author: T.G. NELSON, Circuit Judge:

text:
    Kareem ABDUL-JABBAR, Plaintiff-Appellant, v. GENERAL MOTORS CORPORATION; Leo Burnett Company, Inc., Defendants-Appellees.
    No. 94-55597.
    United States Court of Appeals, Ninth Circuit.
    Argued and Submitted Sept. 12, 1995.
    Decided Feb. 8, 1996.
    As Amended on Denial of Rehearing and Rehearing En Banc May 23, 1996.

      Ronald L. Johnston and Cynthia S. Arato, Blanc, Williams, Johnston & Kronstadt, Los Angeles, California, and David M. Rosman,

      Los Angeles, California, for plaintiff-appellant.
    Amy D. Hogue and Michael B. Garfinkel, Pillsbury, Madison & Sutro, Los Angeles, California, for defendants-appellees.
    Before: T.G. NELSON and KLEINFELD, Circuit Judges, and LEGGE, District Judge.

       Honorable Charles A. Legge, United States District Judge for the Northern District of California, sitting by designation.

   T.G. NELSON, Circuit Judge:

Former basketball star Kareem AbdulJabbar appeals the district court’s summary judgment in favor of General Motors Corporation (“GMC”) and its advertising agency, Leo Burnett Co., in his action alleging violations of the Lanham Act, 15 U.S.C. § 1125(a), and California’s statutory and common law right of publicity. Abdul-Jabbar argues that GMC violated his trademark and publicity rights by using his former name, Lew Alcindor, without his consent, in a television commercial aired during the 1993 NCAA men’s basketball tournament. The district court based its judgment on all causes of action largely on its findings that Abdul-Jabbar had abandoned the name “Lew Alcindor,” and that GMC’s use of the name could not be construed as an endorsement of its product by Abdul-Jabbar. Having jurisdiction pursuant to 28 U.S.C. § 1291, we reverse and remand for trial.

FACTS AND PROCEDURAL HISTORY

This dispute concerns a GMC television commercial aired during the 1993 NCAA men’s basketball tournament. The record includes a videotape of the spot, which plays as follows: A disembodied voice asks, “How ‘bout some trivia?” This question is followed by the appearance of a screen bearing the printed words, ‘You’re Talking to the Champ.” The voice then asks, “Who holds the record for being voted the most outstanding player of this tournament?” In the screen appear the printed words, “Lew Alcindor, UCLA, ‘67, ‘68, ‘69.” Next, the voice asks, “Has any car made the ‘Consumer Digest’s Best Buy’ list more than once? [and responds:] The Oldsmobile Eighty-Eight has.” A seven-second film clip of the automobile, with its price, follows. During the clip, the voice says, “In fact, it’s made that list three years in a row. And now you can get this Eighty-Eight special edition for just $18,995.” At the end of the clip, a message appears in print on the screen: “A Definite First Round Pick,” accompanied by the voice saying, “it’s your money.” A final printed message appears: “Demand Better, 88 by Oldsmobile.”

The following facts are undisputed. Kareem Abdul-Jabbar was named Ferdinand Lewis (“Lew”) Alcindor at birth, and played basketball under that name throughout his college career and into his early years in the National Basketball Association (“NBA”). While in college, he converted to Islam and began to use the Muslim name “Kareem Abdul-Jabbar” among friends. Several years later, in 1971, he opted to record the name “Kareem Abdul-Jabbar” under an Illinois name recordation statute, and thereafter played basketball and endorsed products under that name. He has not used the name “Lew Alcindor” for commercial purposes in over ten years.

GMC did not obtain Abdul-Jabbar’s consent, nor did it pay him, to use his former name in the commercial described above. When Abdul-Jabbar complained to GMC about the commercial, the company promptly withdrew the ad. The ad aired about five or six times in March 1993 prior to its withdrawal. The parties dispute whether AbdulJabbar abandoned the name Lew Alcindor and whether the ad could be construed as an endorsement by Abdul-Jabbar of the 88 Oldsmobile.

Abdul-Jabbar brought suit in federal district court in May 1993, alleging claims under the Lanham Act and California’s statutory and common law rights of publicity. The district court held a hearing on March 14, 1994. During the hearing, incorporated by reference into the order of summary judgment, the district court announced its “tentative finding that plaintiff has abandoned the name Lew Alcindor, and has abandoned the right to protect that name, and the right to assert any other rights that flow from his having had that name at one time in the past.” This finding forms the basis for the district court’s decision to grant summary judgment in favor of GMC on both the Lanham Act and the state law causes of action. Abdul-Jabbar timely appealed.

ANALYSIS

A grant of summary judgment is reviewed de novo. Jesinger v. Nevada Federal Credit Union, 24 F.3d 1127, 1130 (9th Cir.1994). We must determine, viewing the evidence in the light most favorable to the nonmoving party, whether there are any genuine issues of material fact, and whether the district court correctly applied the relevant substantive law. Id.; Fed.R.Civ.P. 56(e). We are not to weigh the evidence or determine the truth of the matter, but only to determine whether there is a genuine issue for trial. Jesinger, 24 F.3d at 1130.

I

The Lanham Act

“[A]n express purpose of the Lanham Act is to protect commercial parties against unfair competition.” Waits v. Frito-Lay, Inc., 978 F.2d 1093, 1108 (9th Cir.1992). In Waits, we held as a matter of first impression that false endorsement claims are properly cognizable under section 43(a), 15 U.S.C. § 1125(a), of the Lanham Act. Id. at 1107. “Section 43(a) [as amended in 1988] ... expressly prohibits, inter alia, the use of any symbol or device which is likely to deceive consumers as to the association, sponsorship, or approval of goods or services by another person.” Id. Accordingly, we held actionable:

[a] false endorsement claim based on the unauthorized use of a celebrity’s identity ... [which] alleges the misuse of a trademark, i.e., a symbol or device such as a visual likeness, vocal imitation, or other uniquely distinguishing characteristic, which is likely to confuse consumers as to the plaintiff’s sponsorship or approval of the product.

Id. at 1110. Abdul-Jabbar contends that GMC’s unauthorized use of his birth name, Lew Alcindor, was likely to confuse consumers as to his endorsement of the Olds 88, and thus violates the Lanham Act.

GMC offers two defenses in response to this claim: 1) Abdul-Jabbar lost his rights to the name Lew Alcindor when he “abandoned” it; and 2) GMC’s use of the name Lew Alcindor was a nominative fair use which is not subject to the protection of the Lanham Act. The district court held both defenses applicable.

a) Abandonment under the Lanham Act

While the district court found that there was no dispute as to GMC’s failure to seek or obtain Abdul-Jabbar’s consent to use Ms former name in its commercial, and that “on its face, the Lanham Act applies,” it held that GMC was entitled to summary judgment on the basis of its finding that Abdul-Jabbar had abandoned his former name through nonuse under the Lanham Act. Title 15 U.S.C. § 1127 (1992) provides in pertinent part:

A mark shall be deemed to be “abandoned” when either of the following occurs:
(1) When its use has been discontinued with intent not to resume such use. Intent not to resume may be inferred from circumstances. Nonuse for two consecutive years shall be prima facie evidence of abandonment. “Use” of a mark means the bona fide use of that mark made in the ordinary course of trade, and not merely to reserve a right in a mark.
(2) When any course of conduct of the owner, including acts of omission as well as commission, causes the mark to become ... generic____

Once created, a prima facie case of abandonment may be rebutted by showing valid reasons for nonuse or lack of intent to abandon the mark. Star-Kist Foods, Inc. v. P.J. Rhodes & Co., 769 F.2d 1393, 1396 (9th Cir.1985). Because Abdul-Jabbar acknowledged that he had not used the name Lew Alcindor in over ten years, and because the district court found that plaintiffs proffered religious reasons for nonuse were not applicable, the court held that Abdul-Jabbar had in effect abandoned the name.

Trademark law withdraws its protection from a mark that has become generic and deems it available for general use. Given that

the primary cost of recognizing property rights in trademarks is the removal of words from (or perhaps non-entrance into) our language, ... the holder of a trademark will be demed protection if it is (or becomes) generic, i.e., if it does not relate exclusively to the trademark owner’s product.

New Kids on the Block v. News America Pub., Inc., 971 F.2d 302, 306 (9th Cir.1992). Similarly, the law ceases to protect the owner of an abandoned mark. Rather than countenancing the “removal” or retirement of the abandoned mark from commercial speech, trademark law allows it to be used by another. Accordingly, courts have held that an unused mark may not be held in abeyance by its original owner. See, e.g., La Societe Anonyme des Parfums Le Galion v. Jean Patou, Inc., 495 F.2d 1265, 1272 (2d Cir.1974).

While the Lanham Act has been applied to cases alleging appropriation of a celebrity’s identity, the abandonment defense has never to our knowledge been applied to a person’s name or identity. We decline to stretch the federal law of trademark to encompass such a defense. One’s birth name is an integral part of one’s identity; it is not bestowed for commercial purposes, nor is it “kept alive” through commercial use. A proper name thus cannot be deemed “abandoned” throughout its possessor’s life, despite Ms failure to use it, or continue to use it, commercially.

In other words, an individual’s given name, unlike a trademark, has a life and a significance quite apart from the commercial realm. Use or nonuse of the name for commercial purposes does not dispel that significance. An individual’s decision to use a name other than the birth name—whether the decision rests on religious, marital, or other personal considerations—does not therefore imply intent to set aside the birth name, or the identity associated with that name.

While the issue of whether GMC’s use of the name Lew Alcindor constituted an endorsement of its product is far from clear, we hold that GMC cannot rely on abandonment as a defense to Abdul-Jabbar’s Lanham Act claim.

b) LanhamAct “fair use” doctrine

The district court cited the “fair use” defense, 15 U.S.C. § 1115(b)(4), as an alternative ground for dismissal of plaintiffs Lanham Act claim. We discussed this defense in New Kids, where we held that the use by two newspapers of the “New Kids” name to conduct phone-in polls measuring the group’s popularity was a nominative or non-trademark “fair use” of the name not subject to protection under the Lanham Act. 971 F.2d at 306-09.

“[T]rademark law recognizes a defense where the mark is used only ‘to describe the goods or services of [a] party, or their geographic origin.’” Id. at 306; (quoting 15 U.S.C. § 1115(b)(4)). We cited the example of a Volkswagen repair shop which used the name “Volkswagen” in the sign advertising its business. Volkswagenwerk Aktiengesellschaft v. Church, 411 F.2d 350, 352 (9th Cir.1969). There, we had recognized that it “ “would be difficult, if not impossible, ... to avoid altogether the use of the word “Volkswagen” or its abbreviation “VW” ... [to] signify appellant’s cars.’ ... Therefore, his use of the Volkswagen trademark was not an infringing use.” Id. at 307 (quoting Volkswagenwerk Aktiengesellschaft v. Church, 411 F.2d 350, 352 (9th Cir.1969)).

We explained that “[c]ases like these are best understood as involving a non-trademark use of a mark—a use to which the infringement laws simply do not apply.” Id.

[W]e may generalize a class of cases where the use of the trademark does not attempt to capitalize on consumer confusion or to appropriate the cachet of one product for a different one. Such nominative use of a mark—where the only word reasonably available to describe a particular thing is pressed into service—lies outside the strictures of trademark law: Because it does not implicate the source-identification function that is the purpose of the trademark, it does not constitute unfair competition; such use is fair because it does not imply sponsorship or endorsement by the trademark holder.

Id. at 307-08.

New Kids was not the classic fair use case because the New Kids trademark was being used not to describe the defendant’s own product (newspapers), but to describe the plaintiffs product (rock band). Id. at 308. However, we held that in such cases, a commercial user is nevertheless entitled to the nominative fair use defense if it meets three requirements:

First, the product or service in question must be one not readily identifiable without use of the trademark; second, only so much of the mark or marks may be used as is reasonably necessary to identify the product or service; and third, the user must do nothing that would, in conjunction with the mark, suggest sponsorship or endorsement by the trademark holder.

Id. (footnotes omitted). Because 1) the New Kids rock band could not be referenced without using its name; and 2) the newspapers used the name only to the extent necessary to identify them; and 3) nothing in the newspaper announcements implied sponsorship or endorsement by the New Kids, we held that the papers were entitled to the nominative fair use defense. Id. at 308-10.

The district court here found that GMC met the three New Kids requirements as a matter of law. We conclude, however, that there was a genuine issue of fact as to the third requirement, implied endorsement or sponsorship. Like the newspapers in New Kids, General Motors could not refer to plaintiff without using his name, and it used no more than was necessary to refer to him. Also, analogously to the newspapers in New Kids asking their readers which New Kid was the best, sexiest, etc., the defendant was selling something, newspapers or cars, different from the product the plaintiff was selling, and their products could not be confused.

The distinction between this case and New Kids is that use of celebrity endorsements in television commercials is so well established by commercial custom that a jury might find an implied endorsement in General Motors’ use of the celebrity’s name in a commercial, which would not inhere in a newspaper poll. Newspapers and magazines commonly use celebrities’ names and photographs without making endorsement contracts, so the public does not infer an endorsement agreement from the use. Many people may assume that when a celebrity’s name is used in a television commercial, the celebrity endorses the product advertised. Likelihood of confusion as to endorsement is therefore a question for the jury. White v. Samsung Elec. Am., Inc., 971 F.2d 1395, 1400-01 (9th Cir.1992) (holding that use of a robot dressed and posed like Vanna White next to a “Wheel of Fortune” set raised sufficient question of fact as to endorsement under the Lanham Act to preclude summary judgment), cert. denied, 508 U.S. 951, 113 S.Ct. 2443, 124 L.Ed.2d 660 (1993).

Had GMC limited itself to the “trivia” portion of its ad, GMC could likely defend the reference to Lew Alcindor as a nominative fair use. But by using Alcindor’s record to make a claim for its car—like the basketball star, the Olds 88 won an “award” three years in a row, and like the star, the ear is a “champ” and a “first round pick”— GMC has arguably attempted to “appropriate the cachet of one product for another,” if not also to “capitalize on consumer confusion.” New Kids at 308. We therefore hold that there is a question of fact as to whether GMC is entitled to a fair use defense.

c) Abdul-Jabbar’s Lanham Act claim

In considering celebrities’ claims of violation under the Lanham Act, we have considered the following factors to determine whether a plaintiff has raised a genuine issue of material fact as to likelihood of confusion over endorsement: “(1) strength of the plaintiffs mark; (2) relatedness of the goods; (3) similarity of the marks; (4) evidence of actual confusion; (5) marketing channels used; (6) likely degree of purchaser care; (7) defendant’s intent in selecting the mark.” White, 971 F.2d at 1400.

The parties dispute the applicability of the factors. GMC concedes that the fifth factor, marketing channels, favors Abdul-Jabbar, but contests the rest. Because a jury could reasonably conclude that most of the factors weigh in plaintiffs favor, we hold that the question of whether Abdul-Jabbar’s Lanham Act claim should succeed is a question for the jury.

II

State law claims: Common Law and Statutory Rights of Privacy

“California has long recognized a common law right of privacy ... [which includes protection against] appropriation, for the defendant’s advantage, of the plaintiffs name or likeness.” Eastwood v. Superior Court for Los Angeles County, 149 Cal.App.3d 409, 198 Cal.Rptr. 342, 346 (1983) (citations omitted). The right to be protected against such appropriations is also referred to as the “right of publicity.” Id., 198 Cal.Rptr. at 347.

The so-called right of publicity means in essence that the reaction of the public to name and likeness, which may be fortuitous or which may be managed and planned, endows the name and likeness of the person involved with commercially exploitable opportunities. The protection of name and likeness from unwarranted intrusion or exploitation is the heart of the law of privacy.

Lugosi v. Universal Pictures, 25 Cal.3d 813, 160 Cal.Rptr. 323, 329, 603 P.2d 425, 431 (1979).

As set out in Eastwood, a common law cause of action for appropriation of name or likeness may be pleaded by alleging “(1) the defendant’s use of plaintiffs identity; (2) the appropriation of plaintiffs name or likeness to defendant’s advantage, commercially or otherwise; (3) lack of consent; and (4) resulting injury.” 198 Cal.Rptr. at 347.

We recently clarified in White that “the ‘name or likeness’ formulation referred to in Eastwood originated not as an element of the right of publicity cause of action, but as a description of the types of cases in which the cause of action had been recognized.” 971 F.2d at 1397. Accordingly, we held that California’s common law “right of publicity is not limited to the appropriation of name or likeness.” Id. at 1398. The key issue is appropriation of the plaintiffs identity.

It is not important how the defendant has appropriated the plaintiffs identity, but whether the defendant has done so.... A rule which says that the right of publicity can be infringed only through the use of nine different methods of appropriating identity merely challenges the clever advertising strategist to come up with the tenth.

Id. (internal citations omitted).

California’s common law cause of action is complemented legislatively by Civil Code section 3344. As the Eastwood court explained, the statute is best understood as “complementing,” rather than enacting, the common law cause of action, because the two are not identical. 198 Cal.Rptr. at 346. Section 3344(a) provides in pertinent part:

Any person who knowingly uses another’s name, voice, signature, photograph, or likeness, in any manner, on or in products, merchandise, or goods, or for purchases of advertising or selling, or soliciting purchases of, products, merchandise, goods or services, without such person’s prior consent ... shall be liable for any damages sustained by the person ... injured as a result thereof.

Cal. CM Code § 3344(a) (1971).

In addition to the common law elements, the statute requires two further allegations: 1) knowing use; and 2) a “direct connection ... between the use and the commercial purpose.” 198 Cal.Rptr. at 347 (quotations omitted). Furthermore, unlike the common law cause of action, section 3344 is apparently limited to commercial appropriations. As the Eastwood court pointed out, however, “California law has not imposed any requirement that the unauthorized use or publication of a person’s name or picture be suggestive of an endorsement or association with the injured person.” Id. at 347. This caveat apparently applies to both the common law and statutory causes of action. See id. at 348 (“the appearance of an ‘endorsement’ is not the sine qua non of a claim for commercial appropriation.”).

We have construed the statute’s protection of “name, voice, signature, photograph, or likeness” more narrowly than the common law’s protection of “identity.” See, e.g., White, 971 F.2d at 1397 (holding plaintiff stated a cause of action under common law but not under section 3344 where likeness in question was robot impersonating celebrity); Midler v. Ford Motor Co., 849 F.2d 460, 463 (9th Cir.1988) (holding common law but not statutory cause of action applicable to appropriation of singer’s voice by voice-impersonator).

The district court ruled that GMC was entitled to summary judgment on both the statutory and common law causes of action. The court reasoned that section 3344 did not apply because: 1) Abdul-Jabbar had abandoned his former name; and 2) GMC did not “use” plaintiff’s name because Abdul-Jabbar “did not [at the time of the ad] and does not have the name used.” While the court found that GMC knowingly used the name Lew Alcindor for commercial purposes without obtaining plaintiff’s consent, it concluded that GMC had not used plaintiff’s name because he no longer bore that name.

The district court found that Abdul-Jabbar abandoned the name Lew Alcindor when he legally recorded his present name in 1971. The court acknowledged that “[w]e have no case law in California that abandonment is a defense [to § 3344], but as I would construe the law, it surely must be.” The court further found, “regardless of abandonment,” that because Abdul-Jabbar no longer uses the name Lew Alcindor, “there has been no use of plaintiff’s name.” Extrapolating from our holdings in White and Midler that, under section 3344, “use must be of actual voice or actual likeness,” the court concluded that “the actual name must be used in a name ease, and ... our case does not involve the use of plaintiffs actual name.”

The court dismissed the common law cause of action on similar grounds. The court referred to and distinguished Carson v. Here’s Johnny Portable Toilets, Inc., 698 F.2d 831 (6th Cir.1983) (holding distributor’s use of the phrase “Here’s Johnny” actionable under Michigan common law, see id. at 837) and Ali v. Playgirl, Inc., 447 F.Supp. 723 (S.D.N.Y.1978) (holding magazine’s publication of drawing of nude black man labelled “the greatest” entitled plaintiff to preliminary injunctive relief for violations of New York statutory and common law right of publicity, see id. at 728), on the grounds that “[o]ne cannot say that Lew Aleindor equals Kareem Abdul-Jabbar in anywhere near the same sense that ‘Here’s Johnny’ equals Johnny Carson ... or the way ‘the greatest’ equalled Muhammed Ali, when [those eases were] tried.” The court described the “essence” of the holdings in Carson and Ali to be “that the sobriquet or nickname must be in the most common present use so that it clearly identifies the person seeking recovery” and opined without reviewing any of the California eases that “[Carson and Ali ] might well come out the same under California common Daw].”

We have frequently held that California’s common law right of publicity protects celebrities from appropriations of their identity not strictly definable as “name or picture.” Motschenbacher v. R.J. Reynolds Tobacco Co., 498 F.2d 821, 827 (9th Cir.1974) (use of famous race ear driver’s well-known race car in televised cigarette ad sufficed to constitute an appropriation of his identity); Midler, 849 F.2d at 463 (use of sound-alike voice in radio ad supported a cause of action under California’s common law right of publicity, though not under section 3344); Waits, 978 F.2d at 1098 (same); White, 971 F.2d at 1397-99 (use of robot dressed and posed like Vanna White next to a “Wheel of Fortune” set sufficiently identified her to state a cause of action under California common, but not statutory, law).

Neither the cases cited by the district court, nor the cases listed above stand for the proposition that the reference must be “in common, present use” under the statute or under California common law. Rather, they stand for the proposition that “identity” is a more flexible proposition and thus more permissive than the statutory “laundry list” of particular means of appropriation. White, 971 F.2d at 1398; see also Carson, 698 F.2d at 835 (“All that is required [under Michigan’s common law right of publicity] is that the name clearly identify the wronged person.”).

The district court’s “common, present use” analysis appears to be a variation on its abandonment theme (e.g., Abdul-Jabbar can only sue for use of his present name, because he has abandoned his former name). Abdul-Jabbar argues that abandonment cannot be a defense to appropriation because the right of publicity protects not only a celebrity’s “sole right to exploit” his identity, White, 971 F.2d at 1399, but also his decision not to use his name or identity for commercial purposes. See, e.g., Waits, 978 F.2d 1093 (applying right of publicity protection to singer with moral and aesthetic objections to advertising). We agree.

Abdul-Jabbar cites Price v. Hal Roach Studios, Inc., 400 F.Supp. 836, 846 (S.D.N.Y.1975), wherein the court dismissed as “nonsensical” defendants’ argument that Laurel and Hardy’s failure to use their caricatures and imitations between 1940 and 1954 constituted abandonment: “It cannot be possible for Laurel and Hardy to lose rights in their own names and likenesses through ‘non-use.’ ” Id. at 846 (citing New York statutory law protecting persons from commercial exploitation by others and case) and see id. at n. 15 (citing Grant v. Esquire, 367 F.Supp. 876, 880 (S.D.N.Y.1973), for the proposition that nonuse of commercial value of name and likeness does not preclude against violation by others). We find this argument persuasive.

We hold that Abdul-Jabbar has alleged sufficient facts to state a claim under both California common law and section 3344. The statute’s reference to “name or likeness” is not limited to present or current use. To the extent GMC’s use of the plaintiffs birth name attracted television viewers’ attention, GMC gained a commercial advantage. See Eastwood, 198 Cal.Rptr. at 349 (“The first step toward selling a product or service is to attract the consumers’ attention.”). Whether or not Lew Alcindor “equals” Kareem Abdul-Jabbar in the sense that “ ‘Here’s Johnny’ equalled] Johnny Carson,” or “ ‘the greatest’ equalled] Muhammed Ali”—or the glamorously dressed robot equalled Vanna White—is a question for the jury. See Waits, 978 F.2d at 1102 (observing that a celebrity’s renown is relative and “adequately reflected in the amount of damages recoverable”).

As to injury, the district court opined that any “loss injury” was “de minim-is,” though it explicitly declined to rely on this in granting GMC summary judgment. White does not explicitly discuss injury, but notes that “the law protects the celebrity’s sole right to exploit th[e] value” of her fame. 971 F.2d at 1399. Abdul-Jabbar alleges, and submits evidence to show, that he was injured economically because the ad will make it difficult for him to endorse other automobiles, and emotionally because people may be led to believe he has abandoned his current name and assume he has renounced his religion. These allegations suffice to support his action. Injury to a plaintiffs right of publicity is not limited to present or future economic loss, but “may induce humiliation, embarrassment, and mental distress.” Waits, 978 F.2d at 1103 (quotations omitted).

GMC makes a final argument that its use of the name Lew Alcindor was “incidental” and therefore not actionable, citing Namath v. Sports Illustrated, 80 Misc.2d 531, 363 N.Y.S.2d 276 (1975), for the proposition that “newsworthy” items are privileged under right of publicity laws. The district court correctly rejected this line of reasoning as irrelevant. The Namath court held that Sports Illustrated was entitled under the First Amendment to use its own news stories to promote sales of its magazine. 363 N.Y.S.2d at 279-80.

A recent California ease, Montana v. San Jose Mercury News, Inc., 34 Cal.App.4th 790, 40 Cal.Rptr.2d 639 (1995), reaches a similar conclusion. The California Court of Appeal denied football star Joe Montana’s claim that a newspaper’s use of his image, taken from its Super Bowl cover story and sold in poster form, violated his section 3344 and common law right of publicity, holding that: 1) the posters represented newsworthy events, and 2) a newspaper has a constitutional right to promote itself by reproducing its news stories. Id. at 641-42. As the court noted, section 3344(d) provides that no prior consent is required for use of a “name, voice, signature, photograph, or likeness in connection with any news, public affairs, or sports broadcast or account, or any political campaign.” Cal.Civ.Code § 3344; Montana, 40 Cal.Rptr.2d at 640.

While Lew Alcindor’s basketball record may be said to be “newsworthy,” its use is not automatically privileged. GMC used the information in the context of an automobile advertisement, not in a news or sports account. Hence GMC is not protected by section 3344(d).

For the reasons set out above, we reverse the judgment of the district court and remand for trial on the claims alleging violation of the California common law right of publicity and section 3344, as well as the claims alleging violation of the Lanham Act.

REVERSED and REMANDED.

      . The record judgment read that "said petitioner's name be, and the same is hereby changed from FERDINAND LEWIS ALCINDOR to KAREEM ABDUL-JABBAR by which said last-mentioned name shall be hereafter known and called.” Illinois' name recordation laws, like California's, are permissive. See Reinken v. Reinken, 351 Ill. 409, 184 N.E. 639, 640 (1933); In re Ritchie, 159 Cal.App.3d 1070, 206 Cal.Rptr. 239, 240 (1984).

      . The district court did not distinguish between defendants GMC and Burnett, but assumed for purposes of the summary judgment motion that "if one is liable, both are liable; if one is entitled to the grant of the motion, both are entitled to it.”

      . Section 43(a) states:
      (1) Any person who, on or in connection with any goods or services ... uses in commerce any word, term, name, symbol, or device, or any combination thereof, or any false designation of origin, false or misleading description of fact, or false or misleading representation of fact, which—
      (A) is likely to cause confusion, or to cause mistake, or to deceive as to the affiliation, connection, or association of such person with another person, or as to the origin, sponsorship, or approval of his or her goods, services, or commercial activities by another person, or
      (B) in commercial advertising or promotion, misrepresents the nature, characteristics, qualities, or geographic origin of his or her or another person’s goods, services, or commercial activities,
      shall be liable in a civil action by any person who believes that he or she is or is likely to be damaged by the act.
      15 U.S.C. § 1125(a) (1992).

      . In some circuits, a showing of nonuse shifts the burden of persuasion to the trademark owner to show intent to resume; in others, including the Ninth, Second and Seventh, prima facie abandonment creates only a rebuttable presumption of abandonment.

      . We need not decide whether Abdul-Jabbar's proffered reasons for non-use of his birth name would serve to rebut a prima facie case of abandonment. Abdul-Jabbar argues that the district court's abandonment ruling substantially burdens his First Amendment right to free exercise of religion. The gist of this argument is that by holding that one loses rights to his given name on adopting a new name for religious purposes, the court puts pressure on a religious believer to “modify his behavior and violate his beliefs.” See Frazee v. Illinois Dep't of Employment Sec., 489 U.S. 829, 832, 109 S.Ct. 1514, 1516, 103 L.Ed.2d 914 (1989). Because we hold GMC failed to establish a prima facie case of abandonment under the Lanham Act, wé do not reach or resolve this argument.

      . GMC's reliance on Major League Baseball Properties, Inc. v. Sed Non Olet Denarius, Ltd., 817 F.Supp. 1103 (S.D.N.Y.1993), vacated, pursuant to settlement, 859 F.Supp. 80 (S.D.N.Y.1994), is inapposite. Aside from the fact that a vacated case is poor authority, we observe that, unlike the case at bar, Major League was decided after full consideration of the evidence at a trial on the merits.


source: Caselaw Access Project

author: HUG, Chief Judge:

license: Public Domain

text:
    In re H. Edwin SCHIMMELS; Mary Jo Schimmels, Debtors. UNITED STATES of America ex rel. Stephen RUDD; Mark Lanterman; Deborah Gibson; Henry Winburn, and Howard L. Hamby, Plaintiffs-Appellants, v. H. Edwin SCHIMMELS; Mary Jo Schimmels, Defendants-Appellees.
    No. 95-15974.
    United States Court of Appeals, Ninth Circuit.
    Argued and Submitted April 11, 1996.
    Decided May 30, 1996.

      Daniel S. Kozma, Connerton, Ray & Simon, Washington, DC, for plaintiffs-appellants.
    Alan R. Smith, Smith & Cope, Reno, Nevada, for defendants-appellees.
    Before HUG, Chief Judge, D. W. NELSON and FERNANDEZ, Circuit Judges.
   HUG, Chief Judge:

This case asks us to determine whether the appellants’ untimely filing of their notice of appeal is excused because the bankruptcy court failed to follow the separate judgment rule of Bankruptcy Rule 9021. The appellants missed the deadline to file their notice of appeal in bankruptcy court, and the district court determined that it was accordingly without jurisdiction to entertain the appeal and dismissed the action. The appellants now contend that their notice of appeal was timely filed because the bankruptcy court failed to enter a separate judgment, under Bankruptcy Rule 9021, and that therefore, the clock never started running with respect to the ten days in which the notice of appeal must be filed. We have jurisdiction under 28 U.S.C. § 158(d), and we affirm.

I.

The appellants are a group of former employees of General Contractors Inc. (“GCI”) who filed a qui tarn action under the False Claims Act (“FCA”), 31 U.S.C. §§ 3729-3731, in the Eastern District of Washington. The appellants’ suit alleged that GCI, along with Ed and Mary Jo Schimmels, GCI’s president and assistant treasurer respectively, defrauded the federal government by failing to compensate their employees properly. Specifically, the suit alleged that GCI and the Sehimmels violated the Davis-Bacon Act, 40 U.S.C. § 276a, by over-deducting from employees’ paychecks for health care, deducting portions of employees’ paychecks for a training program that was incapable of being used to train GCI employees, and refusing to pay overtime. These violations defrauded the federal government out of several thousand dollars in payroll taxes, Social Security taxes, and unemployment and workers compensation payments. GCI settled with the appellants, and the Sehimmels were left as the only remaining defendants.

On March 12, 1993, the District Court for the Eastern District of Washington entered partial summary judgment for the appellants. The court held that the Sehimmels had submitted 149 separate false claims over a period of four years and that the false statements had defrauded the federal government out of $14,958.16. The court reserved ruling on the amount of the mandatory statutory civil penalty it would impose (between $5,000 to $10,-000 for each violation—with potential liability of over $2 million). With two other motions for summary judgment pending and scheduled for oral argument, the Sehimmels filed a Chapter 11 bankruptcy petition in Reno, Nevada. The district court entered an order staying the suit pursuant to 11 U.S.C. § 362(a).

After unsuccessfully attempting to gain relief from the automatic stay in order to pursue an entry of final judgment in the FCA action, the appellants filed an adversarial proceeding in the bankruptcy court in order to establish the nondischargeability of the FCA debts. On January 4, 1994, the bankruptcy court granted a motion for summary judgment by the Sehimmels and held that the debt was dischargeable. The appellants filed a timely motion for reconsideration on January 14, 1994. This tolled the time for appealing the order for summary judgment until the bankruptcy judge ruled on the motion to reconsider. The bankruptcy judge entered an order denying the motion for reconsideration on April 6,1994.

The appellants had ten days, commencing on April 7, to file a notice of appeal. See Bankr.R. 8002(a); Bankr.R. 9006(a). The ten days expired on April 16, a Saturday. Therefore the deadline was automatically extended to Monday, April 18, 1994. Bankr.R. 9006(a). Because the court mailed the order denying the motion for reconsideration to the parties, the appellants mistakenly believed that Bankruptcy Rule 9006(f), which gives three additional days to undertake a proceeding when notice is served by mail, extended the time to file a notice of appeal until April 19. Accordingly, the appellants filed their notice of appeal on Tuesday, April 19 — one day late.

The Schimmels filed a motion to dismiss the appeal as untimely in the United States District Court for the District of Nevada. The appellants conceded that they incorrectly interpreted Rule 9006(f) as extending the deadline. The appellants contended, however, that the clock did not begin to run on April 7, 1994, because the bankruptcy court did not enter a separate judgment as required by Bankruptcy Rule 9021. The district court agreed that the bankruptcy court failed to enter separate judgments pursuant to Rule 9021 but nonetheless dismissed the appeal as untimely, holding that the appellants had waived this contention by treating the court’s order as a final judgment. We affirm the dismissal on the ground that the judgments entered by the bankruptcy court did comply with the separate judgment requirement of Rule 9021.

II.

The Bankruptcy Rules state:

Except as otherwise provided herein, Rule 58 F.R.Civ.P. applies in eases under the Code. Every judgment entered in an adversary proceeding or contested matter shall be set forth on a separate document.

Bankr.R. 9021. The separate document rule of Bankruptcy Rule 9021 is identical to Federal Rule of Civil Procedure 58. Reid v. White Motor Corp., 886 F.2d 1462, 1468 (6th Cir.1989), cert. denied, 494 U.S. 1080, 110 S.Ct. 1809, 108 L.Ed.2d 939 (1990); In re Seiscom Delta, Inc. (Seiscom Delta, Inc. v. Two Westlake Park), 857 F.2d 279, 285 (5th Cir.1988); In re Kilgus (Reichman v. United States Fire Ins. Co.), 811 F.2d 1112, 1117 (7th Cir.1987); see also Fed.R.Civ.P. 58 (“Every judgment shall be set forth on a separate document.”).

A bankruptcy court is required to enter a separate judgment for every final disposition. Bankr.R. 9021. Bankruptcy Rule 9001(7) defines a “judgment” as “an appealable order.” For the purposes of this rule, a “judgment” and an “order” are interchangeable — both are appealable and must be recorded as a separate document. See Beaudry Motor Co. v. Abko Properties, Inc., 780 F.2d 751, 755 n. 3 (9th Cir.), cert. denied, 479 U.S. 825, 107 S.Ct. 100, 93 L.Ed.2d 51 (1986); In re Pederson (Pederson v. Stedman), 78 B.R. 264, 265 (9th Cir. BAP 1987), aff'd, 875 F.2d 781 (9th Cir.1989). “A separate document means one separate from an opinion or memorandum of the court.” In re Rehbein (Horton v. Rehbein), 60 B.R. 436, 439 (9th Cir. BAP 1986) (citing Calhoun v. United States, 647 F.2d 6, 9 (9th Cir.1981)).

In In re Slimick (Slimick v. Silva), 928 F.2d 304 (9th Cir.1990), the bankruptcy court held a hearing on an objection by a trustee to a debtor’s request to exempt certain assets. Id. at 305. The court entered an “Order Sustaining Trustee’s Objection” stating that it was “of the opinion that the trustee’s objection ... should be granted for the reasons set forth in trustee’s points and authorities” and concluding, “IT IS THEREFORE ORDERED that the objection ... is, hereby sustained.” Id. Several months later, at the debtor’s request, the bankruptcy court entered Findings of Fact and Conclusions of Law and a separate judgment sustaining the objection. The debtor appealed to the Ninth Circuit’s Bankruptcy Appellate Panel which dismissed the appeal as untimely. This court affirmed and held that the initial order was the final appealable order and that the later Findings of Fact and judgment were irrelevant. Id. at 307. Although Slimick did not discuss the separate judgment rule in depth, implicit in the opinion was a conclusion that the earlier order satisfied the separate judgment requirement of Rule 9021. Id. at 309.

The purpose of the separate judgment rule is “to promote certainty as to the relatively short time that a party has to appeal a final order.” In re San Joaquin Roast Beef (Ford v. Union Bank), 7 F.3d 1413, 1417 (9th Cir.1993). A separate judgment is required in order to eliminate “uncertainties as to when a judgment is entered” and when the time for appeal begins. United States v. Indrelunas, 411 U.S. 216, 219, 93 S.Ct. 1562, 1563, 36 L.Ed.2d 202 (1973); Rehbein, 60 B.R. at 439. “Wherever the rules establish a time requirement that limits a litigant’s ability to obtain relief from a final judgment, it is imperative that the ... court provide a clear signal that the time period within which that relief can be sought has begun to run.” Carter v. Beverly Hills Sav. & Loan Ass’n, 884 F.2d 1186, 1189 (9th Cir.1989), cert. denied, 497 U.S. 1024, 110 S.Ct. 3270, 111 L.Ed.2d 780 (1990).

The separate judgment rule does not always require the filing of two separate documents. As Slimick made clear, when a court enters a short order that clearly constitutes a final decision, that short order meets the separate judgment rule. Similarly, if a court grants a summary judgment without writing an opinion or memorandum, then the order granting summary judgment is enough to meet the separate document requirement.

[The separate judgment rule] does require every judgment to be set forth on a separate document. Appellant, however interprets this to mean that two documents are required in all cases. This is unfounded. [The separate judgment rule] applies where it is uncertain whether a final judgment has been entered, as where a trial judge writes an opinion or memorandum providing only the basis for the entry of judgment, but containing apparently directive or dispositive words such as “defendant’s motion for summary judgment is granted.” In such a situation, a judgment must be set out on a document separate from the opinion or memorandum.

United States v. Clearfield State Bank, 497 F.2d 356, 358-59 (10th Cir.1974); cf. Mitchell v. Idaho, 814 F.2d 1404, 1405 (9th Cir.1987) (holding that an eight page order discussing the facts and law of the case while detailing the reasons for the court’s decision was not a separate judgment). The separate judgment rule requires that the court enter a judgment or an order—it does not require that a court enter an initial memorandum or opinion.

In this case the bankruptcy court entered an order entitled “Order Granting Summary Judgment,” on January 4, 1994. The order read, in its entirety:

The matter of Debtor’s Motion for Summary Judgment on the First Amended Complaint to Determine Dischargeability filed by the [appellants] having come for hearing on December 2, 1993, Debtors appearing with their counsel, Alan R. Smith, Esq., and the [appellants] appearing through their counsel, John R. Martz, Esq., and it appearing that the [appellants] failed to timely respond to the subject Motion, said failure not being attributable to excusable neglect, and the Court having considered the tardy motion for extension of time filed by the [appellants] and denying the same, and the Court having considered the preliminary response filed by the [appellants] without supporting affidavits, and the Court having considered the arguments of counsel, it is therefore
ORDERED that summary judgment is granted in favor of the Debtors and against the [appellants] on each of the nine causes of action as set forth in the First Amended Complaint to Determine Dischargeability filed by the [appellants].

This order was not followed by an additional document entering judgment.

The appellants, however, recognized that the order granting summary judgment was the bankruptcy court’s final disposition of the case and timely filed a motion for reconsideration. The bankruptcy court entered an order entitled “Order Denying Motion for Reconsideration of Order Granting Debtor’s Motion for Summary Judgment” on April 6, 1994. This order read, in its entirety:

The Court having considered the [appellants’] Motion for Reconsideration of the Court’s Order dated January 4, 1994 granting Debtor’s Motion for Summary Judgment on the [appellants’] First Amended Complaint to determine dischargeability, the Debtors’ opposition thereto, and the Court having heard the arguments of counsel at a hearing on February 23,1994,
IT IS HEREBY ORDERED that the [appellants’] Motion for Reconsideration of the Order dated January 4, 1994 granting debtors’ motion for summary judgment is DENIED.

Again the bankruptcy court did not enter an additional document entering judgment. The appellants, however, again recognized that this was the court’s final disposition of the case and filed a notice of appeal (albeit, one day late). The appellants allege that these orders did not start the time for filing a notice of appeal because the bankruptcy court never entered separate judgments as required under Bankruptcy Rule 9021. We disagree.

On appeal, the appellants rely on Indrelunas, 411 U.S. at 219-22, 93 S.Ct. at 1563-65, and Reid, 886 F.2d at 1468-69, for the proposition that two separate documents must always be filed in order to satisfy the separate judgment rule. We find these cases inapposite to the current situation. In both Indrelunas and Reid, the lower court filed an extensive opinion explaining its disposition. After filing such an opinion, the court failed to enter a separate judgment or order. In this case, the bankruptcy court has entered an order without filing an opinion.

We conclude that both of the orders entered by the bankruptcy court are separate judgments within the meaning of Bankruptcy Rule 9021. The order granting summary judgment is a brief order that gives no detailed explanations and does not contain an opinion or a memorandum. The mere fact that the order contains a single sentence detailing the history of the proceedings does not disqualify it as a separate order. See Laidley v. McClain, 914 F.2d 1386, 1390 (10th Cir.1990) (holding that a summary judgment order containing a single sentence adopting the report of a magistrate met the separate judgment rule and did “not require that two documents be used instead of one”). Furthermore, the document was clearly intended as the final disposition of the case, stating: “[I]t is therefore ORDERED that summary judgment is granted....” There was no possibility that appellants would be misled. In fact they clearly relied upon the document as a final separate judgment by filing a timely motion for reconsideration.

Similarly, the order denying the motion for reconsideration is a final separate order. The order contains only a one-sentence recitation of the procedure, documents, and arguments considered by the court in denying the motion. There is no explanation of the reasoning of the court. The order clearly disposes of the motion for reconsideration. There was no possibility that the appellants would be misled into believing that this was not a final order from which the time for appeal would run. In fact, the appellants admit that they considered the order as the final judgment from which the time for appeal ran. Their tardiness in filing a notice of appeal was based on a misreading of Bankruptcy Rule 9006(f) and a mistaken belief that the time for appeal had been extended by three days. Both orders meet the requirements of Bankruptcy Rule 9021. The appeal was untimely and the district court lacked jurisdiction to hear the appeal. See In re Saunders (Saunders v. Band Plus Mortgage Corp.), 31 F.3d 767, 767 (9th Cir.1994).

AFFIRMED.

      . The FCA provides for the recovery of civil penalties from those who knowingly present a false or fraudulent claim to the federal government for payment, or knowingly use a false record to avoid or decrease an obligation to pay the federal government. 31 U.S.C. § 3729(a)(1). The FCA’s qui tam provisions allow a private person to sue in the name of the United States and to share in any penalty recovered. Id. § 3730(b). In addition to treble damages, the FCA requires a court to award not less than $5,000 and not more than $10,000 for each false claim or statement submitted to the government, even if no damages were caused by the false submissions. Id. § 3729(a).

        . The Davis-Bacon Act requires contractors on all federally assisted construction projects to pay their employees the “prevailing wage," as specified by the United States Department of Labor, in cash, or in contributions to bona fide employee benefit plans. 40 U.S.C. § 276a. Contractors must pay their employees in compliance with the Act and must certify their compliance on a weekly basis. Payment of federal funds to the contractors are expressly contingent upon receipt of the contractors’ weekly certifications of Davis-Bacon Act compliance. Id. §§ 276a-l, 276c; see also 29 C.F.R. §§ 5.9-5.12.

      . Section 362(a) states that the filing of a petition for bankruptcy;
      operates as a stay, applicable to all entities, of (1) the commencement of continuation, including the issuance or employment of process, of a judicial, administrative, or other action or proceeding against the debtor that was or could have been commenced before the commencement of the [bankruptcy proceeding], or to recover a claim against the debtor that arose before the commencement of the [bankruptcy proceeding].

        . It is well established through case authority that Bankruptcy Rule 9006(f) does not apply to the ten-day appeal period of Bankruptcy Rule 8002(a). E.g., In re Arbuckle (Arbuckle v. First Nat’l Bank), 988 F.2d 29, 31 (5th Cir.1993).


author: CYNTHIA HOLCOMB HALL, Circuit Judge: KLEINFELD, Circuit Judge,

text:
    Laurie Isaac BROAD, For Himself and all Others Who are Similarly Situated, Plaintiffs-Appellants, v. SEALASKA CORPORATION; Sealaska Elder Settlement Trust; Patrick Anderson; Charles Carlson; Joseph Demmert, Jr., et al., Defendants-Appellees.
    No. 94-35310.
    United States Court of Appeals, Ninth Circuit.
    Argued and Submitted Aug. 7, 1995.
    Decided May 16, 1996.

      Fred W. Triem, Petersburg, Alaska and Douglas M. Branson, Professor of Law, Seattle University, Tacoma, Washington, for plaintiff-appellant.
    E. Budd Simpson, L. Merrill Lowden, and Ronald W. Lorensen, Simpson, Tillinghast, Sorensen & Lorensen, Juneau, Alaska, for defendants-appellees.
    Bruce N. Edwards and Michael R. Sorensen, Sorensen & Edwards, Seattle, Washington, for the amicus.
    Before: HALL, WIGGINS and KLEINFELD, Circuit Judges.
   Opinion by Judge HALL; Dissent by Judge KLEINFELD.

CYNTHIA HOLCOMB HALL, Circuit Judge:

Sealaska Corporation, a Native regional corporation organized under the Alaska Native Claims Settlement Act (ANCSA), established a “settlement trust” as authorized in an amendment to ANCSA. This trust, titled the Elders’ Settlement Trust (EST), provides a one time $2000 payment to each Sealaska shareholder who reaches sixty-five years of age. The plaintiffs, who are shareholders of Sealaska under age sixty-five, filed a class action complaint in Alaska state court claiming that creation of the settlement trust violated state corporations law and the provisions of ANCSA. Sealaska removed to federal district court and the parties stipulated to deferring the request for class certification.

The plaintiffs appeal from the district court’s order granting summary judgment in favor of Sealaska on all claims. The district court had jurisdiction under 28 U.S.C. § 1441(a) and this Court has jurisdiction under 28 U.S.C. § 1291. We review a district court’s grant of summary judgment de novo. Warren v. City of Carlsbad, 58 F.3d 439, 441 (9th Cir.1995). We affirm.

I

Congress enacted ANCSA, 43 U.S.C. § 1601 et seq., in 1971 “to achieve a fair and just settlement of all aboriginal land [in Alaska] ... with maximum participation by Natives in decisions affecting their rights and property.” 43 U.S.C. § 1601 note (Supp. 1995) (Congressional Findings and Declaration of Policy for ANCSA Amendments of 1987). To accomplish this goal, ANCSA created regional corporations to hold and manage the Native land settlements. Congress amended ANCSA in 1987 to ensure the continuing success of the Native corporations. The amendments included a provision permitting a corporation to create a “settlement trust,” a vehicle into which a corporation could transfer assets that were to be used for the health, education, and- welfare of the trust beneficiaries. Assets held in these trusts enjoy protection from the corporation’s creditors.

Sealaska, which is the Native Corporation for the Southeast Panhandle of Alaska, saw the settlement trust as a means to recognize the contributions of its elder shareholders and to assist them financially. The board of directors adopted a resolution to establish the EST, a trust that would be funded with corporate assets, and that would distribute $20 per share to shareholders aged sixty-five or older.

The board sent to all shareholders a proxy statement for the 1991 shareholder meeting and a description of the proposal, both of which included information about the benefits and disadvantages of the EST. The resolution received an affirmative vote from 50.7 percent of all outstanding shares, and thereby passed. The board appointed trustees and authorized the President and CEO to prepare the trust document. As of December 10, 1991, the trust has been operating according to the terms of the resolution.

In September 1992 the plaintiffs filed a class action suit in the Alaska Superior Court claiming that the cash disbursements paid out through the trust constitute a constructive dividend. They assert that this dividend is an illegal distribution because it discriminates between Sealaska shares of- the same class.

Sealaska removed the case to federal court, and the parties filed cross-motions for summary judgment. In their answer to Sealaska’s motion, the plaintiffs raised several additional claims. First, they argued that the proxy materials Sealaska supplied to its shareholders did not comply with applicable law because the information given was misleading and omitted material facts. Second, they argued that nonvoting shareholders should have been allowed to vote on the establishment of the EST. Finally, they claimed that the EST, under authority of federal law, takes property from the shareholders without just compensation, and thus violates their rights under the Fifth Amendment of the United States Constitution.

The district court issued several orders, which, taken together, entered judgment in favor of Sealaska and against the plaintiffs on all claims. The plaintiffs appealed asserting an additional claim under the Due Process Clause of the Fifth Amendment. We affirm the district court’s judgment on all claims, and dismiss the Due Process claim because it is not properly before us.

II

The plaintiffs’ original complaint contended that the EST’s disbursement of funds to elder shareholders is illegal as a discriminatory distribution under Alaska corporations law. Sealaska countered that the settlement trust provisions of ANCSA preempt state law in this respect and, therefore, the EST is a valid settlement trust authorized by ANC-SA We affirm the district court’s holding that ANCSA displaces contrary state law with respect to settlement trusts, and that the EST is proper under ANCSA.

Under the Alaska Corporations Code a corporation must give equal treatment to all shares of the same class and must make its distributions without discrimination. Alaska Stat. § 10.06.305(b). Both parties agree that the EST discriminates against shareholders who have not yet reached age sixty-five. Therefore, if the EST distributions are treated as shareholder dividends, then the payments made through the trust would violate Alaska state law and would be illegal unless authorized by ANCSA

The district court correctly concluded that ANCSA’s provisions explicitly preempted state law with respect to corporate resolutions that establish settlement trusts. But the relevant inquiry is not whose law governs the establishment of the trust, but instead whether a state law that prohibits the octions taken by the trust is preempted by federal law. Preemption of state law regarding trust distributions is not explicitly covered by the ANCSA settlement trust provisions. Nevertheless, we find that ANCSA implicitly preempts state law in this respect.

Congress provided that conveyance of assets into settlement trusts must be carried out “in accordance with the laws of the State Oexcept to the extent that such laws are inconsistent with [sections 1629b and 1629e of ANCSA7).” 43 U.S.C. § 1629e(a)(1)(A) (Supp.1995) (emphasis added). Section 1629e requires that each trust be established “to promote the health, education, and welfare of its beneficiaries and to preserve the heritage and culture of Natives.” 43 U.S.C. § 1629e(b)(1). Furthermore, it limits the use of these trusts, specifically prohibiting trusts that “discriminate in favor of a group of individuals composed only or principally of employees, officers, or directors of the settlor Native Corporation.” 43 U.S.C. § 1629e(b)(1)(C).

According to its plain language, then, ANCSA prohibits settlement trusts that discriminate in favor of corporate insiders, but does not otherwise prohibit trusts that discriminate in favor of other groups of shareholders. This statutory section suggests that ANCSA anticipates that trusts may discriminate in favor of a particular class of shareholders. As a result, a state law that prohibits discriminatory trusts conflicts with ANCSA. When federal and state laws actually conflict, the state law is preempted. See Wisconsin Public Intervenor v. Mortier, 501 U.S. 597, 605, 111 S.Ct. 2476, 2482, 115 L.Ed.2d 532 (1991) (“Such a conflict arises when ... a state law ‘stands as an obstacle to the accomplishment and execution of the full purposes and objectives of Congress.’ ”) (quoting Hines v. Davidowitz, 312 U.S. 52, 61 S.Ct. 399, 85 L.Ed. 581 (1941)).

Additionally, the Alaska Corporations Code itself recognizes ANCSA’s supremacy when conflicts arise: “a corporation organized under [ANCSA] is governed by [ANC-SA] to the extent [ANCSA] is inconsistent with [the Alaska Corporations Code].” Alaska Stat. § 10.06.960(f). Because ANCSA allows trusts that discriminate in favor of some shareholders, and the Alaska Corporations Code proscribes such actions, federal and state law conflict. In such eases, the federal law prevails. Thus, Alaska corporations law abdicates in favor of ANCSA with respect to settlement trust distributions.

Plaintiffs further contend that even if ANCSA does govern establishment of the EST, the EST is a misuse of the settlement trust option for two reasons: (1) because Congress only envisioned the trusts as land protection devices, and (2) because Congress did not intend settlement trusts to confer special benefits on subclasses of Natives. We reject both these arguments and affirm the district court’s holding that the EST conforms with the provisions and purpose of ANCSA

First, the argument that the settlement trust was intended only as a method by which corporations could shield land from creditors is belied by ANCSA’s text and history. The EST, admittedly, does not aim specifically to protect land. But the text of ANCSA imposes no limitation on what can properly be the res of the trust. It allows Native Corporations to convey “assets (including stock or beneficial interests therein) to a Settlement Trust.” 43 U.S.C. § 1629e(a)(l)(A). The permissible purposes given in the text do not relate only to interests in land: “The purpose of a Settlement Trust shall be to promote the health, education, and welfare of its beneficiaries and preserve the heritage and culture of Natives.” 43 U.S.C. § 1629e(b)(l). Furthermore, ANCSA does specifically proscribe several purposes, but nowhere does the text of ANCSA’s settlement trust option prohibit the purposes espoused by the EST.

Second, nothing in the text of the settlement trust provisions prohibits trust distributions to less than all shareholders. In his dissent, Judge Kleinfeld argues that the EST is nothing more than an impermissible “birthday present” to elder shareholders at the expense of those not yet 65 years old. Under his interpretation of the settlement trust option, any use of a settlement trust to benefit a subset of shareholders is improper. Such an interpretation of Section 1629e would render the settlement trust option superfluous for any purpose except as a land preservation mechanism. Alaska law and ANCSA already allow regional corporations to distribute dividends to all shareholders equally. Admittedly, the Native corporations could still use settlement trusts to preserve Native land and to protect it from creditors, while making equal distributions to all shareholders through the trust instead of through traditional corporate dividends. But nothing in ANCSA supports such a limited interpretation of the settlement trust provisions.

The legislative history of the 1987 amendments to ANCSA suggests a much more expansive purpose for settlement trusts:

Settlement Trusts are expected to serve two principal functions. They are intended to be permanent, Native-oriented institutions which shall hold and manage, in perpetuity, any historic or culturally significant surface lands, sites, cemeteries, traditional use areas, or monuments, for the benefit of the beneficiary population____
The other prime function relates to the health, education and economic welfare of its beneficiaries____ At the discretion of the trustees, [trust assets or income from trust assets] can be used to provide scholarships and other educational benefits. Assets can be used to improve health care delivery or facilities, pay for needed health care and otherwise be devoted to bettering the health of the beneficiary Native community. Finally, the Trust assets may be used to bolster the economic well-being of the beneficiaries. Trust distributions may be used to fight poverty, provide food, shelter and clothing, and serve comparable economic welfare purposes. Additionally, cash distributions of trust income may be made on an across-the-board basis to the beneficiary population as part of the economic welfare function.

133 Cong. Rec. H11,933 (daily ed. Dec. 21, 1987) (House Explanatory Statement), reprinted in 1987 U.S.C.C.A.N. 3299, 3307-08 (emphasis added). This description clearly permits across-the-board distributions to all shareholders. But it permits these distributions in addition to other anticipated uses of settlement trusts — such as distributions to bolster the economic well-being of individual members of the Native community through scholarships, or provisions for food, shelter, clothing, and needed health care. It is nonsensical to assume that if the shareholders vote to create a settlement trust to provide educational scholarships, that these scholarships must be distributed to every shareholder regardless of whether the shareholder is a student. Also, if a settlement trust is used to “fight poverty,” or “provide food, shelter and clothing” then it seems reasonable that distributions will be made based on need, rather than on an across-the-board basis.

In promulgating the 1987 amendments, Congress noted that the corporate structure is not in every instance “well adapted to the reality of life in Native villages and to the continuation of traditional Native cultural values.” 43 U.S.C. § 1601 note (Congressional Findings and Declaration of Policy for ANCSA Amendments of 1987) (Supp.1995). Therefore, Congress intended the amendment to “enable the shareholders of each Native Corporation to structure the further implementation of the settlement in light of their particular circumstances and needs.” Id. To require that settlement trust distributions be treated in every way like corporate dividends would simply reinforce the corporate structure, and limit the flexibility with which shareholders could structure their settlement.

Both the text and the legislative history support the contention that Congress intended settlement trusts as flexible instruments that would serve a number of purposes besides simply shielding Native land from creditors. Section 1629e gives a broad statement of the permissible purposes for settlement trusts, i.e., to promote the health, education, and welfare of the Native population. Nothing in this section explicitly prohibits distributions to less than all shareholders, except groups composed primarily of corporate insiders. Although, as the dissent suggests, Alaska corporations law could serve to prohibit such distributions, the legislative history of the settlement trust provisions suggests that Congress intended to allow distributions to subsets of shareholders. Therefore, given the broad statement of purpose for settlement trusts, and the further elaboration of this purpose in the legislative history, the most reasonable interpretation of Section 1629e would allow Native corporations to establish settlement trusts to benefit subclasses of shareholders.

Congress placed few limitations on the use of settlement trusts, thus providing Native Corporations the greatest flexibility to structure their settlement to best fit the particular needs of their community. This might be construed to suggest that Native Corporations can use settlement trusts to contravene Alaska corporations law with impunity, and to thereby disadvantage many shareholders.

ANCSA does, however, limit the use of settlement trusts in several ways. It proscribes some trust activities, and defines the specific purposes for which these trusts may be created, i.e., for the health, education, and welfare of the Native community. Although this allows a wide range of applications, to simply quote this language in the preamble of a settlement trust resolution does not by itself confer validity on the proposed trust, as the dissent suggests. Judicial review of these trusts will prevent egregious violations of the settlement trust option, such as those “bizarre transfers” cited by the dissent. For example, these limits would easily preclude a trust that sought merely to discriminate against shareholders who were not members of the majority shareholders’ extended family.

Furthermore, ANCSA requires majority or supermajority shareholder approval before corporations may transfer assets to these trusts. 43 U.S.C. § 1629b(d). As with any major corporate decision, shareholder approval does not necessarily guarantee that the outcome is the most prudent course of action. But it does provide some measure of oversight.

Finally, ANCSA specifies that Alaska state law governs settlement trusts in many instances, insofar as the state laws do not conflict with ANCSA For example, Alaska trust law governs the creation and management of the trust, and Alaska corporations law defines the requirements for proxy solicitation materials, as is discussed in part III below.

These limitations should provide shareholders with sufficient protection with respect to settlement trusts, while also leaving enough flexibility to meet Congress’ goals.

In conclusion, the ANCSA settlement trust provisions preempt Alaska Corporations Code with respect to discriminatory settlement trusts. Sealaska’s establishment of the EST conforms with the provisions and purpose of the ANCSA settlement trust option. We therefore hold that the EST is a proper use of the settlement trust provisions of ANCSA.

Ill

Even if Sealaska properly created the EST as authorized by ANCSA, the plaintiffs argue that shareholder approval of the EST was improper under Alaska corporations law, and that disputed issues of fact render summary judgment improper. We agree with the district court’s grant of summary judgment in favor of Sealaska on this issue.

First, the plaintiffs contend that the proxy solicitation materials sent to shareholders were misleading and omitted material facts. The 1987 ANCSA amendments make clear that proxy statements and solicitations made in the course of a Native Corporation’s efforts to establish a settlement trust must comply with state law. 43 U.S.C. § 1629b (Supp.1995). Alaska law prohibits solicitations and proxy statements that contain material misrepresentations, i.e., statements that are “false or misleading with respect to a material fact [or] omit[ ] a material fact necessary in order to make a statement made in the solicitation not false or misleading.” 3 Alaska Admin. Code, tit. 3, § 08.315(a); see also TSC Indus. v. Northway, 426 U.S. 438, 449, 96 S.Ct. 2126, 2132, 48 L.Ed.2d 757 (1976) (same); Brown v. Ward, 593 P.2d 247, 249-50 (Alaska 1979) (although the letter of federal proxy rules does not apply to ANCSA corporations, the spirit does).

The plaintiffs assert a variety of claims that material facts were not disclosed or were concealed in the proxy materials. For example, they claim that Sealaska omitted a material fact by expressing the cost of the EST as a lump sum of about $6 million rather than as cost per share. The district court found, however, and we agree, that the proxy solicitation materials comported with Alaska law, and that plaintiffs failed to raise genuine issues of fact as to whether they were misleading or omitted material facts.

Second, plaintiffs assert that shareholder approval of the EST resolution is invalid because nonvoting shares were not allowed to vote on the proposal. ANCSA provides that shares held by non-Natives that were acquired through inheritance do not carry voting rights. 43 U.S.C. § 1606(h)(2)(C) (Supp.1995). Then, it specifically conditions approval of a settlement trust upon majority vote of “the total voting power of the corporation,” defined as “all outstanding shares of stock that carry voting rights:’ 43 U.S.C. §§ 1629b(d)(l)(A) and 1629b(e) (emphasis added). Thus, ANCSA itself provides that nonvoting shares have no right to vote on corporate resolutions establishing settlement trusts.

The plaintiffs seek to avoid this conclusion by arguing that under state law, nonvoting shares do get to vote on certain fundamental corporate changes. This argument fails, however, because, as discussed previously, section 1629b expressly states that corporate resolutions to establish a settlement trust shall be governed by the provisions of ANC-SA “[n]otwithstanding any provision ... of the laws of the State.” 43 U.S.C. § 1629b(a). Thus, the nonvoting shares were properly denied the right to vote on the EST resolution.

Given the foregoing, we reject plaintiffs’ claim that shareholder approval of the EST resolution was invalid and affirm the district court’s grant of summary judgment on this claim.

IV

The plaintiffs’ final argument is that section 1629e of ANCSA is 'unconstitutional as applied to them for two reasons: first, allowing creation of the EST impairs the shareholders’ “contract” rights under the articles of incorporation, and thus, section 1629e violates the Due Process Clause of the Fifth Amendment; second, because it authorizes Sealaska to transfer $6 million of its corporate equity to the EST, section 1629e permits a “taking” of the disadvantaged shareholders’ property in violation of the Fifth Amendment.

Plaintiffs assert their due process claim for the first time on appeal. Generally, an appellate court will not hear an issue raised for the first time on appeal. Golden Gate Hotel Ass’n v. City and County of San Francisco, 18 F.3d 1482, 1487 (9th Cir.1994) (citing Singleton v. Wulff, 428 U.S. 106, 120, 96 S.Ct. 2868, 2877, 49 L.Ed.2d 826 (1976)). To have been properly raised below, “the argument must be raised sufficiently for the trial court to rule on it.” In re E.R. Fegert, Inc., 887 F.2d 955, 957 (9th Cir.1989). Because this issue was not raised below, we decline to reach the merits.

As to the takings claim, we agree with the district court that, as a matter of law, the claim fails. However, we do not agree with the district court’s reasoning on this issue.

The district court began its analysis “with the assumption that the use of corporate assets to create the EST amounted to a taking of the non-voting shareholders [sic] equity in the corporation for which no compensation was provided.” We question the validity of this assumption. The property interest plaintiffs seek to protect is the value of their Sealaska stock. But takings cases almost universally involve governmental action that affects ownership rights in real property, and plaintiffs cite no case authority for their claim that the Takings Clause protects their interest in Sealaska’s corporate equity.

Furthermore, corporate shareholders do not directly own any part of a corporation’s property or assets. They only own shares of stock, which represent a proportionate interest in the corporate equity remaining after a corporation meets all its other debts and obligations. The profits themselves belong to the corporation, and do not pass to the shareholders unless and until the board of directors declares a dividend. Thus, the plaintiff shareholders have no proprietary interest that could have been “taken.”

Nevertheless, even if we accept the premise that plaintiffs’ interest in Sealaska’s corporate equity may be the subject of a takings claim, the claim still fails for lack of sufficient government action. Takings jurisprudence encompasses two lines of authority: physical occupation cases, and regulatory takings cases. Compare Loretto v. Teleprompter Manhattan CATV Corp., 458 U.S. 419, 102 S.Ct. 3164, 73 L.Ed.2d 868 (1982) (holding that New York law requiring landlords to allow cable television companies to install cables in their buildings constituted a physical intrusion sufficient to be a taking) with Lucas v. South Carolina Coastal Council, 505 U.S. 1003, 1019, 112 S.Ct. 2886, 2895, 120 L.Ed.2d 798 (1992) (indicating that when a government land use regulation forces the owner of real property “to sacrifice all economically beneficial uses [of his property,] he has suffered a taking”). Plaintiffs allege no physical invasion of property, so their claim must fall into the regulatory taking category.

Regulatory takings generally require some government regulation or other government action that compels the owner to sacrifice all economically viable use of his or her property. E.g., Lucas, 505 U.S. 1003, 112 S.Ct. 2886 (the state’s coastal preservation statute prevented the landowner from building any structure on his property). In this case, Sealaska was not in any way compelled by the federal government to create the EST. The settlement trust option is just that — an option. That Sealaska’s action was authorized by federal law does not transmute it into government action sufficient for the Fifth Amendment. Without governmental encouragement or coercion, actions taken by private corporations pursuant to federal law do not transmute into government action under the Fifth Amendment. See, e.g., Fidelity Financial Corp. v. Federal Home Loan Bank, 792 F.2d 1432, 1435 (9th Cir.1986), cert. denied, 479 U.S. 1064, 107 S.Ct. 949, 93 L.Ed.2d 998 (1987) (finding no government action in a bank’s loan decision even though the bank was created by a federal agency to accomplish federal objectives, was subject to extensive federal regulation, and some of the bank’s directors and managers were appointed by a federal bank board). But see Ginn v. Mathews, 533 F.2d 477, 480 (9th Cir.1976) (finding governmental action in an employment decision made by the Economic Opportunity Council of San Francisco, but emphasizing that the Council was operating with almost exclusively federal funds); Burton v. Wilmington Parking Authority, 365 U.S. 715, 81 S.Ct. 856, 6 L.Ed.2d 45 (1961) (finding government action largely on the basis that the defendant, a private lessee, received significant financial support from the parking authority). Even in cases in which the court found government action, it often reiterated the general principle that “[w]here the action taken is entirely by a private corporation with no overriding or pervasive [government] involvement, the provisions of the First, Fifth, and Fourteenth Amendments impose no limitations upon that action.” Ginn, 533 F.2d at 479.

In this case, Sealaska is a private corporation that established the EST using private funds. The operation of the trust is not subject to governmental oversight. Furthermore, Sealaska was neither encouraged nor coerced into creating the EST by the federal government. It merely exercised its option under ANCSA to transfer its assets to a settlement trust. We therefore affirm the grant of summary judgment in favor of Sealaska on the plaintiffs’ takings claim.

V

Through instruments like the settlement trust, Congress sought to expand the ability of Native Corporation shareholders to “structure the further implementation of the settlement in light of their particular circumstances and needs.” 43 U.S.C. § 1601 note (Supp.1995) (Congressional Findings and Declaration of Policy for ANCSA Amendments of 1987). Sealaska did just that, establishing its Elders’ Settlement Trust to address concerns related to the welfare of its elder shareholders. We conclude that Sealaska’s Elders’ Settlement Trust is a legitimate use of the settlement trust option as authorized by ANCSA and that such use comports with the plain language and the purpose of the ANCSA amendments. The district court’s order granting summary judgment in favor of Sealaska on all claims is AFFIRMED.

KLEINFELD, Circuit Judge,

dissenting:

I respectfully dissent.

Sealaska, organized as a business corporation, decided to give each shareholder a $2,000 birthday present at age 65. That discriminates by age, because at the time of the decision, not all the shareholders were 65. Several directors would immediately or soon receive this substantial gift. Many shareholders would not receive the gift for decades. The present value of the gift, assuming a 5% interest rate, is $2,000 to a 65 year old director, $284 to a 25 year old shareholder.

This discriminatory cash gift to shareholders, as the majority acknowledges, would violate Aaska corporation law, if federal law does not provide otherwise. Under the Aaska Corporations Code, all Aaska corporations must treat all shares in the same class equally with respect to dividends and other rights. Aaska Stat. §§ 10.06.542, 10.06.305(b).

The preemption analysis used in the majority opinion is mistaken, because any preemption is illusory. There cannot be federal preemption of state law in this case, because there cannot be any conflict between the two laws. The state law says that a native corporation can do anything ANCSA permits. AS 10.06.960(f). That means there can be nothing which ANCSA permits but state law prohibits, so there can be no conflicting state law to preempt. ANCSA says that a conveyance to a settlement trust should be in accord with Aaska law except to the extent that state law is inconsistent with ANCSA 43 U.S.C. § 1629e(a)(l)(A). That means that there can be no preemption of the field. If federal law permits the particular discriminatory cash transfer through the settlement trust, state law does too, and if not, not.

The majority opinion says that “Recording to its plain language, then, ANCSA prohibits settlement trusts that discriminate in favor of corporate insiders, but does not prohibit trusts that discriminate in favor of other groups of shareholders.” Maj. op. at 426. The “plain language” consists only of the prohibition. The non-prohibition described in that sentence is an inference from silence, not an expression by Congress in plain language. The provision which provides the basis for the majority’s conclusion states only what is prohibited, not what is permitted:

The purpose of a Settlement Trust shall be to promote the health, education, and welfare of its beneficiaries and preserve the heritage and culture of Natives. A Settlement Trust shall not—
(A) operate as a business;
(B) alienate land or any interest in land received from the settlor Native Corporation (except if the recipient of the land is the settlor corporation); or
(C) discriminate in favor of a group of individuals composed only or principally of employees, officers, or directors of the settlor Native Corporation.
An alienation of land or an interest in land in violation of this paragraph shall be void ab initio and shall not be given effect by any court.

43 U.S.C. § 1629e(b)(1) (emphasis added). The majority reasons that because the statute prohibits trusts that discriminate in favor of employees, officers, and directors, “but does not otherwise prohibit trusts that discriminate in favor of other groups of shareholders[,][t]his statutory section suggests that ANCSA anticipates that trusts may discriminate in favor of a particular class of shareholders.” Maj. op. at 426.

This method of reasoning, inferring from the explicit prohibition of one form of discrimination the implicit authorization of all other forms, is a traditional application of the maxim, expressio unius est exclusio alterius. Quoting the maxim is less fashionable than it used to be before Karl Llewellyn’s famous attack. See Karl N. Llewellyn, Remarks on the Theory of Appellate Decision and the Rules or Canons About How Statutes Are to Be Construed, 3 Vand.L.Rev. 395, 401-406 (1950), as reproduced in, Karl N. Llewellyn, The Common Law Tradition: Deciding Ap peals App. C, 521-35 (1960). But the logic of the maxim, that listing several specific things implies an intention to exclude others, is the only way to get from a statutory prohibition of some conduct to implied permission for other conduct. This is how the majority gets from the “shall not” in the statute to the majority’s statement that “ANCSA anticipates that trusts may discriminate in favor of a particular class of shareholders.”

The expressio unius analysis is often correct, but not always. It does not make sense here. Anytime a statute contains a list, the question arises whether the list exhausts all the things the legislature intended to permit or prohibit. The inference that a list excludes things not on the list does not reheve us of our duty to make sense of the statute:

Most strongly put, the expressio unius, or inclusio unius principle is that ‘[w]hen a statute limits a things to be done in a particular mode, it includes a negative of any other mode.’ Raleigh & Gaston Ry. Co. v. Reid, 80 U.S. (13 Wall.) 269, 270, 20 L.Ed 570 (1871). This is a rule of interpretation, not a rule of law. The maxim is ‘a product of logic and common sense,’ properly applied only when it makes sense as a matter of legislative purpose. Alcaraz v. Block, 746 F.2d 593, 607-08 (9th Cir.1984). Like the principle of construing a modifying clause to modify only the closer antecedent, the expressio unius principle describes what we usually mean by a particular manner of expression, but does not prescribe how we must interpret a phrase once written. Understood as a descriptive generalization about language rather than a prescriptive rule of construction, the maxim usefully describes a common syntactical implication. ‘My children are Jonathan, Rebecca and Seth’ means ‘none of my children are Samuel.’ Sometimes there is no negative pregnant: ‘get milk, bread, peanut butter and eggs at the grocery’ probably does not mean ‘do not get ice cream.’

Longview Fibre Co. v. Rasmussen, 980 F.2d 1307, 1312-13 (9th Cir.1992).

It does not make sense to suppose that Congress meant, by the list in § 1629e(b)(l), to permit any kind of discriminación], except “discrimination] in favor of ... employees, officers, or directors.” Consider, by analogy, that Congress in the Americans With Disabilities Act said “[n]o covered entity shall discriminate against a qualified individual with a disability.” 42 U.S.C. § 12112. The ADA does not by that prohibition imply that discrimination by reason of age, sex, and race are permissible. The provision prohibits one kind of discrimination, and leaves it to other federal and state laws to prohibit others. That is the sensible way to read the prohibition in the statute before us.

This makes sense as a Congressional purpose. Congress might have felt that there were special risks to Native corporations that they would be taken advantage of by employees, officers and directors through the Settlement Trust mechanism, unique to Native Corporations, so more protection of shareholders from this device was needed than for ordinary business corporations, but felt that for other risks, state law protections were adequate. One of the virtues of the Alaska Native Claims Settlement Act was the creation of a large number of Alaska Native leaders experienced in business as well as politics, and employment opportunities in towns and villages where there had previously been little work for money wages. But this virtue could become a vice if the corporations were operated for the benefit of their employees, who might not be natives or shareholders, instead of for all the Natives who owned stock and would inherit stock.

Virtually any transfer of corporate assets could be provided for in a resolution which, in its preamble, said that the transfer was to “promote the ... welfare of its beneficiaries,” and, so long as the recipients were Alaska Natives, to “preserve the heritage and culture of Natives.” Unless someone thinks of a distinction in some future case, the majority holding implies that Congress meant to permit some bizarre transfers of Native corporation assets. For example, a Native corporation might decide that a particular candidate for office was likely to promote the health, education, and welfare of Alaska Natives better than competing candidates, and that Native culture would best be preserved by using a trust to pay $2,000 to each Native who signed an affidavit that he or she had voted for the named candidate. Quite a few Alaska native villages have fewer than 100 people, and many have under 300. See The Alaska Almanac: Facts About Alaska 17th Edition 130-31, 147-53 (Carolyn Smith ed.) (1993). Village Corporations may create settlement trusts under ANCSA. 43 U.S.C. §§ 1602 (defines “Native Corporation” to include “Village Corporation”) & 1629e (permits any Native Corporation to create a settlement trust). Under the majority construction of the statute, a village corporation, a majority of whose shareholders were linked by blood or property to a large extended family, might decide that Native culture was best preserved by tunneling the assets through a settlement trust out to their family and not the other families in the village.

The majority says that “[jjudicial review of these trusts will prevent egregious violations of the settlement trust option, such as [these] ‘bizarre transfers.’” But it does not say how. The majority opinion establishes that the federal law preempts state law, and “does not otherwise prohibit trusts that discriminate in favor of other groups of shareholders,” and “trusts may discriminate in favor of a particular class of shareholders.” Maj. op. at 426. I hope that subsequent panels distinguish the case at bar if “bizarre transfers” through settlement trusts are made, but I do not see a basis, in the majority’s ratio decidendi, for making a distinction.

In any corporation, Native or not, people with more power than others may try to translate their power into money. It is unlikely that Congress meant to deprive Native corporation shareholders of all the protections state corporation law generally gives to shareholders against discriminatory distributions of corporate assets. Yet the hypothetical forms of discrimination described above would not be “in favor of a group of individuals composed only or principally of employees, officers, or directors,” so under the majority holding, any state law prohibiting such discrimination would be preempted. None of this seems likely to have been the intent of Congress, because it does not make any practical sense.

If we are to apply the expressio wtius principle to anything, it should be to the statutory provision speaking directly to how to enhance benefits to elders. There is a special provision for issuance of up to 100 additional shares of regional corporation stock to natives who have attained the age of 65:

A Regional Corporation may amend its articles of incorporation to authorize the issuance of additional shares of Settlement Common Stock to—
(III) Natives who have attained the age of 65, for no consideration or for such consideration and upon such terms and conditions as may be specified in such amendment or in a resolution approved by the board of directors pursuant to authority expressly vested in the board by the amendment. The amendment to the articles of incorporation may specify which class of Settlement Common Stock shall be issued to the various groups of Natives.

43 U.S.C. § 1606(g)(l)(B)(i).

The expressio unius inference, as applied to this section, implies that Congress intended that discrimination in favor of elders would take place only through regional corporations, not village corporations, and exclusively through amendments to the articles of incorporation issuing more stock to elders (which may, in turn, yield more dividends). See 43 U.S.C. § 1606(g)(l)(B)(iv) (common stock issued to elders as the result of a special amendments shall not have rights to certain distributions unless a majority of shareholders specially grant such rights). Accordingly, we could assume that Congress intended to leave in place state prohibitions against other forms of discrimination in favor of elders.

One use of settlement trusts is to preserve native corporation assets from creditors, see 43 U.S.C. § 1629e(c)(5), and from the consequences of accidental corporate dissolution. The statute states the purpose of settlement trusts, “to promote the health, education, and welfare of its beneficiaries and preserve the heritage and culture of Natives.” 43 U.S.C. § 1629e(b)(l). Most corporations cannot operate for such purposes, so excluding discriminatory dividends from the purposes does not strip the statute of practical effect. We need not decide whether the statements in the legislative history, such as that settlement trusts can be used to award scholarships to individuals, are correct. Perhaps such scholarship programs are permissible, so long as the criteria for the scholarship awards are nondiscriminatory. Or perhaps this snippet of legislative history was a consolation prize to someone who did not get what he or she wanted in the statute. We should not assume the answer to one difficult question not before us in order to resolve another.

The majority relies too heavily, in my view, on the “House Explanatory Statement.” Maj. op. at 428. We should construe the statute, not the legislative history. See Kenneth W. Starr, Observations About the Use of Legislative History, 1987 Duke L.J. 371 (1987). Reliance on legislative history is often the “equivalent of entering a crowded cocktail party and looking over the heads of the guests for one’s friends.” Conroy v. Aniskoff, 507 U.S. 511, 519, 113 S.Ct. 1562, 1567, 123 L.Ed.2d 229 (1993) (Sealia, J. concurring). The majority infers from the statement in the House Explanatory Statement that if scholarships are permissible, then so are birthday presents. A stronger inference would be that if “distributions of trust income may be made on an aeross-the board basis,” House Explanatory Statement, 133 Cong. Rec. H11,933, (daily ed. Dec. 21, 1987), reprinted in, 1987 U.S.C.C.A.N. 3299, 3308, then they cannot be made on a discriminatory basis.

In sum, the statute says some types of discrimination are prohibited, and also says that Native corporations can provide for issuance of additional shares of stock to elders. The majority reads a negative pregnant into the discrimination section but not the elders section. I do not see why the first inference is any stronger than the second, and see good reason for the contrary view. The majority infers from the statement about scholarships in the legislative history that discriminatory distributions are permitted, but draws no inference that they are prohibited from the “across-the-board” language about distributions in the same paragraph. We must necessarily exercise judgment on difficult questions to decide the extent to which the statute exposes Native shareholders to discriminatory distributions of corporate assets. I believe Congress left in place more of the state law protection generally applicable to corporate shareholders than the majority does.

      . The purpose of the EST is set forth in a document sent to shareholders entitled “A Shareholder Resolution: An Elders’ Settlement Trust:"
      The purpose of the resolution is to provide a benefit to Sealaska elders in recognition of their contribution to Native culture and for the sacrifices they made to fight for and hold on to our lands. The actions of many of these people lead to the passage of the Alaska Native Claims Settlement Act (ANCSA).
      An additional purpose is to provide health, education and welfare through a one-time cash distribution.

      . For instance, a settlement trust may not operate as a business. 43 U.S.C. § 1629e(b)(l)(A).

      . Furthermore, the Congressional findings that accompany the 1987 ANCSA amendments state that "by granting the shareholders of each Native Corporation options to structure the further implementation of the settlement. Congress is not expressing an opinion on the manner in which such shareholders choose to balance individual rights and communal rights.” 43 U.S.C. § 1601 note (Supp.1995) (Congressional Findings and Declaration of Policy for ANCSA Amendments of 1987).

      . Plaintiffs claim that by transferring corporate assets to the EST—$6 million worth—Sealaska decreased its corporate equity, thus decreasing the value of its stock.

      . The district court ultimately concluded that the takings claim failed because the distribution of funds to elder shareholders was for a private use, and not a public use within the purview of the Fifth Amendment. The district court failed to see that takings for a private use, as opposed to a public use, are presumptively unconstitutional. See, e.g., Hawaii Housing Auth. v. Midkiff, 467 U.S. 229, 241, 104 S.Ct. 2321, 2329, 81 L.Ed.2d 186 (1984) ("|T]he Court’s cases have repeatedly stated that 'one person's property may not be taken for the benefit of another private person without a public purpose, even though compensation be paid.' ”) (quoting Thompson v. Consolidated Gas Utilities Corp., 300 U.S. 55, 80, 57 S.Ct. 364, 376, 81 L.Ed. 510 (1937)). Therefore, the district court erred when it held that because this alleged taking was for a private use it did not violate the plaintiffs’ Fifth Amendment rights.