In re: YU HUA LONG INVESTMENTS, LLC v. Mountainfield Properties LLC;

NOT FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
In re: YU HUA LONG INVESTMENTS,
LLC,
Debtor,
______________________________
TENG HUANG,
Appellant,
v.
MOUNTAINFIELD PROPERTIES LLC; et
al.,
Appellees.
No. 22-55476
D.C. No. 2:21-cv-07750-RGK
MEMORANDUM*
Appeal from the United States District Court
for the Central District of California
R. Gary Klausner, District Judge, Presiding
Argued and Submitted December 6, 2022
Pasadena, California
Before: KELLY,** M. SMITH, and COLLINS, Circuit Judges.
* This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
** The Honorable Paul J. Kelly, Jr., United States Circuit Judge for the
U.S. Court of Appeals for the Tenth Circuit, sitting by designation.
FILED
JAN 9 2023
MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS

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Teng Huang appeals the district court’s order affirming the bankruptcy
court’s order disallowing his claim for unjust enrichment on the basis of the
incidental benefit principle. The parties’ familiarity with the record is assumed.
We have jurisdiction pursuant to 28 U.S.C. §§ 158(d)(1) and 1291. We reverse
and remand the case to the district court for further proceedings consistent with this
memorandum disposition.
We hold that the bankruptcy court erred in its application of the incidental
benefit principle to disallow Teng Huang’s unjust enrichment claim in this case.
To prevail on an unjust enrichment claim, a party must show “receipt of a benefit
and unjust retention of the benefit at the expense of another.” Lyles v. Sangadeo-
Patel, 171 Cal. Rptr. 3d 34, 40 (Ct. App. 2014) (internal quotation marks and
citation omitted). Under the incidental benefit principle, the retention of a benefit
is not unjust where the party conferring the benefit acts solely out of self-interest or
duty, and the party receiving the benefit does so only incidentally. See Hartford
Cas. Ins. Co. v. J.R. Mktg., LLC, 353 P.3d 319, 327 (Cal. 2015) (“When a person
acts simply as she would have done in any event, out of duty or self-interest, she
cannot equitably claim compensation from anyone who merely happens to benefit
as a result.”). This principle is inapplicable here because the loan at issue in this
case was secured to provide operating funds for Magnus Sunhill Group, LLC
(Magnus) and to pay off existing debts, forestalling the foreclosure of its real estate

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assets. Even if Teng Huang acted in his own interest, the benefit conferred upon
Magnus was not merely incidental. Rather, it was intentional. We therefore
reverse.
We decline to consider Appellees’ suggested alternate grounds for
affirmance, such as whether Teng Huang has satisfied the prima facie requirements
for unjust enrichment; whether the unjust enrichment claim was time-barred; and
whether Teng Huang—as opposed to Shaanxi Yuhualong Investment Group Co.,
Ltd.—conferred a benefit sufficient to assert an unjust enrichment claim. See
United States v. Johnson Controls, Inc., 457 F.3d 1009, 1022–23 (9th Cir. 2006)
(declining to affirm on alternate ground due to its fact-intensive nature and
remanding for possible further factual development and evaluation below),
abrogated on other grounds by United States ex rel. Hartpence v. Kinetic
Concepts, Inc., 792 F.3d 1121 (9th Cir. 2015) (en banc). We leave it to the sound
discretion of the district court to either consider those issues in the first instance or
to remand the case to the bankruptcy court.
REVERSED AND REMANDED.

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