Court Opinion

ID: 219308
Source: CourtListenerOpinion
Date Created: 2011-06-22 00:01:58+00
Date Added: 2024-06-11T17:28:40.139863
License: Public Domain

FILED
                            NOT FOR PUBLICATION                             JUN 21 2011

                                                                        MOLLY C. DWYER, CLERK
                    UNITED STATES COURT OF APPEALS                       U .S. C O U R T OF APPE ALS

                            FOR THE NINTH CIRCUIT

CAREY F. DALY,                                   No. 09-17823

              Plaintiff - Appellant,             D.C. No. 4:08-cv-04398-PJH

  v.
                                                 MEMORANDUM *
PEARL SPIRITS, INC., a California
corporation; PATRICK SILVAGNIA;
DAVID LEE; LUXCO, INC., a Missouri
corporation,

              Defendants - Appellees.

                   Appeal from the United States District Court
                      for the Northern District of California
                   Phyllis J. Hamilton, District Judge, Presiding

                       Argued and Submitted April 13, 2011
                            San Francisco, California

Before: FERNANDEZ and RAWLINSON, Circuit Judges, and WELLS, Senior
District Judge.**

        *
             This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.

       **    The Honorable Lesley Wells, Senior District Judge, United States
District Court, District of Northern Ohio, sitting by designation.
      Appellant Carey F. Daly (Daly) appeals the district court’s grant of summary

judgment in favor of Defendants on Daly’s various state law claims and a claim

based on the Racketeer Influenced and Corrupt Organizations Act (RICO). Daly

asserts that the district court erred in determining that his claims were time-barred.1

1.    State-Law Based Claims

      Daly asserted state law claims of conversion and concealment. The statute

of limitations for these claims is three years. See Cal. Civ. Proc. § 338(c) and (d).

The statute of limitations for conversion begins to run from the date of the

conversion, however, where there has been fraudulent concealment of the

conversion, the limitations period begins to run when the “the aggrieved party

discovers or ought to have discovered the existence of the cause of action for

conversion.” Strasberg v. Odyssey Group, Inc., 51 Cal.App.4th 906, 916 (1996)

(citations omitted). The discovery rule applies to the running of the statute of

limitations for a claim of concealment as well. See Unruh-Haxton v. Regents of

Univ. of Cal., 162 Cal. App.4th 343, 367 (2008).

      Daly’s state-law claims accrued no later than May, 2004, when he

demonstrated awareness of any purported conversion and concealment in an email,

      1
       Daly did not challenge on appeal dismissal of his claims for fraud and
breach of fiduciary duty, or several of his RICO-related claims.

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and opined that a suit should be filed against Appellees and “anyone else complicit

in this scam.” Daly’s state law-claims were time-barred when he filed suit in June,

2008.

2.      Civil RICO Claim

        “The statute of limitations for civil RICO actions is four years.” Pincay v.

Andrews, 238 F.3d 1106, 1108 (9th Cir. 2001) (citation and footnote reference

omitted). “The limitations period for civil RICO actions begins to run when a

plaintiff knows or should know of the injury which is the basis for the action.”

Living Designs, Inc. v. E.I. Dupont de Nemours and Co., 431 F.3d 353, 365 (9th

Cir. 2005) (citation omitted).

        In May, 2004, Daly learned that the company had sold licensing rights to a

third-party, who had the option to purchase the company’s sole asset at the

conclusion of the agreement. Daly’s civil RICO claim is time-barred because Daly

had “enough information to warrant an investigation” by May, 2004. Living

Designs, 431 F.3d at 365. Indeed, by May, 2004, Daly’s attorney had already

drafted a complaint against Appellees. Daly’s argument that the third-party’s

exercise of the option to purchase in 2006 triggered the statute of limitations is

foreclosed by Volk v. D.A. Davidson & Co., 816 F.2d 1406, 1415 (9th Cir. 1987)

(holding that the operative date on which the RICO statute of limitations began to

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run is when a plaintiff learns of the wrong, not the date on which it sustained the

loss).

         AFFIRMED.

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