under 28
U.S.C. § 1441(b) and (c). They were consolidated on May 1,
2003.

   In January 2004, defendants moved for summary judgment
on the ground that all of Dux’s claims were barred by res judi-
cata. They argued that the bankruptcy court already ruled on
Dux’s claims in its order confirming the LLNC reorganization
plan and that any issues not ruled on should have been
asserted in the bankruptcy court. On March 12, 2004, the dis-
trict court granted in part and denied in part defendants’ sum-
mary judgment motion. The district court held that res
judicata barred Dux’s post-petition claims — claims that col-
laterally attacked the decisions and orders of the bankruptcy
court. Dux and Davis do not appeal that portion of the district
court’s order.

   However, the district court denied defendants’ motion for
summary judgment as to plaintiffs’ pre-petition claims —
claims arising out of events occurring prior to the filing of the
bankruptcy petition. The district court held, “the bankruptcy
court did not adjudicate plaintiffs’ pre-petition claims against
non-debtor defendants to the extent plaintiffs did not seek to
recover from the debtor. Pre-petition claims against a non-
debtor [are] normally nondischargeable.” Order Granting in
                DUX CAPITAL MGMT v. YAGEO CORP.                     2341
Part Defendants’ Mot. for Summary Judgment (“Summary
Judgment Order”) at 17. That is, pre-bankruptcy claims
against the Yageo defendants — who were not the debtor —
were not disposed of in the bankruptcy court. Moreover, the
district court noted that the bankruptcy court preserved these
pre-bankruptcy claims against the non-debtor defendants by
assigning them to plaintiffs Dux and Davis.5

   The case proceeded to a jury trial. At the end of plaintiffs’
case, defendants moved for judgment under Fed. R. Civ. P.
50(a). The district court granted this motion with respect to all
claims except the LLNC and Minority Shareholder claims. In
the midst of trial, defendants raised a standing issue, arguing
that Dux did not have standing to sue on the Minority Share-
holder claim because the Chen-Dux settlement was not final-
ized (and therefore Dux did not own the 200,000 LLNC
shares) until July 25, 2001, after the bankruptcy petition was
filed. The district court reserved this issue until after trial,
directing the jury to assume that plaintiffs had standing.

  F.     Jury Instructions and Verdict

   The parties dispute whether the jury determined that plain-
tiffs Dux and Davis suffered any damages prior to May 9,
2001, the date LLNC filed for bankruptcy. One of the jury
instructions provided:

       If you find that plaintiffs have proven any liability
       by any defendant, then you would have to decide
       whether plaintiffs have proven by the preponderance
       of the evidence any damages. To do so, plaintiffs
  5
   The district court also held that because Geordy Murphy was never
assigned the rights of LLNC, he could not assert any claims on behalf of
LLNC as an assignee. Summary Judgment Order at 17 (“His claims are
limited to personal claims against moving defendants or claims as a share-
holder against directors of LLNC.”). Geordy Murphy is not a party to
these appeals.
2342          DUX CAPITAL MGMT v. YAGEO CORP.
    would have to prove the value of the shares held by
    the common stockholders as of the date of the deci-
    sion to commence bankruptcy proceedings. The
    measure of damages would be the value of those
    shares as of that date less the expected value of those
    shares in bankruptcy proceedings expected as of the
    date of the board’s vote.

Jury Instruction XXXVIII (emphasis added). The jury was
also instructed, “[i]n this case, plaintiffs challenge [the direc-
tors’] decision to commence bankruptcy as having not been in
the best interests of the corporation,” Jury Instruction XIX
(emphasis added), and “[l]iability in this case depends, in the
first instance, upon whether the board’s decision to com-
mence bankruptcy proceedings was improper,” Jury Instruc-
tion XXIX (emphasis added).

   With respect to the LLNC claim, the jury determined after
a first round of deliberations that the three Rextron-controlled
directors (An-Ehr Chen, Cheng-Ling Lee, and Yan Sheng
Chan) had breached their fiduciary duties owed to the corpo-
ration and common shareholders in connection with the vote
to commence bankruptcy proceedings. The jury initially
delivered an inconsistent verdict with respect to the harm
caused by defendants’ breach of fiduciary duty. In response
to Question One of the Special Verdict Form — “Have plain-
tiffs proven by a preponderance of the evidence that the com-
mon stock of Long Life Noodle Company, Inc., had any value
as of the company’s petition to commence bankruptcy pro-
ceedings on May 9, 2001?” — the jury answered, “No.” How-
ever, in response to Question Six — “If you have determined
that any defendant has liability, what damages, if any, have
plaintiffs proven by preponderance of the evidence?”— the
jury answered, “$400,000.” After discussing this inconsis-
tency with the parties, the district court gave the following
curative instructions to the jury:
                 DUX CAPITAL MGMT v. YAGEO CORP.                      2343
        [O]ur intent was . . . to ask you to tell us what
      value, if any, the stock had immediately before the
      bankruptcy proceedings commenced. . . .

         And I want you to understand [question] number
      1 to mean that it is have plaintiffs proven by a pre-
      ponderance of the evidence that the common stock
      of Long Life Noodle Company, Inc. had any value
      as of immediately before the company’s petition to
      commence bankruptcy proceedings on May 9, 2001.

Before giving these curative instructions, the district court re-
read Jury Instruction XXXVIII twice.

   After receiving the curative instructions, the jury returned
with a consistent verdict. With respect to the Minority Share-
holder claim, the jury determined that Rextron breached its
fiduciary duty as a majority shareholder to the minority share-
holders. The jury found $400,000 in damages.6 The jury also
determined that the total dollar value of the 200,000 shares
transferred from George Chen to Dux in their settlement
agreement as of May 9, 2001, was $2 per share and $400,000
total.7

  G.    District Court Ruling on Standing and June 30,
        2004 Judgment

   On June 30, 2004, the district court returned to the standing
issue it had set aside during trial. It held that Dux and Davis
did not have standing to assert the Minority Shareholder
  6
     The jury also awarded punitive damages against An-Ehr Chen and
Rextron. Those damages were vacated by the district court and are not at
issue on appeal.
   7
     Plaintiffs’ evidence of the value of the common shares consisted of the
terms of the Chen-Dux Settlement Agreement, which assigned a value of
$2 per share to the common shares, “which the parties [Chen and Dux]
acknowledge and agree is their good faith estimate of the current fair mar-
ket value of the Shares.” Settlement Agreement ¶ 1.
2344          DUX CAPITAL MGMT v. YAGEO CORP.
claim, because they did not have any legal rights to the shares
prior to the bankruptcy petition that was filed on May 9, 2001.
See Dux Capital Mgmt. Corp. v. Chen, Nos. C03-00539WHA,
C03-00540WHA, 2004 WL 2472247, at *3-5 (N.D. Cal. June
30, 2004). Accordingly, the district court set aside the jury’s
verdict against Rextron based on its breach of fiduciary duty
to the minority shareholder.

   Defendants also argued in its post-trial brief on standing
that plaintiffs failed to prove an assigned claim for breach of
fiduciary duty to the corporation because no damages to the
corporation had accrued as of the time immediately prior to
the bankruptcy filing. Id. at *6. The district court noted that
although “this issue is outside the scope of the standing issue
reserved by the Court,” it would address it because
“[d]efendants may have believed there was some latitude . . .
due to the Court’s request for precise information on what the
trial record showed was the number of common shares out-
standing as of May 9, 2001.” Id. The district court held that
plaintiffs had standing to sue on the assigned LLNC claim
because a breach of fiduciary duty claim accrued when the
directors decided to file for bankruptcy on May 3, 2001. Id.
at *6-7. With respect to the LLNC claim, then, the district
court entered judgment for plaintiffs Dux and Davis against
defendants An-Ehr Chen, Yan Sheng Chan, Cheng-Ling Lee,
Yageo, and Yageo Holding. The district court held that these
defendants were jointly and severally liable to Dux and Davis
as assignees of the corporate claim in the amount of
$2,692,306 ($2 per share as found by the jury x 1,346,153
common shares). Id. at *7.

  H.   Defendants’ Fed. R. Civ. P. 50(b) Motion

  Defendants sought judgment as a matter of law (“JMOL”)
on five renewed motions. See Dux Capital Mgmt. Corp. v.
Chen, Nos. C03-00539WHA, C03-00540WHA, 2004 WL
1936309, at *7 (N.D. Cal. Aug. 31, 2004). Two are relevant
here: First, defendants contended that the LLNC claims were
              DUX CAPITAL MGMT v. YAGEO CORP.                2345
not valid because these claims did not accrue prior to the
bankruptcy petition filing on May 9, 2001. Defendants raised
this issue for the first time in their post-verdict brief concern-
ing standing. See id. at *16. The district court affirmed its ear-
lier ruling that damages occurred at the time the decision to
commence bankruptcy was made and accordingly denied
defendants’ motion for JMOL on the assigned claims. Id. at
*16-18. Second, defendants contended that all of plaintiffs’
claims were preempted by federal bankruptcy laws and barred
by res judicata. Defendants failed to raise the preemption
issue before the jury verdict, and the district court had already
held in its summary judgment order that res judicata did not
bar plaintiffs’ pre-petition claims. The district court denied
defendants’ motion regarding preemption and res judicata,
holding that the pre-petition claims were not preempted
because the bankruptcy court properly reserved them for liti-
gation in another forum and that its earlier res judicata ruling
was law of the case. Id. at *18-19.

   The district court granted defendants’ request to exclude
Rextron’s eventual common shares (the 700,000 shares con-
verted from preferred to common) from the damages calcula-
tion. Defendants argued that damages on the assigned LLNC
claim must exclude Rextron’s shares because there were only
646,153 shares of common stock as of the directors’ resolu-
tion to petition for bankruptcy on May 3, 2001. The parties
had proffered 1,346,153 shares of common stock in their post-
trial briefs on standing. See id. at *18. The district court
amended the judgment entered on June 30, 2004 to hold
defendants An-Ehr Chen, Yan Sheng Chan, Cheng-Ling Lee,
Yageo, and Yageo Holding jointly and severally liable in the
sum of $1,292,306 ($2 per share x 646,153 shares). Id. at *19.

  I.   Plaintiffs’ Post-Judgment Fed. R. Civ. P. 60(b)
       Motion

  After the district court entered its Amended Judgment on
August 31, 2004, plaintiffs moved to vacate the judgment and
2346          DUX CAPITAL MGMT v. YAGEO CORP.
the district court’s ruling on Dux’s standing as a minority
shareholder, “subject to Plaintiffs’ filing and service herein of
a ratification, pursuant to Fed. R. Civ. P. 17(a), by Mr. George
Chen of the commencement and maintenance of this civil
action upon the claims of the minority shareholder, and
amending the Amended Judgment entered herein on August
31, 2004 to reinstate the jury’s verdict for Dux on those
claims for relief.” Notice of Mot. and Mot. by Pls. for Relief
from Judgment at 1. The district court denied this motion.
Plaintiffs appealed. Defendants moved to dismiss the appeal
for lack of jurisdiction. Plaintiffs opposed the motion and
moved for limited remand to the district court to rule on the
merits of their Fed. R. Civ. P. 60(b) motion. The Appellate
Commissioner denied both motions on January 5, 2005.

  J.   Dux’s Adversary Proceeding Against George Chen

   After Dux filed its appeal to this court seeking review of
the district court’s denial of its request to entertain Dux’s Rule
60(b) motion, Dux sought George Chen’s ratification of the
Minority Shareholder claim under Fed. R. Civ. P. 17(a). Dux
sought ratification as a way around the district court’s stand-
ing ruling: if it did not have standing, it would obtain the
claim from the person who did. On July 25, 2003, however,
Chen had filed his own bankruptcy petition, which was con-
verted into a Chapter 11 proceeding on August 8, 2003. The
Trustee, E. Lynn Schoenmann, was appointed on August 28,
2003. Dux commenced an Adversary Proceeding in bank-
ruptcy court on November 2, 2004. In its amended complaint
filed on November 17, 2004, Dux argued that it had been
deprived of the “mutually intended benefit of its bargain”
gained from entering into the Chen-Dux settlement because
the 200,000 shares transferred therein had become worthless
as a result of the bankruptcy. Dux sought specific perfor-
mance of Paragraph 12.2 of the Settlement Agreement, which
provided that the parties were to “take all actions as may be
reasonably required to effectuate this Agreement,” and it
              DUX CAPITAL MGMT v. YAGEO CORP.              2347
argued that Chen was obligated to ratify its direct action
against the Yageo defendants.

   Chen moved to dismiss on the ground that he had no
authority to ratify because a Trustee had already been
appointed to his bankruptcy estate. The Trustee moved for
summary judgment on the ground that the Settlement Agree-
ment created no obligation to ratify the suit or otherwise
transfer Chen’s claims against the Yageo defendants to Dux.
Dux moved for partial summary judgment on liability for
breach of the agreement and requested declaratory relief and
specific performance.

   The bankruptcy court granted Chen’s and the Trustee’s
motions and denied Dux’s motion. Dux appealed to the dis-
trict court. The district court held that Fed. R. Civ. P. 17(a)
is not a substantive rule creating any right to ratification and
the settlement agreement does not otherwise obligate the
Trustee to transfer the Minority Shareholder claim to Dux.
The district court also clarified that even if Dux obtained
judgment against the Trustee, Chen could not be personally
bound to that judgment because the claim was an asset of the
estate that was no longer owned or controlled by Chen.

 II.   JURISDICTION AND STANDARD OF REVIEW

   We have jurisdiction over the appeal and cross-appeal of
the district court civil judgment under 28 U.S.C. § 1291 and
jurisdiction over the appeal arising from the Chen bankruptcy
under 28 U.S.C. § 158(d).

   We review questions of preemption, standing, availability
of damages, and the denial of summary judgment on res judi-
cata grounds de novo. See, e.g., Greany v. W. Farm Bureau
Life Ins. Co., 973 F.2d 812, 816 (9th Cir. 1992); Mortensen
v. County of Sacramento, 368 F.3d 1082, 1086 (9th Cir.
2004); Hemmings v. Tidyman’s Inc., 285 F.3d 1174, 1197 (9th
Cir. 2002); Akootchook v. United States, 271 F.3d 1160, 1164
2348          DUX CAPITAL MGMT v. YAGEO CORP.
(9th Cir. 2001). A motion for judgment as a matter of law is
reviewed de novo. See, e.g., City Solutions Inc. v. Clear
Channel Commc’n, Inc., 365 F.3d 835, 839 (9th Cir. 2004).
In reviewing a judgment as a matter of law, the evidence must
be viewed in the light most favorable to the nonmoving party,
and all reasonable inferences must be drawn in favor of that
party. See Reeves v. Sanderson Plumbing Prods., Inc., 530
U.S. 133, 149-50 (2000).

   This court reviews de novo questions of jurisdiction con-
cerning Fed. R. Civ. P. 60(b) motions. Carriger v. Lewis, 971
F.2d 329, 332 (9th Cir. 1992) (en banc). The interpretation of
language in a contract is a question of law reviewed de novo.
See United States v. 1.377 Acres of Land, 352 F.3d 1259,
1264 (9th Cir. 2003).

                     III.   DISCUSSION

  A.     Standing

    1.    Plaintiffs Have Standing to Litigate the Assigned
          LLNC Claim

   [1] In order for plaintiffs to have standing, they must show
that they suffered an injury in fact, there was a causal connec-
tion between the injury and the conduct complained of, and
the injury is likely to be redressed by a favorable decision.
Lujan v. Defenders of Wildlife, 504 U.S. 555, 560-61 (1992).

   [2] Defendants argue that Dux and Davis lack standing to
raise the LLNC claims because they were assigned only
claims that accrued as of immediately prior to the bankruptcy
filing, and no such claims accrued as of that date because
plaintiffs suffered damages only when the bankruptcy petition
was filed. Plaintiffs argue that the jury found damages as of
the LLNC board of directors’ decision to file bankruptcy on
May 3, 2001, and therefore the LLNC claim accrued on that
date. Thus, the question is whether the jury found actual dam-
              DUX CAPITAL MGMT v. YAGEO CORP.               2349
ages before May 9, 2001. Under California law, a cause of
action accrues with “the infliction of appreciable and actual
harm, however uncertain in amount.” Davies v. Krasna, 535
P.2d 1161, 1169 (Cal. 1975).

   Plaintiffs had standing to assert the LLNC claim because
they suffered harm before May 9, 2001. Several of the origi-
nal jury instructions clearly asked the jury whether the defen-
dants breached their fiduciary duty as a result of the LLNC
board’s decision to file bankruptcy on May 3, 2001, and the
jury’s original verdict found several defendants had breached
their duty on this basis. We agree with the district court’s
analysis:

    Defendants’ argument fails to consider the main fac-
    tual issue for the jury: whether the directors on the
    board breached their fiduciary duty by choosing the
    bankruptcy alternative rather than some other course
    of action expected to provide the company and its
    shareholders with more value. The directors decided
    to file for bankruptcy on May 3, 2001. It is at this
    point in time that a breach of fiduciary duty claim
    may have accrued. If plaintiffs’ damages were rea-
    sonably certain and not speculative at the time of
    wrongdoing, then the cause of action accrued.

Dux Capital Mgmt. Corp., 2004 WL 2472247, at * 6 (cita-
tions omitted).

   Believing that the jury may have interpreted Question One
on the special verdict form to ask what the value of the stock
was “once the bankruptcy proceeding started” — that is, after
the bankruptcy petition was filed — the district court re-
instructed the jury. In giving its curative instruction, the dis-
trict court first re-read Jury Instruction XXXVIII, which
stated in part, “plaintiffs would have to prove the value of the
shares held by the common stockholders as of the date of the
decision to commence bankruptcy proceedings.” Jury Instruc-
2350          DUX CAPITAL MGMT v. YAGEO CORP.
tion XXXVIII (emphasis added). The district court explained
to the jury that if it construed Question One to mean “upon
filing and commencing the bankruptcy petition, did the stock
have value at that point,” “then that was not our intent.” The
court further explained:

      Rather, what our intent was was to ask you to tell
    us what value, if any, the stock had immediately
    before the bankruptcy proceedings commenced. . . .
    have plaintiffs proven by a preponderance of the evi-
    dence that the common stock of Long Life Noodle
    Company, Inc. had any value as of immediately
    before the company’s petition to commence bank-
    ruptcy proceedings on May 9, 2001.

       . . . it is a before and after comparison. If you were
    to find that there were any value immediately before
    and that that got wiped out in the bankruptcy and
    that there was another alternative that would have
    preserved more value to the shareholders, then that
    is what we are trying to get at . . . .

(Emphasis added).

   [3] Seizing upon this curative instruction, defendants argue
on appeal (as they argued below) that the district court told
the jury to ignore May 3, the date of the decision to file, and
instead instructed it to compare the loss caused by the actual
filing of the petition on May 9. See Dux Capital Mgmt. Corp.,
2004 WL 1936309, at *16-17. But the district court did not
tell the jury to ignore May 3. The jury determined that LLNC
common stock had a value of $2 per share prior to defen-
dants’ decision to commence bankruptcy proceedings on May
3, 2001, and that this stock had no expected value after the
defendants’ decision. See id. at *16-18. This is clear in light
of the district court’s concern that the jury had originally
interpreted Question One to mean the value of the shares after
the bankruptcy petition and its addressing this by reminding
                 DUX CAPITAL MGMT v. YAGEO CORP.                      2351
the jury of Jury Instruction XXXVIII8 while giving its cura-
tive instruction. See id. at *17-18. Hence, plaintiffs had stand-
ing to assert the LLNC claim because it accrued before May
9, 2001.

      2.   Plaintiffs Lack Standing to Litigate the Minority
           Shareholder Claim

   The standing issue as to the Minority Shareholder claim is
whether the Chen-Dux Settlement Agreement gave Dux any
legal right to the LLNC shares and endowed it with standing
as of May 9, 2001. Dux bases its standing to sue as a minority
shareholder for breach of fiduciary duty by the majority
shareholder, Rextron, on the 200,000 common shares of
LLNC transferred pursuant to its settlement with Chen.
Because the Settlement Agreement does not assign Chen’s
accrued legal claims as a shareholder to Dux, Dux only would
have standing to sue for loss in share value caused by Rex-
tron’s breach of fiduciary duty if it actually owned those
shares at the time the injury occurred. Neither party disputes
that the Chen-Dux Settlement Agreement was executed on
April 25, 2001, that it contained a good-faith determination
provision, and that a California court did not make this good-
faith determination until July 25, 2001. The district court held
that the settlement agreement could not be construed to pro-
vide Dux any legal right to the LLNC shares prior to May 9,
2001. Dux Capital Mgmt. Corp., 2004 WL 2472247, at *3.
On cross-appeal, Dux and Davis argue that the issue is not
whether they had standing to sue as minority shareholder, but
  8
   This key instruction asked the jury to determine “the difference
between the expected value of the shares with Long Life pursuing the
bankruptcy option versus the expected value of the shares with Long Life
pursuing alternative options, all measured as of the time before the bank-
ruptcy petition itself. Damages, therefore, could be calculated by subtract-
ing the expected value of the shares at the time of the decision to file for
bankruptcy from the expected value of the shares had the directors opted
for an alternative to bankruptcy.” Dux Capital Mgmt. Corp., 2004 WL
1936309, at *16.
2352             DUX CAPITAL MGMT v. YAGEO CORP.
whether they were the real-party-in-interest at the time of
judgment. Plaintiffs do not attempt to establish that they had
standing or legal right to the shares as of May 9, 2001. Defen-
dants argue that whether Dux had standing or was the real-
party-in-interest are separate issues and that Dux does not
have standing.

   [4] We hold that Dux does not have standing to sue on the
Minority Shareholder claim. Whether or not Dux was the real-
party-in-interest, it lacks standing. In order to have standing,
Dux must show injury in fact. See Lujan, 504 U.S. at 560. If
Dux did not own the shares at the time that the injury (breach
of fiduciary duty) was inflicted and damage to the value of the
stocks was sustained, then it did not suffer any injury in fact.9
Paragraph 12.18 of the Chen-Dux Settlement Agreement
clearly provides that the court’s good faith determination is “a
condition to the validity and enforceability of this Agree-
ment,” and the California superior court did not make this
finding until July 25, 2001. Thus, as the district court cor-
rectly held, on May 9, 2001, “George Chen retained all his
legal rights as a minority shareholder of Long Life and was
under no duty yet to transfer the shares or the right to vote to
Dux. (Thus, the cause of action accrued to George Chen.
There was no assignment of the cause of action.).” Dux Capi-
tal Mgmt. Corp., 2004 WL 2472247, at *3.10
  9
    Under California law, shareholder status is based on record ownership
of shares. Cal. Corp. Code § 185 (shareholder is “one who is a holder of
record of shares”); see also id. § 701(d) (shareholders of record are per-
sons entitled to vote, attend meetings, receive dividends). Dux cannot be
considered a shareholder of record vested with the right to pursue a direct
shareholder action unless it received Chen’s shares or recorded them by
the time of the injury. Moreover, California law provides that there is no
division between who owns the shares and has legal title to them and who
has the right to recover for damages to them. See id. §§ 185, 701(d).
   10
      Similarly, the Chen-Dux Settlement Agreement provides no support
for Dux’s position that Chen (or his bankruptcy Trustee) must ratify Dux’s
claim pursuant to Fed. R. Civ. P. 17(a). Dux relies on Paragraph 12.2, the
further assurances provision, which states, “Each party to this Agreement
                 DUX CAPITAL MGMT v. YAGEO CORP.                        2353
   Moreover, we agree with the district court’s analysis com-
paring the Chen-Dux agreement to the buy-sell agreement in
Stephenson v. Drever, 947 P.2d 1301 (Cal. 1997). See Dux
Capital Mgmt. Corp., 2004 WL 2472247, at *3-4. In Stephen-
son, the plaintiff was an employee and minority shareholder
in a closely held corporation. 947 P.2d at 1302. The buy-sell
agreement between the plaintiff and the corporation provided
that the corporation “ ‘shall have the right and obligation to
repurchase’ ” all of the plaintiff’s shares in the event of termi-
nation of employment. Id. After the plaintiff was terminated,
there was a disagreement as to the fair market value of the
shares, and the plaintiff did not deliver the shares back to the
corporation. Id. at 1305. The plaintiff sued directors and offi-
cers of the corporation for breach of fiduciary duty that they
owed as majority shareholders to him, the minority share-
holder. Id. at 1302-03. Defendants argued that the plaintiff
ceased having shareholder rights upon termination of his

shall execute all instruments and documents and take all actions as may
be reasonably required to effectuate this Agreement.” Settlement Agree-
ment ¶ 12.2 (emphasis added). Dux argues that it cannot realize the “bene-
fit of the bargain” because it lost the value of the shares in bankruptcy. But
the further assurances provision provides only that further actions must be
taken to effectuate “this agreement,” and so the question is whether or not
“this agreement” included the transfer or assignment of the minority share-
holder claims to Dux. As the district court noted, “Dux was primarily con-
cerned about protecting its interest in the shares themselves,” and at the
time the agreement was made, no one contemplated any minority share-
holder claims. Order Affirming Bankruptcy Court Decision at 7.
   Moreover, as the Trustee persuasively argues, the terms of the settle-
ment agreement involved transfer of shares, without any warranty as to
value. See Settlement Agreement ¶ 1. It is true that at the time of the
agreement, the shares were assigned the fair market value of $2. However,
“[b]y making the superior court’s approval an explicit condition of the set-
tlement agreement, Dux knowingly accepted the risk that the value of the
stock would decrease in the interim, even independent of a bankruptcy fil-
ing.” Order Affirming Bankruptcy Court Decision at 7. Conversely, Chen
accepted the risk that the value of the stock would increase and the settle-
ment would be approved, or that it would decrease and he would have to
keep the stock if the settlement were not approved.
2354             DUX CAPITAL MGMT v. YAGEO CORP.
employment and thus lacked standing to sue. Id. The Stephen-
son court held that unless something in the agreement indi-
cated to the contrary, plaintiff retained legal title to the shares
“with all the rights appurtenant.” Id. at 1305.11

   [5] Likewise, nothing in the Chen-Dux Settlement Agree-
ment indicates that Dux had any right to the shares prior to the
good faith determination by the California superior court. Fur-
thermore, the agreement had a provision for making Dux’s
voting rights valid “during the pendency of any writ of man-
date which may be filed by any party to the Action to overturn
the Court’s determination of good faith.” Settlement Agree-
ment ¶ 12.18. But, as the district court held, “No similar vot-
ing right was created pending the initial application for good-
faith determination. . . . The fact that the settlement agreement
expressly provided rights in one situation and not another
tends to negate any inference that the parties intended for Dux
to obtain voting rights or any other rights prior to the superior
  11
     On appeal, Dux has apparently given up on the argument that it had
legal title to the 200,000 LLNC shares as of May 9, 2001. Instead, it
argues that it would be unfair to deprive it of standing since it ultimately
suffered the loss in value of those shares. Although Dux does not quite put
it in these terms now, this is similar to the “beneficial owner” theory it
argued (and lost) below. See Dux Capital Mgmt. Corp., 2004 WL
2472247, at *5 (holding that beneficial owners may not bring direct
actions and that Dux’s suit on the minority shareholder claim was a direct
action because it alleged that the defendants’ failure to hold an annual
meeting prevented it from electing directors to the board). What Stephen-
son illustrates, however, is that the record shareholder also possesses all
the legal rights appurtenant to that status, unless the parties have agreed
otherwise. Stephenson, 947 P.2d at 1305. Under the California Corpora-
tions Code, shareholders have a wide range of rights to participate in cor-
porate governance. Id. at 1306-08. As in Stephenson, Dux’s theory that
Chen’s shareholder rights were cut off before legal title was delivered
“would have the effect of stripping [Chen] of all these statutory sharehold-
er’s rights even though he remains the legal owner of record of shares . . . .
A shareholder without a shareholder’s rights is at best an anomaly, and at
worst a shadowy figure in corporate limbo who would be voiceless in the
conduct of the business of which he is part owner and largely defenseless
against neglect or overreaching by management.” Id. at 1307.
              DUX CAPITAL MGMT v. YAGEO CORP.               2355
court’s initial determination of good faith.” Dux Capital
Mgmt. Corp., 2004 WL 2472247, at *4. Thus, Dux could not
have standing to sue as a minority shareholder unless Chen
assigned that cause of action to it. There is nothing in the
Chen-Dux Settlement Agreement providing for such an
assignment. “As in Stephenson, the record owner George
Chen retained all legal rights and thus would have standing.
Dux obtained no legal rights prior to May 9, 2001.” Id.

   Siegel v. Anderson Homes, Inc., 118 Cal. App. 4th 994
(2004), which held that the cause of action for building dam-
age accrues to the owner who suffers a compensable eco-
nomic injury, even though the damage to the building
occurred prior to the time the plaintiff owned the building,
does not provide support for Dux’s position. In general, “a
cause of action accrues at the moment the party who owns it
is entitled to bring and prosecute an action thereon.” Id. at
1003 (internal citations and quotation marks omitted). But
when the property damage is not discovered until later, “a
cause of action for construction defects does not accrue until
the property owner discovers the resulting damages.” Id. at
1009. In Siegel, the defect was latent, so the original owner
was not aware of the defect to the building when he sold it to
the plaintiff. Since plaintiffs and not the original owner dis-
covered the damage, the cause of action accrued to plaintiffs.
In other words, when the original owner sold the house to
plaintiffs, the price of the house presumably did not reflect the
latent defect, and plaintiffs paid more for it than they would
have had they known about the defect. They got the short end
of the stick.

   Here, in contrast, George Chen — the original owner of the
200,000 shares of LLNC stock — was aware of the loss of
value to the stock caused by the decision to file bankruptcy.
The cause of action accrued to him. Although Dux and Chen
reached their settlement (on April 25, 2001) before damage to
the stock value occurred, an express condition of the settle-
ment was that it would not be final until a court made the
2356             DUX CAPITAL MGMT v. YAGEO CORP.
good faith determination. It was clear to both parties that that
determination would take some time,12 and thus Dux bore the
risk that the stock value would decrease during that time,
while Chen bore the risk that the stock value would increase
during that time.

   [6] For these reasons, whether or not Dux was the real-
party-in-interest, it does not have standing, and it cannot cure
its standing problem through an invocation of Fed. R. Civ. P.
17(a). Plaintiffs do not cite any case law for their assertion
that the time that a lawsuit is filed is relevant to the standing
inquiry. Being the owner of the shares at the time of the
injury, Chen legally suffered the shares’ loss in value. It just
turned out that this loss had no economic effect on him
because he had already agreed to transfer the shares to Dux
shortly thereafter for a set price pursuant to their executed set-
tlement agreement. “Rule 17(a) does not give them standing;
‘real party in interest’ is very different from standing.” Kent
v. N. Cal. Reg’l Office of the Am. Friends Serv. Comm., 497
F.2d 1325, 1329 (9th Cir. 1974) (holding that the trustees of
a trust fund in which taxpayers’ money was kept were the
real-parties-in-interest with respect to the trust fund, but they
did not have standing to sue the government to enjoin collec-
tion of the taxes in the trust fund, because only the taxpayers
themselves had standing); see also 6 Wright & Miller, Federal
Practice and Procedure § 1542.

  B.    Plaintiffs’ Breach of Fiduciary Duty Claims Are
        Not Preempted by the Bankruptcy Code

   Defendants argue that plaintiffs’ breach of fiduciary duty
claims are preempted by federal bankruptcy law because they
are claims that LLNC directors improperly used the bank-
  12
     Paragraph 12.18 of the Settlement Agreement provided, “The Parties
to this Agreement agree and understand that an application for good faith
settlement will be filed in the Action . . . and is expected to be heard on
May 7, 2001.”
              DUX CAPITAL MGMT v. YAGEO CORP.               2357
ruptcy process and such claims must be litigated in bank-
ruptcy court. Defendants first raised the preemption argument
in a Fed. R. Civ. P. 50(b) motion. Although the parties dispute
whether this preemption defense is waived due to failure to
timely raise it, we hold in any case it would fail on the merits.

   [7] Plaintiffs’ breach of fiduciary duty claims are not pre-
empted by federal bankruptcy law because these claims con-
cern conduct that occurred prior to bankruptcy. The cases
upon which defendants rely hold only that state law causes of
action for abuse of process and malicious prosecution involv-
ing conduct that occurred during bankruptcy are preempted.
E.g., MSR Exploration, Ltd. v. Meridian Oil, Inc., 74 F.3d 910
(9th Cir. 1996) (holding that state malicious prosecution
actions for events taking place within bankruptcy court pro-
ceedings are preempted); Gonzales v. Parks, 830 F.2d 1033
(9th Cir. 1987) (holding that state courts lack jurisdiction over
claim that filing of a bankruptcy petition is an abuse of pro-
cess); see also Miles v. Okun (In re Miles), 430 F.3d 1083,
1091 (9th Cir. 2005) (holding that 11 U.S.C. § 303(i) provides
the exclusive basis for awarding damages based on involun-
tary bankruptcy petition filing).

   MSR Exploration and Gonzales involved claims between
creditors and debtors that were litigated in bankruptcy court,
involved the bankruptcy process, or otherwise required con-
sideration of what relief was available under federal law. For
example, in MSR Exploration, a creditor filed a claim against
the debtor in bankruptcy court, and the bankruptcy court sus-
tained the debtor’s (MSR Exploration’s) objection to the cred-
itor’s claim. Instead of pursuing sanctions or another remedy
in bankruptcy court, the debtor waited until after the reorgani-
zation plan was confirmed and filed a state law malicious
prosecution claim against the creditor in district court. MSR
Exploration, 74 F.3d at 912. We held, “Whether creditors
should be deterred, and when, is a matter unique to the flow
of the bankruptcy process itself—a matter solely within the
hands of the federal courts.” Id. at 916. Disputes between
2358          DUX CAPITAL MGMT v. YAGEO CORP.
creditors and debtors are a central part of the management of
the bankruptcy process, and allowing state law to resolve such
disputes would undermine the uniformity of federal bank-
ruptcy law. Id. at 914 (noting that Congress intended to
“create a whole system under federal control which is
designed to bring together and adjust all of the rights and
duties of creditors and embarrassed debtors alike.”) (empha-
sis added); see also In re Miles, 430 F.3d at 1089-90; Gon-
zales, 830 F.2d at 1035-36.

   Similarly, in Gonzales, a debtor filed a bankruptcy petition
in an attempt to delay a creditor foreclosure sale. The creditor
subsequently filed an abuse of process claim in state court,
and the state court entered a judgment against the debtor.
Gonzales, 830 F.2d at 1033-34. The debtor filed an adversary
proceeding in bankruptcy court seeking relief from the state
court judgment. Id. at 1034. We held that “[f]ilings of bank-
ruptcy petitions are a matter of exclusive federal jurisdiction”
because “[s]tate courts are not authorized to determine
whether a person’s claim for relief under a federal law, in a
federal court, and within that court’s exclusive jurisdiction, is
an appropriate one.” Id. at 1035 (emphasis added).

   [8] By contrast, Dux and Davis did not allege that LLNC’s
bankruptcy petition was filed in bad faith, and their claim
does not require the adjudication of rights and duties of credi-
tors and debtors under the Bankruptcy Code. The complaint
alleged that the directors and majority shareholder engaged in
self-dealing to the detriment of the corporation through their
decision to pursue bankruptcy and sought damages for breach
of fiduciary duty under California state law. Unlike in MSR
Exploration and In re Miles, the complaint was not “self-
consciously and entirely one which seeks damages for a claim
filed and pursued in the bankruptcy court,” MSR Exploration,
74 F.3d at 912; see In re Miles, 430 F.3d at 1092-93 (noting
that “[t]he complaints state on their faces that Appellants seek
damages for the filing and prosecution of the involuntary
bankruptcy petitions against their relatives. . . . Because
              DUX CAPITAL MGMT v. YAGEO CORP.               2359
Appellants’ complaints allege state law tort causes of action
for damages entirely predicated upon the filing and prosecu-
tion of involuntary bankruptcy petitions, they necessarily
‘arise under’ title 11.”). Simply put, state corporate gover-
nance law, not federal bankruptcy law, governs the duties of
a corporate fiduciary. See FDIC v. Barton, 1998 WL 169696,
at *4 (E.D. La. April 8, 1998) (holding that federal bank-
ruptcy law does not preempt the FDIC’s claim against defen-
dants under Louisiana state law for breach of fiduciary duty
in connection with defendants’ bankruptcy filing).

   Finally, as the district court correctly noted, the bankruptcy
court explicitly assigned to plaintiffs all pre-bankruptcy
claims of LLNC against its directors and the Yageo defen-
dants, over defendants’ objections. Defendants argue that the
bankruptcy court could not assign claims over which it had
exclusive jurisdiction. Even if this were true, plaintiffs’
breach of fiduciary duty claims are not based on “activities
that might be undertaken in the management of the bank-
ruptcy process.” MSR Exploration, 74 F.3d at 914. Since the
bankruptcy court limited the assignment to claims that “ex-
isted on May 9, 2001 (i.e., immediately prior to the Chapter
11 filing),” the assignment was valid.

  C.   Res Judicata Does Not Bar Plaintiffs’ Breach of
       Fiduciary Duty Claims

   [9] “The doctrine of res judicata bars a party from bringing
a claim if a court of competent jurisdiction has rendered final
judgment on the merits of the claim in a previous action
involving the same parties or their privies.” Robertson v.
Isomedix, Inc. (In re Int’l Nutronics, Inc.), 28 F.3d 965, 969
(9th Cir. 1994) (citation omitted). Since the bankruptcy court
issued a final judgment on the merits, and that action involved
the same parties or their privies, the issue here is whether the
LLNC claim was or could have been litigated by the Trustee
(who became the owner of any claims of LLNC against its
directors after the bankruptcy petition was filed) in the bank-
2360          DUX CAPITAL MGMT v. YAGEO CORP.
ruptcy court and whether the two causes of action were the
same.

   The order of confirmation explicitly reserved all claims and
causes of action for the benefit of the estate to the Disbursing
Agent (former Trustee). After confirmation, the bankruptcy
court authorized the Disbursing Agent “to transfer and assign
to Davis/Dux certain of Debtor’s claims that existed on May
9, 2001 (i.e., immediately prior to the Chapter 11 filing), as
described in and according to the terms of the Letter Agree-
ment.” Order Authorizing Compromise ¶ 6. This assignment
was part of a settlement agreement that the Disbursing Agent
reached with Dux and Davis in connection with their claims
against the estate of LLNC. In return, Dux and Davis waived
their general unsecured claims against the LLNC estate except
for seeking payment of administrative expenses. The bank-
ruptcy court authorized the assignment over Rextron and
Equity Plus’s objections.

    Defendants argue that (1) the Trustee could have litigated
the breach of fiduciary duty claim of LLNC against its direc-
tors during the bankruptcy proceeding, (2) Dux/Davis actually
litigated the claim and lost, (3) the assignment of claims to
Dux/Davis was too general to prevent preclusion, and (4) the
trustee was required to assert the claims before the order of
confirmation. Plaintiffs respond that (1) defendants should
have appealed the bankruptcy court’s assignment of claims to
Dux/Davis, and their failure to do so bars their claim, (2) the
LLNC claim does not pertain to the confirmation plan and
therefore was not the same claim, and (3) the bankruptcy
court did not resolve the LLNC claim because it expressly
reserved it and assigned it to plaintiffs.

   [10] Res judicata does not bar plaintiffs’ LLNC claim for
several reasons. First, the LLNC claim is a claim for breach
of fiduciary duty that does not “pertain[ ] to the [reorganiza-
tion] plan.” Trulis v. Barton, 107 F.3d 685, 691 (9th Cir.
1995) (holding that “[o]nce a bankruptcy plan is confirmed,
              DUX CAPITAL MGMT v. YAGEO CORP.                2361
it is binding on all parties and all questions that could have
been raised pertaining to the plan are entitled to res judicata
effect.”); see also Heritage Hotel Ltd. P’ship I v. Valley Bank
of Nev. (In re Heritage Hotel Ltd. P’ship I), 160 B.R. 374,
377 (9th Cir. B.A.P. 1993), aff’d, 59 F.2d 175 (9th Cir. 1995)
(unpublished table decision); Kelley v. S. Bay Bank (In re Kel-
ley), 199 B.R. 698, 702 (9th Cir. B.A.P. 1996) (“a chapter 11
bankruptcy case ‘comprise[s] all matters pertaining to the
debtor-creditor relationship that [the debtor] or any creditors
might . . . raise[ ] to advance their interests in the proceed-
ing’ ”) (citation omitted and alteration in original).

   [11] Second, plaintiffs’ claim for breach of fiduciary duty
on the part of the Rextron-controlled directors was not
decided by the bankruptcy court. While Dux/Davis did argue
that the reorganization plan should not be confirmed because
it was not filed in good faith, the breach of fiduciary duty
claim with respect to the directors and the majority share-
holder was not raised in, much less decided by, the bank-
ruptcy court. The breach of fiduciary duty claim that Dux
raised in its motion to appoint a Chapter 11 Trustee was based
on debtor LLNC’s fiduciary duty to creditors and sharehold-
ers in bankruptcy. This is clearly a different duty than that of
the board of directors and Rextron to the corporation itself
and the minority shareholders prior to bankruptcy. Moreover,
Dux’s objection to the reorganization plan as being in bad
faith in violation of 11 U.S.C. § 1129(a)(3) was not the same
as a breach of fiduciary duty claim under California corporate
law.

   The Trustee recommended confirmation of the plan in part
because the parties could resolve their intra-corporate disputes
afterwards:

    there are a number of factual and legal issues that
    simply will not be resolved before the continued
    confirmation hearing set for November 26, 2001
    . . . . Equity Plus has indicated that it may withdraw
2362          DUX CAPITAL MGMT v. YAGEO CORP.
    its “offer” if a sale . . . is not approved at [that time].
    As a result, the Trustee believes that the Court
    should proceed to sell the assets and business to
    Equity Plus under the general terms set forth in the
    Plan . . . . The parties (Davis/Dux, Rextron and
    Equity Plus) will retain whatever rights they may
    have against one another and can litigate their dis-
    putes after consummation of the sale.

Trustee’s Report and Recommendation Pursuant to Bank-
ruptcy Code § 1106 and Court Order at 3-4. Similarly, the
bankruptcy court questioned whether the entire bankruptcy
proceeding was “on the up and up” and reserved the pre-
petition claims for later resolution. Thus, plaintiffs’ claims
were not, as defendants argue, “thoroughly aired and rejected”
by the Trustee and the bankruptcy court. They were explicitly
reserved.

   [12] Third, the bankruptcy court’s authorization of the
assignment of the LLNC claim to plaintiffs was valid. The
confirmation order did not extinguish plaintiffs’ LLNC claim.
LLNC’s plan of reorganization provided, “The Disbursing
Agent shall have the right to pursue any and all Retained
Claims and other pre-petition obligations or claims in favor of
the Debtor . . . . No such claims shall be waived or relin-
quished under the Plan or by virtue of its Confirmation. The
Disbursing Agent hereby reserves all Claims, defenses, pow-
ers and interests of the Debtor and/or Trustee, existing as of
Confirmation.” Debtor’s Chapter 11 Plan of Reorganization
Dated August 29, 2001 (“Plan of Reorganization”) at 8. The
plan defined “Retained Claims” as “all claims that Debtor had
as of the Filing Date.” Id. at 3. The plan’s definition of
“claim” included the LLNC claim. See id. at 1. The effect of
the confirmation was to discharge the debtor — LLNC —
from all claims, not the directors or Rextron, the majority
shareholder. See id. at 12 (“Confirmation of the Plan will dis-
charge Debtor from all liability for Claims arising prior to
Confirmation . . . .”).
              DUX CAPITAL MGMT v. YAGEO CORP.               2363
   In confirming the plan, the bankruptcy court provided that
all claims “are reserved for the benefit of the estate and may
be asserted by the Disbursing Agent.” Confirmation Order
¶ 10. Pursuant to a settlement between the bankruptcy estate
of LLNC and plaintiffs, the Disbursing Agent assigned those
claims to plaintiffs. See Letter Agreement Dated March 15,
2002 (“Letter Agreement”) at 1-2. The bankruptcy court
approved this assignment. Order Authorizing Compromise at
2; cf. Trulis, 107 F.3d at 689-91 (holding that res judicata
barred plaintiffs’ claim where plaintiffs did not appeal bank-
ruptcy court’s order confirming reorganization plan that
included explicit provision barring such action). The court,
therefore, was ratifying the Trustee/Disbursing Agent’s
choice explicitly to reserve the claim for plaintiffs rather than
to raise the fiduciary duty claim during the during the bank-
ruptcy proceeding. Moreover, as the district court held, “there
is no evidence to indicate that the bankruptcy court dis-
charged the potential liabilities of these non-debtor defendants
to non-debtor plaintiffs.” Summary Judgment Order at 17. In
fact, it was precisely because the bankruptcy court believed
that these claims were too complicated to be litigated in the
bankruptcy proceeding that it reserved them for dispute in
another forum.

   [13] Finally, the Trustee’s assignment of all pre-petition
claims to Dux/Davis was not so general as to render it invalid.
To support their argument that the Trustee’s assignment was
too general, defendants rely on In re Kelley, which suggests
that a blanket reservation is insufficient to prevent application
of res judicata to a specific action, see 199 B.R. at 704. How-
ever, the Bankruptcy Appellate Panel subsequently limited
that language. See Akary Corp. v. Sims (In re Associated Vin-
tage Group, Inc.), 283 B.R. 549, 563-64 (9th Cir. B.A.P.
2002) (“While we did find the purported reservation in the
Kelley plan to be . . . vague in the context of all the facts of
that case, and observed that another court had once found a
general reservation to [sic] rights to be insufficient, our com-
ment was pure dictum . . . and cannot be construed as a gen-
2364            DUX CAPITAL MGMT v. YAGEO CORP.
eral statement of law. . . . We agree with the other courts that
regard it as impractical and unnecessary to expect that a dis-
closure statement and plan must list each and every possible
defendant and each and every possible theory.”) (citations
omitted). Together, the Letter Agreement, the bankruptcy
court order, and the Trustee’s recommendation show that the
claims intended to be assigned were the corporate governance
claims.13

  D.    District Court’s Damages Calculations Were Not
        Erroneous

   As of May 3, 2001, there were 646,153 shares of common
and 1,507,695 shares of Series A preferred convertible stock
issued and outstanding. On May 7, 2001, An-Ehr Chen
requested that the LLNC board of directors convert 700,000
of Rextron’s shares of preferred stock to common. On May 8,
2001, the board granted that request. The jury was asked to
determine whether plaintiffs proved that the common stock of
LLNC had any value as of the company’s petition to com-
mence bankruptcy proceedings. The jury was also asked to
determine the value (both total and per share) of the shares
transferred pursuant to the Chen-Dux Settlement Agreement.
Those transferred shares were common. The jury found that
the common stock was worth $2 per share.

   In its June 30, 2004 Judgment, the district court calculated
damages as $2,692,306, which included Rextron’s 700,000
shares that had been converted to common on May 8, 2001.
This figure did not include the preferred shares because the
jury never was asked to determine a loss in value for the pre-
  13
     The Letter Agreement provided that Davis/Dux would receive assign-
ment of all pre-petition claims, excluding claims arising under the Code,
against “[t]he attorneys for LLNC, including Gayle Chan, Michael Lee,
. . . George Chen, An Erh Chen [sic], Pierre Chen, Equity Plus, Yageo,
Rextron and/or their affiliates; and [t]he LLNC directors and officers.”
Letter Agreement at 1-2.
                 DUX CAPITAL MGMT v. YAGEO CORP.                     2365
ferred shares due to the bankruptcy filing. In its Amended
Judgment, the district court removed the 700,000 shares from
its earlier calculation because they had not been converted to
common until May 8, 2001, after the May 3 board resolution
to petition for bankruptcy. Thus plaintiffs’ damages award
was revised downward to $1,292,306 ($2 per share x 646,153
common shares). See Dux Capital Mgmt. Corp., 2004 WL
19396309, at *19.

   Plaintiffs cross-appeal this damages calculation and make
two arguments. First, they argue that there was sufficient evi-
dence to show the preferred shares had a minimum value of
$2 per share, since they were at least as valuable as the com-
mon shares. They argue that the district court should have
included this “minimum value” of the preferred stock in its
damages calculation and that the parties agreed to use the
value of all LLNC stock to measure damages on the assigned
LLNC claim. Second, they argue that the 700,000 converted
shares should not have been excluded from the damages cal-
culation because while the LLNC claim accrued on May 3,
2001, the amount of damages was not tied to that date.

   [14] The district court did not err in excluding the preferred
shares from its damages calculation. Plaintiffs’ theory of dam-
ages on the assigned LLNC claim throughout trial and after
trial did not include damage to the preferred shares. Before
trial, they sought relief for diminution in value of the com-
pany as a going concern and loss of goodwill. See Joint Final
Pretrial Order at 7. During trial, plaintiffs urged the jury to
find that the common shares were worth at least $2 per share,
but they never urged the jury to make any finding with regard
to the preferred shares. During the discussions about the spe-
cial verdict form and the jury instructions, plaintiffs did not
request the inclusion of any instruction or question to the jury
regarding the value of the preferred shares. After trial, plain-
tiffs clearly recognized that LLNC had both outstanding com-
mon and outstanding preferred shares,14 but they nonetheless
  14
    See Pls.’ Post-Trial Br. Re: Issues of Standing and Damages at 8 (not-
ing that at the time of the bankruptcy filing, there were 807,695 preferred
shares and 1,346,153 common shares issued).
2366          DUX CAPITAL MGMT v. YAGEO CORP.
asked the district court to calculate damages based only on the
outstanding common shares. See Pls.’ Post-Trial Br. at 9
(arguing that “[t]he findings by the jury of the share value of
$2.00 results in the following damages in addition to punitive
damages assessed by the jury: To Dux as an individual plain-
tiff: $2.00/share x 200,000 shares: $400,000; To Dux and
Davis jointly as assignees of the claims of LLNC: $2.00/share
x 1,346,153 shares: $2,692,306.”). Plaintiffs cannot complain
on appeal about a damages calculation they never asked the
district court to make.

   Moreover, no evidence concerning the value of the pre-
ferred shares was presented at trial. See Dux Capital Mgmt.
Corp., 2004 WL 2472247, at *7 (noting that “[a]t trial, the
only evidence proffered was for the value of common shares.
Hence, plaintiffs only proved, as found by the jury, the value
of the common stock at $2 per share.”). The jury did not
determine the value of the preferred shares; it determined only
that plaintiffs proved that the common stock of LLNC had
value as of the bankruptcy petition, and that the (common)
shares transferred between Chen and Dux were worth $2 per
share.

   Pointing to LLNC’s Articles of Incorporation, plaintiffs
argue that the preferred shares must have been worth at least
as much as the common shares, since the preferred shares
“enjoyed significant procedural and financial benefits over the
common shares.” The Articles of Incorporation provided that
the holders of the preferred shares enjoyed certain rights supe-
rior to that of the common shares, including the right to
receive greater dividends and the right to elect three of the
five directors to the board. Even so, the fact remains that
plaintiffs presented no evidence at trial to establish the value
of the preferred shares, and they did not ask the jury to deter-
mine the value of the preferred shares. It is no surprise, then,
that the jury determined only the value of the common shares.
The jury did not make any finding on the “minimum value”
— or any value — of the preferred shares. Damages are
                 DUX CAPITAL MGMT v. YAGEO CORP.                      2367
recoverable to the extent they are reasonably certain, but they
still must be proved. See, e.g., Toscano v. Greene Music, 124
Cal. App. 4th 685, 695 (2004); Mendoyoma Inc. v. County of
Mendocino, 8 Cal. App. 3d 873, 880-81 (1970).

   As assignees of the corporate LLNC claim, plaintiffs would
have been entitled to the loss in value for all the corporation’s
shares, preferred and common, if they had timely made a
request in the district court to include the preferred shares in
the damages calculation.15 At this point, however, we cannot
grant plaintiffs’ request to instruct the district court to enter
judgment for $4,307,700 on this claim. The district court did
not err in excluding the value of the preferred shares in its
damages calculation.16

  Plaintiffs also argue that the district court erred by amend-
ing its judgment to exclude Rextron’s 700,000 converted
shares in the damages calculation. Defendants respond that
while the amount of damages may increase after the injury is
  15
      Although corporate injury is usually demonstrated through means
other than stock value, the plaintiffs’ evidence at trial solely focused on
this measure.
   16
      Plaintiffs point out that they raised the argument about preferred
shares having at least equivalent value to the common shares in the district
court. However, this argument was raised subsequent to the post-trial brief
on damages, and it was too late at that point to change the damage theory.
Moreover, even then, their argument to the district court did not request
an award of damages based on the preferred stocks’ value, but instead was
an effort to refute the defendants’ argument that the plaintiffs should
receive no recovery when they had not proved damage to the entire body
of LLNC’s stock. The district court’s holding that the plaintiffs did not
oppose reducing the award, as opposed to vacating it entirely, accords
with this reading. See Dux Capital Mgmt. Corp., 2004 WL 1936309, at
*18. Tellingly, plaintiffs point to no instance when they asked the district
court to increase the damage award on the assigned corporate claim. Yet,
if damage to the preferred stock was part of their theory of the case, the
award calculation on this claim was always inadequate — even before the
district court amended the judgment to exclude the 700,000 common
shares held by Rextron.
2368          DUX CAPITAL MGMT v. YAGEO CORP.
sustained, there must be further injury to the corporation as a
whole, not just to some shares.

   The district court did not err in amending the judgment to
exclude the 700,000 converted shares from its damages calcu-
lation. The injury for which the jury determined that plaintiffs
should be compensated was the loss of value in the shares and
injury to the corporation caused by the board of directors’
decision to pursue bankruptcy on May 3, 2001. Therefore, the
damaging action was complete before those shares came into
existence, and those shares cannot be the basis for assessing
that already-complete action. The question was whether the
directors violated their “duty to weigh the various alternative
courses of action for the corporation and to select the one best
calculated to return the most value for the shareholders as a
whole.” Jury Instruction XIX. Those 700,000 Rextron shares
were not converted to common until after the board’s decision
to petition for bankruptcy on May 3, 2001. Morever, the jury
determined that the common shares had a value of $2 per
share prior to this board decision and no value afterwards. If
the jury found that the common shares had zero value on May
3, then the Rextron shares that were converted into common
shares on May 8 had zero value, and plaintiffs’ damages
could not be increased even if it were proper to increase dam-
ages for shares converted to common only after May 3, 2001.

  E.   Plaintiffs’ Fed. R. Civ. P. 60(b) Motion

   [15] Once an appeal is filed, the district court no longer has
jurisdiction to consider motions to vacate judgment. Gould v.
Mut. Life Ins. Co. of N.Y., 790 F.2d 769, 772 (9th Cir. 1986).
However, a district court may entertain and decide a Rule
60(b) motion after notice of appeal is filed if the movant fol-
lows a certain procedure, which is to “ask the district court
whether it wishes to entertain the motion, or to grant it, and
then move this court, if appropriate, for remand of the case.”
Id. (internal quotation marks and citations omitted); see also
Defenders of Wildlife v. Bernal, 204 F.3d 920, 930 (9th Cir.
                 DUX CAPITAL MGMT v. YAGEO CORP.                     2369
2000) (holding that a district court order declining to entertain
or grant a Rule 60(b) motion is not a final determination on
the merits); Scott v. Younger, 739 F.2d 1464, 1466 (9th Cir.
1984) (holding that the district court’s denial of a request to
entertain a Rule 60(b) motion is interlocutory and not appeal-
able and that if the court is inclined to grant the motion, the
movant first should request limited remand from the appellate
court); Crateo, Inc. v. Intermark, Inc. (In re Crateo, Inc.), 536
F.2d 862, 869 (9th Cir. 1976) (declining to order a remand
after the district court declined to entertain the Rule 60(b)
motion).

   Here, an amended judgment was filed on August 31, 2004.
Notice of appeal was filed on September 20, 2004. Plaintiffs
filed their motion asking the district court to entertain and
grant their Rule 60(b) motion on October 1, 2004. On October
4, 2004, the district court denied plaintiffs’ request to enter-
tain their motion. The same day, plaintiffs filed their cross-
appeal. On November 3, 2004, plaintiffs appealed the district
court’s refusal to entertain their motion. On November 23,
2004, defendants moved to dismiss this appeal for lack of
jurisdiction and urged that if the court construed plaintiffs’
appeal as a motion for limited remand, it should be denied.
Plaintiffs then recast their appeal as a motion for limited
remand, which asked us to require the district court to decide
the Rule 60(b) motion on the merits. The Appellate Commis-
sioner denied plaintiffs’ motion for limited remand without
prejudice to the jurisdictional issues on January 5, 2005.

   [16] Plaintiffs have followed the procedures outlined in
Gould. They filed their Rule 60(b) motion after their notice of
appeal. They asked the district court whether it wished to
entertain or grant their motion, and the district court declined
to entertain it. They moved for limited remand, and we denied
it on January 5, 2005. Yet, plaintiffs ask for remand again.17
  17
    Plaintiffs erroneously urge that we review the district court’s refusal
to entertain their motion under an abuse of discretion standard. The abuse
2370             DUX CAPITAL MGMT v. YAGEO CORP.
We decline this second request for remand. In any case, the
issue is moot, since we hold that plaintiffs cannot cure their
standing defect through the use of Fed. R. Civ. P. 17(a).

                        IV.    CONCLUSION

   For the foregoing reasons, the district court is AFFIRMED.

of discretion standard is applicable when the district court actually ruled
on the merits of a Rule 60(b) motion, Barber v. Hawaii, 42 F.3d 1185,
1198 (9th Cir. 1994); here, the district court did not rule on the merits of
plaintiffs’ Rule 60(b) motion.