Hamid v. Price Waterhouse
| Decision Date | 07 April 1995 |
| Docket Number | 92-56198 and 92-56199,Nos. 92-56085,s. 92-56085 |
| Citation | 51 F.3d 1411 |
| Parties | RICO Bus.Disp.Guide 8781 Akhtar HAMID, on Behalf of Himself and all Others Similarly Situated, Plaintiffs-Appellants, v. PRICE WATERHOUSE, Price Waterhouse/U.K.; Price Waterhouse World Firm Ltd.; Price Waterhouse/U.S.; Ernst & Young; Abu Dhabi, Emirate of Abu Dhabi; Abu Dhabi Investment Authority; Bank of America Corporation, Bankamerica Corp.; Bank of America NT & SA; Hill & Knowlton; Concorde Finance & Investments, GRP Investments; Interredec, Inc.; Interredec Southern Co.; et al.; First American Corp., First American Bankshares; Paul Adams; Jack Beddow; A. Vincent Scoffone; T. Bertram Lance; Independence Bank; Manuel Noriega; Fulvio Dobrich; Robert Altman; Clark Clifford; Clifford & Warnke, Defendants-Appellees. Akhtar HAMID, on Behalf of Himself and all Others Similarly Situated, Plaintiffs-Appellees, v. PRICE WATERHOUSE, Price Waterhouse/U.K.; Price Waterhouse World Firm Ltd.; Price Waterhouse/U.S.; Ernst & Young; Abu Dhabi, Emirate of Abu Dhabi; Abu Dhabi Investment Authority; Bank of America Corporation, Bankamerica Corp.; Bank of America NT & SA; Hill & Knowlton; Concorde Finance & Investments, GRP Investments; Interredec, Inc.; Interredec Southern Co.; et al.; T. Bertram Lance; Independence Bank; Manuel Noriega; Fulvio Dobrich; Robert Altman; Clark Clifford; Clifford & Warnke, Defendants, and First American Corp., First American Bankshares, Inc.; Paul G. Adams; Jack Beddow; A. Vincent Scoffone; Defendants-Appellants. Akhtar HAMID, on Behalf of Himself and all Others Similarly Situated, Plaintiffs-Appellees, v. PRICE WATERHOUSE, Price Waterhouse/U.K.; Price Waterhouse World Firm Ltd.; Price Waterhouse/U.S.; Ernst & Young; Abu Dhabi, Emirate of Abu Dhabi; Abu Dhabi Investment Authority; Bank of America Corporation, Bankamerica Corp.; Bank of America NT & SA; Hill & Knowlton; T. Bertram Lance; Independence Bank; Manuel Noriega; Robert Altman; Clark Clifford; Clifford & Warnke, First American Bankshares, Inc.; Jack W. Beddow; Paul G. Adams; A. Vincent Scoffone, |
| Court | U.S. Court of Appeals — Ninth Circuit |
William S. Lerach (argued), and Kevin P. Roddy (on the briefs), Milberg, Weiss, Bershad, Spechthrie & Lerach, San Diego, CA, for plaintiffs-appellants Hamid.
Stephen J. Brogan (argued), and Elwood G. Lui (on the briefs), Jones, Day, Reavis & Pogue, Washington, DC, for the defendants-appellants First American Corp., First American Bankshares, Inc., Jack W. Beddow, Paul G. Adams, III, and A. Vincent Scoffone.
James W. Colbert, III, O'Melveny & Myers, Los Angeles, CA (argued), for all defendants-appellees.
Robert C. Vanderet and Linda J. Smith, O'Melveny & Myers, Los Angeles, CA, James E. Tolan and William K. Dodds, Dechert, Price & Rhoads, New York City, for defendant-appellee Price Waterhouse United Kingdom.
DeBevoise & Plimpton, John G. Koeltl, Bruce G. Merritt, Edwin G. Schallert, Barton Legum, New York City, for Price Waterhouse of the United States.
Gravath Swaine & Moore, Francis P. Barron, New York City and Munger Tolles & Olson, Alan D. Bersin, Michael R. Doyen, Los Angeles, CA, for Price Waterhouse World Firm Ltd.
Patton, Boggs & Blow, Ronald S. Liebman, Scott N. Stone, Charles E. Talisman, Washington, DC and Kendig & Ross, Dennis A. Kendig, Bradley D. Ross, Los Angeles, CA, for Emirate of Abu Dhabi and Abu Dhabi Inv. Authority.
Jones Day Reavis & Pogue, Stephen J. Brogan, Elwood G. Lui, Washington, DC, for First American Corp., First American Bankshares, Inc., Jack W. Beddow, Paul G. Adams, III, and A. Vincent Scoffone.
Davis & Gilbert, Mitchell I. Weitz, Howard J. Rubin, New York City and Irell & Manella, Morgan Chu, Wayne Barsky, Los Angeles, CA, for Hill & Knowlton.
John C. Fauvre, Ullar Vitsut, Los Angeles, CA, James Roethe, Office of the Gen. Counsel, Bank of America, Michael J. Halloran, Gen. Counsel, San Francisco, CA, for Bank of America, NT & SA and BankAmerica Corp.
Richards, Watson & Gershon, John A. Belcher, Los Angeles, CA, for Fulvio Dobrich.
Johnson & Gibbs, K. Chris Todd, Mark C. Hansen, Washington, DC, and O'Neill & Lysaght, Brian O'Neill, Santa Monica, CA, for Concorde Finance & Investments, GRP Investments, N.V., InterRedec, Inc., InterRedec Southern Co., Inc., Wesley Co., Inc., River Oaks, Inc., River Oaks Investments, Inc. and Sterling Bluff, Inc.
Rosenfeld, Meyer & Susman, Gary D. Schlessinger, James L. Seal, Beverly Hills, CA, for Clark Clifford, Robert Altman and Clifford & Warnke.
Heller, Ehrman, White & McAuliffe, M. Laurence Popofsky, Ronald C. Peterson, San
Francisco, CA, and Bruce M. Cormier, Kathryn A. Oberly, Office of the Gen. Counsel, Ernst & Young, Washington, DC, for Ernst & Young.
Mark C. Hansen, Johnson & Gibbs, Washington, DC, for defendants-appellees Concorde Finance.
Appeals from the United States District Court for the Central District of California.
Before BROWNING, BOOCHEVER and KLEINFELD, Circuit Judges.
This is an appeal from dismissal of a class action by depositors in the Bank of Credit & Commerce International ("BCCI"). The issues we resolve involve timeliness of appeal, judicial recusal, the derivative nature of the depositors' RICO claims, and the application of the Alien Tort Statute.
We have jurisdiction over depositors' claims pursuant to 28 U.S.C. Sec. 1291. We review the district court's dismissal for failure to state a claim de novo. Oscar v. University Students Co-Operative Ass'n, 965 F.2d 783, 785 (9th Cir.1992) (en banc). A district court's refusal to disqualify the sitting judge may be reversed only for an abuse of discretion. Thomassen v. United States, 835 F.2d 727, 732 (9th Cir.1987).
This case was dismissed for failure to state a claim upon which relief can be granted, under Federal Rule of Civil Procedure 12(b)(6). We therefore are bound to evaluate whether the complaint states causes of action on the assumption that appellants could prove the averments. Pillsbury, Madison & Sutro v. Lerner, 31 F.3d 924, 928 (9th Cir.1994).
Appellants claim to represent depositors of funds in what they call "the constellation of banks known as Bank of Credit & Commerce International ("BCCI")." They do not sue the "constellation of banks." They sue seventy-seven people, firms, and a foreign country.
The complaint alleges that the seventy-seven defendants illegally acquired various banks in the United States, caused deposits to be misused and misappropriated, and, by misrepresenting facts about BCCI, delayed the day when regulators would shut it down. By making the bank appear to be in better financial condition than it really was, some defendants are alleged to have enabled it to attract deposits which it otherwise would have been unable to obtain. Most of the complaint consists of elaborating the egregiousness of the misuse and misappropriation of funds, including allegations of financing international terrorism, narcotics, and arms dealing, and using bribery and fraud to keep governments from interfering with BCCI's and the defendants' activities, along with extensive polemical elaborations such as pointing out that the "BCCI pirates" were "men in business suits." The looting which allegedly caused the bank to be unable to pay the depositors included loans to insiders which were intended never to be repaid.
The district court dismissed depositors' RICO claims without leave to amend after they filed their third amended complaint. Appellants' arguments go to whether their claims were such that relief could be granted, not whether they could have stated valid claims had they been given another chance to amend.
Facts dealing with particular issues are explicated more fully below, in the discussions of the issues.
We must first decide whether the appeal was untimely, depriving us of jurisdiction. The complaint went through four iterations. The district court dismissed the third amended complaint on April 30, 1992. On May 11, the plaintiffs moved to recuse Judge Marshall, on the ground that the employment plans of her law clerks required her to be disqualified. They also filed a motion under Federal Rule of Civil Procedure 52(b) to vacate the April 30 judgment on the basis of Judge Marshall's alleged disqualification. They did not appeal at that time.
Judge Marshall issued a corrected version of her order and judgment May 20. Judge Byrne denied the motion to recuse Judge Marshall July 9. Judge Marshall then denied the Rule 52(b) motion July 27. Plaintiffs filed their notice of appeal August 19. The appeal is directed to the merits of the dismissal, not just to whether Judge Marshall should have been recused. The appellate jurisdiction issue is whether the appeal was timely as to the merits. On its face, an August 19 appeal from a May 20 judgment comes more than thirty days after the judgment. See Fed.R.App.P. 4(a)(1).
Appellees argue that the motion to vacate the judgment could not properly be characterized as a Rule 52(b) motion, that it should not be characterized as a Rule 59 motion which would toll the running of the thirty days, and that as a Rule 60(b) motion, it would not toll the thirty days. They are correct about Rule 52(b). That rule governs motions to amend findings of fact. This case was dismissed before trial; the district court did not hear evidence or make findings. Nor was the motion directed toward correction of any findings. It related solely to recusal because of the law clerks' conflicts of interest.
Appellees are also correct that at the time the notice of appeal was filed, a Rule 60(b) motion was not among those which would toll the thirty days for filing notice of...
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