good morning your honor is my name is derek brandt i represent the plaintiff appellants kodak ag fujifilm and mag also referred to in the papers as the i p s aluminum three guides this appeal to dictates that as to the plaintiffs before the court today the should reach the opposite result and there's three specific reasons for that first unlike the aluminum three plaintiffs the plaintiffs here today claim that the restrained market is the physical aluminum market and that we suffered classic antitrust injury in that market market that is directly restrained i take it you are arguing that it is the physical aluminums nails market that is restrained and they are saying it is directly restrained that is our claim your honor that that the physical limit of market is at least one of the directly restrained markets in the case now as judge jacobs hypothesizes at the end of aluminum three it's but it's possible that there is more than one market that somebody could describe as directly restrained but certainly the physical in a market is a directly risk it does not mean that passage does not mean that you have to be a participant in the market in which the anti competitive conduct itself occurred i don't think that's what it means your honor although in this case we also have anti competitive conduct in the physical aluminum market the let me expound just for a second the in the paragraph of aluminum three that says the upshot is the first part of the first sentence says something like you must be in in the directly restrained market but the last sentence of the of that same paragraph says  regardless any trust injury is suffered by participants in the restraint market or markets right and i think that's an important point if at all this conduct took place if at all in the elementary warehouse storage market and that is where the direct immediate impact would have been felt was not clarified well i don't think that all of the conduct took place in the warehouse storage market for reasons that i'm happy to go through but even if it did all take place in a warehouse storage market consistent with aluminum three and with mccready and with crimpers and the other cases like that there can also be a classic anti trust injury suffered by the object of the conspiracy of the the midwest premium midwest premium which derives from the l m e warehouse market directly affects the market that you are talking about because pricing the pricing in your market the pricing in the market in which you participate includes the midwest premium that right that's exactly right your honor the midwest premium actually only exists in the physical aluminum market i understand the theory of your complaint warehouse market is not one in which participants are withdrawing aluminum to put it into commerce in part because that's a woman in which is represent which is simply held there while the while the trading entities trade and do what they want and with a two year with a two year delay in withdrawal nobody would have any interest in withdrawing that aluminum from the l m e where houses and these  all significant import if i understand it of the collusive conduct that you are alleging is to increase the prices in the market for the sale of aluminum through for example supply contracts right that is what we say is the object of the conspiracy it was to increase the price in the physical market the key fact being that the defendants are pro did just sellers of aluminum in the physical market so it was in their interest to do that let me just make one quibble with what your honor said and that's that aluminum that is stored in a now let me warehouse is also part of the supply to the physical them in a market it's one of the sources of that reliable it radical last resort it  marginal supply and when that when that supply is restrained as it was by the defendants that created the the increase in price your but your your theory is that the reason that the defendants your theory if i understand it that the reason that the defendants collusive li bottled up the the the mechanisms of the elem you warehouse was soley or as least primarily to make the price jump in the market in which you participate the market for the sale of aluminum because the midwest premium is is a part of that prize exactly correct your honor that it was to increase the price in the physical limi market where we are purchasers in the defendants are and this this in your league ations is the intended fact of the what we call bill of the shenanigans in the warehouse market  that was the intended outcome was to affect the physical aluminum market that's your allegation it was the object of the conspiracy and it was this is not what judge jacobs was referring to as collateral damage collateral damage is not what you know if you drop a bomb and unfortunately some civilians are killed they are not appropriately referred to as collateral damage if your purpose was to blow them up that's exactly right your honor we  can't be both the intended target or a fact and collateral damage at the same time judge judge jacobs hypothesized at the end of the aluminum three decision exactly the scenario here at page one sixty three where he says if the defendants could not by themselves increase the price for physical aluminum one alternative might be to manipulate the warehouse market very peculiar paragraph because it winds up by saying there are the less everybody still collateral damage so i guess what i'm trying to get at owned i think i understand your theory i think i understand why it is different than the theories of the plaintiffs who are at issue in three and so is your argument basically that we need to take the language that the defendants site from three as effectively limited to the kind of point it's who were there and the kind of allegations that were made in that case well i think this case is different because of the fact that the defendants are sellers of aluminum in our case as clearly alleged and shown and because the plaintiffs in a limit of three only mccready theory of antitrust injury which is different from what we argue it's a little bit but i have this is a sort of collateral question by accident to comb to read the first time i was working on this case the some point in this case it seems to me we're going to have to address the question of what justifies those redactions because it seems to me if we wind up deciding this case against you the public might have a very misled and the purpose of  public access to court documents is so that the public i realize this does not mean the man in the street this probably means business press and experts and antitrust law that the public should have the opportunity to evaluate whether our decisions make any sense and they'd have a rather different view of it it seems to me if they could see the entirety of your brief this has nothing much to do with whether you win or lose i take it because we have seen those  materials and will take them into account but i am going to at some point somebody is going to have to to explain us why those materials should remain redacted or why there is why this is the equivalent of how to make a nuclear bomb or the secret formula for coca cola to find out that much to my surprise a company like goldman sachs is kneedeep in selling physical aluminum  but anyway that's that's a side point and we just question the good it sounds like you're not challenging a woman three probably because you can't because we're bound by it but maybe you could tell me how your clients are different from the commercial and users and the consumer and users that we're in three but i think the key difference or or maybe several key differences are that the consumer and the commercial end users didn't have the claim that the defendants were prodigious sellers of aluminum didn't target didn't have the argument that this conspiracy was targeted at the physical limit of market and also as judge jacob noted they were they were in some way remote whereas my clients pay the actual benchmark midwest premium that is manipulated by defendants we say and pay that in the first instance  we pay it as a matter of our contracts as an inescapable matter of our contracts the midwest premium is built is built into the supply contracts that your clients are that's correct your honor the contract will say the pricing for x volume of aluminum is determined by the you know to two elements one the alamy cash price into the midwest premium as of a date same month minus two from delivery something like that what i just reflected that my clients contacts contracts say i think they said that increases to the midwest premium were passed down to them i can't go further than that well i mean it gets complicated because you've got these two separate issues of antitrust injury and most efficient enforcer and the fact that there are sort of these people have a brick problem goes to the second issue and not the first and that issue is not before the court understand but it would seem to me  reading the complaint of those indirect purchasers that they were alleging that the defendants were trying to affect the market and that that's because they were sellers of aluminum my reading of what they were saying based on the aluminum three decision which is what i have to go by is that they were saying these guys did some bad stuff in an n l i mean warehouse and it had an impact on us is it fair to say that your point had it yeah i mean that's an interesting question and one i wanted to raise with you and with the defendants in this intent matter here in other words it's one thing to say people conspired to restrain this market and maybe they did that in a hypothetical case or even in this case in order to just raise the rents in the warehouse market and alas that had ripple effects all through the economy for all kinds of reasons for seeable unforeseeable whatever it's a different thing to allege that the reason they were screwing around with the warehouse activities was precisely to have an impact in the  and that is what we claim your honor would be the where the people who paid more rent to the warehouse would be kind of mccready point exactly then you would be the direct plaintiffs in that kind of scenario if that's be intimately familiar with his library because what you're saying is this was a conspiracy to fix one of the price of one of the components of the prices and then he just case it seems to me that this line kind of kind of theory of fixing a component of a price and i write that this makes sense mostly with respect to existing supply contracts that reference a fixed price that's fixed by reference to among other things the midwest premium but your honor i can't say price in which the midwest dream is b in i don't know that i can say specifically with respect to existing contracts but certainly in this industry of people that are buying primary aluminum physical aluminum at the top of the chain this is the way the industry works and i think the defendant knew that and knew that they could then sell aluminum at that for a formular standing how that could possibly apply in a spot market in other words if as is alleged in the time period covered by this activity aluminum is a glut on the market now i understand that if you restrained some chunk of aluminum somewhere there is a difference between a market in which there's twice as much aluminum available as people want to buy in a market in which there's ten times as much  people want to buy and something like that but i'm having a little trouble understanding why if i go to a smelter who's got who is making aluminum in part because it's just too expensive to turn off the smelters and turn them back on next year when there's a shortage again and that person wants to get rid of this aluminum why that smelter is and the person buying sort of looks up in a book what the price should other than ones in which you've already got a contract that says you're going to supply me with all my aluminum needs for next year and because we have to fix a fair price for that the price will be whatever the prices in the  to ask to pay the price that's then blatz book rather than go by the fact that there was a spy in demand that might make it easier to negotiate a better price well we're pretty far into the evidence on this and i'm not sure i have anything in the record on this point your honor but i think it's not so much that the purchaser goes to that producer and says i would like to buy it at such and such formula but the producer says if you want to buy from me you will buy it at this formula so that's why on earth would he say that if he knows that there's another competitor because we're not talking about goldman sachs here we're talking about people who have imagine these melters look like giant factories where they're boiling down the b sometimes called the spot market which i think different people have different definitions of what that means is that pricing is still done in that same fashion so i have a further problem as well i don't understand is  if the defendants by doing what you allege have caused the price of aluminum to be inflated unreasonably to be inflated artificially i  mean how do they make money out of that because a they sell aluminum but if they need to buy the aluminum in order to sell it to you they need to pay that inflated price as well so did how did the defendants what explains the profit motive of the defendant to inflate the price for a number and if that's going to affect them in acquiring aluminum as as well as affecting you and buying it from them and  others but i think there's a couple of answers likely to your honor's question and one is that a very minimum it's the long game for them what they buy today if they can inflate the price of it by tomorrow or next week they can sell it for more tomorrow or next  week the other answer though is that they can acquire aluminum by buying warrants for aluminum that's in a warehouse or not in a warehouse i guess which would be non warranted metal but they can acquire and then hoard that aluminum the way that we've alleged in the complaint th t they would acquire it in n l a l m e warehouse accumulated there for some time and then and then at some time in the future withdraw it and and sell it at this inflated price that's correct your palmer here on behalf of appellants reynolds consumer products and software company defendant sold aluminum to my clients and charged them the illegally inflated midwest premium and as purchasers of a that that case was decided on the basis that the defendants were not in the primary aluminum market and i think that's pretty clear from a reading of it so i mean how are they different from the plaintiffs here we are you saying th in commercials completely disavow of partition pays participation in any markets that the defendants participated in participation in any of the markets in which the defendants operate rocked our situation of course is much different the issue of injury if you're not a consumer competitor in the defendant's market or if you're not the focus of the conspiracy under mccready type theory and again we're purchasing directly from these defendants in the primary market so i think for the defenders disabled that aluminum three is dispositive here is just simply a bridge too far you know i think that's sort of where the district court got hung up in a analysis and when looking at the claims that we've brought  applies to these three groups as well ultimately right correct correct although if you look at the district court's order dismissing referred to as the f l p's which are coffins clients she in fact said it would be possible to develop a traditional and i trust injury theory here but then i went ahead and disregarded the complaint in the amended complaint that we had filed which asserted traditionally an interest injury as a customer of these of these defendants and i think in that analysis in the court sort of just focused on what was happening in the warehouse market it kind of lost the big picture of what the purpose in effect of the conspiracy was and i'm sympathetic to the district court here judge and stand their position is franklin's position here if one set of plaintiffs who is filed a complaint has that complaint dismissed i certainly understand the logic that then they get to appeal because that's a final decision in their case even though it's part of an m d you know the problem is that in these complex m d o litigations that may mean that the first thing that comes to an appellate court is kind of the weakest complaint framed in the weirdest way and then if appellate decision in reference to that focused on that case may use language that can then be applied more broadly it creates problems down the road and do it first explicitly said that and i think you'd have to agree wouldn't you that there certainly is language in aluminum three that is not helpful to you i think that there may be aluminum three language in there that's more that goes beyond the facts with it has to be understood in light of the particular facts of the case or something like that but yeah but i also think though that a loon through is helpful in understanding the analysis that the district court should have engaged in and part of that is i think judge jacobs's observation that a single and i trust conspiracy can restrain multiple markets and it can impact numerous distinct types of injuries and you know as mr branton pointed out he really posed the hypothetical which is the basis of what we've alleged are many complaint which is you know that they couldn't directly restrain the physical market through you know control of it you know  option would be to corrupt the warehouse market and you know i think that language harkens back to what this court said in gallup point which is you need to look at the purpose and effect of the conspiracy so here horizontal price you know the machinery doesn't matter and so if the defendants do this through corrupting the warehouses or if they do that by colluding to insert illegal prices into our contracts with them the conclusion and i trust clients and then the district court just sue us ponty dismissed us so our original claim we believe asserted facts that supported the traditional and i trust theory but in light of the judge's order saying attritional and i trust erie theory is possible to develop here we filed an amended complaint which we believe we had an absolute right to do because the defendants in never responded to our complaint and that's our position that you know that's what the court should have proceeded on in that the court had been conducted the correct analysis which would be the the analysis that this court employed in the conclusion that we have alleged and i trust injury is just inexcusable unless there's furthe a set in the following way it is set first out in the macroeconomic world real world sales but really it's that and the second train a bell of the l and me so everybody that's fine aluminum reference is that price first as the base price room and then they add on the midwest premium which takes into storage insurance taxes transportation and that's why that is in addition to the elon me price now the defendants argue th some inverse relationship between the al ameen price in the midwest premium in other words as this premium skyrocketed that somehow the ala me price you know drop down that's not the case not a single industry participant found that to be the best some evidence of that in the record that at least at some points if you do a graph you see the element of price going up even as the midwest premium goes up at the same time absolutely it's statistically the experts that took a look at it it's a ninety five percent statistic match of those two things going up yes they used to where when this case was first brought everybody knew about or had learned or were learning about the warehouse activities premium history or cle had gone down in times of big supply and here it was skyrocketing and what was happening and what was happening in is that the defendants of course were linking the queues increasing the storage cost which was picked up in the real world where the midwest premium was paid the midwest premium is only paid in the wee real world so people in the warehouse l m e market they don't care they're never they're not paying the midwest premium they're paying whatever the  letters in effect traders are futures yes but what we didn't understand at a time when we first brought this case is that the defense had stepped in to become some of the biggest purchasers of aluminum in the country goldman sachs and j p morgan went from owning only no limit them prior to purchasing alamy warehouses to becoming some of the biggest purchasers of aluminum in the country in two thousand and twelve they own seventy five percent of one year's consumption in the country and more than ten billion dollars worth of lumen they talk about how all this off activity all took place over here in the warehouse market that was the warehouse market was nothing compared to the billions and billions of dollars of aluminum that they head and your honor yes well didn't they hurt themselves by raising this midwest premium that they would have to pay and it really is as as said before by council it was part of the long game they were purchasing aluminum in warehouse yes unknown but aluminum really is sold based on this al ameen price plus so if you're like if you're one of my clients or propose clients and i represent four actual direct purchasers you pa plus the midwest you can't get away from it that was the testimony in front of congress did your clients have long term supply contracts that referenced the  suddenly this year the supply and demand price of them at the smelter might be going down you've already got a contract where you've agreed to pay according to a price that's pegged to certain market indicators is that the idea in partner stock and we're big manufacturers and so there's only two hundred eighty six and that's a finite class so one partner sucked but that's not necessarily the case the l in the warehouses were supposed to act as as you said a place to go for the last resort the marginal supply in case you go there and it's most and the reason that it was so important is to bring price conversions so you didn't get stuck in the situation that you're talking about where you've got some kind of anomaly that say they're snow in the northeast and it's just you have one of the bomb blasts that i was lucky enough to be here for and you and all sudden certain things skyrocket where you could go to alamy and  s did go to the alamy and you could order some aluminum when this when they bought these things it was the wait for aluminum was a couple weeks that was the norm to get it out of the alamy warehouse to keep that price convergence by the time after two years of what they were doing it went out seven hundred days so no valas goes to see how far out it's going it takes some four and a half months to get aluminum they make aluminum cans for coca cola but they buy a primary their primary direct purchaser and  they knew that that was no longer a place where they could get their aluminum as a last resort so what happened is the defendants go out and buy billions of dollars worth of lumina and they sell it to our client we bought tens of thousands of metric tons directly from these defendants here they made some argument that we waived that that's not true at all and i can show you on the record several times at page forty six of the very brief they cite that we somehow waived o purchases from them we had not calculated at the time of class or our damages for the direct purchases from them because that we were still sifting through that thing but we were further wrong right we had finished discovery and we had also oppose had complaints that had not yet even been addressed by the defendants but you're in a somewhat different procedural posture right you've had some discovery and at least some of the rulings that the district court made  seem to me to be turning like for example not allowing you to amend the complaint to bring in the allegations or that that was based on a theory that you've been at this for a while and i don't know whether you are at or near the end of discovery when these motions took place and therefore it would be unreasonable to allow you to amend your complaint in a way that would crank up a whole additional set of discovery do you have response certainly the district court was concerned about that and certainly i understand that you know you can't you can't throw in at the end some new theory but that was not the case the third amended complaint which is the backbone of what the district court ruled on it stated there were two markets there was a warehouse market and there was a physical aluminum market and then it went through and documented that that players competed in the physical market for producers metal against defendants metro's incentive payments and that's at the tack ninety one fifty eight four fourteen glencore j p morgan goldman sachs sell to industrial users such as plaintiffs paragraph six o three defendants didn't did this to make their own physical holdings which dwarfed their warehouse investments more valuable the tax or at least the third amended complaint than arguing that the conspiracy was aimed at the physical market yes  know i don't know if i said some that they can and i'm just wondering because you know i think that's one of the facts that i didn't appreciate on the first go around was all of these documents that you're now referencing that's not to criticize you it may be because nobody jumped up on the other side and said these guys can't say this that is relevant to whether those research be eventually redacted but that's my side obsession i tend to like first amendment access to the briefs that are filed in this cya interrupted you know at least you know yes they've been trying to keep some of the facts out you know forever but we went overseas we took these depositions so we we discovered exactly you know what was going on and and you know we also competed with the defendants for the purchase of primary aluminum from the smelter we they were in competition with us for that they say oh you're complaining now about competition well it's competition if it's fair competition but you can't go out and buy your supply of consumption of aluminum slop in a warehouse in a centrally ported while you're driving up the midwest premium and creasing the prices to everybody else that needs to use that aluminum right now they can't  and that's what was held in l and we're warehouses at a different theory i mean one issue is they are restraining competition in the market in which they sell to you but this sounds like a somewhat different theory in which they are somehow affecting competition in the market in which you and they both buy it i think it complementary they were hoarding aluminum so they could sell it to us at a higher price so our theory is the same as their theories we were we it's a classic and i cross injury they were hoarding aluminum they had to hoard it to sell it to us and make their money and they sold it to us in an inflated price so that really is the crux argument i'm not i'm not trying to change arguments there but we also say hey that hoarding and everything also had an impact because they make a big argument there was a surplus during this time there was not a surplus in the sense that it was available to us and that's what our argument is there was what they call a can tangle where near term prices are lower than expected for long term prices so traders such as these entities would purchase anything so it was off the market and not available for us and then they put in the squeeze and as their own their own defendant say metro c e o chris wilton physical traders a conjunction with banks producers hold stock and  thank you your honor may it please the court richard peppermint on behalf of the defendants and talk into the microphone yes your honor my apologies your honor the conspiracy claims the allegations of anti competitive conduct and the alleged harm at issue here are exactly the same as those that were at issue in aluminum three the only difference between these cases and aluminum three is the plaintiff's location on the chain of distribution whereas the plaintiffs here claim to have bought aluminum directly from either a smelter or a trader defendant at the top of the distribution chain the plaintiffs in aluminum three purchase fabricated aluminum or aluminum products further down the chain the distribution but that difference could not have had any legal relevance in aluminum three because the plaintiffs there sued under state statutes that a lemonade the distinction between direct indirect purchases they did but then when the panel got around to the state claims it seems to me that the reason why the state claims were dismissed was because the allegations under the state claims w i beg to differ the state claims that are dressed in the two paragraphs and room and roman two are the consumer protection and unfair trade statutes the state any trust claims are what are addressed in rome and one because the plaintiffs there as indirect purchasers sued only for injunctive relief under federal any trust law and for damages under state any trust law so the court notes in the paragraph before roman one day that the claims for money are under the state of any trust as its nature of the paragraph i mean section one of aluminum three address that i think i did find certainly in the complaints and possibly in the briefing to this court theories being floated that are analogous to the ones that these point is allege it's very hard for me to read the opinion and find anything that addresses those theories this is an opinion reads mccready mccready mccready and i can only take from that that that was how the court perceived those plaintiffs as primarily structuring their claims and i am wrong about that anywhere where is there an actual discussion of a direct seller theory a direct traditional antitrust  commercials on consumers in their brief before this court argued first that they suffered any choice injury under mccready and argued in the alternative that they suffered classic or traditional any trus injury based on a supply  restraint that also was argued that were argument they argued that there was an output restriction judge or a study i hear you and so you are you are saying that we are fair by aluminum three to reject claims that were made to the panel in aluminum three and implicitly in effect rejected right because it's i mean i didn't hear you i didn't hear you you were telling me that these claims were made to that panel and were discussed in oral argument but you haven't said yet disputed there's someplace in aluminum three where the court actually analyzes this kind of claim an regardless of the theory of any trust injury on which the plaintiffs rely were the court says that to suffer any trus injury the putative plaintiff must be a participant in the very market that is directly restrained and help me out let's let's alleged in the complaint that this whole warehouse thing was just a way to fix a component of the price in the direct purchase aluminum market that someone who is injured in the very market at which the defendants aimed and i understand you're going to say this didn't happen but that's the allegation of the point how can it be that someone who was injured in that market does not have traditional antitrust standing yeah your honor and i'm glad your honor raised the complaints mr branscum plaints representing the individual plaintiffs in the injury section of the complaint what eyepiece allege and it's paragraph three fourteen of the joint amended complaint and it's paragraph three nineteen of the first amended complaint filed by fuji but what they allege is that the defendant's conduct impaired competition among suppliers of warehouse services and that this in turn had a predictable and forseeable effect on the market for aluminum and i believe what the panel did in aluminum three is articulate a general rule of any trus injury that to suffer any trust injury you must be a participant in the directly restrain market as opposed to being a participant in a separate right but let me let me follow up so are you hindering this argument on the idea that they have not in fact alleged that the conspiracy was aimed at this market you're saying they that there is a conspiracy to directly restrain the warehouse services market that had a foreseeable proximate cause it to effect in some other market and in that scenario the logic of aluminum three makes a lot of sense but are you also telling me that if they had alleged that there was an intended conspiracy that in effect like mccready itself only aimed at the warehouse people there collateral damage nobody cares about a few extra dollars in rent the main thing that this is and if they allege the main thing this is aimed at is the aluminum supply market but you're right it would still be the case it would still be the case under this upshot paragraph that because the direct targets of an any trust conspiracy were not operating in the market space the law is clear that specific intent is not sufficient to show any trust injury going back to aluminum three the same point that your honor makes here was made in aluminum three and the court directly addressed that the court said undaunted the commercials and consumers allege that defendants intended to corrupt the market for primary aluminum so that same argument of specific intent was made there but that was not sufficient because where the supreme court wrote and i'm quoting quote the availability of the section for remedy to some persons who claimed its benefit is not a question of the specific intent of the conspirators and that specifically in the context of talking about any trust injury the very next term in associated general contractors the supreme court picked up on that language from mccready and reiterated that an allegation of improper motive is not a panacea that will enable any complaint to withstand a motion to dismiss and the courts of appeals follow that language from the supreme court have have determined uniformly that specific intent is neither a necessary nor a sufficient ground to establish any trust injury it is relevant your honor under the efficient in force are factors in the second part of of any trust standing but it's not relevant to any trust injury what any trust injury looks at and if you look at what the supreme court said and associated general contractors it looks at the harm suffered by the pla wrongdoing by the defendants and the relationship between the two and here the alleged wrongdoing by the defendants drek lee restrain the warehouse services market that's what this court held in  three that the contact took place if at all in the elem a storage warehouse market and that is where the direct effect was was felt so that's where the direct restraint occurred what these plaintiffs are complaining about is an effect in a separate market and just because they lehrer on top of it allegations of specific intent does not distinguish it from aluminum three and runs headlong into what the supreme court held him a creepy and associated general contractors and i'm still having a lot from with this because the idea is that again we're assuming the truth of something that may not even plausibly alleged i don't know but that if it is the case that the defendants deliberately conspired to screw up the  warehouses in such a way that would have a direct impact on the price paid in the aluminum market and they did that in order to be able to profit in the aluminum market by fixing a component of the price the same way that the library defendants affected a component of the price of money and that the people who were the targets of that conspiracy who paid inflated prices that it was the whole point of the conspiracy to create do not have an antitrust injury that's what you're is that what you're saying to me if i can make two points to respond to that  the first is and i think is you know maybe the law i just want to understand it reckoned i don't know i think what i'm arguing is what the court held in aluminum three but i want to go beyond aluminum three and address your honor's point first principles i think that would be helpful first i think i think it's useful to explain why this case is different from golborne this case would be on all fours with bellboy and if what the defendants had done was made a conspired to provide fraudulent submissions to platts in calculating the benchmark or they had agreed to engage in manipulative or sham track of transactions in the spot market and then report those prices the plots because that there would be conduct that directly restrain the physical aluminum market and that directly manipulated a benchmark that was used in pricing what's alleged different here is there's not a claim here that there were fraudulent transactions in the spot aluminum market the claim is instead that the defendants failed to complete compete in the warehouse market that that created it meant the warehouse queues that that drove up the cost of storage and that the cost of storage had an effect on the midwest premium it's that indirect nexus that the sting which is it the second point your honor again and also that that was the point w gauged in fraudulent spot aluminum transactions in the aluminum market so if if and you see this for example the district court's recent decision in the brant crude oil case where traders are alleged  engaged in manipulate for sham spot transactions in the physical market with an effort towards manipulating a benchmark that would be a drag restraint of the physical market that directly manipulated a benchmark price and  why on earth would we want from any policy reason related to the antitrust laws to distinguish that from a situation in which in effect the plaintiffs are alleging that you folks in gauged in really fraudulent transactions bouncing things back and forth between warehouses for example in order to effect a component of the benchmark why is that different than a forged on the spot market transaction which would have the exact same impact on the market you the specific intent point let me focus on the policy point the reason why courts have limited any trus injury to participants in the directly restrain market is twofold one it is the nian trouble damages remedy that those plaintiffs have and the risk of what they say is over deterrence if that trouble damages remedy is then given to participants in separate markets and second your honor is the complexities of tracing an effect on price from one directly restrain market into a separate market and what i would like also to do because i think in that makes a lot of sense if we're talking about something like illinois brick some situation in which it's hard to see how this passes through or something like that because the economy gets very complicated once you're beyond one level but in these unusual circumstances where at least we are told the price of aluminum is determined by benchmarks and certainly that may be true as why are contracts where people have an indetermin price term that's pegged to a benchmark if you can screw up the benchmark somehow you are having you were directly restraining that market aren't you why isn't that a direct it may be done by some  element warehouse all in the price of physical loman in the physical limit of market is just as complicated as the pass through analysis that supreme court addressed in a brick second can you help me out with this because this goes to how blatz thing really work right and maybe this is just a factual issue and that creates a problem with dealing with the pleading stage i thought your argument in part which was very interesting to me was that this is not like libel or because the formula it's not a formula and i thought the plaintiffs were suggesting in their briefing that what happens is blatz has some kind of formula that in some way references the queues and what's happening in the warehouse and all that sort of stuff and you do the formula and you get an x number which you then add to the elam a price and that creates their number and i thought you were saying that no in fact what happens is blatz is referencing the actual transactions that take place in the real world and then saying this is the benchmark because this is the average that's being paid midwest transaction price which is the price at which aluminum is being bought and sold in the physical market they then take that midwest transaction price and they subtract from it the cash price and the difference is the midwest premium so if hughes have the effect of depressing the element cash price relative to the physical limit in price because warrants for aluminum stored an element warehouses are less valuable that has the effect of increasing the midwest premium although it has no effect at all in the overall price but then that raises two questions one one factual question which is what do you do with the evidence that the elem the price doesn't seem to be going down at the same time  between this case and aluminum three the commercials in aluminum three also allege that pursuant to their supply contracts they paid the midwest premium the the commercials supply contracts in alumin three were the element cash price the midwest premium and some additional cost for fabrication so the fact that the plaintiffs here pay the midwest premium and it's in their supply contracts does not distinguish these cases from the commercials in aluminum three commercials or not you don't have an illinois brick problem is that if the commercials come right the consumer going to us and i can see the commercials the not have an elderly brick problem mean it brings to mind the notion that if if someone for example if someone chops down a tree that is in some manner illegal as chopping down a tree but he does it for the purpose of having the tree fall over and and crush a house oh well that's that was indirect that's not that's not covered or if somebody closes off a water supply that goes into to  two for cattle to get water and the cattle all die and that's the purpose of doing it i'm closing off the water supply in order to kill the cattle no no that's not that that can't be an injury that one contemplates because it's indirect the only injury was just to the water to the water not to the cattle i mean i just don't understand the argument that mean i understand the elegant choice of words to achieve it with you know words like like in direct and different market but when one who's doing one is doing the legal conspiring for the express purpose of raising of raising a number which will have a which will then translate into raising the price of aluminum in this market and that's the only reason that you do it your own little baffling to hear these these elegant lawyers arguments are no no no no that's not the price of physical aluminum is quite frankly and post aluminum three invention throughout this case the argument has always been that the defendants did this in order to increase warehouse rent that people because as mr kaufman pointed out there was a two year queue that users of warehouse services were were forced to pay delhi rent while they waited in a queue for two years to take them out and the claim was that that increased storage had an effect in the physical movement of market and that's the point i made based on paragraphs three forty but you know the one that was the point of judge jacobs opinion in aluminum that they don't they disavow any participation in the market but they are telling us they don't disavow it they as opposed to whatever might have been the case and wounded three they are very much of vowing that the court said that the plaintiffs in aluminum three disavow participation in the markets in which defendants operate your honor that is simply another way of saying that the plaintiffs in aluminum three were indirect purchasers who bought their aluminum further down the chain of distribution the plaintiffs in aluminum three bought either fabricated aluminum or aluminum products things such as aluminum foil or aluminum boats the defendant here don't self abrogate fabricated aluminum they don't sell aluminum foil or aluminum boats so when they said that they disavowed participation in which the defendants operate that simply meant that they bought the aluminum further down the chain of distribution and therefore did not participate in the markets in which the defendants participated and who would have suffered and the trust injury and the situation there would have and that would have the incentive to bring this kind of action your honor to class as a plaintiff they would be consumers were competitors in the direct allegedly directly restrain market for ellen me where our services so they have an incentive to bring an action like this they would your honor if they thought that there was any trust violation because they that the claim would be is they had aluminum in the warehouse they cancelled their warrant they wanted to take it out and they had to pay delhi rent for over two years because a queue had been generated by illegal clue collusive conduct and i think it's noteworthy that to be a lots more effect on the in the national economy than the price of aluminum that goes into everything that people buy you know that that that's my tracing point is that's part of what any trus injury does most of the profits that you're alleged to have made your religion  that market that had the effect of raising the price that the intended effect of raising the prices in that market so i mean it's a little disingenuous isn't it again assuming the truth of the allegations in the complaint to say oh we're going to be stuck with enormous damages if the whole point of this was to get enormous profits that those damages are keyed to your honor keep in mind that three of the defendants here metro henry bath and were saying to me that that the the language disavow participation was because they were down the line users of fabricated aluminum as opposed to buyers of aluminum in the direct market  and then you said two to two judge droney when he asked who would be able to challenge it was only people who were users of the elam he warehouse services who said hey we have to wait too long we're having a problem and being charged too  much torrie because we like it or a woman i'm out with all due respect i don't think the answers are inconsistent the aluminum three plaintiffs obviously also were not participants in the warehouse market so that is another distinction from then the i was making the point that the difference between these plaintiffs and the aluminum three plaintiffs the only the only substantive distinction among these plaintiffs is that these plaintiffs all aluminum at the top of the distribution chain and the plaintiffs aluminum three bought aluminum further down the distribution chain and for the commercials it was just one step below i mean the commercial and users allege that they bought aluminum from these plain and that they too directly paid the midwest premium so of course of these plaintiffs paid an inflated midwest premium that was passed on directly to the commercials but this court held an aluminum three that the commercials did not suffer an opportunity for leave to a man if we're given leave to our man we're going to copy the third amended complaint that's the operative complaint of the class planets we're going to copy that complaint verbatim give us a leave to a man and what this court said is that they failed to allege and could not allege any trus written injury and the reason for the could not allege is they just couldn't plead around the fact that they didn't participate in the directly restrain warehouse element where all services market were all the any competitive conduct car and one of the real fallacies here is the analogy to marc mccready as i understand it one of the arguments they make is that the warehouse customers are the maccready plaintiffs that the where else customers are the fulcrum lateral them but your honor just that if you are representing a warehouse customer you would never claim that you were a mccready plain that you would say i'm a direct customer of the defendants i purchased warehouse services from the defendants and i'm a consumer in the the of the potentially inconsistent responses to your honor's about disavowal of participation in the market if we look at exactly what aluminum three told us when it said that the commercials and consumers disavowed participation it's that they did not store aluminum  the defendants warehouses they did not trade aluminum futures contracts with the defendants and they do not allege that any of the loom aluminum they purchased was ever stored in any of the defendant's warehouses or was the underlying asset for any of defendants futures trades nowhere in here is a discussion of are the defendants sellers of massive amounts of aluminum because if that if that were known to the court in aluminum three then the court would have had to explain how those plaintiffs were not in a market with the defendants in that in that context there is no there can be no question that we have alleged and long maintained that this was about a price in the physical market long before aluminum three came out eighteen months before aluminum three came out in our january second reply brief two thousand and fifteen to the district court we told the court in support of our motion for leave to file the jack so it's not even an operative plan to complain at that point the jack alleges straightforward any trust injury to i p s in the market for aluminum such that the court need not even engage in an inextricable intertwine analysis that had such a mark with the defendants that they saw it leave to file a syrup lie got their leave and came in and complained to the district court that we were not arguing mccready  points i think mr peppermint did a very good job of sort of shuffling between the district court's order and aluminum three and trying to portray this fallacy that somehow the looming three court understood that his clients  actually in the physical limit market just put aside for a second the fact that the consumers of commercials disavowed but just take a mr peppermints state and that they could into men to track the f l p s and that's somehow because the co understood that they were you know still in the physical market but somehow had this other problem but if you look at aluminum three the court says there when talking about what happened with the apple case it says in that order which is not the subject this appeal the district court concluded that the purchasers while not participants in any of the defendants markets still had some sort of you know injury in his whole argument that oh as and directs they should have had standing it was decide it falls apart at that point i think his argument and his analysis of luminance three runs headlong into this court's decision in the united states apple and so kony and the only explanation for how that case came about is not that you know in august of two thousand and sixteen this court decided on three and did a complete one hundred eighty from gal boy which had decided three months earlier it all turns on the simple holding that that court concluded that the defendants were not in the primary aluminum market only way you can rationalize and explain that decision thank you thank you mr connelly just very quickly  i wanted to there was a discussion about who would have the incentive to people in the warehouse that were charged extra rent if you read the facts of this case you find out that what they did was they paid for begin adiz resized themselves to cancel warrants and return the aluminum in a circle in detroit to bring it back and so the idea that there were somehow people in the warehouse impacted that's not the case because they actually were paid to cycle their aluminum in a circle red kite and three other entities were paid literally hundred million dollars to move aluminum in a circle and agree to bring it back into the warehouse then these three defendants stored aluminum in the detroit warehouses even though they had their own warehouses and canceled warrants too there was nobody in that queue because who would want to be in a seven hundred day queue unless you got paid for there was nobody in that queue except people that they were paying off to be in their collection that queue and that's not how the element pricing works the element pricing works out the real world that midwest premium is set out the real world on availability supply and demand and it includes the cost of getting things from the warehouse they know basically what's happening with the queue and the storage costs and that is that if one regards the antitrust injury as the one to the participants of the warehouse market there was no injury no nobody ever