Court Opinion

ID: 4399546
Source: CourtListenerOpinion
Date Created: 2019-05-22 20:00:33.227488+00
Date Added: 2024-06-11T14:51:51.262389
License: Public Domain

NOT FOR PUBLICATION                        FILED
                    UNITED STATES COURT OF APPEALS                       MAY 22 2019
                                                                      MOLLY C. DWYER, CLERK
                                                                       U.S. COURT OF APPEALS
                              FOR THE NINTH CIRCUIT

VINCENT HASCOET, ex rel. United States          No.    17-16915
of America; et al.,
                                                D.C. No. 5:15-cv-00746-LHK
                Plaintiffs-Appellants,

and                                             MEMORANDUM*

UNITED STATES OF AMERICA; STATE
OF CALIFORNIA,

                Plaintiffs,

 v.

MORPHO S.A., AKA Safran Identity &
Security, S.A., a French corporation;
SAFRAN GROUP, S.A., a French
corporation,

                Defendants-Appellees.

                   Appeal from the United States District Court
                     for the Northern District of California
                     Lucy H. Koh, District Judge, Presiding

                               Submitted May 17, 2019**
                               San Francisco, California

      *
             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).
Before: McKEOWN and GOULD, Circuit Judges, and BATTAGLIA,*** District
Judge.

      Vincent Hascoet and Philippe Pacaud Desbois (collectively “Relators”)

appeal from the district court’s orders dismissing their qui tam action with

prejudice and granting Safran Identity & Security, S.A.’s request for attorneys’

fees. We have jurisdiction under 28 U.S.C. § 1291 and affirm.

      The district court did not abuse its discretion by staying discovery until

Relators could plead a legally sufficient complaint. See Ala. Cargo Transp., Inc. v.

Ala. R.R., 5 F.3d 378, 383 (9th Cir. 1993) (reviewing stay of discovery for abuse of

discretion). The district court appropriately concluded that purported insiders such

as Relators should not be allowed to use discovery to satisfy Federal Rule of Civil

Procedure 9(b)’s particularity requirement.

      Nor did the district court abuse its discretion by declining to modify the

scheduling order to allow Relators to add new defendants after the December 19,

2016 deadline. See Johnson v. Mammoth Recreations, Inc., 975 F.2d 604, 610 (9th

Cir. 1992) (reviewing district court’s refusal to modify scheduling order for abuse

of discretion). Even assuming Federal Rule of Civil Procedure 16(b)(4)’s good

cause standard applies, Relators failed to show that they were diligent. Id. at 609.

      ***
            The Honorable Anthony J. Battaglia, United States District Judge for
the Southern District of California, sitting by designation.

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Federal Rule of Civil Procedure 15(a) is not applicable because Relators sought to

amend their complaint after the scheduling order’s deadline. Id. at 607–08.

      We affirm on de novo review the district court’s holding that Relators failed

to satisfy Rule 9(b)’s particularity requirement. Yourish v. Cal. Amplifier, 191
F.3d 983, 992 (9th Cir. 1999). Relators failed to specify what role Safran U.S.A.,

Inc. played in the alleged fraud. See United States v. Corinthian Colls., 655 F.3d
984, 997–98 (9th Cir. 2011) (“Rule 9(b) . . . requires plaintiffs to differentiate their

allegations when suing more than one defendant and inform each defendant

separately of the allegations surrounding his alleged participation in the fraud.”).

They also failed to adequately allege that the other two defendants actually

submitted false claims. See Ebeid ex rel U.S. v. Lungwitz, 616 F.3d 993, 998–99

(9th Cir. 2010) (holding that qui tam plaintiffs must allege “reliable indicia that

lead to a strong inference that claims were actually submitted”). Relators alleged

that companies that were either unidentified or not named as defendants submitted

false claims, but did not plead facts sufficient to impart those companies’ liability

to the named defendants. See United States v. Bestfoods, 524 U.S. 51, 61–62

(1998) (holding that ownership and control is insufficient to demonstrate an alter-

ego relationship). Relators also failed to identify who made false certifications of

compliance with the Trade Agreements Act of 1979 (TAA), 19 U.S.C. §§ 2501–

2581, and U.S. antitrust laws, when such certifications were made, or the

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circumstances of the ostensible false certifications, so those claims also failed to

satisfy Rule 9(b). See Ebeid, 616 F.3d at 998.

      The attorneys’ fees award was not an abuse of discretion. Stetson v.

Grissom, 821 F.3d 1157, 1163 (9th Cir. 2016). The district court appropriately

concluded that the TAA and antitrust false certification claims in the Third

Amended Complaint were frivolous, because identical claims in the Second

Amended Complaint had already been found insufficient to satisfy Rule 9(b), see

Elwood v. Drescher, 456 F.3d 943, 949 (9th Cir. 2006), and the court correctly

applied the lodestar method to determine the amount of the fees award, see Van

Skike v. Dir., Office of Workers’ Comp. Programs, 557 F.3d 1041, 1046 (9th Cir.

2009); see also Fox v. Vice, 563 U.S. 826, 838 (2011) (holding that district courts

“may use estimates in calculating and allocating an attorney’s time[, a]nd appellate

courts must give substantial deference to these determinations”).

      AFFIRMED.

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