your honour's this is rudy tell sure and during the testing there's h v a c in the background which is not loud in this room but i'm told it might be for you so i'm going to do my best to mute why you're asking questions i don't hear  good good good if you do let me know and i'll do my best to address it for you good morning your honour's really tells b f emerson obviously the court does not need to reach the fee issues if it reverses on the merits if the were going to have the court consider the fees again because it would be possible to go back down and have the district court judge of find the error harmless which we disagree with of course but if the court found it harmless then the via shoes would still be pending so it would be my my estimation you probably want to reach the finish or to provide guidance to the district court can see seems to me we would want to look at the eighty's when there's a final field warrant from the district court if we there are two major components that one of the billing records and i think that you could you know address that to the court and further on the limited discovery relating to offset a quarter of a quarter of the brown makes absolutely clear that the district court judge was to have looked at the face of settlement monies that were received in assessing offset quarter says directly that is reversible error not to do so so if we went back down to your point i think it would be helpful to provide guidance to the just record the debt limit of discover should have been allowed and that emerson should have had the same billing records that the district court had so that it could or to sabaidee in the debate as to what a reasonable fee should have been here largest field word in an ip case of all time nd only to the work of decision that's based on my knowledge of the cases and it's based on what blade rim could find so yes in a case of this magnitude the billing records should have been produced and it would have been i proper for those to be reviewed in camera your model is right on point that both the district court judge the special master to the extent he was involved in emerson all should have had those billing records and once we look at the case there in our view there is substantial legal error in the view or in four categories one due process which we just talked about to offset which i've briefly talked about  twenty one so there's a substantial legal error in the record in the sent back down that legal air would need to be addressed  and at this point you know i can talk for a while about these issues but also i know we've briefed these issues so the one that i'm going to start with just because it's a this is the circuits night this th circuit decision says that if an attorney is unqualified for pro hoc v j you don't reach the nd prong so the st prong is is an out of state lawyer who wasn't pro hockey and could they certainly that's the words certainly have been pro hocked in in winter out they were looking at an organ lawyer who was he was highly qualified he he contributed time and the court found that he was probably going to be qualified pro hoc but what the court said when aroud is it's not certain that he could have been prohack then so the court reached the nd prong as the court goes to the nd prong which talks about paralegals an i t person now who did not appear before the court but contributed footnote four is critical and it says in footnote four we do not reach the  prong if the lawyer is not qualified for pro hoc this point was so important to the core that a page twenty five it repeated there is no case cited by blade r case that we found a lousy for a lawyer to practice us law and be reimbursed for their fees we think when aroused directly on point and that's a purely legal issue  turning to the issue of an expert feeds again this court in the c v s and st national bank said that in the context of section and ninety eight dollars which is an offer of settlement in the context of an offer a settlement there's a strong policy that if you try the case and what you get is less than the offer of settlement the cost can be shift this core found that state law under section one hundred and ninety eight dollars is trumped by federal law and the cost can't be shift under crawford and shady grows so in this particular instance we're dealing with  have a special master he reporter at least some evidence indicating that michael joy was not working as part of the litigation team that he was general in house and no guard tempering and you look at the same language that is repeated to page two hundred and eighty five of that decision that's one reason but now let me turn to your question which is your question is just as a matter of regular walk and in house counsel acting in ordinary capacity receive an a know like any of my in house clients my own house clients look at my briefs and they edit them they have thoughts about the case they meet with me and they take notes of things that mr joy did are exactly what an ordinary in house counsel would do neither the special master nor the district court cited any evidence at all that mr mr joy did something beat on ordinary ordinary work of an in house counsel and of course about you know legal discussion i'm sympathetic to his notes probably do the problem is you can't use notes as a sword in a shield so you're correct the decision that you cite is right on point mr joyce should have been entitled to no fees and none of us should be concerned about that outcome for ella is asking for seventeen million dollars in fees which is already an extraordinary sum to put mr joyce is on top of it one dollar is unfair to emerson he wasn't a us lawyer he wasn't qualified in u s trade secret law so the fact that he was interested is understandable but that's not compensable and there's nothing unfair about that to play dream can i talk to ask find that it was apportioning in phase two ninety percent of the time to emerson in ten percent of facebook it does not make that express finding if you look at age twenty six in the pages it creep preceded it talks about block billing it talks about other areas and talks about facebook only time and then it just says ten percent will be reduced in phase two but it does not explain that that is a ten percent a portion of the number says that and w curious about what the district court did is in phase thirty one dollars everson was out of the case it reduced it by the same amount as phase two which was by ten percent so you know one of the hallmarks of th circuit jurisprudence is that the district court when the district court judge said based on that that there shouldn't be any offset the th circuit said that's not correct we're not going to let our a settling defendant in the plaintiff game the system by putting that language in avoiding an to the extent that blade room pursued facebook and spent their time and money doing so and they reached the settlement any settlement in the litigation would contemplate what it cost me to go after this pardon and i want a fair return and so what a quarter of the brown states in unequivocal terms is that where there's a settlement the district court judge need to look at it and it needed to fairly contemplate how much should emerson have to bear and if you look this just think about of the standpoint what have facebook not settled out and there was this finding in fees were awarded emerson wouldn't be left paying all the fees that would be apportioned between facebook and emerson and some fair way that calculus should not change just citing lawyer argument the best evidence of whether facebook monies were used to pay for all the firm would be what was the fee agreement what was the settlement agreement and what was the payment history it is like you can put that amount of discovery in a white manila folder we asked for that discovery and we were declined it so the district court judge has no information no competent information certainly not the best evidence to assess whether facebook money was used to pay for ella just start with an overview it was about seven years ago that all rogers received an e mail from a client that indicated that emerson was building a data center for facebook using later i'm still in technology and that began what became this litigation litigation was started nearly six years ago and it has taken nearly six years of our obligation for blade room to vindicate its rights to trial and finally get to the point it wasn't easy face to very large corporations with what the district court found to have quote seemingly endless resources with quote from minimal defense to news and quote significantly outnumbered our team that's a pages twenty three dollars twenty four cents the court order of the record well we don't know what emerson spent to defend this case we do know what facebook represented in the court's six months before trial when it represented to the court and submitted  assured that the work that was being done is actually work and should be considered for payment who are and i appreciate that your honor in the district court did as well and in its discretion you looked at that and it determined that based on the were clear as to what and we also included travel records and the like to help to help put the pieces together but how i agree with you however that it might have helped us had he had contemporaneous records and were both incorrect he says he indicated that there was nothing in the record mr joy was always performing his in house counsel and that the district court did not look at that the district court absolutely looked at that it's covered on three pages of the court's order if you look at reaffirmed the discretion of a district court in this context of awarding fees look very carefully at what mr joy was doing based on the submissions and for that reason only gave us forty five percent of what we were all every day in this in this country where in this case discovery was taken out of out of the united states law firms have offices and other in other countries most of those most of those lawyers on license two ways in which the rent or road minus could be able to recover fees for weekly seniors work the st is of the attorney or to she would have certainly been permitted to care pro beach as a matter of course that he or she had by leaving circuit nevertheless the court determined the fees and the fees portion as being a pleasurable in the court in federal courts and determined in c r s t that the fees portion does not collide with hannah or hear those other cases such that there's a problem with applying that and i would say every court that has considered this issue from sea aristide to eldorado stone r b c bearings the special master below to the district court below as hell that there's no direct collision with applying the fees and cost provision of california trade secret statute diversity action in federal court and i would note that there are other portions of california law that are applied in california federal courts all the time that are arguably not consistent with the federal rules of procedure including the there's a discovery provision section  because i don't think that's the proper prism to look at it ninety percent emerson and ten percent of facebook this case at its core was a conspiracy case where we alleged in the original complaint that was filed even though  party of the very beginning that the to work together to build this data center using technology so the question is whether the claims are can extract be intertwined in the this court has been very clear about that california courts and very clear about that and in this case with these facts in phase one and the court determined that only thirty percent related to the claims versus emerson in phases two dollars and three dollars in the court determine objection to providing to the settlement agreement well there was a confidential settlement agreement facebook in particular file papers indicating that it wanted to keep the agreement confidential it could have been that were parties to the settlement agreement both submitted evidence under penalty of perjury that nothing in that agreement was to pay attorney's fees and that is the case we represented a district court below and i represent again to this court  important as an order that emerson did not do not appeal in that context and i want to see the settlement agreement there's evidence in the record from both signatories to that agreement facebook and blade room that nothing in st on the winter out issue as i've mentioned footnotes for makes absolutely clear that you can't proceed to the nd prong if the council was not proactive it was unqualified for pro hockey courts is my understanding yes for and lawyer cannot and think about it he's not trained in u s law in how can a lawyer who's is not passed the bar exam in the u s how would they be qualified to come in and practice u s law it doesn't it doesn't make sense and in fact i don't know any client that would go hire a foreign lawyer to handle a case in california that involves u s trade secret law so it that's that's the rule and when aroud went around to clear there's no  mere in house counsel if we allow fees especially in the magnitude of one million five hundred thousand this is a recipe for every case my my and his client in this is the list the judge they have really gave reviewed pleadings reviewed motions prep all the in house counsel that i represent are going to do the same things and if somebody can sit back they knew they were going for fees and they never kept records for mr joy and then they come in and they sign a declaration and in every case i could sign same declaration for any of my in house counsel and when they say only forty five percent was awarded that's one million five hundred thousand dollars as a lot of money and this this would be a bad precedent now if counsel tries cases or they're an active trial member no problem that is not this record mr joyce at the back of the courtroom i will point out on the expert issues mr fisher referred to see r s t eldorado c r s t is not on point it involves shifting of attorney's fees there is no federal rule like there is on expert costs relating to that so c r s t is not on point eldorado was a district court case in which the defendant did not object when we turned to the settlement agreement one everson did offer to receive that's only agreement on a confidential basis your honor is correct that a regular protective order w protected it i mean look no further than the m t a can we have magic of mr fischer signed a declaration saying that in his view the n d a didn't attorney into two years and they didn't produce that a agreements are subject to dispute the best evidence of what the agreements are the agreements themselves not lawyers characterizing what those agreements are