i think the clerk already indicated this but because there's three appeals here are the way we're going to split the time in order to make it both easier in terms of time keeping and al so in terms of the cases as we'll hear argument first on the appeals related to the jurisdiction and the sixty b and those are the cases in which safe sega's the appellant will hear that for fifteen minutes per side and then when that's when we're finished with jurisdiction well go to the third of which relates to whether if there is an appropriate judgment the district court calculated the commissions correctly in terms of the timeframe and that would be five minutes per side and at that point the nugent would be perhaps i can ask a clarifying question sure  disfavoring the full judgments and favoring resolution of cases on the merits as the mess the court and other cases that we've cited make clear this policy requires the default judgment only be permitted in extraordinary honor but the jurisdictional question in considering the jurisdictional question the district court also failed to consider and appreciate the fundamental policy in favor of resolution of cases on the merits so on the jurisdictional question you're saying that the allegations of diversity jurisdiction were deficient in the original complaint that's something that i guess your client didn't catch until after it was of appeal had already been filed up here and then having caught at it we send it back to the district court and they just record allowed nugent to him and the complaint two to make appropriate allegations of diversity so so at that yes yes your honor although i don't think you even need to get to that point because i think the district court's failure in the very first instance to establish whether it had jurisdiction is a sufficient basis in of itself to reverse this joel that's why we have section six hundred fifty three because because courts mess it all the time is the parties do and that can be fixed even on appeal as long as there is actually jurisdiction in the supreme court is that it doesn't matter if the allegations were deficient so long as they could be amended at any time and the question is was there jurisdiction at the outset and nothing changed here correct to suggest there wasn't jurisdiction of the us i don't think there is evidence  change the allegations have the affidavit saying our people are from wisconsin and the district court found they had that was sufficient to fix the facial problem and that there was no evidence showing or to it found that there weren't fact the president lives in the other the members all live in wisconsin so what was wrong with the district court finding that there was there was diversity well two things number one the finding that no as the us supreme court has held the existence of the state list defendant will destroy diversity a person can be stateless if they are for example d that least two of these people it's clear they live in los angeles when save six sues they basically say all of the safe in state court that they're living in most of that they are in los angeles and when asked by the district court basically says you know due to lack of information and belief or whatever and that's not sufficient so you know it seems to me that there's a lot of game playing here not to get to the answer and to talk about that they might be living you know in yemen or in one condo moer in england doesn't really get to the question that's what the judge asked you and what did what did your client respond we at the filed the company was in the midst of a great deal of turmoil and that jonathan robert de stole a massive amount of inventory and left town shortly after this complaint was filed and they have not been in contact with the safes existence lula malone has never had an active role within the operation management or business of cif sic she is a true you know passive silent investor and it is not at all unusual in a limited liability company for the company itself to not know the precise domicile of each and every one of its members because in l l c all it needs to know is who the manager is in order to operate and it just needs to have an address to which it can send notice and correspondence but an address does not establish domicile and particularly with respect to the defs we have been chasing them for now the better part of three and a half years trying to get a hold of them and bring them to justice for what they did and they continue to move around the country so the idea that the dicks may or may not have been domiciled in the state of california in october of two thousand and twelve when this lawsuit was filed there is no evidence in the record that establishes that the only evidence in the record establishes that in two thousand and ten they signed an operating agreement declaring that their ad the two of their addresses were located in california facial challenge to these allegations and that else what's wrong with that so this is where the fundamental policy against the judgments comes in ok we have a situation here where the plaintiffs has not proven through admissible evidence that diversity jurisdiction exists frankly we have challenged their evidence of their own dumb asylum their evidence of their own domicile is nothing more than a self serving declaration the case is the  value case in the washington vs events a case that we cited in our papers talk about the fact that he self serving declaration to try to establish diversity jurisdiction after a challenge has been raised is insufficient what's and then the allegations having to and now contrary factual allegations in the district are found good enough and what's wrong with that i guess is the question so we are in the amazing posture here today did you do or not that there was that did you say now some of our members are in wisconsin so this is not no diversity there's no diversity no more i have one of our regarding some of our members and with respect to the dx we stated that we didn't have sufficient information to determine what their domicile was and we therefore denied those allegations on that basis we did the same thing with nugent we don't have sufficient evidence to determine whether nugent is in fact a wisconsin citizen all we have is a self serving declaration amazingly nugent was able to put forward safe six operating even not actually the current operating agreement an outdated version of it but a version of say for example the agreement yet the record doesn't contain new gens own operating agreement it is it is remarkable to me that a very bald self serving declaration without a single piece of documentary proof that in fact doesn't erickson is the sole member of newton or that doesn't erickson is in fact domiciled in the state of wisconsin would be sufficient to prove diversity jurisdiction let's not forget that the plaintiffs have the absolute burden to prove to the jurisdiction this court and the court below is required to presume that diversity jurisdiction does not exist until had it it has been proven so we are standing here today in the remarkable position of having the currently operative pleading in the case is an amended complaint to which an answer has been filed which denies the juristic many of the jurisdictional allegations and denies the substan allegations and yet we have a judgment that has been entered on a superseded complaint which no longer has any force in effect because an amended complaint was filed so getting back to the initial question default be opened up sixteen fifty three can't trump the fundamental due process right that is set forth and will fifteen the defendant never sought to litigate the case the defendant did not stand up before the court and say there shouldn't be a default here i'm ready i'm here i'm prepared to defend the case so on that basis alone the jacobs case is in applicable to this scenario because the jacobs case didn't have the opportunity to balance the competing interests of finality of judgments versus not allowing default judgments and  consideration of the fact that default judgments are disfavored and should only be entered in extraordinary circumstances that factor is considered both in the eye tell analysis and in the ruling on the  sixty motion and that's fundamentally where the district court failed here i also think that the jacobs case was wrongly decided because the jacobs case fundamentally deprived of the defendant in that situation court here attempt to fulfill its affirmative duty by asking the lawyers one of the facts and when one of the lawyers says i don't have any information what's the district court supposed to do to fulfill its quote affirmative duty well again in the context of a default judgment the district court is required to give the defendant who is asking for the opportunity to should have had the opportunity to get us in erickson for example into a deposition we should have had the opportunity to take discovery on these allegations but more fundamentally we should have had the opportunity to litigate this case what we're talking about here is a default judgment that was entered with no proof of a contract a default judgment that was entered with no actual evidence of damages no no actual affirmative evidence that ever made any sales with contrary evidence in fact presented by safe saying that what they were claiming was the contract was not in fact the contract so you have a judgment that was entered with all kinds of questions and doubts about whether it is even a valid cause of action and a valid judgement and then to gloss over all of that and simply say because safe saying it doesn't have enough information to disprove diversity jurisdiction turns the entire legal system on its head the plaintiff has the our obligation to prove diversity jurisdiction the defendant doesn't have the obligation to disprove it now used your time any other questions that  think that the court has hit the nail on the head i think the real issue that the court has asked us to address is whether or not a district judge sitting  diversity jurisdiction has the right to ask the parties questions about where they are what their citizenship is and his response to that is in the shape of an l l c you've got you know a managing director or whatever the status is and all you need for the other members is an address and therefore they didn't know but if they've been able to take discovered then they could have told you the answer but they never got a chance to take discovery so i'd appreciate your answer to that well it's a very funny proposition because in this instance the discovery that they would be talking about taking would be of their own minds not of think i think they're saying we don't even know where these people are so we don't know where they live now or maybe you know maybe they live in madison wisconsin right and i think that unlikely but i'm sorry i said it may be unlikely but maybe they do right and i think that they're i think that first of all they never asked there's nothing in the record even suggesting that the defendant safe sex ever requested any discovery the never did and as far as deny that that was true in other words taken it on as a factual dispute as opposed to official dispute if they had done it then i think there would have been a further duty to  prove jurisdiction they didn't do that i think at some point they said it was weak but they didn't contest it right and so i think the real issue here is can the judge can a district judge was a change in the proof in the burden of proof and it is not it is simply asking questions relative to jurisdiction i think the case law all through suggest and of course twenty eight sixteen fifty three clearly says that they can do that and so i think the issue here that has to be determined is whether a judge can do that now what happens when the judge did that was a declaration filed by a gentleman mark rosenberg who claimed to be the second person over the chairman of the board of safes and i think what happened was safe sig attempted to find the only ignorant individual that safety to file the declaration and very often in this case the truth about safe sex is found not in what they say but what they don't say and this declaration is a personal that gratian it's not a declaration on behalf of cif sig and he basically this is this is a fellow who became the chairman of the board in january for the it's rape i think january third of two thousand and thirteen he made this declaration about not knowing where the were and not having documents or information about them in april of the following year so fourteen months thirteen fourteen months later but taking that at face value was that esther court i guess the members are so did the district court or in doing that i think that's the question before us right and i think if i could finish the timeline a month after he mr rosenberg became chairman  deeps when he says in this declaration that that who the members are in paragraph three of his declaration he says based on my review of safe sigs operating agreement as amended i am informed that save sic had five members as of october twenty third twelve this is a person that has been in litigation on behalf of safes with  dea for over a year this is a person who is the chairman of the board for this organization and he says he has to go to the operating agreement to find out who the members are this is not an organization that has five hundred members this is an organization that and there they are engaged in litigation it's just i think accurate to say that there were plenty of other people at safe city who knew very well where what the deeps were up to throughout this entire period of time and all the declarations says it doesn't say i m inquiry it doesn't say i talked to other people about this it doesn't say anything that they did to find this information it simply says i mark rosenberg don't know did you take it try to take any discovery on this point army did you try taking a discovery on this point i did not your honor because by the time this if you if you look at the timeline the appeal was filed in july the notice of appeal was july first of two thousand and thirteen the default judgment was entered and then after that a receiver was appointed and there were a number of proceedings because safe sic was not cooperating with the receiver so the receiver went to the court of a number of times to get instructions from the judge and then ultimately it was  the first brief in this was filed nine months later or ten months later which is the first time that this jurisdiction issue was raised by that time the district court didn't have jurisdiction and this court had jurisdiction and i'm afraid to say i don't know if there is any possibility to take discovery once this court has and so no we didn't take the stuff every because this court already had the initial appeal and i can tell you that there is as i said this california st ongoing and if discovery is possible in this court in this setting we have the attorney's name that represents the deeks you know we unfortunately or for the better don't  take evidence or discovery up here now i understand that but we're addressing a matter that is specifically addressed in twenty eight sixteen fifty three which allows the court to pardon me consider jurisdictional matters and facts of this level that's why it's a question and i don't know the answer to it but believe me i would be happy to do discovery on that issue because i believe i know the answer and i think was the district court attempting to fulfill its affirmative duty when it ask save for evidence of the dixon ms malone's domicile was the district court inferring since they didn't answer that the answer would be adverse to the defendant is that what they just recorded well i think i think that probably the court did that but i think the court also read the allegations in the amended complaint which met the obligations to plead jurisdiction properly but the of that by the defendant safes it was we don't have any information so my question is was a reasonable and not an abuse of discretion for the district court to find that the answer must be adverse to the defendant i think it is and i think that the jacobs case and the reference to right miller also suggests that in that circumstance  simply deny information without making a reasonable inquiry about it and i think that the fact that the declaration that came back from mr rosenberg did not make any reasonable inquir and didn't state that it made any reasonable inquiry it just said i don't know this information and so i think with the amended pleading that properly pled so sorry that properly pled the issue of of jurisdiction and then when they said what we don't have any information to respond to that i think that the judge properly made a finding that in fact there was absolutely not even a breath or a suggestion that any of the defendants that is any of the members of safe sig had anything to do with the state of wisconsin much less w at that point is the case in the sixty beat past year yes so if you put one minute on the clock please thank you very much owners let me just judge pratt's last question i don't think it is proper for the district court to draw some adverse inference in this circumstance for two reasons default judgment context and the entering the default in the first place without having proper allegations of jurisdiction was without jurisdiction and should have been set aside and then entering the default judgment without doing this should have been so so secondly creating that adverse inference is yet again putting the burden on the defendant the whole process here that the trial court conducted which fact that the trial court was putting the burden on ceasing to disprove diversity jurisdiction was a fundamental error of law which justifies revers bottle thank you thank you he's the pulsation he will go first right and if so at this point will conclude the argument in the appeals related to the jurisdiction of sixty b and b i tell factors which i believe it's thirteen dash fifty six two to five and so this will be five minutes per s nugent and the only issue there is that the trial judge concluded that because that web site that had been used so you sued was no longer in existence that commissions were no longer payable but there were facts submitted by way of a declaration by dustin irksome that in fact what happened was the  e sales that were made through the web pages that he established that originally went to save sick had been transferred by saves to  the indian tribe the someone'll tribe of florida and that those same sales were continuing to take place and that under the agreement he had a right to commissions from th that was lacking in that evidence which is there was no evidence that safe seat was actually making those sales or getting that money the only evidence that was presented was that the safety website was redirected to assemble dr web site but of course if the seminal dr made those sales those would not be damages that seasick would have those because those are sales made by the seminal doctor and there was absolutely no evidence that there weren't fact any safe seat customers that nugent had referred that actually bought electronic cigarettes after two thousand and twelve so without that evidence there's no basis on which to award damages going out in the future and frankly that defect exists in the entire damages calculation that the court relied on there was no evidence by mr erickson that in fact customers that nugent had referred to safe saying bought these products the evidence was simply here's what we think safe cigs sales were or here think here's what we think safe six sales should have been but they weren't entitled to commissions on all of c six sales they were only and even under their theory of the contract only entitled to commissions on sales that were generated by nugent that started with a link from a nugent affiliate website and there was no evidence as to the identity of customers or the you know tracking customers from new gens website through the city six website to prove how much of those estimated or projected safe six revenue could possibly be attributable t records presented or the numbers of gross safe sync sales that were presented by new gen were inaccurate and they submitted a declaration save six amid a declaration first of all saying that the contract is what they say it is and second of all that the sales aren't what they say they are so that evidence was submitted by in a declaration by steve else filed in opposition to the second motion for liberation the chart that was attached to that and then of course the declaration establish that safe sic made no sales after december fourteenth and frankly has still not made any sales as of that this is