Appellant Crystal Seafood Company, Inc. appeals a district court order holding Crystal and two of its officers (the Trans) jointly and severally liable for a $1,034,228.42 payment that Crystal received pursuant to the BP settlement.
In 2013, the district court appointed a Special Master to examine and investigate suspicious past or pending claims submitted to the Deepwater Horizon Economic Claims Center (“DHECC”). The district court further ordered the Special Master to initiate legal action to “clawback” any already paid fraudulent claims.
In 2015, the Special Master and the Claims Administrator filed a joint claw-back motion seeking to recoup $1,034,228.42 that the DHECC paid to Crystal Seafood Company, Inc. In order to obtain this $1,034,228.42, Crystal was required to and did swear, inter alia, that it did not constitute a “failed business” under the terms of the settlement agreement. The Special Master and the Claims Administrator alleged that this misstatement constituted fraud, and sought to have the district court order Crystal and any individuals who benefitted from Crystal’s misstatement to remit the full $1,034,228.42 to the DHECC.
On May 24, 2016, the district court granted the clawback motion without a hearing, holding that there is no genuine dispute of material fact that Crystal was a failed business under the terms of the settlement agreement and that Crystal’s sworn statement to the contrary constituted fraud. The district court then went on to pierce Crystal’s corporate veil and hold two of Crystal’s officers, Loc “Victor” Tran and Christopher Tran, jointly and severally liable with Crystal for the $1,034,228.42 owed.
Crystal—and only Crystal—now appeals.
II.
Pursuant to the settlement agreement, we review the district court’s grant of a clawback motion without a hearing as a grant of summary judgment. We review a district court’s grant of summary judgment de novo, viewing all facts and drawing all inferences in a light most favorable to the non-moving party.
III.
We treat a DHECC clawback motion as a common law fraud claim brought under general maritime law. To prove common law fraud, the Special Master and the Claims Administrator must establish: (1) that the claimant knowingly or recklessly (2) made a material misrepresentation (3) that he intended to be acted upon, and was in fact acted upon, to the detriment of the DHECC.
Crystal alleges that there is, at a minimum, a genuine dispute of material fact as to the first and second elements. We address each below.
A.
We first consider whether Crystal made a material misrepresentation.
The settlement agreement defines a failed business as, inter alia, a business that subsequent to May 1, 2010, but prior to December 31, 2011: (1) ceased operations and wound down, or (2) initiated or completed a liquidation of substantially all of its assets.
In terms of operations, it is undisputed that Crystal processed the last of its shrimp approximately one year before the oil spill, in April or May 2009. It is also undisputed that Crystal sold the last of its frozen inventory approximately three months after the oil spill, in August 2010.
In terms of liquidation, it is undisputed that Crystal submitted profit and loss statements to the DHECC—under oath— illustrating that Crystal stopped taking a depreciation expense
Based upon this information, the district court held that Crystal was a failed business and was therefore ineligible for the $1,034,228.42 that it received. This finding was, again, based upon Crystal’s own sworn statements. Crystal took a depreciation expense in every month prior to May 2010—therefore, the district court held that Crystal initiated a liquidation of substantially all of its assets subsequent to May 1, 2010. Crystal “disposed” of all of its assets on or before December 31, 2010— therefore, the district court held that Crystal completed a liquidation of substantially all of its assets prior to December 31, 2011.
Crystal attacks its own 2010 tax returns on two grounds. First, it provides the affidavit of Victor Tran. Tran attests that Crystal “continues to own ... well more than a million dollars” worth of processing equipment and implies that Crystal’s 2010 tax returns were in error. It is, nonetheless, well-established that a non-movant “cannot create a genuine issue of fact sufficient to survive summary judgment simply by contradicting his or her own previous sworn statement ... without explaining the contradiction or attempting to resolve the disparity.”
Second, Crystal asserts that its new lawyer, who was retained after the district court granted the now-contested clawback motion, has learned that Crystal’s accountant made some mistakes on Crystal’s 2010 tax returns. Specifically, some of the equipment listed as “disposed,” Crystal continues to own. Crystal did not raise this
Crystal materially misrepresented itself as an ongoing business when it filed its claim in 2012. With respect to that point, there is no genuine dispute of material fact.
B.
In order to satisfy the scienter element of common law fraud, the Special Master and the Claims Administrator must establish that Crystal knew or should have known that it was a failed business when it filed its claim in 2012. ‘While the term recklessness is not self-defining, the common law has generally understood it in the sphere of civil liability as conduct violating an objective standard: action entailing an unjustifiably high risk of harm that is either known or so obvious that it should be known.”
For example, in Brown v. Parker Drilling Offshore Corp., we inferred that Brown intentionally concealed prior back problems on a pre-employment medical questionnaire, even though Brown argued that he did not believe that his prior back problems constituted what the questionnaire described as “back trouble.”
Similarly, in Meche v. Doucet, we inferred that Meche intentionally concealed prior spinal injuries on a pre-employment medical questionnaire, even though Meche argued that he did not consider “his preexisting condition to be a matter of importance.”
Crystal argues that we should view this ' appeal through the lens of “a small family business with unsophisticated owners trying to maneuver a complex claims process
Ultimately, it is undisputed that Crystal: (1) processed the last of its shrimp approximately one year before the oil spill, in April or May 2009; (2) sold the last of its frozen inventory approximately three months after the oil spill, in August 2010; (3) stopped taking a depreciation expense the month of the oil spill, in May 2010; and (4) submitted tax returns to both the DHECC and the IRS representing that it “disposed” of all of its assets on or before December 31, 2010.- Guided by this mountain of circumstantial evidence, we, like the district court, conclude that the Special Master and the Claims Administrator have proven scienter as a matter of law. Crystal either knew or should have known that it was a failed business when it filed its claim in 2012.
IV.
Lastly, Crystal argues that the district court erred in holding Victor and Christopher Tran personally liable. Because the Trans have not sought to appeal the judgment of the district court, and because Crystal has not identified a genuine obstacle preventing the Trans from filing their own appeal, we hold that Crystal lacks standing to champion the rights of the Trans.
“The doctrine of standing asks whether a litigant is entitled to have a federal court resolve his grievance.”
Prudentially, the right to lodge an appeal in federal court is generally reserved to those who seek to protect their “own legal rights and interests.”
The Trans apparently “do not wish” to contest the judgment of the court below.
Y.
The judgment of the district court is AFFIRMED.
Notes
. For a brief history of the events leading up to the BP settlement, see generally In re Deepwater Horizon,
. Burell v. Prudential Ins. Co. of Am.,
. Fed. R. Civ. P. 56(a).
. See In re Deepwater Horizon,
. 26 U.S.C. § 167(a) allows corporations such as Crystal to reduce their taxable income a reasonable allowance for the exhaustion, wear and tear, and obsolescence of property used in the trade or business.
. Cleveland v. Policy Mgmt. Sys. Corp.,
. Because Victor Tran’s affidavit does not raise a genuine dispute of material fact pursuant to Cleveland, we need not address the district court’s reliance on Scott v. Harris,
. LeMaire v. La. Dep’t of Transp. & Dev.,
. Safeco Ins. Co. of Am. v. Burr,
. United States v. Philip Morris USA Inc.,
.
. See id. at 172-173.
. See ibid.
. Id. at 174.
.
. Id. at 247.
.Id. at 248.
. See ibid.
. Kowalski v. Tesmer,
. Rohm & Hass Tex., Inc. v. Oniz Bros. Insulation,
. Powers v. Ohio,
. See Kowalski,
. See ibid. (quoting Warth,
. Powers,
. Wauchope v. U.S. Dep't of State,
. Lepelletier v. F.D.I.C.,
. Singleton,
. Powers,
. Viceroy Gold Corp. v. Aubry, 75 F.3d 482, 489 (9th Cir. 1996).
. Singleton,
. To the extent that Victor and Christopher Tran are nonparties, they may be able to challenge any attempt to enforce this portion of the district court’s order. See Taylor v. Sturgell,
. Stallworth v. Monsanto Co.,
. Amato v. Wilentz,
. See FW/PBS, Inc. v. City of Dallas,
