Court Opinion

ID: 4026392
Source: CourtListenerOpinion
Date Created: 2016-08-18 20:01:25.706861+00
Date Added: 2024-06-11T12:17:08.497185
License: Public Domain

FILED
                            NOT FOR PUBLICATION
                                                                             AUG 18 2016
                     UNITED STATES COURT OF APPEALS                      MOLLY C. DWYER, CLERK
                                                                          U.S. COURT OF APPEALS

                            FOR THE NINTH CIRCUIT

LARRY BROWN,                                      No.   14-55731

              Plaintiff-Appellant,                D.C. No.
                                                  5:12-cv-02009-TJH-SP
 v.

BANK OF AMERICA, N.A.; et al.,                    MEMORANDUM*

              Defendants-Appellees.

                    Appeal from the United States District Court
                       for the Central District of California
                     Terry J. Hatter, District Judge, Presiding

                         Argued and Submitted May 3, 2016
                               Pasadena, California

Before: BYBEE and N.R. SMITH, Circuit Judges, and STEIN,** District Judge.

      Larry Brown appeals the district court’s dismissal of his case for lack of

standing, and the court’s determination that a certain letter (the “Victa Letter”) was

         *
             This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
         **
            The Honorable Sidney H. Stein, United States District Judge for the
Southern District of New York, sitting by designation.
not protected by the attorney–client privilege or work-product privilege. We

affirm.

1.    Brown lacks standing to litigate any of his claims. Brown is not a mortgagor

or an attorney. Yet, he sues numerous mortgagees (“Appellees”), claiming he

represents more than one thousand discontented mortgagors. Because Brown

cannot represent the mortgagors as an attorney, his standing depends on whether

the mortgagors assigned him their claims. The district court found that Brown

lacked standing for two reasons: (1) Brown did not demonstrate that the

assignment of RICO claims was express, and (2) Brown did not demonstrate that

he acquired an interest in each mortgagor’s property to permit him to litigate the

claims that seek an interest in real property. We need not pass judgment on the

district court’s findings, because “[w]e may affirm on any proper ground supported

by the record.” Novak v. United States, 795 F.3d 1012, 1017 (9th Cir. 2015).

      “The party invoking federal jurisdiction bears the burden of establishing [the

elements of standing].” Lujan v. Defs. of Wildlife, 504 U.S. 555, 561 (1992).

Generally, “to satisfy Article III’s standing requirements, a plaintiff must show . . .

it has suffered an ‘injury in fact.’” Friends of the Earth, Inc. v. Laidlaw Envtl.

Servs. (TOC), Inc., 528 U.S. 167, 180 (2000). However, an assignee—who “stands

in the shoes of its assignors,” Spinedex Physical Therapy USA Inc. v. United

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Healthcare of Ariz., Inc., 770 F.3d 1282, 1291 (9th Cir. 2014)—may meet the

requirements of standing by showing that he received an assignment of claims,

Sprint Commc’ns Co. v. APCC Servs., Inc., 554 U.S. 269, 274–75 (2008).

      Although the Ninth Circuit does not require “terms of art . . . for a valid

assignment,” United States ex rel. Kelly v. Boeing Co., 9 F.3d 743, 748 (9th Cir.

1993), the assignee must provide proof that an assignment occurred. “[G]eneral

contract principles dictate that to prove an effective assignment, the assignee must

come forth with evidence that the assignor meant to assign rights and obligations

under the contracts.” Britton v. Co-op Banking Grp., 4 F.3d 742, 746 (9th Cir.

1993) (citing Restatement (Second) of Contracts §§ 317(1), 324 (1981)). Because a

court’s subject matter jurisdiction turns on whether the plaintiff has standing, the

plaintiff must “present affidavits or any other evidence necessary to satisfy its

burden of establishing that the court, in fact, possesses subject matter jurisdiction”

if the defendant moves to dismiss on that basis. St. Clair v. City of Chico, 880 F.2d
199, 201 (9th Cir. 1989); see also White v. Lee, 227 F.3d 1214, 1242 (9th Cir.

2000) (noting that, “[w]ith a factual Rule 12(b)(1) attack, . . . a court may look

beyond the complaint” and “need not presume the truthfulness of the plaintiffs’

allegations”).

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      Brown’s Second Amended Complaint, the relevant document, fails to

provide any proof that Brown was assigned claims by the more-than-one-thousand

mortgagors he purports to represent. The entire language of assignment in the SAC

reads as follows.

      Plaintiff Larry Brown (hereinafter, “Plaintiff”) brings this Action as the
      assignee of Life Savers Concepts Association, Inc., a North Carolina
      corporation, and certain affiliates thereof (collectively hereinafter, “Life
      Savers”). Life Savers, in term, is the assignee of the claims of the
      individuals listed on Exhibit “A” attached hereto (collectively
      hereinafter, the “Assignors”), and it is solely in the capacity of assignee
      of the respective Assignors that Plaintiff appears herein.

Brown did not allege any facts—or provide any exhibits with his SAC—to support

his bald assertion. Nor did Brown oppose Appellees’ Motion to Dismiss on the

basis of Rule 12(b)(1) with evidence, facts, or exhibits that would tend to support

his statement. Brown’s standing is entirely dependent on a valid assignment,

therefore Brown’s failure to provide proof of such is fatal to all of his claims.1

2.    Brown failed to show that the Show Cause Motion was improperly granted.

Although the district court may have abused its discretion by failing to require a

threshold showing that the letter was not privileged before reviewing it in camera,

any such error was harmless. See United States v. The Corp. (In re Grand Jury

      1
       Brown’s untimely request for leave to amend his complaint is DENIED.
Brown has not demonstrated that, even if we overlooked his untimeliness, the
standing deficiencies could be cured by the proposed amendment.
                                           4
Investigation), 974 F.2d 1068, 1071, 1075 (9th Cir. 1992) (“Although the district

court did apply [the wrong] threshold, the application of the correct threshold

would not change the result.”); United States v. de la Jara, 973 F.2d 746, 749 (9th

Cir. 1992) (“The district court abused its discretion by declining to [require a

threshold showing]. We may, however, affirm the district court ‘on any ground

fairly supported by the record.’” (footnote omitted) (quoting Lee v. United States,

809 F.2d 1406, 1408 (9th Cir. 1987))).

      Appellees easily made the “minimal showing” that the information in the

Victa Letter was not privileged or was subject to the crime-fraud exception. In re

Grand Jury Investigation, 974 F.2d at 1071, 1074. Bank of America’s counsel

received an unsolicited email from an unknown sender that “strongly suggest[ed]

that there ha[d] been malfeasance in connection with soliciting claims for [Brown’s

lawsuit].” Appellees referred the district court to consumer alerts issued by the

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Federal Trade Commission “about similar fraud schemes underlying mass

actions.”2

3.    Brown has failed to show that the Victa Letter was privileged and not

subject to the crime–fraud exception. See United States v. Ruehle, 583 F.3d 600,

607 (9th Cir. 2009) (placing the burden of proof on the plaintiff). Brown contends

that the letter was written by a former Executive Officer of Life Savers (Victa),

who “had sat in on several meetings with Brown and his counsel where the

litigation was discussed.” Brown does not show that the Victa letter contains

“confidential communications between [Brown and his attorney], which [were]

made for the purpose of giving legal advice.” United States v. Richey, 632 F.3d
559, 566 (9th Cir. 2011). Rather, Brown admits that the meetings Victa attended

were conducted for information-gathering and that multiple Life Savers officers

were present. Further, Brown has not shown that Life Savers had a common

      2
        We reject Brown’s contention that California State Bar, Formal Opinion
No. 2013-188 (“State Bar Opinion”) prohibited Appellees from referring to the
contents of the Victa Letter in their request for an Order to Show Cause. The State
Bar Opinion is advisory, not law; the parties were, instead, governed by Federal
Rule of Civil Procedure 26(b)(5)(B). Even if the State Bar Opinion imposed a
legally binding ethical obligation, it does not apply here. The State Bar Opinion
addresses a situation in which an attorney receives an unsolicited letter that
purports to contain confidential communications between an opposing party and its
counsel. Upon learning of the confidential contents of the letter, the attorney would
be ethically obligated to cease reading and relinquish the letter. Such was not the
situation here.
                                          6
interest in the litigation, such that Brown’s communications with his counsel were

protected despite Life Savers’s officers’ presence. See Pac. Pictures Corp. v. U.S.

Dist. Ct. for the C.D. of Cal. (In re Pac. Pictures Corp.), 679 F.3d 1121, 1129 (9th

Cir. 2012) (“[A] shared desire to see the same outcome in a legal matter is

insufficient to bring a communication between two parties within [the common

interest doctrine]. Instead, the parties must make the communication in pursuit of a

joint strategy in accordance with some form of agreement—whether written or

unwritten.”).

      The Victa letter is not protected by the work-product privilege, because

Brown has not shown that the Victa Letter, or any portion of the Victa Letter, was

“prepared in anticipation of litigation or for trial by or for another party or its

representative.” Fed. R. Civ. P. 26(b)(3)(A).

      AFFIRMED.

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