Fhfa v. Saticoy Bay, LLC

• Court: Court of Appeals for the Ninth Circuit
• Decided: July 24, 2023
• Docket: 20-17447
• Status: Unpublished

Opinion

FILED NOT FOR PUBLICATION JUL 24 2023 UNITED STATES COURT OF APPEALS MOLLY C. DWYER, CLERK U.S. COURT OF APPEALS

FOR THE NINTH CIRCUIT

FEDERAL HOUSING FINANCE No. 20-17447 AGENCY; et al., D.C. No. Plaintiffs-Appellees, 2:16-cv-02242-JAD-BNW

v. MEMORANDUM* SATICOY BAY, LLC,

Defendant-Appellant.

Appeal from the United States District Court for the District of Nevada Jennifer A. Dorsey, District Judge, Presiding

Argued and Submitted February 18, 2022 Submission Withdrawn March 14, 2022 Resubmitted July 20, 2023 San Francisco, California

Before: McKEOWN and W. FLETCHER, Circuit Judges, and BENNETT,** District Judge.

* This disposition is not appropriate for publication and is not precedent except as provided by Ninth Circuit Rule 36-3. ** The Honorable Richard D. Bennett, United States District Judge for the District of Maryland, sitting by designation. Defendant-Appellant Saticoy Bay LLC (“Saticoy”) appeals from the district

court’s grant of summary judgment in favor of Plaintiffs-Appellees Federal

Housing Finance Agency, Federal National Mortgage Association, and Federal

Home Loan Mortgage Corporation (collectively, “Appellees”). We have

jurisdiction under 28 U.S.C. § 1291. We review the grant of summary judgment de

novo. Nationstar Mortg. LLC v. Saticoy Bay LLC, 996 F.3d 950, 954 (9th Cir.

2021).

Saticoy is a master LLC with numerous series LLCs that operate under its

umbrella. See Nev. Rev. Stat. § 86.296(2). Appellees sued Saticoy in district court

for declaratory judgment and to quiet title over 37 properties, each of which is

owned either by Saticoy or by one of its series LLCs. Appellees named Saticoy as

the defendant. They did not name any of the series LLCs as defendants. The

district court held that so long as they named and served the master LLC, Saticoy,

as a defendant, Appellees did not need to name the series LLCs as defendants in

order to exercise jurisdiction over them and their properties.

On appeal, Saticoy argues the district court lacked jurisdiction to grant relief

with respect to the series LLCs’ properties because Appellees failed to name the

series LLCs as defendants. On March 14, 2022, we certified to the Nevada

Supreme Court the question whether a series LLC must be sued in its own name

2 for a court to obtain jurisdiction over it and its property, or whether a plaintiff need

only name and serve the master LLC. Fed. Hous. Fin. Agency v. Saticoy Bay,

LLC, 28 F.4th 115, 118 (9th Cir. 2022). On April 21, 2022, the Nevada Supreme

Court accepted the question, and on July 6, 2023, it issued an opinion answering

the question. The Nevada Supreme Court held that “a series LLC created pursuant

to NRS 86.296 must be sued in its own name for the court to obtain jurisdiction

over it, provided the series LLC has observed the corporate formalities provided

for in NRS 86.296(3).” Fed. Hous. Fin. Agency v. Saticoy Bay LLC, No. 84370,

2023 WL 4360100, at *1 (Nev. Jul. 6, 2023).

Based on the answer of the Nevada Supreme Court, we affirm in part,

reverse in part, and remand for further proceedings. We affirm the judgment with

respect to 372 Rushing Creek Court, owned by Saticoy. We reverse the judgment

with respect to the other properties, owned by the series LLCs. We remand to the

district court for whatever further proceedings it deems appropriate.

We GRANT Saticoy’s motion to strike a portion of Appellees’ citation of

supplemental authority (ECF No. 43).

AFFIRMED in part, REVERSED in part, REMANDED.

Costs are to be taxed against Appellees.