                                                                            FILED
                           NOT FOR PUBLICATION
                                                                             JUN 20 2016
                    UNITED STATES COURT OF APPEALS                       MOLLY C. DWYER, CLERK
                                                                          U.S. COURT OF APPEALS


                            FOR THE NINTH CIRCUIT


GG CAPITAL, a California general                 No. 14-55852
partnership; et al.,
                                                 D.C. No. 8:12-cv-02213-JLS-RNB
              Plaintiffs - Appellants,

 v.                                              MEMORANDUM*

DEUTSCHE BANK AG, a German
corporation,

              Defendant - Appellee.


                   Appeal from the United States District Court
                       for the Central District of California
                   Josephine L. Staton, District Judge, Presiding

                             Submitted June 10, 2016**
                               Pasadena, California

Before: RAWLINSON and BEA, Circuit Judges and SEEBORG,*** District Judge.




        *
             This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
        **
             The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).
        ***
             The Honorable Richard Seeborg, District Judge for the U.S. District
Court for the Northern District of California, sitting by designation.
      Plaintiffs-Appellants GG Capital and associated entities (“GG Capital”)

appeal from the district court’s dismissal with prejudice of their First Amended

Complaint (“FAC”), which alleged causes of action for fraud and negligent

misrepresentation against Defendant-Appellee Deutsche Bank AG. We have

jurisdiction pursuant to 28 U.S.C. § 1291, and we affirm.

      As demonstrated by GG Capital’s own FAC, it knew from the very

beginning, based on Deutsche Bank’s representations, that the majority of its

investments had approximately a .051% chance of hitting the “sweet spot,” with one

option pair having a .091% chance. GG Capital’s own allegations thus show that

Deutsche Bank simply did not make a misrepresentation to GG Capital regarding

the likelihood that the “sweet spot” would be hit; it is not inconsistent to say that

something that has an “actual possibility” of a .051% chance of happening has

“virtually no chance” of happening. The “possibility” is precisely the “chance.”

And nothing in the 2010 Non-Prosecution Agreement (“NPA”) suggests that

Deutsche Bank’s recording of the investments as having no risk to Deutsche Bank

in its internal risk management system meant that Deutsche Bank would not have

calculated the sweet spot properly or paid out the sweet spot if it hit. GG Capital’s

own Opening Brief seems to recognize that how Deutsche Bank internally manages

its own trading risks is not evidence of any misconduct. GG Capital acknowledges


                                           2
that “Deutsche Bank never represented it would hedge the sweet spot risk,” and that

“banks in general, and Deutsche Bank in particular, routinely ma[k]e the business

decision to assume (not hedge) certain trading risks . . . .” As such, GG Capital has

failed plausibly to plead that Deutsche Bank made any misrepresentations to it. See

Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citing Bell Atlantic v. Twombly, 550

U.S. 544, 570 (2007)); see also Estate of Wright, 90 Cal. App. 4th 228, 238 (2001)

(“[T]rue statements . . . do not constitute fraud.”). The district court did not err in

dismissing GG Capital’s First Amended Complaint.1

      1
         Alternatively, the district court did not err in dismissing GG Capital’s First
Amended Complaint on the ground that the fraud-based claims were barred by the
three-year statute of limitations in Cal. Code Civ. Pro. § 338(d). Because the
underlying options transactions (and Deutsche Bank’s representations) occurred in
2000 and 2001, GG Capital relies on the “discovery rule” to toll the statute of
limitations for its claims. “The discovery rule delays accrual only until the plaintiff
has, or should have, inquiry notice of the cause of action. The discovery rule does
not encourage dilatory tactics because plaintiffs are charged with presumptive
knowledge of an injury if they have information of circumstances to put them on
inquiry or if they have the opportunity to obtain knowledge from sources open to
their investigation.” Fox v. Ethicon Endo-Surgery, Inc., 35 Cal. 4th 797, 807–08
(2005) (internal quotation marks and alterations omitted). GG Capital alleges that
it could not have known of Deutsche Bank’s alleged misrepresentations until
December 2010, when Deutsche Bank’s NPA disclosed (1) that “there was virtually
no chance that the sweet spot would be hit”; and (2) that Deutsche Bank had not
hedged for the risk that the sweet spot would hit, and instead “recorded the
[investments] in its internal risk management system as having [no risk to Deutsche
Bank].” But the 2010 NPA contained no information that GG Capital did not
already know by at least 2008, so the NPA could not have been the first trigger to
GG Capital’s inquiry notice. GG Capital’s FAC was not filed until 2013, and thus
                                                                         (continued...)

                                            3
      AFFIRMED.




      1
        (...continued)
its fraud and negligent misrepresentation claims are barred by the statute of
limitations.

                                           4
