G and G Productions LLC v. Rusic, 082918 FED9, 16-56107

Docket Nº:16-56107
Opinion Judge:. MCKEOWN, CIRCUIT JUDGE.
Party Name:G and G Productions LLC, a California Limited Liability Corporation, Plaintiff-Appellant, v. Rita Rusic, Defendant-Appellee.
Attorney:Brent Herbert Blakeley (argued), Blakeley Law Group, Manhattan Beach, California, for Plaintiff-Appellant. Scott S. Humphreys (argued), Burt M. Rublin, and Peter L. Haviland, Ballard Spahr LLP, Los Angeles, California, for Defendant-Appellee.
Judge Panel:Before: M. Margaret McKeown and Kim McLane Wardlaw, Circuit Judges, and James Donato, District Judge. DONATO, District Judge, concurring
Case Date:August 29, 2018
Court:United States Courts of Appeals, Court of Appeals for the Ninth Circuit
SUMMARY

G&G appealed the district court's order granting summary judgment to defendant, a citizen of Italy, in G&G's suit asserting various state law claims. G&G alleged that Rustic stole a large, valuable oil painting from her former husband and G&G's predecessor-in-interest. The district court held that G&G's claims were barred by California's borrowing statute, Cal. Civ. Proc. Code 361. The Ninth... (see full summary)

 
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G and G Productions LLC, a California Limited Liability Corporation, Plaintiff-Appellant,

v.

Rita Rusic, Defendant-Appellee.

No. 16-56107

United States Court of Appeals, Ninth Circuit

August 29, 2018

Argued and Submitted February 14, 2018 Pasadena, California

Appeal from the United States District Court for the Central District D.C. No. 2:15-cv-02796-RGK-E of California R. Gary Klausner, District Judge, Presiding

Brent Herbert Blakeley (argued), Blakeley Law Group, Manhattan Beach, California, for Plaintiff-Appellant.

Scott S. Humphreys (argued), Burt M. Rublin, and Peter L. Haviland, Ballard Spahr LLP, Los Angeles, California, for Defendant-Appellee.

Before: M. Margaret McKeown and Kim McLane Wardlaw, Circuit Judges, and James Donato, [*] District Judge..

SUMMARY[**]

Statute of Limitations

The panel affirmed in part, and vacated in part, the district court's summary judgment that was entered in favor of Rita Rusic in a diversity action brought by G&G Productions, LLC, alleging various claims concerning ownership of Wine of Babylon, a valuable oil painting by the artist Jean-Michel Basquiat.

G&G alleged that Rusic stole the painting from her former husband and G&G's predecessor-in-interest, Vittorio Cecchi Gori, an Academy Award-winning Italian film producer.

The panel applied the substantive law of California, which involved determining the accrual dates of G&G's various claims and assessing their timeliness under California's borrowing statute. The panel further held that there was no dispute that all of G&G's causes of action arose in Italy. Finally, the panel held that if the Italian statute of limitations would bar a claim, then the borrowing statute, Cal. Civ. Proc. Code § 361, barred that claim in California.

Concerning the conversion claim, as a threshold matter, the panel concluded that the district court was permitted to determine accrual under Italian law, assuming the borrowing statute authorized the court to do so. The panel further held that under de Fontbrune v. Wofsy, 838 F.3d 992, 997 (9th Cir. 2016), and Fed.R.Civ.P. 44.1, a party relying on foreign law had an obligation to raise the specific legal issues and to provide the district court with the information needed to determine the meaning of the foreign law. The panel held that in the district court, the parties did not raise explicitly the issue of whether G&G's claims accrued under Italian law, and G&G failed to raise the issue whether its conversion claim was exempt from an Italian statute of limitations. Given the circumstances, the district court did not err in applying California law to determine when the conversion claim accrued. The panel affirmed the district court's order with respect to G&G's conversion claim because the district court properly determined that the claim accrued sometime in 2000 and was time-barred under both the Italian and California statutes of limitations.

The panel vacated and remanded to the district court with respect to G&G's replevin and unjust enrichment claims because there was no indication that the district court determined when those claims accrued.

The panel vacated and remanded the district court's order with respect to G&G's claim for declaratory relief because the disputed facts on the claim defeated summary judgment in favor of Rusic.

District Judge Donato concurred because the conversion claim was properly dismissed under Italy's 10-year statute of limitations whether the accrual was measured under Italian law or California law. He noted that the approach of in effect splitting the borrowing statute - by applying California law to determine when a claim accrues and foreign law to decide if the time to sue has lapsed - might not be sound when the laws of California and the foreign jurisdiction do not align so neatly.

OPINION

MCKEOWN, CIRCUIT JUDGE.

What happens when you cross an Academy Award-winning Italian film producer, a Croatian actress-turned-producer, a bitter divorce, an oil painting worth millions of dollars, and dozens of pages of untranslated Italian law in the court of appeals? The answer, we conclude, is a procedural morass and a remand to the district court.

G&G Productions, LLC ("G&G"), a California limited-liability company, appeals the district court's order granting summary judgment in favor of Rita Rusic, a citizen of Italy, in G&G's suit asserting various state-law claims. G&G alleges that sometime in 1999 or 2000, Rusic stole Wine of Babylon-a large, valuable oil painting by the late American artist Jean-Michel Basquiat-from Rusic's former husband and G&G's predecessor-in-interest, Vittorio Cecchi Gori. The district court held that G&G's claims were barred by California's borrowing statute, Cal. Civ. Proc. Code § 361, because the applicable ten-year Italian statute of limitations would bar those claims in an Italian court.

We affirm the district court's order with respect to G&G's conversion claim because the district court properly determined that this claim accrued sometime in 2000 and was time-barred under both the Italian and California statutes of limitations. We vacate and remand the district court's order with respect to G&G's replevin and unjust enrichment claims, however, because there is no indication that the district court determined when those claims accrued. We also vacate and remand the district court's order with respect to G&G's claim for declaratory relief because the disputed facts on this claim defeat summary judgment in favor of Rusic.

Background

Vittorio Cecchi Gori is a well-known film producer and former Italian politician.1 In 1983, Gori married Rita Rusic, a Croatian-born actress, singer, and film producer who is now a citizen of Italy. At the time they married, Gori and Rusic agreed to keep their assets separate under Italian law.

In June 1998 Gori purchased a large oil painting entitled Wine of Babylon (1984) by the late American artist Jean-Michel Basquiat from the Tony Shafrazi Gallery in New York for $330, 000. In late 1998 or early 1999, the Shafrazi Gallery shipped the painting to Gori and Rusic's residence in Rome, Italy, where it hung with other artworks.

Mere months later, the marriage deteriorated. Rusic filed for divorce from Gori in May 1999, accusing Gori of physical abuse and infidelity. Around the time that Rusic filed for divorce, Wine of Babylon vanished from the couple's home. Gori contends that Rusic smuggled the painting out of the residence and stashed it elsewhere. Rusic counters that she did not take-and, because of a head injury allegedly caused by Gori, could not have taken-the painting, which actually disappeared "when Mr. Gori caused movers working for him to remove numerous items of personal property from [the residence] in 1999 or possibly 2000."

In the meantime, Basquiat's works have continued to appreciate in value. In 2017, for example, Basquiat's 1982 oil-stick and spray-paint creation, Untitled, set a record for any work by a U.S. artist sold at auction, fetching $110.5M at Sotheby's.

Gori has never wavered in his belief that Rusic took Wine of Babylon. On several occasions, he initiated legal action in Italy to recover the painting. On May 16, 2000, Gori's attorney sent Rusic a letter demanding the painting's return. Two months later, Gori's attorney filed a brief in Italian court in connection with the divorce proceedings, petitioning for the painting's return. The Italian court rejected Gori's petition in an August 2006 divorce decree, which found Gori at fault for spousal abuse.2 Undeterred, Gori's attorneys sent another letter to Rusic on February 24, 2009 threatening to initiate criminal proceedings if Rusic failed to return the painting. Gori's attorneys sent similar letters to Rusic later in 2009 and in 2010.

When nothing came of the letters, Gori filed a criminal complaint against Rusic in Italian court on March 22, 2010. On February 13, 2014, the court ruled in Rusic's favor and acquitted her of the charges. The court first determined that Rusic and Gori had not legally separated when Gori filed his complaint, thus barring the criminal action under Italian law. The court further determined that because Gori suspected Rusic stole the painting as early as 2000, Rusic's purported crime was "subject to the Statute of Limitations" of seven years and six months, which expired on January 10, 2008- over two years before Gori initiated the criminal action.

On February 22, 2010-one month before Gori filed his criminal complaint in Italy-Gori assigned any rights that he held in Wine of Babylon to his long-standing Italian attorney, Giovanni Nappi, to settle a 2M debt for unpaid legal fees. Nappi then assigned his rights to the painting to G&G, in exchange for a 50% ownership interest in the...

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