                           NOT FOR PUBLICATION

                    UNITED STATES COURT OF APPEALS                            FILED
                            FOR THE NINTH CIRCUIT                              JUL 20 2011

                                                                           MOLLY C. DWYER, CLERK
                                                                            U.S. COURT OF APPEALS

ILLINOIS UNION INSURANCE                         No. 10-55060
COMPANY,
                                                 D.C. No. 8:07-cv-01095-CJC-RNB
             Plaintiff - Appellee,

  v.                                             MEMORANDUM*

BROOKSTREET SECURITIES
CORPORATION; et al.,

             Defendants,

and

JUDITH L. CHIOSSO-GLASS,

             Defendant - Appellant.


                    Appeal from the United States District Court
                       for the Central District of California
                    Cormac J. Carney, District Judge, Presiding

                        Argued and Submitted June 9, 2011
                              Pasadena, California




        *
             This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
Before: B. FLETCHER, and N.R. SMITH, Circuit Judges, and BREWSTER,
Senior District Judge.**


      We affirm the district court’s order granting summary judgment in favor of

the Appellee/Insurer, Illinois Union Insurance Company.

      The professional liability insurance policy provides, in relevant part, the

following exclusion:

             The Insurer shall not be liable for Loss on account of any Claim
      made against any Insured:
             ....
             W. Based upon, arising out of, or attributable to the sale,
      attempted sale, or servicing of:
                    1. Commodities, commodity future contracts, any type of
      option contract or derivative.
The policy clearly excluded losses arising out of investments in derivatives. The

collateralized mortgage bonds in Appellant’s portfolio were derivatives.1

      Appellant argues that part of her damage arises out of conduct that is separate

and apart from the sale of derivatives. She contends that the Insured, Brookstreet

Securities Corporation, breached its fiduciary duty, committed fraud, made

misrepresentations, omitted material facts, acted negligently, and violated state and

federal securities laws before buying derivatives. Appellant argues the insurance

          **
             The Honorable Rudi M. Brewster, Senior United States District Judge
for the Southern District of California, sitting by designation.
      1
              The district court held that collateralized mortgage bonds fell within
the definition of derivatives. Appellant did not appeal that issue.

                                          -2-
policy covers this distinct conduct under a theory of concurrent causation or

efficient proximate cause analysis. See, e.g., State Farm Mut. Auto. Ins. Co. v.

Partridge, 514 P.2d 123, 129–32 (Cal. 1973).

      We are not persuaded by this argument. The exclusion at issue in this case

applies irrespective of the legal theory of recovery asserted against the Insured. See

Century Transit Sys., Inc. v. Am. Empire Surplus Lines Ins. Co., 49 Cal. Rptr. 2d

567, 571 (Ct. App. 1996). The plain terms of the policy exclude coverage for any

loss attributable to an investment in derivatives. The fact that the Insured allegedly

made intentional misrepresentations of fact or breached a fiduciary duty sets up the

purchase of collateralized mortgage bonds. The measure of damages for each and

every claim is loss based upon the purchase and sale of derivatives; therefore, these

claims directly arise from a category of claims arising from a loss specifically

excluded from coverage. See Cont'l Cas. Co. v. City of Richmond, 763 F.2d 1076,

1081–82 (9th Cir. 1985); Century Transit, 49 Cal. Rptr. 2d at 571–72 & n.6.

      AFFIRMED.




                                         -3-
                                                                               FILED
                                                                                JUL 20 2011
N.R. SMITH, Circuit Judge, concurring in part:
                                                                           MOLLY C. DWYER, CLERK
      Appellant argued in her Reply Brief that she had an actionable claim against APPEALS
                                                                         U.S. COURT OF



Brookstreet under California’s “concurrent cause doctrine,” notwithstanding the

policy exclusion. See Cont’l Cas. Co. v. City of Richmond, 763 F.2d 1076, 1081

(9th Cir. 1985) (“[U]nder California insurance law, when two different risks

concur in proximately causing a loss, coverage will be upheld if either risk is

covered, notwithstanding the exclusion of the other.” (citing State Farm Mut. Auto.

Ins. Co. v. Partridge, 514 P.2d 123, 129 (Cal. 1973) (emphasis added)). Although

her concurrent cause claim may have merit, Appellant waived this argument by

failing to raise it (1) before the district court, see Hillis v. Heineman, 626 F.3d

1014, 1019 (9th Cir. 2010), and (2) in her Opening Brief, see Dilley v. Gunn, 64

F.3d 1365, 1367 (9th Cir. 1995). We must therefore affirm the district court’s

summary judgment order.
