Court Opinion

ID: 4522903
Source: CourtListenerOpinion
Date Created: 2020-04-06 20:00:34.909016+00
Date Added: 2024-06-11T12:07:45.589528
License: Public Domain

FILED
                           NOT FOR PUBLICATION
                                                                               APR 6 2020
                    UNITED STATES COURT OF APPEALS                         MOLLY C. DWYER, CLERK
                                                                            U.S. COURT OF APPEALS

                            FOR THE NINTH CIRCUIT

CHARLES W. HOUPT, United States of               No.     19-35205
America, ex rel.,
                                                 D.C. No. 4:17-cv-00377-CWD
              Plaintiff-Appellant,

 v.                                              MEMORANDUM*

WELLS FARGO BANK, N.A.,

              Defendant-Appellee.

                    Appeal from the United States District Court
                              for the District of Idaho
                    Candy W. Dale, Magistrate Judge, Presiding

                             Submitted April 1, 2020**
                               Seattle, Washington

Before: McKEOWN, N.R. SMITH, and NGUYEN, Circuit Judges.

      Charles W. Houpt appeals the district court’s grant of summary judgment in

his qui tam action under the False Claims Act (“FCA”) against Wells Fargo Bank,

      *
             This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
      **
             The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).
N.A. (“Wells Fargo”). We have jurisdiction under 28 U.S.C. § 1291, and we

affirm.

      “We review de novo the district court’s ruling on cross-motions for

summary judgment.” Equal Emp’t Opportunity Comm’n v. BNSF Ry. Co., 902
F.3d 916, 921 (9th Cir. 2018) (italics removed). “Summary judgment is appropriate

only if, taking the evidence and all reasonable inferences in the light most

favorable to the non-moving party, there are no genuine issues of material fact, and

the movant is entitled to judgment as a matter of law.” Tauscher v. Phx. Bd. of

Realtors, Inc., 931 F.3d 959, 962 (9th Cir. 2019). Similarly, “the district court’s

dismissal on statute of limitations grounds is a question of law reviewed de novo.”

Mann v. Am. Airlines, 324 F.3d 1088, 1090 (9th Cir. 2003).

      The district court did not err in granting summary judgment on Houpt’s FCA

claims under 31 U.S.C. § 3731(b). The FCA’s statute of limitations provides that

“[a] civil action under section 3730 may not be brought”:

      (1) more than 6 years after the date on which the violation of section
      3729 is committed, or

      (2) more than 3 years after the date when facts material to the right of
      action are known or reasonably should have been known by the official
      of the United States charged with responsibility to act in the
      circumstances, but in no event more than 10 years after the date on
      which the violation is committed,

                                           2
      whichever occurs last.

31 U.S.C. § 3731(b)(1)–(2).

      Houpt’s claims are barred under both provisions of § 3731(b). The six-year

statute of limitations in § 3731(b)(1) is keyed to the date “the violation of section

3729 is committed.” Id. § 3731(b)(1). Thus, because “the FCA attaches liability,

not to the underlying fraudulent activity or to the government’s wrongful payment,

but to the claim for payment,” we must answer the question (in ascertaining

whether Houpt’s FCA claims are timely) of when Wells Fargo presented the

allegedly false claim to the U.S. Small Business Administration (“SBA”). United

States ex rel. Kelly v. Serco, Inc., 846 F.3d 325, 333 (9th Cir. 2017) (quotation

marks omitted). A “claim” “means any request or demand . . . for money or

property . . . that . . . is presented to an officer, employee, or agent of the United

States.” 31 U.S.C. § 3729(b)(2)(A)(i).

      Houpt’s FCA claims are predicated on Wells Fargo inducing the SBA to pay

the loan guarantee based on alleged “false statements and certifications to the

SBA” that Wells Fargo had the right to enforce the promissory note and complied

with SBA reporting regulations. Assuming Wells Fargo made false statements and

certifications to the SBA, the statute of limitations began to run on April 19, 2010,

the date Wells Fargo requested the “SBA purchase the guaranteed portion” of the

                                            3
loan. Therefore, because Houpt did not file suit until September 2017, Houpt’s

FCA claims are barred by § 3731(b)(1)’s limitations period.

      Houpt’s FCA claims are likewise barred by the three-year limitations period1

under § 3731(b)(2). The SBA2 either knew or should have known of the facts

material to Houpt’s FCA claims no later than April 30, 2014. Houpt does not

contest that, if Wells Fargo repaid the loan guarantee to the SBA in April 2014,3

      1
        Houpt argues that the district court’s holding that the three-year limitations
period set forth in § 3731(b)(2) applied was “moot[ed]” by the Supreme Court’s
decision in Cochise Consultancy, Inc. v. United States ex rel. Hunt, 139 S. Ct.
1507, 1510 (2019). Contrary to Houpt’s argument, Cochise did not hold that
§ 3731(b)(2) creates a ten-year statute of limitations, and the Court, in fact,
repeatedly acknowledged that § 3731(b)(2) provides a three-year limitations
period. Id. at 1510, 1514.
      2
          Neither party addresses the question of who, in this case, is properly
considered “the official . . . charged with responsibility to act in the
circumstances,” such that his or her knowledge triggers the three-year statute of
limitations in § 3731(b)(2). Wells Fargo assumes it is the knowledge of the SBA
official that is relevant to triggering the three-year statute of limitations. Houpt
does not challenge this assumption. Accordingly, we assume without deciding that
it is the SBA official’s knowledge that is relevant to determining whether Houpt’s
claims are barred under § 3731(b)(2).
      3
         There is no genuine issue of material fact concerning whether Wells Fargo
repaid the loan guarantee in April 2014. Representatives of both Wells Fargo and
the SBA submitted declarations based on the representatives’ personal knowledge
that establish that Wells Fargo repaid the loan guarantee. Contrary to Houpt’s
argument, the lack of formal documentation detailing Wells Fargo’s repayment is
insufficient to refute the uncontroverted testimony of both Wells Fargo’s and the
SBA’s representatives. For this reason, Houpt’s arguments that Wells Fargo
violated § 3729(a)(1)(D) and (G) also fail as Houpt’s theories of liability are
                                                                         (continued...)
                                           4
then the SBA either knew or reasonably should have known of the facts material to

Houpt’s FCA claims no later than April 30, 2014. Indeed, when the SBA received

payment of the guarantee and closed its loan file in April 2014: (1) the SBA would

have known what reports, documents, or other information it had or had not

received from Wells Fargo; and (2) based on those documents (which included the

loan collateral documents), the SBA either knew or should have known whether it

should have paid the loan guarantee in 2010. Therefore, because April 30, 2014,

falls more than three years before Houpt filed his complaint in this matter, Houpt’s

FCA claims are barred by the statute of limitations. See id. § 3731(b)(2).4

      AFFIRMED.

      3
       (...continued)
predicated on Wells Fargo’s failure to repay the loan guarantee.
      4
        Because we hold that Houpt’s FCA claims are barred by § 3731(b), we do
not reach Houpt’s other arguments.
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