Argued and Submitted March 15, 2013-San Francisco, California
Appeal from the United States District Court for the District of Nevada Philip M. Pro, Senior District Judge, Presiding D.C. No. 2:08-cv-00461-PMP-PAL
Allan B. Diamond (argued) and J. Maxwell Beatty (argued), Diamond McCarthy LLP, Houston, Texas, for Plaintiff-Appellant.
Steve Morris and Rosa Solis-Rainey, Morris Peterson, Las Vegas, Nevada; Miles N. Ruthberg (argued), Robert W. Perrin and Melanie M. Blunschi, Latham & Watkins LLP, Los Angeles, California, for Defendant-Appellee.
Before: J. Clifford Wallace and Sandra S. Ikuta, Circuit Judges, and Marvin J. Garbis, Senior District Judge. [*]
The panel filed an order recalling the mandate, granting appellee's request for publication, withdrawing a memorandum disposition, and filing an opinion affirming the district court's summary judgment on claims brought by a bankruptcy litigation trust under Nevada law.
The trust, created by a confirmed chapter 11 plan, sued the debtor's former outside auditor, alleging that the auditor wrongfully issued unqualified audit opinions, concealing the misappropriations of the debtor's funds through two allegedly fraudulent schemes perpetrated by the debtor's owners and controllers. The panel held that under Nevada's "sole actor" rule, the misconduct of the owners and controllers must be imputed to the debtor. Accordingly, the district court properly granted summary judgment to the defendant auditor on its affirmative defense that the debtor's claims had expired under Nevada law prior to the bankruptcy petition date.
The mandate issued on May 15, 2013, is hereby recalled. Appellee Deloitte & Touche's request for publication is GRANTED, and the Memorandum Disposition filed on April 22, 2013, is withdrawn. The withdrawn memorandum disposition is replaced and superseded by the attached opinion.
No petitions for rehearing and/or rehearing en banc will be entertained.
ORDER AND OPINION
GARBIS, Senior District Judge:
On April 13, 2006, USA Commercial Mortgage Company ("USACM") filed for bankruptcy in the United States Bankruptcy Court for the District of Nevada. USACM's confirmed Chapter 11 plan created a bankruptcy litigation trust, USACM Liquidating Trust (the "Trust"), for purposes of pursuing USACM's claims for the benefit of holders of allowed unsecured claims in USACM's bankruptcy. On April 11, 2008, the Trust sued USACM's former outside auditor, Deloitte & Touche LLP, alleging that Deloitte wrongfully issued unqualified audit opinions for fiscal years 2000 and 2001, concealing the misappropriations of USACM's funds through two allegedly fraudulent schemes perpetrated by Thomas Hantges and Joseph Milanowski (the owners and controllers of USACM). The charged misappropriations caused USACM to sustain millions of dollars in losses and required its bankruptcy filing.
The Trust appeals from the district court's summary judgment in favor of Deloitte. We have jurisdiction under 28 ...