Court Opinion

ID: 8212652
Source: CourtListenerOpinion
Date Created: 2022-10-07 16:00:38.463452+00
Date Added: 2024-06-11T16:42:12.385512
License: Public Domain

Appellate Case: 21-1232     Document: 010110750340   Date Filed: 10/07/2022   Page: 1
                                                                              FILED
                                                                  United States Court of Appeals
                       UNITED STATES COURT OF APPEALS                     Tenth Circuit

                              FOR THE TENTH CIRCUIT                     October 7, 2022
                          _________________________________
                                                                     Christopher M. Wolpert
                                                                         Clerk of Court
  JUN LI, et al.,

        Plaintiffs - Appellants,

  and

  DIANWEN CUI, et al.,

        Plaintiffs,

  v.                                                       No. 21-1232
                                               (D.C. No. 1:19-CV-02443-RM-STV)
  COLORADO REGIONAL CENTER I,                               (D. Colo.)
  LLC, et al.,

        Defendants - Appellees.

  –––––––––––––––––––––––––––––––––––

  DIANWEN CUI, et al.,

        Plaintiffs - Appellants,

  and

  JUN LI, et al.,

        Plaintiffs,

  v.
                                                           No. 21-1253
  COLORADO REGIONAL CENTER LLC,                (D.C. No. 1:19-CV-02443-RM-STV)
  et al.,                                                   (D. Colo.)

        Defendants - Appellees,

  and
Appellate Case: 21-1232     Document: 010110750340         Date Filed: 10/07/2022       Page: 2

     PETER KNOBEL,

         Defendant.
                          _________________________________

                                       ORDER
                          _________________________________

 Before MATHESON, KELLY, and PHILLIPS, Circuit Judges.
                   _________________________________

        This matter is before the court on Peter Knobel’s Petition for Panel Rehearing for

 Purposes of Clarification (“Petition”). Upon careful consideration, the Petition is

 GRANTED to the extent of the modifications1 in the attached revised order and

 judgment. The court’s September 12, 2022 order and judgment is withdrawn and replaced

 by the attached revised order and judgment, which shall be filed as of today’s date.

                                               Entered for the Court

                                               CHRISTOPHER M. WOLPERT, Clerk

 1
  In addition to the modifications intended to provide the clarification requested in the
 Petition, the court has sua sponte further revised the order and judgment.
                                              2
Appellate Case: 21-1232      Document: 010110750340    Date Filed: 10/07/2022   Page: 3
                                                                               FILED
                                                                   United States Court of Appeals
                        UNITED STATES COURT OF APPEALS                     Tenth Circuit

                              FOR THE TENTH CIRCUIT                       October 7, 2022
                          _________________________________
                                                                       Christopher M. Wolpert
                                                                           Clerk of Court
  JUN LI; QI QIN; YI LIU; JIE YANG;
  YUQUAN NI; ZHONGZAO SHI; FANG
  SHENG; SHUNLI SHAO; KAIYUAN
  WU; ZHIJIAN WU; ZHONGWEI LI;
  YUWEI DONG; LIN QIAO; JINGE HU;
  RUJUN LIU; FAN ZHANG; LU LI; SA
  WU; YING XU; CAO XIAOLONG;
  HSIN-YI WU,

        Plaintiffs - Appellants,

  and

  DIANWEN CUI; LEI GU; SUFEN LENG;
  XUE MEI; ZHOU MEI; YAN SONG; LU
  WANG; YUE WU; ZHOU YANG;
  JINGWEN ZHANG; LEI ZHANG; LING
  ZHANG; XIAOHONG ZHANG; QIN
  ZHOU; XUN ZHU; CHUNYI ZOU,

        Plaintiffs,

  v.                                                          No. 21-1232
                                                  (D.C. No. 1:19-CV-02443-RM-STV)
  COLORADO REGIONAL CENTER I,                                  (D. Colo.)
  LLC; SOLARIS PROPERTY OWNER I
  LLC; PETER KNOBEL; COLORADO
  REGIONAL CENTER PROJECT
  SOLARIS LLLP, and all principals and
  ultimate owners of business entities
  pursuant to piercing of the limited liability
  veil,

        Defendants - Appellees.

  –––––––––––––––––––––––––––––––––––

  DIANWEN CUI; LEI GU; SUFEN LENG;
Appellate Case: 21-1232     Document: 010110750340   Date Filed: 10/07/2022   Page: 4

  XUE MEI; ZHOU MEI; YAN SONG; LU
  WANG; YUE WU; ZHOU YANG;
  JINGWEN ZHANG; LEI ZHANG; LING
  ZHANG; XIAOHONG ZHANG; QIN
  ZHOU; XUN ZHU; CHUNYI ZOU,

        Plaintiffs - Appellants,

  and

  JUN LI; QI QIN; YI LIU; JIE YANG;
  YUQUAN NI; ZHONGZAO SHI; FANG
  SHENG; SHUNLI SHAO; KAIYUAN
  WU; ZHIJIAN WU; ZHONGWEI LI; LIN
  QIAO; JINGE HU; RUJUN LIU; FAN
  ZHANG; LU LI; SA WU; YING XU;
  CAO XIAOLONG; WU HSIN-YI;
  YUWEI DONG,

        Plaintiffs,

  v.                                                       No. 21-1253
                                               (D.C. No. 1:19-CV-02443-RM-STV)
  COLORADO REGIONAL CENTER LLC;                             (D. Colo.)
  COLORADO REGIONAL CENTER I,
  LLC; SOLARIS PROPERTY OWNER
  LLC; SOLARIS PROPERTY OWNER I
  LLC; COLORADO REGIONAL CENTER
  PROJECT SOLARIS LLLP;
  WAVELAND VENTURES, LLC,

        Defendants - Appellees,

  and

  PETER KNOBEL,

        Defendant.
                          ________________________________
Appellate Case: 21-1232     Document: 010110750340       Date Filed: 10/07/2022     Page: 5

                              ORDER AND JUDGMENT*
                          _________________________________

 Before MATHESON, KELLY, and PHILLIPS, Circuit Judges.
                   _________________________________

       Appellants are two groups of Chinese investors, the Li Appellants and the Cui

 Appellants. Each investor purchased a limited partnership interest in Colorado

 Regional Center Project Solaris LLLP (“CRCPS”). Through its general partner,

 CRCPS loaned the proceeds from the investments to a real estate development

 project. After the project produced low returns and defaulted on the loans, each

 group of Appellants separately sued CRCPS, its general partner, and other parties

 involved in the real-estate project.

       The district court dismissed both complaints, denied several motions filed by

 Appellants, and ordered them to pay attorney fees. Each group of Appellants

 appealed. We consolidated their appeals. Exercising jurisdiction under 28 U.S.C.

 § 1291, we

       (A) affirm the district court’s dismissal of Appellants’ claims under Federal
           Rule of Civil Procedure 12(b)(6) except for the Li Appellants’ claim for
           breach of fiduciary duty, which we affirm in part and reverse in part;

       *
         After examining the briefs and appellate record, this panel has determined
 unanimously to honor the parties’ request for a decision on the briefs without oral
 argument. See Fed. R. App. P. 34(f); 10th Cir. R. 34.1(G). The case is therefore
 submitted without oral argument. This Order and Judgment is not binding precedent,
 except under the doctrines of law of the case, res judicata, and collateral estoppel. It
 may be cited, however, for its persuasive value consistent with Fed. R. App. P. 32.1
 and 10th Cir. R. 32.1.

                                                1
Appellate Case: 21-1232    Document: 010110750340         Date Filed: 10/07/2022    Page: 6

       (B) affirm dismissal of the Cui Appellants’ remaining state law claims for
           lack of subject-matter jurisdiction;

       (C) reverse the district court’s denial of the Cui Appellants’ motion to amend
           their complaint;

       (D) affirm the district court’s denial of the Li Appellants’ motion for default
           judgment; and

       (E) vacate the awards of attorney fees as described herein.

 We remand to the district court for further proceedings consistent with this Order and

 Judgment.

                                   I. BACKGROUND

                                A. Factual Background1

    The Parties

       CRCPS is a limited liability limited partnership created by Colorado Regional

 Center, LLC (“CRC”) and Waveland Ventures, LLC. It serves as an EB–5 Regional

 Center, an entity approved by the federal government to promote economic growth

 by encouraging investments by foreign persons in exchange for permanent resident

 cards (green cards). As described in Liu v. SEC, 140 S. Ct. 1936, 1941 (2020), “[t]he

 EB–5 Program, administered by the U.S. Citizenship and Immigration Services,

       1
         The Li Appellants and Cui Appellants each amended their complaints three
 times. Their third amended complaints are the operative complaints, from which we
 draw the factual background presented above. “In reviewing a district court’s
 dismissal under . . . 12(b)(6), we accept as true all well-pleaded factual allegations in
 the complaint and view them in the light most favorable to the plaintiff[s].” Garling
 v. United States Env’t Prot. Agency, 849 F.3d 1289, 1292 (10th Cir. 2017)
 (quotations and alterations omitted).

                                             2
Appellate Case: 21-1232     Document: 010110750340         Date Filed: 10/07/2022    Page: 7

 permits noncitizens to apply for permanent residence in the United States by

 investing in approved commercial enterprises that are based on proposals for

 promoting economic growth.” (quotations omitted). Colorado Regional Center I LLC

 (“CRC I”),2 a subsidiary of CRC, manages CRCPS as its general partner.

        Appellants, two groups of Chinese investors, purchased limited partnership

 interests in CRCPS. In total, 165 investors each paid approximately $500,000 for

 their limited partnership interests, totaling $82.5 million. CRCPS loaned the

 proceeds from these investments to Solaris Property Owner, LLC (“SPO”) to fund the

 completion of a condominium complex in Vail, Colorado.

    Governing Documents

        Three documents set forth the terms of the parties’ arrangements.

        First, CRCPS’s “Partnership Agreement” (undated) set the terms of CRCPS’s

 internal management. It provided that CRC I had the exclusive right to manage,

 operate, and control CRCPS. Neither CRCPS nor the limited partners could hold

 CRC I liable for any acts or omissions unless CRC I acted in bad faith, gross

 negligence, or willful misconduct. The Partnership Agreement allowed limited

 partners to exercise a put option3 to sell their interest to the partnership.

        2
        Although the Li Appellants refer to this entity as “CRC 1,” the Cui
 Appellants refer to it as “CRC I,” which we adopt throughout this order.
        3
          A put option is “[a]n option to sell something (esp. securities) at a fixed price
 even if the market declines.” Option, Black’s Law Dictionary (11th ed. 2019).

                                              3
Appellate Case: 21-1232    Document: 010110750340        Date Filed: 10/07/2022    Page: 8

        Second, the “Loan Agreement,” dated November 5, 2010, provided for CRCPS

 to loan funds to SPO to complete development of SPO’s condominium project.

        Third, the “Confidential Information Memorandum,” dated March 31, 2011,

 set the terms of each investor’s purchase of the limited partnership stake. It stated

 that each investor would pay approximately $500,000 for a limited partnership

 interest in CRCPS. CRCPS would loan the proceeds to SPO, which would use these

 funds to pay project development costs for the condominium complex. The

 Memorandum also stated that certain condominium units in the building would be

 used as collateral for the loan. A related document designated 19 condominium units

 as collateral.

        The Confidential Information Memorandum provided that CRCPS would fund

 the loan through multiple advances, and each advance would carry a 5% interest rate.

 The principal balance and accrued interest on each advance was due within five years

 of each advance. SPO could not prepay any of the balance for three years, but after

 the three-year-period, it could repay with cash or a collateral condominium unit.

 CRCPS could refuse repayment through cash and compel SPO to convey the

 collateral condominium unit.

    Investments and Loans

        Based on the documents, CRCPS began soliciting investments. Investors

 purchased limited partnership interests in CRCPS between 2012 and 2015. Before

 receiving any advances, SPO assigned its rights and obligations under the

 arrangement to its wholly owned subsidiary, Solaris Property Owner I (“SPO I”).

                                            4
Appellate Case: 21-1232     Document: 010110750340      Date Filed: 10/07/2022      Page: 9

        Between April 2012 and January 2015, CRCPS made 19 loan advances to

 SPO I. About three years after the first advance, CRCPS and SPO I entered into an

 agreement regarding the collateral condominium units (the “Agreement Regarding

 Collateral Units” or “ARCU”). Under the ARCU, SPO I gave CRCPS notice that it

 would pay back the loan advances by conveying the collateral condominium units.

 The ARCU stated that SPO I would not immediately transfer the deed to the

 condominium units but CRCPS would be responsible for all fees and costs associated

 with the units and would pause the accrual of interest on the advances. Thus, under

 the ARCU, SPO I was deemed to have repaid the loan advances.

        In 2016, CRC I and CRCPS began sending notices to the limited partners that

 identified the collateral condominium units as partnership property but acknowledged

 that SPO I still held title. The notices stated that CRCPS was coordinating with

 SPO I to transfer title.

                             B. District Court Proceedings4

        In 2019, the two groups of limited partners—the Li and the Cui Appellants—

 filed lawsuits alleging state and federal claims against various defendants. In

 general, they alleged that SPO and SPO I misrepresented the value of the collateral

 condominium units and that CRC I violated its duties as the general partner of

 CRCPS. According to Appellants, Defendants-Appellees misrepresented that the

        4
         We summarize the district court proceedings here and elaborate on them as
 needed later in our analysis.

                                            5
Appellate Case: 21-1232    Document: 010110750340       Date Filed: 10/07/2022   Page: 10

  loan was fully secured when it was not. They alleged that these misrepresentations

  led to losses of over $40 million and that SPO and SPO I defaulted on their loans.

        In their operative complaint, the Li Appellants brought several direct and

  derivative5 claims against CRCPS, CRC, CRC I, Waveland Ventures, LLC, SPO,

  SPO I, and Peter Knobel (SPO’s owner).6 Separately, the Cui Appellants sued

  CRCPS, CRC, CRC I, Waveland Ventures, LLC, SPO, SPO I, and Mr. Knobel

        5
           “A derivative action is a vehicle that enables the prosecution of claims on
  behalf of a corporation or other entity.” S’holder Derivative Actions L. & Prac. § 1:1
  (2022). A derivative suit enables limited partners and other shareholders to assert
  claims on behalf of the entity, here CRCPS. A plaintiff in a derivative suit may
  assert claims against parties that owe fiduciary duties to the entity.
        6
            The Li Appellants brought:
                (1) a derivative breach-of-fiduciary-duty claim against CRC I;
                (2) a derivative civil-theft claim against CRC, SPO, SPO I, and
                     Mr. Knobel;
                (3) a derivative breach-of-contract claim based on the Loan Agreement
                     against SPO I;
                (4) a derivative breach-of-transfer-of-title claim against SPO I;
                (5) a derivative federal securities-fraud claim against CRC I;
                (6) a derivative Colorado securities-fraud claim against CRC and
                     Mr. Knobel;
                (7) a derivative claim to remove CRC I as CRCPS’s general partner;
                (8) a direct fraud claim against CRC, CRC I, Waveland Ventures,
                     LLC, and Mr. Knobel;
                (9) a direct fraud claim against CRCPS; and
                (10) a direct claim to pierce the corporate veil to hold CRC I’s and
                     SPO I’s owners and members liable.
                                            6
Appellate Case: 21-1232       Document: 010110750340       Date Filed: 10/07/2022   Page: 11

  alleging both direct and derivative claims.7 In both complaints, the derivative claims

  were brought on behalf of CRCPS.8

     Motions to Dismiss and Other Motions

          Appellees moved to dismiss both operative complaints for failure to state a

  claim. CRC I also filed a counterclaim against the Li Appellants after the Li

  Appellants alerted the district court that CRC I had been removed as general partner

  of CRCPS for cause. CRC I argued its removal as general partner was improper.

  The Li Appellants moved to dismiss the counterclaim, and the Cui Appellants moved

  for a receiver to be appointed to manage CRCPS.

          Before the district court ruled on the motions to dismiss, Appellants

  voluntarily dismissed some of their claims. The Li Appellants’ remaining claims

  were:

          7
              The Cui Appellants brought:
                  (1) a direct fraud claim against all Defendants;
                  (2) a direct and derivative breach-of-fiduciary-duty claim against CRC
                       and CRC I;
                  (3) a direct Colorado consumer protection claim against all
                       Defendants;
                  (4) a direct federal securities-fraud claim against CRCPS and CRC I;
                  (5) a direct federal securities-fraud claim against all Defendants;
                  (6) a direct and derivative breach-of-contract claim against SPO I;
                  (7) a direct and derivative declaratory relief claim against CRC I, SPO,
                       and SPO I; and
                  (8) a direct claim to pierce the corporate veil to hold CRC I’s and
                       SPO I’s owners and members liable.
          8
          The Li and Cui Appellants also identified other Defendants that are not
  relevant to this appeal.

                                               7
Appellate Case: 21-1232    Document: 010110750340        Date Filed: 10/07/2022      Page: 12

               (1) a derivative breach-of-fiduciary-duty claim against CRC I;

               (2) a derivative civil-theft claim against CRC, SPO, SPO I, and
                   Mr. Knobel;9

               (3) a derivative breach-of-contract claim based on the Loan Agreement
                   against SPO I;10

               (4) a derivative federal securities-fraud claim against CRC I; and

               (5) a derivative state securities-fraud claim against CRC, its principals,
                   and Mr. Knobel.

        The Cui Appellants’ remaining claims were:

               (1) a direct fraud claim against all Defendants;

               (2) a direct and derivative breach-of-fiduciary-duty claim against CRC
                   and CRC I;

               (3) a direct federal securities-fraud claim against all Defendants;

               (4) a derivative breach-of-contract claim against SPO I; and

               (5) a direct and derivative claim for declaratory relief against CRC I,
                   SPO, and SPO I.11

        9
           The district court dismissed this claim, and the Li Appellants mention it only
  in a footnote in their opening brief. They have thus waived any arguments as to this
  claim. San Juan Citizens All. v. Stiles, 654 F.3d 1038, 1055-56 (10th Cir. 2011)
  (argument raised in a footnote and inadequately developed is waived).
        10
          The district court also dismissed the Li Appellants’ surviving derivative
  breach-of-contract claim against SPO I for lack of subject-matter jurisdiction. The Li
  Appellants do not challenge this dismissal on appeal.
        11
           The district court order lists this claim as against CRCPS, SPO, and SPO I,
  but the complaint lists CRC I, SPO, and SPO I, so we describe the claim as stated in
  the complaint.
         The Cui Appellants pled this as a separate claim for relief under Colo. Rev.
  Stat. § 13-51-106, which allows a plaintiff to “have determined any question of
  construction or validity arising under the instrument, statute, ordinance, contract, or
  franchise and obtain a declaration of rights, status, or other legal relations
  thereunder.” See Villa Sierra Condo. Ass’n v. Field Corp., 878 P.2d 161, 164
                                             8
Appellate Case: 21-1232     Document: 010110750340        Date Filed: 10/07/2022       Page: 13

        The district court granted the Appellees’ motions to dismiss in part and denied

  them in part. It (1) granted the motions as to Appellants’ federal securities-law

  claims; (2) denied the motions as to Appellants’ breach-of-contract claims and the

  Cui Appellants’ declaratory-relief claim against SPO and SPO I; and (3) dismissed

  the remaining state law claims.

        Because only state law claims against SPO and SPO I remained, the court

  ordered the parties to address whether diversity jurisdiction existed, and if not,

  whether it should exercise supplemental jurisdiction over those claims. After

  briefing, the court determined that it lacked diversity subject-matter jurisdiction over

  Appellants’ remaining state law claims against SPO and SPO I, declined to exercise

  supplemental jurisdiction over those claims, and dismissed them without prejudice.

        The district court next denied the Cui Appellants’ motion to appoint a receiver.

  It also denied the Li Appellants’ motion to dismiss CRC I’s counterclaim. CRC I

  later withdrew its counterclaim.

        The Li Appellants moved for reconsideration of the district court’s dismissal

  of their claims. They also moved for default judgment on their abandoned claim to

  remove CRC I as general partner. The Cui Appellants also renewed their motion for

  appointment of a receiver. The district court denied these motions.

  (Colo. App. 1994) (Section 13-51-106 is “intended to provide a method to relieve
  parties from uncertainty and insecurity with respect to their rights, status, and other
  legal relations” (quotations omitted)).

                                              9
Appellate Case: 21-1232        Document: 010110750340   Date Filed: 10/07/2022    Page: 14

         Finally, the Cui Appellants moved to file a fourth amended complaint, which

  the district court denied.

     Attorney Fees

         Appellees then moved for attorney fees on multiple grounds. Waveland

  Ventures, LLC, CRC, and CRC I (collectively “CRC Defendants”) sought attorney

  fees against the Li and Cui Appellants under Colorado law and the Private Securities

  Litigation Award Act (“PSLRA”). SPO, SPO I, and Mr. Knobel (collectively “SPO

  Defendants”) sought attorney fees against the Li and Cui Appellants under the Loan

  Agreement, Colorado law, and the PSLRA. The district court addressed these

  requests in three orders, which we describe below.

         a. Order on the CRC Defendants’ motion for attorney fees

         The court awarded the CRC Defendants $390,056.25 against the Li Appellants

  and $139,539.75 against the Cui Appellants under Colorado law, Colo. Rev. Stat.

  § 13-17-201. It explained that the CRC Defendants were entitled to attorney fees

  under Colorado law because (1) the Li and Cui Appellants asserted tort claims

  against the CRC Defendants and (2) the court had dismissed the entire action against

  the CRC Defendants under Rule 12(b)(6).

         b. Order on the SPO Defendants’ motion for attorney fees

         The district court awarded the SPO Defendants attorney fees against the Li

  Appellants and the Cui Appellants.

                                             10
Appellate Case: 21-1232     Document: 010110750340        Date Filed: 10/07/2022     Page: 15

               i. Li Appellants

        The court awarded the SPO Defendants $244,020.68 in attorney fees against

  the Li Appellants under the Loan Agreement and Colorado law, which each provided

  an independent basis for the award.

        First, the court granted attorney fees under the Loan Agreement. The Loan

  Agreement provided that the prevailing parties in litigation arising from the loan

  were entitled to attorney fees. The district court concluded that the SPO Defendants

  were the prevailing parties. It then said that “[t]his should end the issue of fees as

  against the Li [Appellants] because the Court will not award a party, and the SPO

  Defendants cannot recover, the same fees more than once.” App., Vol. XIV at 3867.

  Nonetheless, the court proceeded to evaluate the remaining bases for attorney fees.

        Second, the court concluded that Mr. Knobel, but not the other SPO

  Defendants, was entitled to attorney fees under Colorado law. It determined that the

  entire action was dismissed with prejudice only as to Mr. Knobel under

  Rule 12(b)(6), not SPO and SPO I,12 so only he could recover attorney fees under

  Colorado law. It then concluded that the essence of the action against Mr. Knobel

  was in tort, which entitled him to fees under Colorado law.

        12
           The court dismissed certain state law claims against SPO and SPO I without
  prejudice for lack of diversity jurisdiction and because it declined to exercise
  supplemental jurisdiction.

                                             11
Appellate Case: 21-1232    Document: 010110750340       Date Filed: 10/07/2022       Page: 16

               ii. Cui Appellants

        The court awarded the SPO Defendants $77,376.79 against the Cui Appellants

  under the Loan Agreement and Colorado law.

        First, the court awarded attorney fees under the Loan Agreement because the

  SPO Defendants were the prevailing parties on the Cui Appellants’ claims.

        Second, the court awarded Mr. Knobel, but not the other SPO Defendants,

  attorney fees under Colorado law. It again explained that only Mr. Knobel was

  dismissed entirely under Rule 12(b)(6). It also concluded that the Cui Appellants’

  claims against Mr. Knobel were tort claims. The court declined to specify the

  amount of fees awarded to Mr. Knobel under Colorado law because it had awarded

  him fees under the Loan Agreement and he could not recover those fees twice.13

        c. Order on fees under the PSLRA

        The court separately addressed the requests for attorney fees against the

  Appellants’ counsel under the PSLRA. It concluded that the Li Appellants’ counsel

  and the Cui Appellants’ counsel had violated Federal Rule of Civil Procedure 11(b).

  Because the PSLRA imposes a rebuttable presumption in favor of attorney fees for

  substantial Rule 11 violations, the court evaluated whether each counsel’s violation

  was substantial and, if so, whether the presumption that attorney fees should be

  assessed had been rebutted.

        13
           On appeal, neither the Li Appellants nor the Cui Appellants challenge the
  attorney fee awards to the SPO Defendants based on the Loan Agreement.

                                            12
Appellate Case: 21-1232    Document: 010110750340       Date Filed: 10/07/2022     Page: 17

        As to the Li Appellants’ counsel, the court determined his Rule 11 violation

  was substantial, so the PSLRA’s presumption applied, and that he had failed to rebut

  the presumption. It said that, excluding the claims that the Li Appellants voluntarily

  dismissed, four of the five remaining claims were frivolous. The court awarded

  $390,056.25 to the CRC Defendants and $244,020.68 to the SPO Defendants against

  the Li Appellants’ counsel.

        As to the Cui Appellants’ counsel, the court determined that the entire amount

  of attorney fees should be assessed against him for the claims against the CRC

  Defendants. But it concluded that his Rule 11 violation was not substantial for the

  claims against the SPO Defendants, so the presumption that he should be liable for

  the full amount of attorney fees did not apply. The court thus awarded $139,539.75

  to the CRC Defendants and $5,000 to the SPO Defendants against the Cui

  Appellants’ counsel.

        Finally, the court noted that the attorney fee awards were not cumulative and

  that the CRC and SPO Defendants could only collect once even though fees were

  awarded under different theories.

        Appellants timely appealed.14

        14
            We summarize here our understanding of the district court’s subject-matter
  jurisdiction underlying its orders. Both sets of Appellants filed claims for federal
  securities-fraud. The remainder of their claims were based on state law. The district
  court had federal question jurisdiction over the federal securities claims under
  28 U.S.C. § 1331 and 15 U.S.C. §§ 77v and 78aa. It dismissed them under Rule
  12(b)(6). It also dismissed the state law claims against the CRC Defendants and
  Mr. Knobel under Rule 12(b)(6), apparently exercising supplemental jurisdiction
  under 28 U.S.C. § 1367. It denied the Rule 12(b)(6) motions to dismiss the
                                            13
Appellate Case: 21-1232    Document: 010110750340        Date Filed: 10/07/2022     Page: 18

                                     II. DISCUSSION

        On appeal:

        (A) The Appellants challenge the district court’s Rule 12(b)(6) dismissal of
            their claims for (1) breach of fiduciary duty, (2) federal securities fraud,
            (3) Colorado securities fraud (Li Appellants only), and (4) Colorado
            common law fraud (Cui Appellants only).

        (B) The Cui Appellants argue the district court erred in dismissing their
            remaining state law claims for lack of subject-matter jurisdiction.

        (C) The Cui Appellants contend the district court abused its discretion in
            denying their motion to file a fourth amended complaint.

        (D) The Li Appellants assert the district court improperly denied their motion
            for default judgment on their original claim seeking removal of CRC I as
            general partner.

        (E) The Appellants challenge the district court’s awards of attorney fees under
            Colorado law and the PSLRA.

  We address each issue in turn.15

                               A. Rule 12(b)(6) Dismissals

        On appeal, both sets of Appellants challenge the dismissal of (1) their breach-

  of-fiduciary-duty claims against CRC I and (2) their federal securities-fraud claims.

  The Li Appellants contest dismissal of (3) their state securities-fraud claim, and the

  derivative state breach-of-contract and declaratory-judgment claims against SPO and
  SPO I. But, after asking for supplemental briefing on subject-matter jurisdiction
  regarding those claims, the court determined it lacked diversity jurisdiction under
  28 U.S.C. § 1332 and declined to exercise supplemental jurisdiction under 28 U.S.C.
  § 1367.
        15
          The Li Appellants listed eight issues in their brief. Li Aplt. Br. at 5-6. The
  Cui Appellants listed seven issues in their brief. Cui Aplt. Br. at 5-6. We have
  consolidated the issues into the foregoing five categories and have identified those
  which both sets of Appellants raise and those which each of them raise on their own.

                                            14
Appellate Case: 21-1232     Document: 010110750340         Date Filed: 10/07/2022    Page: 19

  Cui Appellants argue against dismissal of (4) their fraud claim. Although many of

  the arguments overlap, we address them based on each separate complaint.

        We review de novo the dismissal of a complaint under Rule 12(b)(6).

  Mayfield v. Bethards, 826 F.3d 1252, 1255 (10th Cir. 2016). “We accept all

  well-pleaded factual allegations in the complaint as true, and we view them in the

  light most favorable to the nonmoving party.” Sinclair Wyo. Refin. Co. v. A&B

  Builders, Ltd., 989 F.3d 747, 765 (10th Cir. 2021) (quotations and alterations

  omitted). To survive a Rule 12(b)(6) motion, a complaint must contain “enough facts

  to state a claim to relief that is plausible on its face.” Bell Atl. Corp. v. Twombly,

  550 U.S. 544, 570 (2007). “A claim has facial plausibility when the plaintiff pleads

  factual content that allows the court to draw the reasonable inference that the

  defendant is liable for the misconduct alleged.” Ashcroft v. Iqbal, 556 U.S. 662,

  678 (2009). “Threadbare recitals of the elements of a cause of action, supported by

  mere conclusory statements, do not suffice.” Id.

        We typically consider “only the contents of the complaint when ruling on a

  12(b)(6) motion.” Berneike v. CitiMortgage, Inc., 708 F.3d 1141, 1146 (10th Cir.

  2013). But we will consider “documents incorporated by reference in the complaint

  [and] documents referred to in and central to the complaint, when no party disputes

  [their] authenticity.” Id.; see Broker’s Choice of Am., Inc. v. NBC Universal, Inc.,

  861 F.3d 1081, 1103 (10th Cir. 2017).

                                              15
Appellate Case: 21-1232     Document: 010110750340        Date Filed: 10/07/2022      Page: 20

        “[W]e may affirm the judgment on any ground supported by the record” as

  long as the plaintiff “had a fair opportunity to address that ground.” Nakkhumpun v.

  Taylor, 782 F.3d 1142, 1157 (10th Cir. 2015).

        “Federal courts exercising diversity jurisdiction apply the substantive law of

  the forum state . . . .” Sinclair Wyo. Refin. Co., 989 F.3d at 765-66; see Erie R.R. v.

  Tomkins, 304 U.S. 64, 78 (1938). We therefore apply Colorado law to Appellants’

  state law claims.

     Breach-of-Fiduciary-Duty Claims

        a. Legal background

               i. Economic loss rule

        To state a breach-of-fiduciary-duty claim, a plaintiff must allege (1) “the

  defendant was acting as a fiduciary of the plaintiff,” (2) “[the defendant] breached a

  fiduciary duty to the plaintiff,” (3) “the plaintiff incurred damages,” and (4) “the

  defendant’s breach of fiduciary duty was a cause of the plaintiff’s damages.” Taylor

  v. Taylor, 381 P.3d 428, 431 (Colo. App. 2016) (quotations and emphases omitted).

  This claim may be based on breach of a contractual duty or breach of a tort duty.

  Compare Casey v. Colo. Higher Educ. Ins. Benefits All. Tr., 310 P.3d 196, 204 (Colo.

  App. 2012) (breach of fiduciary duty could support a breach-of-contract claim), with

  Castro v. Lintz, 338 P.3d 1063, 1069 (Colo. App. 2014) (construing breach-of-

  fiduciary-duty claim as a tort claim).

        The Appellants’ challenge to dismissal of their fiduciary-duty claims

  implicates the “economic loss rule,” which bars a party to a contract from using a tort

                                             16
Appellate Case: 21-1232    Document: 010110750340        Date Filed: 10/07/2022   Page: 21

  claim to recover contract damages unless the party can show it is owed an

  independent duty in tort creating a separate entitlement to those damages.

        Under the economic loss rule, if a plaintiff alleges “only economic loss from

  the breach of an express or implied contractual duty,” he or she “may not assert a tort

  claim for such a breach absent an independent duty of care under tort law.” Town of

  Alma v. AZCO Const., Inc., 10 P.3d 1256, 1264 (Colo. 2000). “Economic loss is

  defined generally as damages other than physical harm to persons or property.” Id.

  To be independent of a contractual duty, the duty must (1) “arise from a source other

  than the relevant contract,” and (2) “not be a duty also imposed by the contract.”

  Haynes Trane Serv. Agency, Inc. v. Am. Standard, Inc., 573 F.3d 947, 962 (10th Cir.

  2009) (applying Colorado law). “Fiduciary relationships may be the kind of special

  relationship that will trigger an independent common law duty of care,” but “not

  every fiduciary relationship implicates a risk of damages for which contract law

  cannot provide a remedy.” Casey, 310 P.3d at 202-03 (quotations omitted).

               ii. Federal Rule of Civil Procedure 23.1 and the contemporaneous
                   ownership rule

        The fiduciary-duty claims also implicate Federal Rule of Civil Procedure

  23.1(b), known as the contemporaneous ownership rule. Bangor Punta Operations,

  Inc. v. Bangor & A. R. Co., 417 U.S. 703, 708 n.4 (1974). It provides that a plaintiff

  bringing a derivative action must allege that he or she “was a shareholder or member

                                            17
Appellate Case: 21-1232    Document: 010110750340       Date Filed: 10/07/2022    Page: 22

  at the time of the transaction complained of.” Fed. R. Civ. P. 23.1(b).16 Rule 23.1 is

  a procedural rule, but we apply the state’s substantive law in determining whether the

  transaction at issue occurred while the plaintiff was a shareholder or member. Cadle

  v. Hicks, 272 F. App’x 676, 678-79 (10th Cir. 2008) (unpublished) (cited as

  instructive under Fed. R. App. P. 32.1; 10th Cir. R. 32.1(A)).

        b. Analysis

        In their complaint, the Li Appellants brought a derivative-breach-of-fiduciary-

  duty claim against CRC I. They alleged that CRC I, acting as general partner of

  CRCPS, failed to adequately ensure that the loan agreement with the SPO Defendants

  was sufficiently collateralized. They also alleged that CRC I breached its fiduciary

  duty in failing to demand complete repayment of the loan and by providing

  misleading information about it.

        The Cui Appellants separately brought both direct and derivative breach-of-

  fiduciary-duty claims against the CRC Defendants. They alleged that the CRC

  Defendants provided them with misleading marketing materials and took advantage

  of the Cui Appellants’ lack of English proficiency to convince them to invest in the

  limited partnership.

        The district court dismissed the breach-of-fiduciary-duty claims on two

  grounds. First, the court read both complaints as asserting the claims under tort law.

        16
           Under Colorado’s limited partnership statute, “‘Member’ means a general
  partner or a limited partner.” Colo Rev. Stat. § 7-61-102(2).

                                            18
Appellate Case: 21-1232     Document: 010110750340        Date Filed: 10/07/2022     Page: 23

  It concluded the economic loss rule barred the claims because the CRC Defendants’

  duties arose from contract. Second, the court held that many of the allegations

  supporting the Li Appellants’ claim and all of the allegations supporting the Cui

  Appellants’ derivative claim stemmed from the CRC Defendants’ conduct that

  preceded the plaintiffs’ investments in the limited partnership. Thus, under Federal

  Rule of Civil Procedure 23.1, the court held that Appellants could not recover based

  on those allegations.

        Appellants argue the district court erred in construing their allegations as

  arising under tort and not under contract. They contend their complaints make clear

  that their breach-of-fiduciary-duty claims arose from contract and are therefore

  properly construed as breach-of-contract claims. And because their claims are

  contractual, Appellants argue the economic loss rule does not bar their claims.

  Appellants also contend the district court improperly applied Rule 23.1.

                 i. Li Appellants

        The Li Appellants brought this claim derivatively against CRC I, arguing it

  breached its fiduciary duty to CRCPS and therefore violated its contractual

  obligations.

        We employ a three-step analysis to determine whether the district court

  properly dismissed the Li Appellants’ breach-of-fiduciary-duty claim. First, we

  determine this is a contract claim, not, as the district court concluded, a tort claim

  subject to the economic loss rule. So the district court should not have dismissed it

  on that ground. Second, because part of this claim was based on alleged misconduct

                                             19
Appellate Case: 21-1232    Document: 010110750340        Date Filed: 10/07/2022      Page: 24

  that occurred before the Li Appellants invested in CRCPS, the district court correctly

  determined that Rule 23.1 and the “contemporaneous ownership rule” barred that part

  of the claim. Third, we conclude that the remaining post-investment allegations

  stated a claim for breach of contract. We thus affirm the district court’s dismissal of

  the pre-investment allegations supporting the claim and reverse the dismissal of the

  post-investment allegations.

                      1) The contractual nature of the Li Appellants’ claim

        Construing the complaint in the light most favorable to the Li Appellants, see

  Sinclair Wyo. Refin. Co., 989 F.3d at 765, we conclude that it pled a breach-of-

  contract claim rather than a tort claim. The Li Appellants’ complaint labeled its

  claim as a “Breach of Fiduciary Duty arising by Contract and Statute.” App., Vol. II

  at 299 (emphasis added). In describing this count, the complaint identified the

  contractual language creating the fiduciary relationship. Id. at 300 ¶ 114 (“The

  CRCPS [Partnership Agreement] at Section 8.04 states that ‘In carrying out their

  duties and exercising their powers hereunder, the General Partner [CRC I] shall

  exercise reasonable skill, care, and business judgment.”). It then described CRC’s

  breaches as “contractual and fiduciary.” Id. at 301 ¶ 126. Finally, the complaint

  sought damages equaling the “shortfall between what it would have received i[f] the

  Loan had been paid in cash versus the value of what it actually received (hereafter,

  the ‘Damages’).” Id. at 302 ¶ 129. These allegations show that the legal predicate

  for the Li Appellants’ breach-of-fiduciary-duty claim was contract, not tort.

                                            20
Appellate Case: 21-1232     Document: 010110750340          Date Filed: 10/07/2022     Page: 25

         Casey v. Colorado Higher Education Institute is instructive. 310 P.3d 196

  (Colo. App. 2012). There, the plaintiffs brought a breach-of-contract claim alleging

  the defendants breached their fiduciary duties. Id. at 201. The defendants responded

  that, by alleging breach of fiduciary duties, the claim was based on tort and thus was

  barred. Id. The Colorado Court of Appeals rejected this argument, concluding that

  the “[t]he complaint does not allege a tort claim for breach of fiduciary duty against

  the trustees. Rather it alleges that the trustees breached the contract . . . by ‘failing to

  perform their contractual obligations, including contractually imposed fiduciary

  duties.’” Id. at 203 (alterations omitted). Because the complaint referred to the

  specific contractual duties creating the fiduciary duty, the court concluded it was a

  contractual claim. Id. The Li complaint similarly alleged a breach of fiduciary duty

  that breached the parties’ contract.

         Appellees’ assertion that the Li Appellants alleged a tort-based breach of

  fiduciary duty is not persuasive.

         First, they point to the Li Appellants’ colloquy with the district court at the

  motion-to-dismiss hearing where counsel confirmed to the district court that the

  claim was a breach-of-fiduciary-duty claim. Appellees argue that the Li Appellants

  should have clarified then that its claim arose from contract or statute. But the Li

  Appellants were not asked whether the claim arose from tort or contract. They were

  asked only whether it was a breach-of-fiduciary-duty claim, and they confirmed it

  was. App., Vol. X at 2723. Their response did not contradict the plain language of

  their complaint, which governs in any event.

                                              21
Appellate Case: 21-1232    Document: 010110750340        Date Filed: 10/07/2022     Page: 26

        Second, Appellees argue that the Li Appellants’ assertion of breach-of-contract

  claims against SPO I shows that they knew how to assert breach-of-contract claims.

  But Appellees fail to explain how the Li Appellants’ assertion of a breach-of-contract

  claim elsewhere in their complaint affects the substance of this claim.

        We conclude that the complaint alleged a contractual breach-of-fiduciary-duty

  claim and is thus not subject to the economic loss rule. The district court erred in

  dismissing the claim on this ground.

                      2) Rule 23.1

        The Li complaint alleged pre-investment misconduct as the basis for CRC I’s

  breach of its fiduciary duties. Rule 23.1 barred its derivative claim based on these

  allegations. The complaint alleged that CRC I willfully and negligently structured

  the Loan Agreement with SPO. App., Vol. II at 300 ¶ 118. Because this alleged

  misconduct predated the Li Appellants’ investment, the district court dismissed these

  allegations. The Li Appellants contend the transaction supporting their derivative

  claim did not occur until they purchased the ownership stake in CRCPS. We

  disagree.

        The Loan Agreement was executed on November 5, 2010. Id. at 276 ¶ 31.

  Per the Li complaint, no investors, including the Li Appellants, received marketing

  materials regarding the limited partnership stakes until after the Loan Agreement’s

  execution. Id. at 285 ¶ 61. Thus, the Li Appellants did not own any interest in

  CRCPS when the transaction complained of—the Loan Agreement—was executed.

                                            22
Appellate Case: 21-1232    Document: 010110750340        Date Filed: 10/07/2022       Page: 27

        The Li Appellants cite Elk River Assocs. v. Huskin, 691 P.2d 1148 (Colo. App.

  1984), to argue that CRC I’s fiduciary obligation to the investors predated their

  actual investment. Li Aplt. Br. at 32. Huskin said “a fiduciary relationship between

  the parties to a limited partnership can attach during the negotiations which precede

  formal execution of the certificate of limited partnership.” 691 P.2d at 1152. This

  argument fails for two reasons.

        First, the Li Appellants sued derivatively on behalf of CRCPS, so the relevant

  fiduciary duty is not between the limited partners and the general partner but between

  the general partner and the CRCPS partnership. See Burks v. Lasker, 441 U.S. 471,

  477 (1979) (“A derivative suit is brought by shareholders to enforce a claim on

  behalf of the corporation.”); Colo. Rev. Stat. § 7-62-1001(1) (Colorado law

  permitting limited partners to bring derivative suits on behalf of the limited

  partnership). Because the Li Appellants were not limited partners of CRCPS when

  the Loan Agreement was executed, they could not sue CRC I on behalf of CRCPS.

        Second, even assuming the fiduciary relationship between the Li Appellants

  and CRC I began during negotiations to sell the limited partnership interests in

  CRCPS and that the Li Appellants were suing directly, the negotiations did not begin

  until after execution of the Loan Agreement. Thus, Rule 23.1(b) barred the Li

  Appellants’ pre-investment derivative claims.

                      3) Remaining post-investment allegations

        Turning to the Li Appellants’ remaining, post-investment allegations, we

  conclude they plausibly stated a claim for breach of contract.

                                             23
Appellate Case: 21-1232    Document: 010110750340           Date Filed: 10/07/2022   Page: 28

        To plausibly state a breach of contract, a plaintiff must allege “(1) the

  existence of a contract; (2) performance by the plaintiff or some justification for

  nonperformance; (3) failure to perform the contract by the defendant; and

  (4) resulting damages to the plaintiff.” Marquardt v. Perry, 200 P.3d 1126, 1129

  (Colo. App. 2008).

        The Li complaint alleged that (1) the Partnership Agreement was the contract

  governing the relationship between CRCPS and CRC I, App., Vol. II at 300 ¶ 114;

  (2) CRCPS paid management fees to CRC I, id. at 298 ¶ 104; (3) in failing to honor

  its fiduciary duties, CRC I failed to perform the contract, id. at 300-01 ¶¶ 114-18,

  126; and (4) CRCPS incurred damages resulting from the breach, id. at 302 ¶ 129.

  The Li complaint thus plausibly alleged a breach of contract.

                                      *    *        *   *

        In sum, the breach-of-fiduciary-duty claim was validly pled as a contract

  claim, but Rule 23.1(b) barred the pre-investment part of the claim. We therefore

  reverse the district court’s dismissal of the Li Appellants’ breach-of-fiduciary-duty

  claim for allegations relating to post-investment conduct.

               ii. Cui Appellants

        In contrast, the Cui Appellants’ complaint failed to allege a contractual breach-

  of-fiduciary-duty claim and was thus subject to the economic loss rule. The Cui

  complaint described this count generally as a breach of fiduciary duty by CRC and

  CRC I. App., Vol. VI at 1585. It did not mention any contractual creation of the

  fiduciary duty. Indeed, the Cui complaint stated that CRC owed the Cui Appellants a

                                               24
Appellate Case: 21-1232      Document: 010110750340       Date Filed: 10/07/2022    Page: 29

  duty “[a]s the regional center entrusted by the Plaintiffs to oversee their investment.”

  Id. at 1586 ¶ 107. Thus, the complaint on its face does not allege a fiduciary duty

  arising out of contract.

        Because the Cui Appellants’ claim arises out of tort, we must apply the

  economic loss rule. As described above, the rule bars recovery for economic losses

  under tort if the breach stemmed from a breach of a contractual duty. Town of Alma,

  10 P.3d at 1264. Here, the breach stemmed from a breach of contract, and the Cui

  complaint alleged only economic losses. Thus, the economic loss rule barred the Cui

  Appellants’ breach-of-fiduciary-duty claim. We therefore affirm the district court’s

  dismissal of the Cui Appellants’ breach-of-fiduciary-duty claim.

     Federal Securities-Fraud Claims

        The Li Appellants appeal the dismissal of their derivative federal securities-

  fraud claim against CRC I. The Cui Appellants appeal dismissal of their direct

  federal securities-fraud claim against all Appellees.17 We affirm the district court.

        a. Li Appellants

        The Li Appellants brought a derivative federal securities-fraud claim only

  against CRC I. They allege that CRC I made material misrepresentations to the

  limited partners to induce them to exercise their put options at a loss. The district

  court dismissed their claim because it (1) was barred under the statute of repose and

        17
          The Cui complaint also included a direct federal securities-fraud claim under
  15 U.S.C. § 80a against CRCPS and CRC I in its capacity as the general partner. The
  Cui Appellants do not raise this claim on appeal.

                                             25
Appellate Case: 21-1232     Document: 010110750340         Date Filed: 10/07/2022     Page: 30

  (2) was not a proper derivative claim. We affirm on the second ground and do not

  address the first.

         A derivative action “permits an individual shareholder to bring ‘suit to enforce

  a corporate cause of action against officers, directors, and third parties.’” Kamen v.

  Kemper Fin. Servs., Inc., 500 U.S. 90, 95 (1991) (quoting Ross v. Bernhard, 396 U.S.

  531, 534 (1970)). The derivative action allows an individual shareholder “to protect

  the interests of the corporation from the misfeasance and malfeasance of faithless

  directors and managers.” Id. (emphasis added) (quotations omitted).18

         Here, the Li Appellants’ securities-fraud claim did not allege violations by

  CRC I against CRCPS. Instead, they alleged harms that CRC I and CRCPS caused

  the investors directly. For instance, the Li complaint alleged that “CRCPS - acting

  through CRC1 - issued an offering of securities when it granted a put right to each

  limited partner to ‘put’ his unit back to CRCPS.” App., Vol. II at 310 ¶ 187. In

  making this “offering of the put option to investors,” the Li complaint alleged, “CRC

  failed to explain the history and method by which it was over-valuing the collateral.”

  Id. at 310-11 ¶ 189 (emphasis added), see also id. at 311 ¶ 190 (“CRC never

  explained clearly to investors the implications of allowing SPO to recharacterize the

  loan (a debt) as ‘investors equity.’ . . . This is a material omission of fact to induce

         18
            We treat limited partnerships and corporations the same for purposes of a
  derivative suit. See Fed. R. Civ. P. 23.1(a) (treating unincorporated associations and
  corporations similarly for derivative suits); Colo. Rev. Stat. § 7-60-106(1) (defining a
  limited liability partnership as an association). The parties do not dispute this
  approach.

                                              26
Appellate Case: 21-1232        Document: 010110750340         Date Filed: 10/07/2022     Page: 31

  the limited partners to invest and stay in the transaction which has caused them

  continuing detriment.” (emphasis added)). These allegations described a direct and

  not a derivative claim. They do not allege any harm caused to CRCPS. It was thus

  an improper derivative claim, and the district court properly dismissed it.

           b. Cui Appellants

           The Cui Appellants brought direct federal securities-fraud claims against all

  Appellees. They allege that Appellees made material misrepresentations to convince

  them to purchase their limited partnership interests in CRCPS.19 The district court

  dismissed their claim after concluding it was barred under the statute of repose. We

  agree.

           “A statute of repose . . . puts an outer limit on the right to bring a civil action.”

  CTS Corp. v. Waldburger, 573 U.S. 1, 8 (2014). Unlike a statute of limitations,

  whose limit begins after a claim accrues, a statute of repose’s limit is measured “from

  the date of the last culpable act or omission of the defendant.” Id. Thus, it bars “any

  suit that is brought after a specified time since the defendant acted . . . , even if this

  period ends before the plaintiff has suffered a resulting injury.” Id. (quotations

  omitted).

           19
           The Cui Appellants’ complaint also alleged that Appellees violated
  section 78o of the Federal Securities Act by selling securities without being
  registered. They do not present any argument regarding these allegations on appeal,
  so they have abandoned this claim.

                                                27
Appellate Case: 21-1232      Document: 010110750340       Date Filed: 10/07/2022        Page: 32

        Under 28 U.S.C. § 1658(b)(2), a plaintiff alleging a federal securities violation

  may not bring a private cause of action later than “5 years after such violation.”

  Before the district court, the Cui Appellants did not dispute Appellees’ assertion that

  they purchased their limited partnerships in 2012. App., Vol. XI at 2955 n.43. They

  thus needed to bring their claims no later than 2017, but they failed to file their

  complaint until 2019. The Cui Appellants’ federal securities-fraud claim was

  therefore time-barred.20

     Li Appellants’ Colorado Securities-Fraud Claim

        The Li Appellants brought a derivative securities-fraud claim under the

  Colorado Securities Act against CRC, its principals, and Mr. Knobel. Their

  allegations were identical to their federal securities-fraud claims: CRC, along with

  Mr. Knobel, “sent misleading and fraudulent valuations to investors in connection

  with an attempt to get them to exercise a put option offered to them, which would

  cause a loss to each investor.” App., Vol. II at 312 ¶ 200.

        As with their federal securities-fraud claims, Appellants failed to allege a

  derivative action. They alleged that they, as investors, suffered harms, not CRCPS.

  We thus affirm the dismissal of their Colorado Securities Act derivative fraud claims.

        20
           The Cui Appellants incorporate the Li Appellants’ arguments regarding the
  statute of repose. They suggest that Appellees’ 2016-2019 notices offering to allow
  limited partners to exercise their put options each constituted a new security. But the
  Cui complaint alleged only that the security at issue was the 2012 sale of the limited
  partnership interest.

                                             28
Appellate Case: 21-1232     Document: 010110750340        Date Filed: 10/07/2022     Page: 33

     Cui Appellants’ Fraud Claims

        The Cui Appellants appeal dismissal of their Colorado fraud claim against all

  Appellees. To state a fraud claim under Colorado law, a plaintiff must allege (1) “the

  defendant misrepresented a material fact,” (2) “the defendant knew the representation

  was false,” (3) the plaintiff “did not know the representation was false,” (4) “the

  defendant made the misrepresentation intending that the [plaintiff] act on it,” and

  (5) “damages resulted from the [plaintiff’s] reliance.” Loveland Essential Grp., LLC

  v. Grommon Farms, Inc., 251 P.3d 1109, 1116 (Colo. App. 2010).

        A plaintiff asserting a fraud claim must satisfy the heightened pleading

  requirements of Federal Rule of Civil Procedure 9(b). Under Rule 9(b), the plaintiff

  “must state with particularity the circumstances constituting fraud or mistake.”

  Fed. R. Civ. P. 9(b). We have interpreted this Rule to require a plaintiff to “set forth

  the time, place, and contents of the false representation, the identity of the party

  making the false statements and the consequences thereof.” Toone v. Wells Fargo

  Bank, N.A., 716. F.3d 516, 522 (10th Cir. 2013) (quotations omitted); United States

  ex rel. Polukoff v. St. Mark’s Hosp., 895 F.3d 730, 745 (10th Cir. 2018) (allegations

  of fraud must “provide factual allegations regarding the who, what, when, where and

  how of the alleged claims” (quotations and alterations omitted)).

        The district court dismissed the Cui Appellants’ fraud claim after determining

  the Cui complaint failed to meet Rule 9(b)’s heightened pleading standard. The Cui

  Appellants contend the complaint adequately alerted Appellees to the nature of their

                                             29
Appellate Case: 21-1232     Document: 010110750340         Date Filed: 10/07/2022     Page: 34

  claim, and any deficiency in the pleadings resulted from asymmetric information.

  We agree with the district court.

        As the district court determined, the Cui Appellants’ allegations lacked the

  specificity needed to allege fraud. For instance, the complaint alleged that Waveland

  LLC “colluded with SPO to defraud the EB–5 investors by misrepresenting to them

  that the Loan was 100% collateralized and safe.” App., Vol. VI at 1564-65 ¶ 9. But

  this allegation contained no specifics regarding which statements were fraudulent,

  nor did it identify when or where the false representation was made. Elsewhere in

  the complaint, the Cui Appellants identified numerous purported misrepresentations

  in a marketing presentation to potential investors by Appellees’ agents, id. at 1573-75

  ¶¶ 65-66, but the complaint again failed to identify where, when, and to whom the

  misrepresentations were made. Indeed, as the district court noted, the complaint

  failed to allege that any of the Cui Appellants attended this presentation. These

  allegations lack the requisite specificity to allege a fraud claim.

        The Cui Appellants argue we should relax Rule 9(b)’s heightened pleading

  standard because Appellees were better placed to have details regarding their

  fraudulent scheme. We have held that “courts may consider whether any pleading

  deficiencies resulted from the plaintiff’s inability to obtain information in the

  defendant’s exclusive control.” Polukoff, 895 F.3d at 745 (quotations omitted). But

  the Cui Appellants’ complaint was deficient, not because they lacked information in

  Appellees’ exclusive control, but because they failed to identify necessary

  information that was squarely within their knowledge, such as the dates, locations,

                                              30
Appellate Case: 21-1232     Document: 010110750340        Date Filed: 10/07/2022    Page: 35

  and identities of relevant actors. We thus affirm the district court’s dismissal of the

  Cui Appellants’ fraud claim.

                  B. Dismissal of State Claims for Lack of Jurisdiction

        After the district court denied the motion to dismiss the Li Appellants’

  derivative breach-of-contract claim against SPO I and the Cui Appellants’ derivative

  breach-of-contract and declaratory-judgment claims against SPO and SPO I, it

  ordered the parties to address whether it had diversity jurisdiction over these claims,

  and if not, whether it should exercise supplemental jurisdiction.

        After briefing, the district court concluded that because the Appellants’

  remaining claims were derivative in nature, it had to determine whether to align

  CRCPS as a plaintiff or a defendant. It concluded CRCPS’s interests were adverse to

  the Appellants’ interests, so the court aligned it as a defendant. And because

  CRCPS, as a limited partnership, takes on the citizenship of its limited partners, see

  Carden v. Arkoma Assocs., 494 U.S. 185, 195-96 (1990), the court concluded it had

  the same citizenship as the Appellants. It therefore determined it lacked subject-

  matter jurisdiction. It then declined to exercise supplemental jurisdiction under

  28 U.S.C. § 1367(c)(3).21

        On appeal, the Li Appellants do not challenge the dismissal of their derivative

  breach-of-contract claim against SPO I for lack of subject-matter jurisdiction. We

        21
            On appeal, the Appellants do not challenge this declination of supplemental
  jurisdiction.

                                             31
Appellate Case: 21-1232    Document: 010110750340        Date Filed: 10/07/2022        Page: 36

  thus limit our analysis to the Cui Appellants’ challenge to the dismissal of their

  derivative breach-of-contract and declaratory-judgment claims against SPO and

  SPO I for lack of subject-matter jurisdiction.22 The Cui Appellants do not address the

  district court’s determination of CRCPS’s alignment or its citizenship. Instead, they

  focus on the diversity of citizenship between themselves and the SPO Defendants.

  Because the district court determined CRCPS and the Cui Appellants shared the same

  citizenship and therefore there was no complete diversity, the citizenship of SPO is

  not material to its holding that there was no diversity jurisdiction. See Strawbridge v.

  Curtiss, 7 U.S. (3 Cranch) 267 (1806). Because the Cui Appellants fail to dispute the

  alignment and citizenship of CRCPS, they have waived their challenge to the district

  court’s dismissal for lack of subject-matter jurisdiction. Krastev v. INS, 292 F.3d

  1268, 1280 (10th Cir. 2002) (“Issues not raised on appeal are deemed to be

  waived.”). Any such challenge would fail in any event.

                            C. Leave to Amend the Complaint

        The Cui Appellants argue the district court should have granted their motion

  for leave to file a fourth amended complaint. “A district court should refuse leave to

  amend only upon a showing of undue delay, undue prejudice to the opposing party,

  bad faith or dilatory motive, failure to cure deficiencies by amendments previously

        22
           In their reply brief, the Cui Appellants argue they alleged both direct and
  derivative claims that survived the motion to dismiss. This is incorrect. The district
  court dismissed the direct claims under Rule 12(b)(6) and left only the derivative
  claims.

                                             32
Appellate Case: 21-1232      Document: 010110750340       Date Filed: 10/07/2022    Page: 37

  allowed, or futility of amendment.” Wilkerson v. Shinseki, 606 F.3d 1256, 1267

  (10th Cir. 2010) (quotations and alterations omitted). “We ordinarily apply the

  abuse-of-discretion standard when reviewing a denial of leave to amend.” Moya v.

  Garcia, 895 F.3d 1229, 1239 (10th Cir. 2018).

        In a June 14, 2021 order,23 the district court denied the Cui Appellants’ motion

  for leave to amend. It reasoned that amendment would be futile based on (1) its

  dismissal of the Cui Appellants’ breach-of-fiduciary-duty and fraud claims with

  prejudice, (2) its refusal to exercise supplemental jurisdiction over the surviving state

  law claims, and (3) the Cui Appellants’ previous three amendments of their

  complaint. See Anderson v. Suiters, 499 F.3d 1228, 1238 (10th Cir.2007) (a district

  court may deny a motion to amend a complaint if the amendment would be futile, and

  “[a] proposed amendment is futile if the complaint, as amended, would be subject to

  dismissal” (quotations omitted)). We view the request to amend differently.

        To the extent the Cui Appellants proposed to amend their complaint to state a

  breach-of-contract claim based on CRC I’s breach of its contractual fiduciary duty,24

  as we explained above in our discussion of the Li Appellants’ fiduciary-duty claim,

  such a claim is not subject to the economic loss rule. In short, the proposed amended

        23
             Issued the same day the court entered final judgment.
        24
           Although on appeal the Cui Appellants focus on their fraud claim, they
  moved to amend to “clarify[] the Claims for Fraud; Breach of Fiduciary Duty; and
  Declaratory Relief,” and to plead “a Breach of Contract cause of action as an
  alternative to the Breach of Fiduciary Duty cause of action.” App., Vol. XIII
  at 3470; see also id. at 3477, 3482-3519.

                                             33
Appellate Case: 21-1232      Document: 010110750340      Date Filed: 10/07/2022     Page: 38

  complaint does not appear to be futile, and “[i]f a proposed amendment is not clearly

  futile, then denial of leave to amend is improper.” Seale v. Peacock, 32 F.4th 1011,

  1029 (10th Cir. 2022) (quoting Wright & Miller, Federal Practice & Procedure

  § 1487). We reverse the district court’s denial of the Cui Appellants’ request for

  leave to amend and remand for further consideration.

                             D. Motion for Default Judgment

        The Li Appellants challenge the district court’s refusal to enter default

  judgment in their favor on their abandoned claim to remove CRC I as general partner

  of CRCPS. They initially included a count in their operative complaint seeking

  removal of CRC I as general partner. But they voluntarily dismissed this count.

  App., Vol. VIII at 2090. After CRC I filed a counterclaim seeking a declaratory

  judgment that its purported removal was improper, the Li Appellants moved to

  dismiss the counterclaim and “for [an] order declaring general partner removed

  instanter.” Id. at 2079.

        The district court denied the Li Appellants’ motion to dismiss the counterclaim

  and their request for a declaration stating that CRC I was properly removed as

  general partner. After this ruling, CRC I voluntarily dismissed its counterclaim. The

  Li Appellants then moved for entry of default judgment ordering the removal of

  CRC I as general partner. The court denied their motion during a hearing. See App.,

  Vol. XIII at 3420-69.

        The Li Appellants argue this denial was erroneous. They appear to suggest

  that CRC I’s voluntary dismissal amounted to a concession that its removal was

                                            34
Appellate Case: 21-1232     Document: 010110750340        Date Filed: 10/07/2022     Page: 39

  proper. But as Appellees point out, the Li Appellants had already dismissed their

  claim seeking removal of CRC I as general partner. The district court thus had no

  claims involving removal of CRC I before it, let alone a claim adjudicated in the Li

  Appellants’ favor. In short, when the Li Appellants moved for default judgment,

  there was no pending claim on which judgment could be entered. We therefore

  affirm.

                                     E. Attorney Fees

        The district court awarded attorney fees to the CRC Defendants under

  Colorado law and the PSLRA. It also awarded attorney fees to the SPO Defendants

  under the Loan Agreement, Colorado law (Mr. Knobel only), and the PSLRA. We

  vacate the award of attorney fees for the CRC Defendants under Colorado law and

  the awards of attorney fees for all Defendants under the PSLRA. We remand to the

  district court for further proceedings.

        “[A]lthough this appeal involves the review of an award of attorneys’ fees

  under state law, the standard of review under which we review an award of fees is a

  procedural matter controlled by federal precedent.” Xlear, Inc. v. Focus Nutrition,

  LLC, 893 F.3d 1227, 1233 (10th Cir. 2018). “We review the decision to award

  attorney fees, and the amount awarded, for abuse of discretion.” United Phosphorus,

  Ltd. v. Midland Fumigant, Inc., 205 F.3d 1219, 1232 (10th Cir. 2000). “A district

  court abuses its discretion if it commits legal error, relies on clearly erroneous factual

  findings, or issues a ruling without any rational evidentiary basis.” Xlear, Inc., 893

                                             35
Appellate Case: 21-1232    Document: 010110750340        Date Filed: 10/07/2022      Page: 40

  F.3d at 1233. “Whether a litigant is a ‘prevailing party’ is a legal question we review

  de novo.” Id.

     Colorado Law

        Under Colorado law, if a court grants a motion to dismiss a tort action, the

  “defendant shall have judgment for his reasonable attorney fees in defending the

  action.” Colo. Rev. Stat. § 13-17-201(1).

        If a plaintiff has pled tort and non-tort claims, the court must determine

  “whether the essence of that party’s action was one in tort.” Gagne v. Gagne, 338

  P.3d 1152, 1167 (Colo. App. 2014). The court first assesses “whether the ‘essence of

  the action’ is tortious in nature (whether quantitatively by simple number of claims or

  based on a more qualitative view of the relative importance of the claims).” Id.

  at 1168 (quotations omitted). If this assessment fails to give a definitive answer, the

  court must then determine “whether tort claims were asserted to unlock additional

  remedies.” Id. (quotations omitted).

        If the court determines the essence of the action was tortious, then attorney

  fees are mandatory. See Luskin Daughters 1996 Tr. v. Young, 448 P.3d 982, 987

  (Colo. 2019). A court must also award attorney fees to a defendant even if claims

  remain live against a co-defendant. See Stauffer v. Stegemann, 165 P.3d 713, 718

  (Colo. App. 2006). But “the statute does not authorize recovery if a defendant

  obtains dismissal of some, but not all, of a plaintiff’s tort claims.” Colorado Special

  Districts Prop. & Liab. Pool v. Lyons, 277 P.3d 874, 885 (Colo. 2012).

                                              36
Appellate Case: 21-1232    Document: 010110750340        Date Filed: 10/07/2022    Page: 41

        a. Li Appellants

        Because we reverse the dismissal of the Li Appellants’ breach-of-fiduciary-

  duty claim, we vacate the attorney fee award for the CRC Defendants against the Li

  Appellants. As discussed, the district court misconstrued the breach-of-fiduciary-

  duty claim as a tort claim rather than as a contract claim, and Colorado law does not

  permit an award of attorney fees if some of a plaintiff’s claims remain live. Falcon

  Broadband, Inc. v. Banning Lewis Ranch Metro. Dist. No. 1, 474 P.3d 1231, 1244-45

  (Colo. App. 2018) (statute does not apply “if the court doesn’t dismiss all the tort

  claims against a certain defendant or if an action contains both tort and non-tort

  claims and the defendant obtains C.R.C.P 12(b) dismissal of only the tort claims”

  (quotations omitted)). Our reversal revives the breach-of-fiduciary-duty claim

  against CRC I. We therefore vacate the award of attorney fees for the CRC

  Defendants under Colorado law.25

        25
           This does not affect the attorney fee award for Mr. Knobel against the Li
  Appellants under Colorado law. As discussed above, the district court awarded
  Mr. Knobel attorney fees under Colorado law because the entire action was dismissed
  against him and the claims against him sounded in tort. Because the Li Appellants
  asserted their breach-of-fiduciary-duty claim against CRC I, not Mr. Knobel, our
  revival of that claim does not affect the award against him.
         In sum, (1) the fee award against the Li Appellants under Colorado law
  regarding the SPO Defendants was given only to Mr. Knobel and (2) our partial
  reversal of the breach-of-fiduciary-duty claim does not affect the award to him
  because that claim was not asserted against Mr. Knobel.

                                             37
Appellate Case: 21-1232      Document: 010110750340        Date Filed: 10/07/2022     Page: 42

         b. Cui Appellants

         Similarly, because we reverse and remand on the Cui Appellants’ motion for

  leave to amend their complaint, we vacate the award of attorney fees under Colorado

  law.

         As discussed, Colorado law awards attorney fees for a tort action when the

  “action is dismissed on motion of the defendant.” Colo. Rev. Stat. § 13-17-201(1).

  But because we reverse the district court’s denial of the Cui Appellants’ proposed

  amendment, which included a breach-of-contract claim based on a breach of

  fiduciary duty, the district court must re-evaluate whether the statutory basis for the

  attorney fee award applies.26

     Federal Law

         The PSLRA requires a court, “upon final adjudication of the action,” to make

  “specific findings regarding compliance by each party and each attorney representing

  any party with each requirement of Rule 11(b) of the Federal Rules of Civil

  Procedure as to any complaint, responsive pleading, or dispositive motion.”

  15 U.S.C. § 78u-4(c)(1). If the court finds that a party violated Rule 11(b), it “shall

  impose sanctions on such party or attorney.” 15 U.S.C. § 78u-4(c)(2). Unlike other

         26
           It is unclear from the Cui Appellants’ briefing on appeal how they will
  amend their complaint. Because we do not know the specifics of their amended
  claim, the district court is best situated to revisit the award of attorney fees for Mr.
  Knobel and the CRC Defendants under Colorado law on remand.

                                              38
Appellate Case: 21-1232     Document: 010110750340        Date Filed: 10/07/2022    Page: 43

  sanctions provisions, the PSLRA imposes a presumption in favor of sanctions. Id.

  § 78u-4(c)(3).

        After making its dismissal rulings and concluding that no claims were pending,

  the district court ordered the parties to address whether it should award attorney fees

  under the PSLRA. The court concluded that four of the Li Appellants’ five claims—

  including their federal securities claim—were frivolous and thus warranted a

  sanctions award.

        As to the Cui Appellants, the court concluded that two of the five claims it

  adjudicated—including the federal securities claim—were frivolous. The court

  determined that the Cui Appellants’ claims against the CRC Defendants contained

  substantial defects and that the Cui Appellants failed to rebut the presumption in

  favor of sanctions. But it concluded the Cui Appellants’ claims against the SPO

  Defendants were not as defective, so it awarded lower sanctions.

        The court then ordered (1) the Li Appellants’ counsel to pay about $390,000 to

  the CRC Defendants and $244,000 to the SPO Defendants; and (2) the Cui

  Appellants’ counsel to pay about $140,000 to the CRC Defendants and $5,000 to the

  SPO Defendants.

        a. Li Appellants

        Because we reverse the district court’s dismissal of one of the Li Appellants’

  claims, we vacate the PSLRA fee award. The PSLRA provides that, “[i]n any private

  action arising under” the securities statutes, the district court must award attorney

  fees “upon final adjudication of the action.” 15 U.S.C. § 78u-4(c)(1). The parties

                                             39
Appellate Case: 21-1232      Document: 010110750340          Date Filed: 10/07/2022     Page: 44

  have not briefed, and the district court did not address whether “final adjudication of

  the action” refers solely to federal securities-law claims or whether it refers to the

  entire action. If it refers to the latter, our reversal of the district court’s dismissal of

  the Li Appellants’ breach-of-fiduciary-duty claim means that adjudication of the

  action is not final.27 On remand, the district court must determine whether it should

  first resolve the Li Appellants’ surviving breach-of-fiduciary-duty claim before

  assessing attorney fees under the PSLRA.28

         27
            We note the case law understanding of 15 U.S.C. § 78u-4(c)(1) is unsettled.
  The Fourth Circuit has said, but only in dicta, that the PSLRA “applies to any action
  with a claim arising under Chapter 2B of Title 15 of the U.S. Code, 15 U.S.C. § 78a
  et seq.” Morris v. Wachovia Sec., Inc., 448 F.3d 268, 276 (4th Cir. 2006). Relatedly,
  district courts have attempted to address the meaning of “final adjudication.” See
  Blaser v. Bessemer Tr. Co., 2002 WL 31359015, at *3 (S.D.N.Y. 2002) (noting
  “there is little case law on its meaning”); Manchester Mgmt. Co., LLC v. Echo
  Therapeutics, Inc., 297 F. Supp. 3d 451, 465 (S.D.N.Y. 2018); Great Dynasty Int’l
  Fin. Holdings Ltd. v. Haiting Li, 2014 WL 3381416, at *5 (N.D. Cal. 2014).
         28
           The district court concluded that the breach-of-fiduciary-duty claim was
  frivolous, which is not correct in light of our reversal. We affirm the dismissal of the
  derivative federal securities-law claim because it did not allege harm to CRCPS, the
  limited partnership. But the district court may have awarded fees on a faulty basis
  because it seems to have broadly concluded that a derivative federal securities-law
  claim against a general partner would be a suit against the limited partnership itself
  and could not be maintained even if it alleged damage to CRCPS. App., Vol. XIV
  at 3823 (“It was not objectively reasonable for Li Plaintiffs to sue CRC I derivatively
  on behalf of CRCPS for alleged securities violations.”).
         The case law indicates that investors may pursue derivative federal securities-
  law claims against a corporate manager (here, the general partner, CRC I) for alleged
  harm to the corporation (here, the limited partnership, CRCPS). See Frankel v.
  Slotkin, 984 F.2d 1328, 1332-33 (2nd Cir. 1993) (plaintiff could maintain derivative
  federal securities-law claim against majority shareholder by showing damage to the
  corporation); Hill v. Vanderbilt Cap. Advisors, LLC, 834 F. Supp. 2d 1228, 1268-69
  (D.N.M. 2011) (other circuits have established that federal securities-law claims may
  be pursued derivatively).

                                               40
Appellate Case: 21-1232     Document: 010110750340       Date Filed: 10/07/2022    Page: 45

        b. Cui Appellants

        Because we reverse the district court’s order denying the Cui Appellants leave

  to amend their complaint, we vacate the district court’s PSLRA fee award. As with

  the award against the Li Appellants, the district court must determine whether “final

  adjudication of the action” refers solely to the Cui Appellants’ federal securities-law

  claim or whether it covers the entire complaint.29

                                   III. CONCLUSION

        In sum, we

        (A) affirm the district court’s dismissal of Appellants’ claims under Federal
            Rule of Civil Procedure 12(b)(6) except for the Li Appellants’ claim for
            breach of fiduciary duty, which we affirm in part and reverse in part;

        (B) affirm dismissal of the Cui Appellants’ remaining state law claims for
            lack of subject-matter jurisdiction;

        (C) reverse the district court’s denial of the Cui Appellants’ motion to amend
            their complaint;

        (D) affirm the district court’s denial of the Li Appellants’ motion for default
            judgment; and

        (E) vacate the awards of attorney fees as discussed herein.30

        29
           As noted above, the Appellants do not challenge on appeal the awards of
  attorney fees to the SPO Defendants under the Loan Agreement. Appellees argue
  this moots Appellants’ challenges to the fees awarded to the SPO Defendants under
  Colorado law and the PSLRA. See Aplee. Br. at 63-64. The district court is in the
  best position to consider the relationship among the various bases for the fee awards
  and should address this mootness argument on remand.
         Nothing in this Order and Judgment should necessarily prevent the district
  court from revisiting whether it should award attorney fees under Colorado law or the
  PSLRA at the conclusion of proceedings on remand.
        30
           We thus deny as moot the following motions addressing the district court’s
  orders regarding the attorney fee awards: (1) CRC I’s motion for leave to allow the
                                            41
Appellate Case: 21-1232       Document: 010110750340           Date Filed: 10/07/2022    Page: 46

        The following chart lists the issues presented on appeal and our dispositions:

                   Appeal Issue                        Li Appellants        Cui Appellants
      (A)         Rule 12(b)(6) Dismissal of:
            (1)   Breach of fiduciary duty            Affirmed in part         Affirmed
                                                      Reversed in part
            (2)   Federal securities fraud               Affirmed              Affirmed
            (3)   Colorado securities fraud              Affirmed                N/A
            (4)   Colorado common law fraud                 N/A                Affirmed
      (B)         Dismissal for Lack of                     N/A                Affirmed
                  Subject-Matter Jurisdiction
      (C)         Denial of Motion to Amend                 N/A                Reversed
      (D)         Denial of Motion for Default           Affirmed                N/A
                  Judgment
      (E)         Attorney Fees
            (1)   Colorado                            Vacated as to the        Vacated
                                                      CRC Defendants
            (2)   PSLRA                                   Vacated              Vacated

  district court to correct the amended final judgment, Doc. 10870007; (2) the Li
  Appellants’ motion for affirmative relief striking the amended final judgment, Doc.
  10878163; and (3) the Li Appellants’ motion to strike the second amended final
  judgment, Doc. 10874725.
         We also deny the Li Appellants’ motion for appointment of a neutral appellate
  counsel for CRCPS, Doc. 10847355. The Li Appellants provide no legal basis for
  this request.

                                                 42
Appellate Case: 21-1232    Document: 010110750340       Date Filed: 10/07/2022   Page: 47

        We remand to the district court for further proceedings consistent with this

  Order and Judgment.31

                                             Entered for the Court

                                             Scott M. Matheson, Jr.
                                             Circuit Judge

        31
           This court’s rulings on appeal revive the Li Appellants’ breach-of-fiduciary-
  duty claim and potentially revive certain of the Cui Appellants’ state law claims
  through amendment of their complaint. In either instance, the district court on
  remand will need to consider whether to exercise supplemental jurisdiction in light of
  the dismissal of the federal claims.

                                           43