clear that in order to show antitrust injury antitrust impact you need to show and injury from above for world without the acquisition or without the merger i think that  clearly established that is how do you prove antitrust injury and i think particularly a case like this where you have the possibility of a long term contract that may insulate consumer from the consequences of a merger i think it is particularly for them to establish that the customer is worse off because of the merger and pay higher prices than they would in a bottle for world without the merger i think that is critical to how do you differentiate the injuries that you're suffering from a reduction in competition from the areas you might see suffering if it's just from any other ordinary breach of contract and  and so you know i just try to emphasize that i think that this is a need to show this fight for a jury is absolutely critical and i think it also sort of underscores some of the other errors in the case because it's good for but yet just paying completely excluded that head of it and excluded on a basis that is absolute clear legal error under the supreme court's general dynamics spring forth in general dynamics for the argument from the it's reversible here well i think it is absolutely reversible error your honor and i think the reason is it's not that we were trying to make a failed to fail company defenses and were unable to do it but we were trying to showing that prices are higher with the merger than they would be for world without the merger particularly when they're hoping that the evidence of what a c e o i would be doing and whether it would be setting prices increasing prices lower the prices is absolutely critical so are those two those two if you think both of those are errors and i'm wondering if they're if they're connected if the if we think there was an adequate injury alleged here now maybe the damages model was wrong but that doesn't seem to be an issue on appeal but  if we think that there with an injury and we take the case as it played out except for evidence being excluded do you still have a case that it would change that it's not harmless error that could change antitrust injury and the lack of proof of the an eye for injury is the basis for judgment in our favor and i understand and proud of your problem is that maybe you don't agree with that but i really face that that is pretty clearly the right answer in this case and if you walk into the extra case and you prove the identical damages under breach of contract theory and you do for d your product there is a clear signal path i have a couple questions i'll start with this one i thought evidence ruling on this issue was premised on his view of the market conditions that existed at the where the evidence supported the view that all of the door skin manufacturers were not the best of shape at the operative time but with the expectation that market conditions would improve so if that's true then why isn't that but as i understand judge paine's things the reason why he allowed the jury to make that calculation as imperfect as it might be is because of the possibility that the divestiture might never come to bear because of the various market conditions except or and the like are you saying that that was improper to allow it to come to a jury at all but or are you saying that once having calculated that number that that excludes any other potential equitable proved out a future lost profit some other way if they said it was because we're paying ten percent more for the risk and that we should and so for the next eight years we want to basically damages in the amount of that ten percent more that we're paying was it did seem that the judge focused on the damages claim that they couldn't have known that they would have had you know the damages claim and how much it would be and still further down the road but he seems to rely for their antivirus injury on the market based carve out to their contract twenty percent to three percent price relation and other things and i'm i didn't see the judge addressing why those injuries wouldn't have been foreseeable or threatened i guess is what the law requires at the time that the that the merger  now two points in response to that one is i think the reason the judge came didn't focus on the twenty percent argument is with all due respect that the argument was making at the time it's not an argument that they made justice department is going to look out for the public interest and enjoying the merger obviously the sprint court in california has american stores said it's possible to have a diversion short of product case but in most of the effectively bar private lead again from challenging mergers once they are consummated if distinction between unwinding mergers and blocking them preemptively is one that the supreme court rejected in california vs american stored at and american stores the defendant there raised the issue of the difference between rescinding what was already a consummated merger and blocking a merger preemptively in the court specifically rejected that distinction  experience a plaintiff who waits until the consummation of a merger may have several good reasons for the delay even the government sometimes challenges consummated mergers because the likely effects of the merger were too difficult to identify or to prove in advance reported that in the prior three years approximately one th of its merger challenges had been to consummated transaction as compared to the government a private plane has faces additional difficulties that may often justify the way they have limited investigative powers and the requirement to demonstrate standing as was passing a moment ago indeed i'm not sure the concepts of standing as possible to reconcile with valid ones argument on rock on lodges in order for a cause of action to whether steve would have had standing as of the time of the merger here or you just saying as a general principle it's something to consider it something to consider your honor we're not taking a position on what taking a position on whether he is demonstrated standing here however i'm trying to paint a picture for the court of the dilemma that a private plane just might face as a general matter as judge diaz was pointing out the rule that giles one would have the court apply would require private plaintiffs are rather market participants to pay attention prospectively is have remerge or that might affect their business and try to investigate on their own what what the effect might be of course without the investigative powers that the government has in fact a plaintiff may have to speculate that they would feel a fax and then sue in simply a sort of a truism but the fact of consummation and the hardship that it creates for the defendant is a factor that's much more properly considered under the equitable pass for injunctive relief and d the remedy how on earth can we tell if competition is being restored to the market divestiture here when we don't know who if anyone is going to take over the divest did city it might be steve's it might be someone else it might be no one how do we weigh the equitable factors here when that question is is favored remedy in those circumstances and and the whole question of the public interest prong as i understand it the th problem of the equitable analysis is whether you're restoring competition and and not because i don't we don't know if who if anyone is going to take over this vested into the i have no idea if it'll restore competition do i judge in the briefs that the justice department the method in the district court below we laid out  for the independent purchasers and that would be the touch point that the justice department would use to decide whether competition had been restored in the market i would move just briefly  to the evidentiary question and press the point that there is no such thing as a government of the government approving a merger under the antitrust laws inaction is not approval and the case is that and it's free not raise doubt about the fact the two appellate court cases ginsburg and alberta gas are both cases where the d o j sued and then settled and the courts reliance in those cases on the d o j the affirmative statements about the into an unlawful acquisition the jury found it was unlawful and if we bracket off for the moment my friends the discussion about see my evidence which i do want to take on it's otherwise not trying to convince the court that this was a lawful acquisition and the acquisition puts us out of business and the district court's order remedied that those are those are jury findings or district court findings district court equitable judgments and i've heard precious little about the standard of review of these things it's not until i think very late in the brief speech in the seventy's or something we get to an issue that actually gets peer to nova review and so this case asks what do we do about unlawful acquisition what do we do about it going forward that's the divestiture remedy and what do we do about the harms that it's caused which is the trust injury question related to the damages for that certainly as a customer in fact both the largest independent customer of the defendant we are certainly the right party to bring an antitrust claim of that sort but all the arguments we're getting here are about how there should be no consequences at all for this unlawful merger and that there won't be any restoration of competition that there's a liability for putting us out of business that there's there's no any trust damages for the last few years when we had no choice in the market at and nevermind all the seventeen days of evidence and argument one hundred and forty nine dollars pages of equitable analysis there's just going to be no consequences for this this merger of those of those remedies certainly the most important thing for steve's is that it wants to stay in business that's why we sought divestiture that's what keeps us and that's what keeps us in business and as my friend from the government provided us port american stores says that is the holding of american source private parties can obtain divestiture and it says that it is quote the remedy best suited to redress the ills of an add to competitive merger and if this if this isn't the case where that remedy is desk suited where you take it back to three f the court's analysis on divestiture it seems to me in many respects was based on the idea that the couldn't have two and wouldn't have known that it had a claim an antitrust claim at the time of the merger before the merger when it was and now it seems that many of the injuries you nowhere a lot telling us about have to do no with contract damages but with market influences the twenty percent you can buy outside of the contract the way the price is affected by the market and other things like that why couldn't steve have two why wouldn't it have known there was a threatened injury at the time of the merger when it comes to those anti trust injury so at the time of the merger we had we had a long term supply agreement that was perpetually renewing so we would have been in the position of going into court and arguing that well hypothetically  thirty five of your briefs you're trying to convince us this is not a contract it's an antitrust case and so yes well it's point where you talk about outside of the contract their market influences that that caused an antitrust injury and i'm wondering why the zero weren't suitable for a lawsuit at the time of the merger before you brief sure i understand your honor so those those points at the at the time you have to remember that we had entered into this contract essentially the same time as the merger and so and under the contract for for essentially the st two years there wasn't any appearance to us that we weren't getting that we were that we weren't getting anything that we were we weren't getting anything worse than what we would have gotten in the market because the contract had a had a pricing formula where prices would go down when costs went down and so it's important for the port to distinguish here also between the two different questions of if you trust injury present here so that that that discussion isn't cited anywhere in its briefs and that's the question of standing and that that addresses the question of standing under section sixteen and that that is something that exists that's a problem that exists independent of the if your honor thought that we could that we could have sued that or and i don't think this court wants to write a decision that says as a matter of law we want to invite all of these challenges to rush into court even when parties can't  challenge here is a is a is a law school textbook example of why we're appeals no deference to district court findings on this their challenge here rests entirely on inviting this board to believe testimony of a witness that the district court this believed based on the manner and content of his testimony this was a witness who testified who lived three times in front of the district court and so even if this court so i would suggest that if this court has doubts about the delay prong the court should simply affirm on the fact that children can't make out the prejudice prong the because because that testimony was subject to credibility is a credibility finding and the only other issues they want to raise there is that well they say well we shut down this plan and we shut down that plan and the record is to the contrary i'm happy to point the the court to the evidence on that where they they said they shut down the north carolina plant because of environmental compliance costs and they had already made a decision before the merger to shut down their iowa plant so those can't be prejudiced because of the merger and so it's just an invitation to reweigh all the evidence and of course the district court is the actor that does that in our system if i could maybe cycle back to the antitrust injury issue because i i i do think that i'm in  the same predicament with respect to those past damages and the answer is no we wouldn't have because a judge rushing because of the very provisions that you identified we could have gone out to the market and and this is not something that they didn't vent it for appeal i guess i'd like to take the court of the record on that because we know what happened before the merger and we know what happened after before the merger yes now you are what about your friend on the other one separating those two issues and so we have to talk about those things separately and i'm happy so i'm happy to talk about how the damages model corresponds to that the testimony of the whole the whole thrust of professor shapiro is testimony which starts  joint appendix twenty dollars to thirty two dollars and it goes on for dozens of pages is that the the acquisition kept prices higher than they would have been in the in the absence of the merger and that instead prices would have gone down when costs went down and the reason that should sound familiar is because that's also the formula in the supply agreement prices go down when costs go down they started at the competitor at the competitive level negotiated in a price for tw and there's a formula that says cost prices go down by half the amount the costs go down so the fact that the damages wind up the same is because the reasoning is the same the contract formula says prices go down as costs but out so if the court would look at tw and forty four dollars this is in volume six of the joint appendix professor shapiro testifies on direct direct that the contract has prices moving according to a formula based on the competition that took place before the merger we saw the competition there and then the court then he does this again on on cross examination two thousand three hundred and eighty one he says he does i'm i'm i'm talking i'm talking about the price before the merger what happened later with less competition and he's asked well your opinion here is that if job wins costs went down as you've measured then you would expect the buck for world price in the merger didn't take place to have gone down right yes other things being equal that's correct when he says a two thousand three hundred and eighty four he says with craft master continuing to compete this is the but for world the door skin prices would have come down as costs come down and that's something we never saw instead we saw prices go up that's why the damage model lives and i well that's that is what the we can competitor defense is and the problem is that the financial weakness they wanted to show is only one element of that defense so i'll spot them that elements i mean i don't think financial weakness is always an anti trust exemption i mean we would say the airlines are probably financially weak right now but i don't think all of them want to get together and merge right now but let's pot them at the nd element in the t the end of the day there's nobody else who can buy those who can buy the firm but really from an antitrust policy perspective gjelten and mason i guess also because it's the other supplier those two firms are the last two on the planet who should own the children's own expert emphasized that going through a bankruptcy or getting a private equity infusion that's the that's the pattern that has been seen in the market i believe it may have been judged as to who referred to that and that that's a hundred and thirty nine t and thirty nine dollars t one and so any of those options is preferable and sheldon wasn't wasn't offering any evidence that those were impossible which you would have needed to get this to the jury and then even if i take that element even if i you still get to the rd one which is that they have to also show that the weakness would have been such that it that it undermined the prime a facie case the prime aphasia case here is overwhelming in terms of the market share analysis that's how the prime efficient case is done is absolutely overwhelming and professor shapiro's testimony on that is clear and non contradictory this case is a lot like the problematic district court decision cited in our papers where for it to for this defense to work you have to assume that this weakness means that the firm it's acquired goes from something in the teens the percentage market share in the teens down to like two percent or one percent and we don't have yes  it what the district court was left with was this zombie bit of evidence that couldn't have made a difference to the jury if the jury was properly following the law and and if anything was going to confuse the jury into thinking that the test was something but i mean with the jury having found a rather substantial amount of lost profits in this case which by definition suggested that there was a remedy of some concert of divestiture why shouldn't the case and the re the reason it shouldn't and there is that that lost profits is not that is not a substitute for the company continuing in business is what we have the loss of a business the court could think of i loss of all kinds of goodwill goodwill is the standard commercial irreparable injury or loss of goodwill is the total annihilation of the business which is what we're facing here next year is is a loss of goodwill from our customers loss of goodwill with our other suppliers loss of goodwill with our employees loss of goodwill with the communities we're in it's everything it's everything from one hundred and fifty four years that we've been in business  and so it's about six million dollars a year and that's that's what our damages expert offered for last profit so it isn't the word isn't wrong it's just complete because it doesn't keep us doesn't keep us in business i might if i could take a minute to talk about the fact that this is an uncommonly seen remedy because i think it is asking the court to say well you shouldn't order the remedy because nobody's seen it before the problem with that logic is that actually what's rare here are section seven cases merger cases like this where there's where there's actually goes to a finding of liability but actually doesn't nobody cites the in the papers any section seven case where where the court of the jury properly found liability in a private party case and the reason for that is is that the justice department in the federal trade commission are very good at their jobs but with with respect to my my friend i they're not one hundred percent perfect and some things get through this as the government is reminded the court the private parties have an enforcement role here but you've been in that subset of cases it's going to be really rare because most most parties who might challenge a merger aren't going to have this extreme form of the irreparable injury that we're facing here judge russia and yes i apologize i'd like to ask you about you mention that private parties do have a role to play furtively what they're doing is trying to enforce the public interest against competitive agreements and as i asked the counsel for the government how on earth can we tell whether divestiture is in the public interest here when we don't know if it might be steve who gets to divest that entity or important question your honor because i do think this court needs to be able to look at that question and the district court crafted a process that that follows the supreme court's recognition in the brown shoe case that you have to do that in two steps because you create a chicken and the egg problem if you say well we have to know that there's going to be something for sale because you can't before you find a buyer but then if you say well we have to find the buyer before we know if something is for sale  you're not going to be able to do either of those things so what the district court did what was done in brown shoe and what the supreme court approvingly said is this true or if you just to be clear i take your point that the supreme court made  very logical point and grounds to that it unless you have a court order saying that this is ok might be hard to find a buyer but they didn't they didn't go through the sort of i i take your point that brown's is relevant i don't think it resolves whether this is an appropriate analogy that we're trying to undertake here the logical way to implement that teaching from brown shoe is that the district court should resolve everything that it can without knowing the identity of the particular buyer that's the st thing it needs to do and obviously there was plenty for the district court to look at on that score that didn't depend on the identity of  the district court needs to figure out if there is likely to be such a fire and the district court did conclude that it's like we just have to remember this factory has been has changed hands twice in the last twenty years and there were multiple interest debtors last time so this is this is a these are good conditions for it to work and then and this is very important then that the district court is going to have to look at that question when the actual divest transaction is proposed with a particular buyer and i assume that at that point the district court is likely to have the benefit not only of the special master and the investment bankers involved there in this report so knowledge of the market but of course the department of justice has taken an interest in the case and i obviously it will have the opportunity to weigh in and then this court can review that order this court can review that order we are not suggesting this is the last time that this court will ever look at the case now obviously there's a lot more issues involved here than there would be at that last step where the court would look and consider well has the district court actually assessed the buyer correctly but  so within the scope of this court's mandate where we are going to revisit issues that are open now absolutely this court has to be able to look at that question but what brown says and says is that we can't get to that point unless we tell buyers that there's something for sale in fact it's contrary to the public interest not to not to follow the ground to process because you're not going to attract the best buyers so you're going to refer to the possibility that m it for the company but i'll be asleep other companies aren't going to express their interest until they know something is for sale and so the surest way to see about that about other bidders and and there were other betters who got farther in the process the last time around than we did the surest way is to tell them there is something for sale let's proceed forward with it i see over my time if the court had questions about other areas though i i would be pleased to address them overstate that i do think that with a lot of merger litigation takes place is that you hold the acid satirists until the court result of the merger and then after the marion jones and hearing that takes place before the combination of the assets of those issues and then you've combined that i think that reflects the reality that the combination is an important point the confirmation is an important point but we're not talking about somebody who brought their challenge to effect a confirmation we're talking about somebody who waited four years and that is just too late as a matter of law and to generate revenue for you to the extent that they really say that their injury was the failure to be able to take advantage of that twenty percent because because of the merger because we could have proven the other elements of a failed company depends who you are trying to prove a failed company the fact we were saying see i would necessarily be completely out of business we were saying that they would be weakened and helpful brief this is a very difficult and complex issue but i think i think i'll speak for my colleagues confidently that your arguments here today in the braves will help a long way in our hopefully resolving this case well it'll be correct regardless but because we said it at least for now but we would typically come down from the bench and shake counsel's hand and reach you obviously we can't do that except virtually so on behalf of my colleagues in the court thank you very much for participating in these these video arguments and allowing us to continue to do our very important work as best we can given the circumstances so with that i'd ask