Janese v. Fay, No. 11-5369 (2d Cir. 2012)

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Justia Opinion Summary

This appeal and purported class-appeal primarily concerned two issues arising under the Employee Retirement Income Security Act of 1974 (ERISA), 28 U.S.C. 1001 et seq. The first issue was whether trustees of a multi-employer pension fund acted as fiduciaries when they amended the pension plan. The second issue was whether the claims asserted in this case were time-barred. The court concluded that the dismissal of Counts I-V was proper because the trustees were not acting as fiduciaries in amending the Plan, and in reaching that conclusion, the court deemed the contrary rulings of the court in Chambless v. Masters, Mates & Pilots Pension Plan and Siskind v. Sperry Retirement Program, to have been abrogated by subsequent decisions of the Supreme Court. The court also concluded that fact issues remained as to whether Counts VII-IX were properly dismissed as time-barred.

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11-5369-cv(L) Janese v. Fay UNITED STATES COURT OF APPEALS FOR THE SECOND CIRCUIT August Term 2011 Heard: June 26, 2012 Decided: August 27, 2012 Docket Nos. 11-5369-cv(L), 12-80-cv(XAP) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 - - - - - - - - - - - - - - - - - - - - - Douglas A. Janese, Christopher V. Shakarjian, Louis D Aurizio, as representatives of the participants and beneficiaries of the former Niagara Genesee & Vicinity Carpenters Local 280 Pension and Welfare Funds, Plaintiffs-Appellants-Cross-Appellees, v. David A. Fay, Angelo Massaro, Dominic P. Massaro, George R. Weidert, Christopher M Scrufari, David J. Knapp, Trustees of the Niagara-Genesee & Vicinity Carpenters Local 280 Pension and Welfare Funds from 1994 through 1998, and John J. Fuchs, Patrick Morin, John J. Simmons, Trustees of the Niagara-Genesee & Vicinity Carpenters Local 280 Pension and Welfare Funds from 2006 through 2008, and Gordon J. Knapp, Robert P. Williams, Thomas P. Hartz, Trustees of the NiagaraGenesee & Vicinity Carpenters Local 280 Pension and Welfare Funds in 2000, and Santo S. Scrufari, Russell P. Scrufari, Plan Managers of the NiagaraGenesee & Vicinity Carpenters Local 280 Pension and Welfare Funds, and Empire State Carpenters Welfare Fund, Empire State Carpenters Pension Fund, Defendants-Appellees-Cross-Appellants. - - - - - - - - - - - - - - - - - - - - - Before: NEWMAN, WINTER, and POOLER, Circuit Judges. Appeal from the May 2, 2011, judgment of the United States 34 District Court for the Western District of New York (John T. Curtin, 35 District Judge), dismissing as time-barred a complaint brought under 36 the Employee Retirement Income Security Act of 1974 ( ERISA ), 29 1 U.S.C. § 1001 et seq. 2 the 3 decisions, the continuing validity of our opinions in 4 Masters, Mates & Pilots Pension Plan , 772 F.2d 1032 (2d Cir. 1985), 5 and Siskind v. Sperry Retirement Program, Unisys, 47 F.3d 498 (2d Cir. 6 1995), which stated that trustees of a pension plan act as fiduciaries 7 when they amend the plan. 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 Appellees The Appellants challenge the time-bar rulings; challenge, in light of subsequent Supreme Court Chambless v. Affirmed in part, vacated in part, and remanded; cross-appeal dismissed as unnecessary. Timothy Alan McCarthy, Buffalo, N.Y. (Burd & McCarthy, Buffalo, N.Y., on the brief), for Appellants-Cross-Appellees. Jeffrey S. Swyers, Washington, D.C. (Allison A. Madan, Slevin & Hart, P.C., Washington, D.C.; Robert L. Boreanaz, Lipsitz Green Scime Cambria LLP, Buffalo, N.Y., on the brief), for Appellees-Cross-Appellants. JON O. NEWMAN, Circuit Judge: 23 This appeal and a purported cross-appeal primarily concern two 24 issues arising under the Employee Retirement Income Security Act of 25 1974 ( ERISA ), 29 U.S.C. § 1001 et seq. 26 trustees of a multi-employer pension fund act as fiduciaries when they 27 amend the pension plan. 28 asserted in this case are time-barred. 29 appeal by present and former beneficiaries of the former Niagara- The first issue is whether The second issue is whether the claims -2- These issues arise on an 1 Genesee & Vicinity Carpenters Local 280 Pension and Welfare Funds1 from 2 the May 2, 2011, judgment of the District Court for the Western 3 District of New York (John T. Curtin, District Judge) dismissing their 4 complaint against present and former trustees and plan managers of the 5 Funds. 6 2011, order denying their motion for reconsideration and for leave to 7 amend. 8 appeal that part of the District Court s October 22, 2010, order that 9 had denied dismissal of Counts I-V of the Complaint for failure to The Plaintiffs-Appellants also appeal from the December 1, By a purported cross-appeal, the Defendants-Appellees seek to 10 state a claim on which relief could be granted; these counts were 11 subsequently dismissed as time-barred. 12 We conclude that dismissal of Counts I-V was proper because the 13 trustees were not acting as fiduciaries in amending the Plan, and in 14 reaching that conclusion, we deem the contrary rulings of our Court in 15 Chambless v. Masters, Mates & Pilots Pension Plan, 772 F.2d 1032 (2d 16 Cir. 1985), and Siskind v. Sperry Retirement Program, Unisys, 47 F.3d 17 498 (2d Cir. 1995), to have been abrogated by subsequent decisions of 18 the Supreme Court.2 19 whether Counts VII-IX were properly dismissed as time-barred. 20 dismissal of Count VI is not challenged on appeal. We also conclude that fact issues remain as to The On the appeal, we 1 The Funds merged into the Empire State Carpenters Pension and Welfare Funds, effective January 1, 2008. 2 This opinion has been circulated to the active judges of the Court prior to filing. -3- 1 therefore affirm in part, vacate in part, and remand. 2 cross-appeal as unnecessary. 3 We dismiss the Background 4 The parties. This is a derivative action brought on behalf of the 5 participants and beneficiaries of the Funds seeking to recover assets 6 that the Plaintiffs-Appellants assert were wrongfully depleted by the 7 Defendants-Appellees in violation of their fiduciary duties. 8 Defendants-Appellees are present and former trustees or plan managers 9 of the Funds. The The Complaint divides the trustees into four separate 10 groups, based on whether they served as trustees during the following 11 periods: 12 to July 12, 2000 (the 2000 trustees ); (3) January 20, 1994 to 13 January 25, 1999 (the 1994-98 trustees ); and (4) November 1993 to 14 January 19, 1994.3 15 served from 1985 to July 14, 1996, and his son Russell, who succeeded 16 his father and served until December 31, 2008. 17 (1) July 13, 2000 to December 31, 2007; (2) January 26, 1999 The two plan managers are Santo Scrufari, who The allegations in the Complaint. The Complaint asserted nine 18 counts of breach of fiduciary duty, eight of which are at issue in 19 this appeal. 20 claimed to have breached the trustees fiduciary duties. Count VI 21 alleged an increase in the monthly retirement benefit for a retired 22 trustee, accomplished with a plan amendment. 23 count is not challenged on appeal. Counts I-V alleged various plan amendments that are 3 The dismissal of this Some defendants are members of multiple groups. -4- 1 Count VII alleged that, from 1993 to July 14, 1996, Santo 2 Scrufari manipulated Pension Fund calculations in order to grant 3 himself and one trustee higher pay-outs than they were owed under the 4 Fund Plan. He concealed this from the other trustees by altering the 5 relevant pension credit records. 6 1994-98 7 adequately 8 Scrufaris and their associates stole money from the Welfare Fund over 9 a trustees number breached monitor of their Scrufari. years, Count VII further asserted that the fiduciary duties by failing to Counts VIII-IX alleged that the fraudulently concealed these withdrawals by 10 labeling them Scholarship or Health Care benefits, and failed to 11 pay taxes on these withdrawals. Like Count VII, Counts VIII and IX 12 further asserted that the 1994-98 trustees and the 2000 trustees 13 failed to adequately monitor the Scrufaris. 14 Prior litigation involving Santo Scrufari. In 2006, Santo 15 Scrufari was found liable for a number of breaches of fiduciary duty, 16 including improper weighting of his fringe benefits, during the period 17 between March 1989 and October 1992. See LaScala v. Scrufari, No. 93- 18 CV-982C(F), 2006 WL 469404, at *1 (W.D.N.Y. Feb. 27, 2006), rev d, 479 19 F.3d 213 (2d Cir. 2007), on remand, 2010 WL 475284, at *1 (W.D.N.Y. 20 Feb. 5, 2010). 21 October 1992. 22 That suit did not consider Scrufari s activities after See LaScala, 2006 WL 469404 at *1. Procedural history of the pending suit. The Plaintiffs filed the 23 present action on June 26, 2009. 24 of the Defendants illegal activities after September 20, 2007, when 25 damages discovery in the They assert that they became aware LaScala -5- case revealed incriminating 1 documents. The Defendants moved to dismiss pursuant to Fed. R. Civ. P. 2 12(b)(6), principally asserting that the Plaintiffs claims were time- 3 barred under section 413 of ERISA, 29 U.S.C. § 1113 (as amended). 4 District Court granted the motion as to all pertinent claims on that 5 basis but rejected the Defendants alternative claim that Counts I-V 6 did not allege actions that fell within the scope of ERISA s fiduciary 7 duty statute. 8 9 Following The entry of judgment, the Plaintiffs moved for reconsideration of the District Court s order and for leave to amend 10 the complaint to allege fraud with greater particularity. 11 District Court denied the motion for reconsideration, rendering the 12 motion to amend moot. 13 Stolt Sheaf, 930 F.2d 240, 244 (2d Cir. 1991) ( [O]nce judgment is 14 entered the filing of an amended complaint is not permissible until 15 judgment is set aside or vacated pursuant to Fed. R. Civ. P. 59(e) or 16 60(b). ) (internal quotation marks and citation omitted). 17 18 19 The See National Petrochemical Co. of Iran v. M/T Discussion I. Whether Trustees Act as Fiduciaries in Amending a Plan We consider first the contention of the Appellees that the 20 dismissal of Counts I-V should be affirmed on the ground that the 21 actions challenged in those counts were pension plan amendments, which 22 are not fiduciary actions and therefore do not violate section 23 404(a)(1) of ERISA. 24 unnecessary step of filing a cross-appeal to assert this contention. 25 An appellee needs to file a cross-appeal only to request an appellate 26 court to grant some additional relief beyond the judgment entered by Initially, we note that the Appellees took the -6- 1 a district court. See Carlson v. Principal Financial Group, 320 F.3d 2 301, 309 (2d Cir. 2003). 3 appellee is entitled to seek affirmance on any ground supportable by 4 the record. 5 202, 205 (2d Cir. 2006) ( [W]e may affirm on any basis for which there 6 is sufficient support in the record, including grounds not relied on 7 by the district court. ). 8 appeal as unnecessary, but nonetheless consider the contention that 9 the Appellees have advanced in support of the District Court s 10 In the absence of a cross-appeal, an See Bruh v. Bessemer Venture Partners III L.P., 464 F.3d For this reason, we will dismiss the cross- judgment. 11 In 1985, this Court ruled that, with respect to multi-employer 12 pension plans, the act of amending a plan should be treated as a 13 fiduciary function, see Chambless, 772 F.2d at 1040, thereby invoking 14 section 404(a)(1) of ERISA, 29 U.S.C. § 1104(a)(1), which obliges a 15 fiduciary to discharge his duties with respect to a plan solely in 16 the interest of the participants and beneficiaries. 17 we ruled that amending a single employer pension plan was not a 18 fiduciary function, pointedly distinguishing Chambless on the ground 19 that [i]n the multi-employer setting, trustees amending a pension 20 plan affect the allocation of a finite plan asset pool to which each 21 participating employer has contributed. See Siskind, 47 F.3d at 506 22 (quoting Musto v. American General Corp., 861 F.2d 897, 912 (6th Cir. 23 1988)). 24 language in Siskind distinguishing multi-employer plans has been 25 abrogated by the combined effect of three decisions of the Supreme 26 Court: Curtiss-Wright Corp. v. Schoonejongen, 514 U.S. 73 (1995); The Appellees contend that the ruling in -7- Ten years later Chambless and the 1 Lockheed Corp. v. Spink, 517 U.S. 882 (1996), and Hughes Aircraft Co. 2 v. Jacobson, 525 U.S. 432 (1999). 3 Chambless/Siskind view of multi-employer plans has survived the later 4 Supreme Court decisions. The Appellants respond that the 5 Resolving this dispute involves consideration of the deference a 6 court of appeals owes to language in Supreme Court opinions that 7 contributes to the Court s reasoning, even if it does not incorporate 8 a precise holding. See generally Pierre N. Leval, Judging Under the 9 Constitution: Dicta about Dicta, 81 N.Y.U. L. Rev. 1249 (2006) 10 Initially, we note that Curtiss-Wright, Lockheed Corp., and Hughes 11 Aircraft all involved single employer plans. 12 had no occasion to rule definitively on whether amending a multi- 13 employer plan was a fiduciary function. 14 consider carefully what the Supreme Court said in deciding those 15 cases. Thus, the Supreme Court Nevertheless, we need to 16 In Curtiss-Wright, which involved a welfare plan, the Court said, 17 Employers or other plan sponsors are generally free under ERISA, for 18 any reason at any time, to adopt, modify, or terminate welfare plans. 19 514 U.S. at 78 (emphasis added). 20 benefit plan. 21 Curtiss-Wright should not be extended to pension benefit plans. 517 22 U.S. at 890. 23 terms of a plan do not fall into the category of fiduciaries. Id. 24 Hughes Aircraft concerned a pension plan to which employees were 25 required to contribute. 26 circumstance distinguished Lockheed Corp. involved a pension The Court said, We see no reason why the rule of The Court also declared, Plan sponsors who alter the The Ninth Circuit had thought that this Lockheed -8- Corp. and concluded that an 1 amendment to such a plan was subject to ERISA s fiduciary standards. 2 See Jacobson v. Hughes Aircraft Co. , 105 F.3d 1288, 1293 (9th Cir. 3 1997) ( [T]the asset surplus that was used in 4 early 5 contributions. 6 used to fund the early retirement program and the new Non-Contributory 7 Plan was attributable to both employer and employee contributions ). 8 The Supreme Court disagreed. 9 applies with equal force to persons exercising authority over a retirement program was attributable Lockheed to fund the only to employer Here, plaintiffs allege that the asset surplus Hughes Our conclusion [in Lockheed Corp.] 10 contributory plan, a noncontributory plan, or any other type of plan. 11 Hughes 12 emphatically, the fiduciary duty claims are directly foreclosed by 13 [Lockheed s] holding [sic] that, without exception, [p]lan sponsors 14 who alter the terms of a plan do not fall into the category of 15 fiduciaries. Id. at 445 (quoting Lockheed, 517 U.S. at 890). Aircraft, 525 U.S. at 443-44. And, the Court added 16 Shortly after Lockheed was decided, the Third Circuit relied on 17 the Supreme Court s reference to plan sponsors to rule that the 18 Court s decision applies to multi-employer plans. 19 Brady, 125 F.3d 114 (3d Cir. 1997). 20 sponsors, a term that applies to both single-employer sponsors and 21 multi-employer sponsors under ERISA, and the opinion lacks any hint 22 that single- and multi-employer plans should be analyzed differently. 23 Id. at 117. 24 sponsor : See Walling v. Lockheed speaks of plan The Third Circuit also quoted ERISA s definition of plan -9- 1 2 3 4 5 6 7 8 9 10 11 The term plan sponsor means (i) the employer in the case of an employee benefit plan established or maintained by a single employer . . . or (iii) in the case of a plan established or maintained by two or more employers or jointly by one or more employers and one or more employee organizations, the association, committee, joint board of trustees, or other similar group of representatives of the parties who establish or maintain the plan. Id. at 118 (quoting 29 U.S.C.A. § 1002(16)(B)). Thereafter, the District benefit of of Lockheed reached the Hughes 13 conclusion. See Hartline v. Sheet Metal Workers National Pension 14 Fund, 286 F.3d 598, 599 (D.C. Cir. 2002). 15 clear 16 employers and plan sponsors do not act in a fiduciary capacity when 17 they modify, adopt or amend plans. 18 decisions or ERISA itself creates an exemption for multiemployer 19 pension plans. Id. Lockheed, Circuit and Aircraft, [Curtiss-Wright, Columbia Corp. 12 in the with same The Supreme Court made it and Hughes Aircraft] that Nothing in the Supreme Court s 20 Even before the three Supreme Court decisions, the Sixth Circuit 21 had abandoned dictum in Musto, 861 F.2d at 912, indicating that 22 trustees amending a multi-employer plan act as fiduciaries, and ruled 23 that amendment of multi-employer plans does not differ from amendment 24 of single-employer plans. Pope v. Central States Southeast and 25 Southwest Areas Health and Welfare Fund, 27 F.3d 211, 213 (6th Cir. 26 1994). 27 Closer to home, three district courts within the Second Circuit 28 have either questioned or disregarded the continuing validity of our -10- 1 opinions in Chambless and Siskind in light of the Supreme Court s 2 decisions. 3 stated that the invalidation of . . . Musto . . . leaves the view in 4 Siskind and Chambless without any support in the post-Hughes Aircraft 5 era. Fuchs v. Allen, 363 F. Supp. 2d 407, 416 (N.D.N.Y. 2005). 4 6 that same year, Judge Garaufis, in the Eastern District of New York, 7 ruled that the holdings in 8 Lockheed and Hughes Aircraft. See Cement and Concrete Workers District 9 Council Pension Fund v. Ulico Casualty Co., 387 F. Supp. 2d 175, 186 In 2005, Judge Hurd, in the Northern District of New York, In Chambless and Siskind cannot survive 10 (E.D.N.Y. 2005), aff d on other grounds , 199 F. App x 29 (2d Cir. 11 2006). 12 York, stated flatly that Chambless and Siskind have been overruled. 13 Gannon v. NYSA-ILA Pension Trust Fund and Plan, No. 09-CV-10368, 2011 14 WL 868713, at *8 (S.D.N.Y. Mar. 11, 2011). 15 Last year, Judge Gardephe, in the Southern District of New Although the Supreme Court s opinions in Curtiss-Wright, 16 Lockheed, and Hughes Aircraft all involved single-employer plans, we 17 agree with the Third, Sixth, and District of Columbia Circuits that 18 the Court s language analyzing fiduciary duties under ERISA is equally 19 applicable to multi-employer plans. 20 question whether that language was sufficiently related to the Court s 21 ultimate 22 persuasive dicta, we now regard it as ample justification to deem it 23 to have abrogated Chambless and Siskind with respect to multi-employer rulings to be considered 4 Although it is a somewhat close as holdings or only highly Judge Hurd noted, but disagreed with, the opinion of Judge Curtin, in the Western District of New York, Burke v. Bodewes, 250 F. Supp. 2d 262, 270 (W.D.N.Y. 2003), adhering to Chambless and Siskind after the Supreme Court decisions. See Fuchs, 363 F. Supp. 2d at 416. -11- 1 plans. 2 contrary, maintaining a circuit split on the issue of trustee 3 liability as 4 inadvisable. 5 subject to dismissal because the Defendants were not acting as 6 fiduciaries when they amended the plans. 7 II. Whether Counts VII-IX Are Time-Barred 8 9 Moreover, in the absence of compelling reasons to the fiduciaries for amending multi-employer plans is We therefore conclude that Counts I through V were ERISA s statute of limitations, set out in the margin,5 provides three alternative limitations periods, depending on the underlying 10 factual circumstances. 11 any special circumstances, is six years from the date of the last 12 action that was part of the breach. The second period is three years, 13 applicable putative 14 knowledge of the violation, defined as knowledge of all material 15 facts necessary to understand that an ERISA fiduciary has breached his 16 or her duty or otherwise violated the Act. Caputo v. Pfizer, Inc., and The first period, applicable in the absence of beginning when a plaintiff has actual 5 Section 1113 provides: No action may be commenced under this subchapter with respect to a fiduciary's breach of any responsibility, duty, or obligation under this part, or with respect to a violation of this part, after the earlier of (1) six years after (A) the date of the last action which constituted a part of the breach or violation, or (B) in the case of an omission the latest date on which the fiduciary could have cured the breach or violation, or (2) three years after the earliest date on which the plaintiff had actual knowledge of the breach or violation; except that in the case of fraud or concealment, such action may be commenced not later than six years after the date of discovery of such breach or violation. -12- 1 267 F.3d 181, 193 (2d Cir. 2001).6 2 of the breach does not trigger the three-year period. See id. at 194. 3 The third period is six years, applicable where a complaint alleges 4 fraud or concealment with the requisite particularity. 5 the pending appeal, this six year period is tolled until the plaintiff 6 discovers, or should with reasonable diligence have discovered, the 7 breach. See id. at 190. 8 concealment exception, a complaint must allege that a fiduciary 9 either (1) breached its duty by making a knowing misrepresentation or 10 omission of a material fact to induce an employee/beneficiary to act 11 to his detriment; or (2) engaged in acts to hinder the discovery of a 12 breach of fiduciary duty. 13 stated with particularity, Fed. R. Civ. P. 9(b), requiring a 14 plaintiff to specify the time, place, speaker, and content of the 15 alleged misrepresentations, as well as how the misrepresentations 16 were fraudulent and those events which give rise to a strong 17 inference that the defendant had an intent to defraud, knowledge of 18 the falsity, or a reckless disregard for the truth. 19 (internal 20 omitted). 21 textual However, constructive knowledge Relevant to To successfully plead this fraud or Id. alterations, Moreover, these allegations must be quotation marks, and Id. at 191 citations The issue as to whether Counts VII-IX could be dismissed on 22 motion under Rule 12(b)(6) concerns application of the fraud or 23 concealment exception of Section 1113(2). 24 Scrufari s improper weighting of benefits between late 1992-1993 and 6 Count VII alleged Santo Of course, the three-year limitations period may not extend the viability of claims beyond the outer limit of six years specified in section 1113(1). -13- 1 1996. Counts VIII and IX alleged that Scrufari and his son stole 2 money from 3 fraudulently labeling withdrawals Scholarship or Health Care 4 benefits. 5 adequately pleaded fraud or concealment, at least with respect to 6 Counts VII and VIII,7 he concluded, taking judicial notice of the 7 LaScala case, that they knew or should have known of Santo Scrufari s 8 activities well in advance of June 26, 2003, six years prior to the 9 commencement of this suit. 10 the Welfare Fund and concealed their actions by Although Judge Curtin was satisfied that the Plaintiffs had We think that conclusion could not properly be reached at the 11 pleading stage. 12 similar to what Scrufari is alleged to have done in this case. 13 However, the prior litigation concerned misconduct occurring no later 14 than October 1992, a period prior to the time during which the 15 misconduct at issue in this case is alleged to have occurred. 16 most, LaScala creates an issue of fact as to whether the Plaintiffs 17 knew or should have known of Scrufari s activities between 1993 and 18 1996 based on his activities prior to that time. The resolution of 19 that issue was not proper at the pleading stage. Whether the issue 20 might be resolved on motion for summary judgment after discovery 21 remains to be determined on remand. 22 III. Whether the District Court Properly Denied the Motion to Amend 23 24 It is true that theLaScala case concerned misconduct At The Plaintiffs-Appellants assert that the District Court erred in denying leave to amend the Complaint. 7 Normally, leave to amend should Count IX asserted substantially the same activity as Count VIII, which the District Court found adequately alleged fraud or concealment. Fairly read, the allegations of fraud or concealment in Count VIII apply to Count IX as well. -14- 1 be freely give[n] . . . when justice so requires. 2 15(a)(2). 3 more difficult when a plaintiff waits, as the Plaintiffs in this case 4 did, until after judgment has been entered. 5 entered the filing of an amended complaint is not permissible until 6 judgment is set aside or vacated pursuant to Fed. R. Civ. P. 59(e) or 7 60(b). 8 merit of this approach is that [t]o hold otherwise would enable the 9 liberal amendment policy of Rule 15(a) to be employed in a way that is 10 contrary to the philosophy favoring finality of judgments and the 11 expeditious termination of litigation. 12 Wright & A. Miller, FEDERAL PRACTICE 13 Here, the District Court properly denied the motion to amend following 14 its denial of the motion for reconsideration. 15 Fed. R. Civ. P. However, amendment of a complaint becomes significantly [O]nce judgment is National Petrochemical Co. of Iran, 930 F.2d at 244. AND The Id. at 245 (quoting 6 C. PROCEDURE § 1489, at 694 (1990)). Because we vacate the District Court s dismissal of several 16 counts, however, we note that the prior judgment will no longer bar 17 future motions for leave to amend with respect to the surviving 18 claims. 19 Conclusion 20 For the foregoing reasons, the District Court s dismissal of 21 Counts I-V is affirmed, its dismissal of Counts VII-IX is vacated, and 22 the case is remanded for further proceedings. 23 dismissed as unnecessary. -15- The cross-appeal is