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Salameh v. Tarsadia Hotel

United States Court of Appeals for the Ninth Circuit
726 F.3d 1124 (2013)


Tamer Salameh (plaintiff) purchased condominiums in the Hard Rock Hotel San Diego from 5th Rock, LLC (defendant). Salameh did not intend to occupy the condos but rented them out to third parties. Approximately one year after the purchase, Salameh entered into a rental management agreement with Tarsadia Hotels (defendant). Pursuant to this agreement, Tarsadia was exclusively responsible for marketing, management, and operation of the units. Salameh brought suit, alleging that the sale of the condominiums together with the rental management agreement violated securities laws because it constituted an investment contract and a sale of securities. Salameh alleged that he had no control over his condominium unit, and that any profit gleaned from the unit was obtained through the efforts of Tarsadia. The defendants filed a motion to dismiss, which the district court granted. Salameh appealed.

Rule of Law


Holding and Reasoning (Gould, J.)

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