Amacker v. RENAISSANCE ASSET MANAGEMENT LLC
2011 U.S. App. LEXIS 19210
| 5th Cir. | 2011Background
- Investors in a Renaissance Asset Management commodity pool allege FCMs aided and abetted a violation of the CEA by Ramunno.”
- Ramunno operated a Ponzi scheme: profits paid with new-investor funds; he traded pool funds as if for his own account.
- CFTC froze Renaissance assets, halted trading, and filed a civil action; Ramunno pled guilty to wire and mail fraud.
- Investors claim FCMs failed to perform Patriot Act–BSA background checks, constituting willful aiding and abetting.
- District court dismissed for lack of knowledge/intent; investors appeal.
- Court affirms dismissal, citing lack of extreme recklessness or extraordinary disclosure duties.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Standard for willful aiding and abetting under §25(a) | Willful means extreme recklessness. | Requires actual knowledge and intent. | Knowledge/intent required; extreme recklessness not established. |
| Applicability of Abbott recklessness standard to CEA | Abbott supports recklessness as sufficient. | Abbott not controlling for CEA; limits unknown. | Abbott persuasive but not controlling; CEA requires knowledge unless exceptions apply. |
| Admissible exceptions to recklessness (special duty/unusual aid) | BSA duties create unusual assistance; disclosure duty applies. | Exceptions not satisfied here. | Neither exception applies; conduct not unusual or a special duty. |
| Extreme recklessness pleaded by investors | Investors allege serious omissions in investigation. | Trades were routine; omissions not extreme. | Omissions not extreme; actions not severely reckless. |
| BSA and disclosure duties vis-à-vis private plaintiffs | BSA duties owed to investors; required deeper inquiry. | BSA duties limited; not to private plaintiffs. | No private-duty trigger; standard not met. |
Key Cases Cited
- Abbott v. Equity Group, Inc., 2 F.3d 613 (5th Cir. 1993) (recklessness risked as standard for aiding and abetting in SEA context; not controlling for CEA)
- Damato v. Hermanson, 153 F.3d 464 (7th Cir. 1998) (willful §25(a) requires knowledge; aligns with 18 U.S.C. §2)
- Nicholas v. Saul Stone & Co. LLC, 224 F.3d 179 (3d Cir. 2000) (agrees that willful aiding under CEA requires knowledge)