thank you very much for the opportunity to show you why a mistake was made in this case are going to be short even shorter than the short present patient i had planned this is a very important case it's obviously important to our client whose financial life has been ruined by the imposition of the bankruptcy bankruptcy death penalty upon her and  a term used in many cases it's also very important because i have practiced bankruptcy law for a very long time and i have seen many many cases and the courts the bankruptcy feel needed guidance this case came out wrong because the premise underlying their trial was wrong this case was tried under the theme that are crying it could be held responsible merely because she knew or should have known certain underlying facts are able of closing counsel in his brief said that this enterprise is to determine a wayne of historical facts the district court set that the bankruptcy court standard was wrong it then went down the same wrong pam because it ruled that instead of just knowing historical facts that the process well let me just point out of the i think the district court whose opinion we are reviewing yaks thought that it was important to be careful about what has to be known where is intent come in and i'll point out things are concerning to me about this circumstantial evidence at a minimum suggests to me that the district court rationally could have found that she knew about the van buren property and the need to list it that she knew about the bank guarantee with edge broke bank a very large guarantee whether she thought it was going to go away or not is really not certain accounts i think those are the strongest things the shareholder loan might have been a little murkier except as a district judge said one way or the other looks like something needed to be disclosed it was either done or it wasn't done so these are all things she knew about and they're not in the form now then we can move to the question whether she negligently or forgetfully or deliberately or however whatever adjective you want you know did she mina soda and they act case said there are two prongs to this scienter element of the knowing element and the first is what you just went to step at a time i want to know whether you agree that the district courts finding that she did know these things was not clearly erroneous i disagree to this extent this standard isn't whether she has historical knowledge even for that prong the standard is whether he wanted to impose the district court that should know or should and should remember stand because district court is taking it in a different order from the one that you're taking and just reports as the first thing we have to find it's just even know it's there yeah i'll put it that way the answer is yes then there's the next question was her failure to put it down on the bankruptcy for something that deserves to be called intentional so the children seven twenty seven nerd two i disagree judge the disk records error is there he did not nineteen the other half of the science your question respectfully drugs were not intended yet we're still on sky inter which has a second element in the district judges own quoted case which states the very next sentence this second point about science your honor is the second is the debtor's understanding that he was required to disclose the specific points of information on his statements and i don't know that that helps you so much i mean i think you meant that district court broke this down is quite sensible he says there's no real dispute that debtors knew they own the van buren property had executed personal guarantees to edgewood me goes on some other stuff and then he says the bankruptcy court didn't earn holding the fourth  satisfied then he turns to intent to defraud which some of the fence you're talking about right now might factor in if somebody didn't have any idea that if along the bankruptcy form then it's omission  would not suggest an intent to defraud and judge i don't mean to belabor the point i will move on to say is that point that they relate to the bankruptcy is part of the knowing scienter element it's not part of the intent the intent is the other things that i would get to but intent we aren't there yet so i don't think that's relevant to the intent whether or not the debtor knew she was supposed to report some of these things judge it's a little bit matter of degree but no the case cited by the district court itself says it's a knowledge a knowing element is not the intent and i do agree with the district  point that the debtor knew that these items should have been reported yes and that's what they're paid and you're saying that's not part of the intent to defraud so if he did it there it's wrong you that i heard you say that there is a blender so let's assume it that it should go in the first problem but he did it in the second prong instead what's the harm what's the air because he did it if the first crime isn't fulfilled enough itself then you can't find that the debtor doesn't deserve a discharge is it a way it might could have been fulfilled for intent to defraud but not for knowledge made the finding that it was fulfilled he made the finding into terminating intent to defraud that she knew the should have been reported so the fact that he didn't do that on knowledge it's still there what's the harm if it does not fulfill both elements the better gets a discharge and he found it fulfilled both elements he just assessed whether or not she knew it should have been reported in the second element so ok what's the harm how could it have come out differently i think the case should have come out differently because there are no findings here that the debtor was aware that it should go into the bank or to schedule the i thought that i thought you were going to get to that yes ok the difficulty that i have with that is a point that i think judge star mentioned but nowhere near to the degree that the bankruptcy court mentioned in that was i think the bankruptcy court on three or four different occasions emphasized that the debtor sat down with her counsel and west page by page through the financial statement disclosures in the supporting schedules and did so with knowledge of the van buren property that guarantees you know it cetera et cetera sure judge we could go through this and we pointed this out it's a catch twenty two there are cases that say you didn't go through this with your counsel so you're guilty and the other say you went through this with your counsel so you're guilty i love peter in about it and he's going to heaven and i would act but he was an incompetent lawyer and he didn't do these schedules right and my client has been going to be asked to pay for the rest of her life for his mistakes that is not justice and that is also against the clear factual findings here one of you mentioned it would even against the clear factual findings i mean one of the points that we emphasize in our camp opinion is that the district i'm sorry the bankruptcy judge you know sits ringside to these proceedings and in a case where you have a pattern of you know false representations or omissions you know proper deference is warranted and one of the points that the bankruptcy court made is that she sat down with her counsel and reviewed these filings page by page and that's a heavy burden to overcome there is there is no pay matter that has been described in the case there are just the words don't been talking about whether she knew she was supposed to have it on the form she does this particular us review with her counsel she knows about the property she knows about the guarantees she knows about these ferries things and keeps her mouth shut there's no finding ever and she did not know that the guarantee should go on the form there was a there was a there there was only clarity for the bankruptcy courts in his priest he pointed out a number of cases that came out differently and he suggests that the reason they came out differently is because we have different judge and judges and they don't have a specific direction from this court on how to proceed but i think what's really going on here is we have different cases with different facts and different doctors the judges have an opportunity to sit and hear the evidence they have an opportunity to hear to see the witnesses and to determine what the whether they're credible or not that's the reason for the differences between the cases this court the supreme court in the statute the very clear standards a debtor that knowingly and fragile makes a false oath or account guarantee it's a liability on her part for eight hundred twelve thousand dollars on this promissory note it's not like she's concealing an asset from the bankruptcy estate she's even worse off than the schedules indicate so in what sense is that material you're in the bankruptcy context materially has brought this case recently in the largest or i'm sorry this court recently in the largest cases emphasized that  materiality when it comes to objections to discharge means basically anything that has to do with the debtors financial affairs it's not whether the estate would have benefited although if the state did benefit certainly that would make it material but also behind you wouldn't you agree couldn't possibly say to you eight hundred twelve thousand dollars guaranteed that you think she's even further in the hole if the if that gets called on then she already was yes that's true your honor but even things that are valueless have to be disclosed your bankruptcy petition in the statement of financial affairs or the question that asks whether you have any financial accounts that were closed in the past year close financial accounts clearly have no value but it still has to be reported  instance as in this case when we looked at the statements for the undisclosed account you saw that there are transfers that have been made of the debtor owed money to creditors that point instead of transfer money to other people she could have been using that money to pay predators this is the reason why the bankruptcy schedules require not just information about your assets but also about who your creditors are and also certain historical information about your financial affairs my coll emphasizes that there has to be for the knowledge element a conscious awareness that the facts must be disclosed in a conscious decision not to list them but really these factors are all about intent they're really focused on debtor feel to disclose a known fact and as such you can accept the conscious and deliberate standard we both agree this is a finding of fact in that may make some difference here because if it's a fact finding an intent then the standard of review would be clear error and it would also be possible to show it through circumstantial evidence since you normally can't get inside someone's head if it's closer to an issue of l cases like the standard right your honor at the end of the day what we have here is a judge that held a trial over several afternoons he heard the witnesses he heard their explanations he decided to reject their explanations and and he found that there was a pattern of false statements here that was sufficiently degree just to warrant denial of the doctor's discharge that wasn't that the tatar has argued that she made disclosures of some of these factors to the chapter seven trustee do you just spew that we do dispute some of those there were some disclosures that were made to the chapter seven trustee for investment alias wisc made yes she did disclose that there was also bank statements that were turned over however just as relevant to the intent issue your honor there's case law from from this court that says that later did later disclosures later amendments to the schedules do not cure an initial fraudulent information later on your honor certainly it's a consideration that the courts can commit it's a fact it's part of the record and they can decide whether whether that fact might overcome that whether the doctor was credible she was able to listen to the whole facts and circumstances surrounding all of the false statements decide whether the the disclosure to that one person was enough or not one thing that's important to mind here too is that the trustee is not the only party in interest who the debtor is making disclosures to the schedules are filed publicly available publicly and they're consumed not only by the trustee whose job it is  slickly assets but also by creditors who want to understand what happened with their daughter leading up to this bankruptcy case so merely giving thanks statements to a trustee merely telling the trustee about another name is not the same as telling all of your colleague just said that this case is all about why did the debtor do it or similar words that is not in the pleadings it's not in the trial it's not in the bankruptcy ford opinion it's not in the district court opinion and that is a critical question there is no evidence the debtor had no motive to do any of this it's all mistakes none of it is the most egregious conduct that this court has found in other places has to be an extreme departure from ordinary here there is nothing here worth condemnation to the bankruptcy the death penalty and there are factual mistakes there weren't no transfers from say that for i count the money lads property and there we cited a case that said it doubts that a withdrawal by a joint can it ever is a transfer there were also no transfers regarding the shareholder loan there was only two thousand and twelve information from a tax return or whatever happened happened in two thousand and thirteen that two thousand and thirteen tax return was done in late two thousand and fourteen there was no movement of money which is what the bankruptcy court is normally addressing there was only the movement of a c p a or accountants pen and there were no transfers all right