sentially what we're dealing with is the defendants in new york developed a product colloquially known as a kiko for which they used subsidiaries in other countries to market sell largely to small and medium sized companies that export of goods to the united states and europe they would get paid typically in dollars or in euro's and then they would be forced to that to their local currency and kiko was kind of a brand new foreign exchange product that allowed them to supposedly hedge the risks of an exchange rate fluctuation kiko had a small upside but a massive potential downside frequently and in this case the downside would not kick in until well after the contract was executed i understand that the k has actually bankrupted quite a few companies that entered into them in korea mr mehlman and the us were don't speak for myself sure colleagues are pretty intimately familiar with shorter lines things yours or maybe it would help us perhaps if you turn of the major point you argue about why john forrest gump is wrong well she took kind of a scare a shotgun approach so there are about thirteen of there are maybe thirteen grounds fourteen she said the cases were barred because of an earlier action that had to do with foreign exchange manipulation that was the we alleged  that was involved traitors in london and what we said what we what we believed was that the district court did not really appreciate the factual differences between us and  our reply brief i think on page two of our reply brief i laid out a chart that showed that they who what why and where are the motives and so forth between that case and our current case  very very different and that's well established case law what was different the theory no no everything accept the facts were very different for example in our in our council of three fourteen the actors were in korea their text messages in chat rooms to to coordinate that that's just one example but as i said there's a chart that we have which which counts are you on now through fourteen  with respect to counts one to four we we thought that the district court erred in trying to apply standard of law for arrest judicata there are couple of reasons for that number one is we said that the this is an edge act case not to act is passed through it's passed through legislation looks at still looks to the state law on substantive issues law a claims against one party would only be precludes of against that one party and there are there are reasons for that within the korean system that makes sense because having to do with how things like the investigative process works how discovery works there there's very limited discovery if you have a claim against one person and you think that someone else might be involved in korea you're really not able to go after that second person unless you really have the goods on them and to pick li what will happen in korea is  typically bring a criminal action that allows prosecutors to engage an investigative process and then based on that evidence the plaintiff would then sue the defendants in korea one of the problems in our case is that because the defendants in question are here the prosecutors in korea really don't have any investigative power over those defendants and so as a practical matter it would have been impossible to sue in korea had feelers to state a claim based on things like we said the products were supposedly zero cost the district judge said well it's unbelievable their product zero cost how can a product be zero cost and there are plenty of reasons business reasons that a product can be zero cost they could be lost leaders for example and in fact we are aware of other people for whom these products were marketed as loss leaders there are there are even people for whom these products in freo are marketed as they are called a government sponsored project so the district court was really not in a position to say just because it's just a cost that's unbelievable  it sort of gatekeeping line on a twelve the six motion to to more or less read think facts into the complaint that you know there motion i'm trying you know i don't know if there's anything particular where you have questions it's hard for me to sort of you know do this in the space that we have a lot of here  good morning your honor may please the court then perry from millbank tweed on behalf of the various city defendants as to the main claims as distinguished from what we call the new fraud claims there are three bases for  missal failure to state a claim the parties have focused on three misrepresentations mr mehlman covered two of them none of them suffice to state a claim for fraud and they have another problem none of the defendants in this case actually made any of the misrepresentations the second basis is statute of limitations the conduct here is old and all of the claims would be barred under looked at all the issues this time and so we have a comprehensive decision that really goes through every claim and every argument that my question was only to be in order to affirm the judge that the judgment of the district court we do not have issues this panel does not have to address that that's right judge hall any of the three suffice to to dismiss this claim the third is claim and issue preclusion and in particular judge forrest on pages twenty five and twenty six of her order goes through some of the issues that were decided in korea this plaintiffs litigated this case literally sued on these fifteen transactions seeking the exact same damages in korea against citibank korea they lost their they appealed they lost again and they brought this case and all it is is a second bite at the apple and we judge forest used issue and claim preclusion that's a third way to dismiss the case  federal so we would apply federal law she applied federal law and i do think that was correct the sort of interesting legal question is probably before and you say yes to that and then the question is that or stay that's right you're wrong and and i think the parties agree that if we were here on a diversity case you would apply state law which actually differs at least new york state law differs from federal law if we were here on federal question jurisdiction for example if they were there  we would i believe the parties agree apply federal law and since we're here on edge act jurisdiction the question is do you apply federal or state laws it's not a question that i'm aware of having been decided by a circuit court just two arguments there one if you look at the edge section six thirty two on its face it it says that claim in international banking if it meets those requirements shall be deemed to be to shall be the district court the federal court shall be deemed to have jurisdiction in the same way that you would under a federal question k so the statutory scheme seems to contemplate making international banking cases in effect federal question cases and even moving beyond that the purpose of the edge act is to give uniformity and uniformity of decision here we believe would only be accomplished through using federal law if this case were brought in new jersey for example new jersey has the same rule that the federal courts do which is they recognize that reza judicata not only protects the litigants from double litigation but also the courts from having to hear cases that have already been litigated and decided and so we think that's the judge force got it just right that's the appropriate result here it's not just an academic question this plaintiff for the law firm representing this plaintiff after this appeal was filed actually filed five new cases or five a case some behalf of five new plaintiffs who are all losers of litigation in korea and so there is there is a price to not recognizing and protecting judicial economies here there are going to be a lot more second bite at the apple k cases filed in the score there's now a total of six plaintiffs you said five new plate has to be filed to these two before they sued in korea and lost in other words they're in the same the on the prior issue on form nine convenience and and they filed and they filed a new case that got wheeled out to judge ray cough we moved moved to dismiss he's indicated that he'll dismiss the case but i think he's waiting to write an opinion until he hears what this court says on this case let me just move i see i have some time to the twelve b six arguments there are the notion that these were zero cost instruments you need look at the confirmations and the confirmations are written signed contracts there are fifteen of them they contain an entire column that says premium it's clear to any reader of the contract that there was going to be a cost associated with it the suggestion that these contracts were hedges they in fact work there this case is about a world where the dollar strengthened which is usually a problem if you're an exporter and the dollar strengthens and you're  d you've you've effectively found money because the dollar in the period of time between making the product you make the product the dollars here if by the time you sell the product the dollar is up here it's strength and you've effectively found money due to currency movement and what they made a decision to do was hedge because of course the dollar could depreciate in value which would lead to an artificial loss and when they talk about this being a zero hedge product essentially the way the product was structured is if the dollar depreciated too much city had the option to knock the trade out in other words substantial dollar depreciation no hedge this is a case where in the world financial crisis the dollar strengthened measurably and so when they're talking about losses what they're really talking about is a circumstance where they wish they were on hedge because they have dollars that are suddenly more valuable just because currency movements and whatever one thinks about that structure of  there's nothing fraudulent in the suggestion that that this was a product that hedge these plaintiffs were perfectly hedged it didn't work out for them if you just think about it from a trading that money for them so i think what they're saying they say they lost seventy three million dollars i don't i don't know how they calculate that i don't know if that's a lost gain in other words if i were unhedged i wouldn't of lost money i think what they're saying is this and it's this isn't a fraud claim and i think this is why they're not that transparent about it but if you have a circumstance where you're in a global recession they make circuit boards and they decide to head and here they had just sometimes a year out and sometimes longer they have an obligation to deliver currency and if you're in a global recession and people stop buying computers and you still have an obligation to deliver currency then you have a problem but that's not a problem that relates to the kiko structure or anything like that it's it would be a plain vanilla currency had structure you'd have the same issue and also there's no misrepresentation that they can point to and so they don't they don't really make that argument but i think when they're saying this is how we were damaged i think that's what they were saying they didn't have enough dollars as the global economy began to slow crash the dollar skyrocketed demand for product cratered and all of a sudden they were in a position where they had to deliver dollars and then it happened that's not a problem that that has anything to do with the kiko that's a more fundamental problem or they told it was  no position will be they don't they don't allege that they were told it was a no lose proposition and no rational person could think dealing as a principal with a financial institution that it would be no lose what they were we're told was that they were told three things so no cost we've addressed that it's a heads we've addressed that the third thing they say they were told is we believe the dollar will depreciate and and therefore you need to enter into a hedge that now we're in a situation where they're told the dollar's going to depreciate a couple of problems with that theory first of all it's not realistic to think city is somehow omniscient about the currency markets second of all that the dollar actually did depreciate they admit that the first several trades they entered into they essentially came out on top because the dollar depreciated consistent with the opinion third there's there are legion cases that talk about this level of advice really providing opinion from currency traders about where they think the market's going that is typically not actionable and it ought not to be here and the last point i'd make is every single one of the contracts that they signed had very specific non reliance clause that really prohibits them from making this argument it's specific it talks about them making an independent decision to enter into the trade and not relying on any advice from citibank and so putting all of those together this really isn't a case that sounds or ought to be permitted to proceed  ok thank you so i am just going to try to do this quickly i think part of the issue is how the law handle situations in which u s companies use foreign subsidiaries to market products that are basically designed to bring profits over here  as far as the the hedging issue the the district court said well if a product you know hedges at some exchange rate ahead that's not what a hedge hedge is an insurance against all contingencies this was not insurance against all contingencies that means what a hedge is is that you you take you know that you're going to potentially lose money but it's calculated how much you're going to lose this was completely beyond what what anyone calculated as far as the current statute of limitations is concerned which new york was beyond yeah  actually expanded your risk one other thing all of the contracts were in english and yet they were sold from koreans to koreans in korea and the contracts in english were only given like four days after people actually entered into  contract so that the normal reading of an english language contract doesn't it doesn't work in this situation well they were doing this yeah well that's part of partly because of the relation the type of relationship the banks have in korea banks are viewed differently in korea and typically people view them as an advisor and that's what happened here reasons in this case and i explained them in my initial eight minutes that we should look at korean law that the federal courts should choose korean law because the korean class of law makes sense within the entire korean system about how you can easily sue one person but just because you suspect another person doesn't fall if you can't sue them as a practical matter in korea