No. 22-2107 ___________________________

Larry Muff, Executor of the estate of Joseph A. Muff

Plaintiff - Appellant

v.

Wells Fargo Bank NA

Defendant - Appellee ____________

Appeal from United States District Court for the Northern District of Iowa - Western ____________

Submitted: March 14, 2023 Filed: June 28, 2023 ____________ Before SHEPHERD, ERICKSON, and GRASZ, Circuit Judges. ____________ SHEPHERD, Circuit Judge.

The estate of Joseph A. Muff brings three conversion claims against Wells Fargo Bank for allegedly failing to detect that Joseph’s stepson, Josh Paige, was stealing money from Joseph by way of fraudulently endorsed checks. After denying the estate’s motion to amend its complaint, the district court granted summary judgment in favor of Wells Fargo on all three claims. The estate appeals. Having jurisdiction under 28 U.S.C. § 1291, we affirm in part, vacate in part, and remand to the district court.

I.

In January 2015, Joseph’s wife, Joyce Paige Muff, passed away. Joyce’s son from a previous marriage, Josh, had been living with Joyce and Joseph. Josh had assumed responsibility for taking care of Joyce and Joseph, and they relied on Josh for handling personal matters. After Joyce’s death, Josh continued to live with Joseph. Joseph continued to rely heavily on Josh to manage his personal affairs. However, Josh soon began to isolate Joseph from the rest of his family, and Joseph’s physical and mental health declined.

Roughly a year after his mother’s death, Josh initiated a scheme to defraud Joseph of his life’s savings. The scheme involved multiple bank accounts. They included (1) a Wells Fargo deposit account originally held jointly by Joseph and Joyce (Joseph/Joyce account); (2) a Wells Fargo deposit account originally held jointly by Josh and Joyce (Josh/Joyce account); (3) a deposit account held by Joseph for Muff Corporation at a different bank not involved in this lawsuit (Muff Corporate account); and (4) a deposit account held by Joseph for farming purposes at a different bank not involved in this lawsuit (Muff Farm account). 1 Joseph also had an Individual Retirement Account (IRA) with Hartford Core Equity Fund.

The estate alleges that Josh fraudulently used the Joseph/Joyce account as a conduit to pilfer funds from his aging stepfather. In January 2016, Josh began instructing Hartford Core to forward checks to Joseph’s home by impersonating Joseph over the phone and using Joseph’s personal information. Josh then would intercept the checks, forge Joseph’s signature, deposit them into the Joseph/Joyce

1 The complaint alleges that the Muff Corporate and Muff Farm accounts were at Wells Fargo. However, the record establishes that these accounts were, in fact, at other banks. The estate admitted this before the district court. And the estate seems to concede as much in its brief. See Appellant Br. 22. -2- account at Wells Fargo, and transfer the funds electronically into the Josh/Joyce account using his deceased mother’s online credentials. The last Hartford Core check was dated August 30, 2017 and deposited into the Joseph/Joyce account on September 8, 2017. Josh ultimately stole over $280,000 from Joseph’s Hartford Core IRA in this manner. Josh also fraudulently endorsed checks from the Muff Corporate and Muff Farm accounts at other banks, deposited them into the Joseph/Joyce account, and then, again, transferred the funds electronically into the Josh/Joyce account. Al