international also called b m s we are very thankful to be able to be here today to present our arguments and the reason we're here is because a procedure that is used or intended to be used to prevent irreparable harm is causing irreparable harm to a a family in this is the only remedy that we have to  this family to really earn a living but it was done for no good reason twenty thousand a month isn't enough to earn a living above the poverty line my response is above the  to throw at us and have done so it is evident from the record in addition to that judge jones the order itself basically not basically you know says  that we cannot open mr gross cannot open close transform any funds whatsoever it is not limited to any funds that are in dispute in this case but didn't include any funds of any type that belonged to him so if he goes to work for wal mart those funds are included in this and he can only spend the twenty thousand from the specific accounts that have been designated by the court there was no call for that it's  there was no predicate for the injunction itself your honor and we've addressed that in several ways my main concern is that the predicate for the injunction itself was for the burden of proof was with reverse as is evident from the record in judge thomas the burden was put on us to disprove their case they did not have the burden to make their case of a probability  f being able to prevail on the merits and well what it's all this evidence in the record about all the different trains i mean they have the three exemplary transactions in their brief but all of the different accounts that were opened with sort of misleading names and the complicated paper trail for all the transactions and so on that i mean that looked like evidence to me  and i think that was the intent judge that if you pro enough stuff on the wall that did maybe it would it would look like that we've addressed every single one of those every single tenant in the summary exhibits th suspicion of you know wrongdoing is not sufficient grounds for an injunction but the problem here is that the burden of proof was reversed on that it was put on us to show that there was some issue with that haven't disputed one penny of the summary that we provided has been correct i think the point is that as i understand it your chart show that the chinese steel companies all got paid what they rode but the difference between the contract price and those other prices is a lot of money it's a lot of money and it went into all these various accounts and some of it went to the intermediaries the other defendants in  in the oil industry they do that with a with an invoice in the u s so why were these transactions having to go through so many intermediaries the the reason for that is this the princip of the plaintiffs did not want their fingerprints with regard to any of the companies that they established to do business in venezuela they did not want to show the venezuelan government that they were the owners of these companies and so that's step number one it was for that reason i want to say they were not the owner of shop wrong correct one wrecked because they were in litigation with body even at the time and did were in my view what they were doing was money laundering in venezuela so i guess i want to know what you're so your explanation is that mr gross was doing all of this with the knowledge and approval of his sons absolutely and not only that then to finish the actual evidence of that in the record but and and well the evidence is in the exhibits that we provided with the court shows that all the  and on the other hand the issue was that the chinese companies did not want to show any ownership of companies or that they were dealing with their own companies so foreign corrupt practices act but the point is your client as soon as he resigned went to china with his father and took out nearly a million dollars from some of these accounts yes he did and he didn't explain why he did it right yes he did in depositions he did judge jones he is he is very afraid of the plaintiffs physically you know afraid for the safety of himself and his family have agreed that he's a he's an american citizen and so this is one of but they are they're they're they're very afraid of these people and i guess the best work next point you just stones is and i guess the bottom line issue is the question of can a criminal organization use our laws use our rico laws use our fraud laws to suit one of their employees areas at all he in fact that the record shows that he was of the view that that was one of the ultimate issues in the case and he didn't want to go into it and that's what the record forty nine  twenty believe into those particular issues in and of these issues with regard to whether the entire deal as structured is judge jones is mentioned was illegal and in my view is very relevant because if we you don't judge jones of twenty twenty hindsight you know maybe so quite frankly we were just being inundated with discovery requests we produce over twenty thousand some twenty thousand pages of documents just deposition requests and with a limited budget and again six lawyers on the other side and the burden of proof being reversed because what the judge hoyt said was no that your burden of proof to show that the what is being asked and done is unreasonable they've asked i've given you should be saying this is unreasonable for these reasons that's what that's what the paper should be saying and to me that it's fundamentally reversing the burden of proof in the case and that's that's what happened it was it it was is as you pointed out saying ok we've got all the smoke we've got all these transactions and stuff like that so there must be something wrong unless of course you can prove to me that there's nothing wrong and that's not what the lawyers that that's not the standard with respect to injunctive relief transaction the transaction and relate t do that with the summary exhibits for example with the wire transfer payments to defang america's showing you precisely how all of these funds were used in paid and that is instead of repeating money movi and the judge asked us to submit findings of facts and conclusions of law and then five days later judge hoyt signed their proposed findings of facts and conclusions of law without changing a comma fifty three pages of findings of facts and conclusions of law  and so there was at that hearing for example who was out that's exhibit forty three we show every payment how it made its way to the factory what they want to do is they want to draw a little you know exhibits and showing arrows going everywhere and all this kind of stuff to evidence in with regard to specific e mails showing how the chinese factories wanted us to have set up the accounts for example one of them is different it's exhibit eighteen which is a as i know it's still not illegal in america to open bank accounts or to establish companies and that's basically the sin is having lots of back accounts my time is up thank you thank you very much for you causing a reprimand harm to the family there's no evidence of that he didn't show up at a preliminary injunction hearing or to t i hearing and stand up and in argue that there was a repertoire he did between the t r and the preliminary injunction and therefore we agreed to allow them to withdraw twenty thousand dollars a month in order to not have a burden on the plus the family members can't earn a living he hasn't worked in as best we can tell since he resigned from the company medical issues none of this is in the record he didn't show up at all for any of this evidence it's inappropriate to be raising it before this court post injunction away just once earnest on that he was asked a question by a member of the court about whether twenty thousand was enough so i don't think he can be accused of trying to answer the court's question for point your honor but i do believe that if he's going to stand before you and argue that it's insufficient that he should have offered some evidence before the local into the lower court before judge hoyt as far as all this the statements that this was not in response to the court's question about the principles not wanting their fingerprints none of that's in the record in fact we would like to have an up market twenty twenty thousand  understood but nobody's come back to us and said it's inadequate for any particular reason my clients are reasonable people if mr ogilvie is burning through all the fees and the family is short we can certainly address that what seems most  to me is your client agreed to let them have twenty thousand but his salary while he was some floyd was ninety thousand a year grows which is you know less than a thousand a month extra reason we did that is recognizing this brings the reason for that your honor is what was originally ten thousand dollars a month that we reached a stipulation with plaintiffs count i mean defendants kelso excuse me for the twenty thousand dollars and now the on the appeal they complain about it that's so but then he was skimming off the top of it first point on there's no evidence of setting up a scheme to for whatever purpose second thing is he stole our money and that's the distinction and then just saying americans are supposed to be paying the steel supplier of the problem is when you take forty five bank accounts and use a bunch of d b a of the actual steel suppliers if we were to go look at the books and records which were then tain by the defendant one hundred percent you would see the payments going in from the bar and out to the still supplier but they weren't really going to steal suppliers they would go through this chain of other companies with forty five different  not at all not till this litigation is committed we start taking discovery in terms of press i believe it was drawn as question did we take the deposition yes i actually took that deposition and i specifically asked him numerous times to explain what was the intended purpose of this particular wire transfer what was intimate purpose of this transaction why did you set up this shell and we contrary what counsel said we did not get any answer to those questions in the records very clear in that respect  was the evidence about the transfer of money to father in law well there's several your honor we became suspicious of the defendant's activities we started asking questions about it once again he refused to answer he showed up on our doorstep on july one and resigned immediately after that he jumped on an airplane and went to hong kong with his father in law who had never been on a business trip with him ever in the past and they withdrew i believe your honor the numbers are far in excess of a million dollars and close to a million five which he gave some of the money from the bank accounts in hong kong to his father in law directly that check issued to him the remainder he gave to him in houston and the amount of like four hundred fifty thousand dollars in houston was turned over to his father in law allegedly for investment purposes there's been no explanation of that he's never had a history of investing with his father in law at any point in time in the history of their relationship and he has refused to account for that he's refused to turn over the bank records for that and so we're out subpoenaing all the hong kong bank account records which now i'm getting beyond the  are the next question or statement by counsel is what was referred to as d x eleven defendants exhibit eleven the record of eight hundred fifty one addressed everything if the court takes a look at the ex a love and actually believe this exhibit raises more questions that can be and then were answered it's a summary the appellant did not produce the backup records the appellant's own chart demonstrates a very very large differential between the purchase price being billed to the buyers and the purchase price being paid to the manufacturer sellers in china the problem is that it lists actual factory agents those act actual factory agents showing minute sean way and b are nothing more than companies created by the defendants in his coconspirators to funnel money around through the various bank accounts our cup client has been in business this business a pyramid for many many years they've never used a factory agent and in right from two thousand and seven through twenty fourteen year old ok seven years and my understanding is that he he became the company's principal intermediary for chinese business multi million dollar transactions right that's correct and they had they never had an audit done in the three or four years of these you know shell companies  operating we already had come to work force at the recommendation of one of mr bennett is lot long time friends mr schwartz and he had been a trusted employee for the first couple years they had no reason to suspect the fraud was even ongoing it's easy to from a bar come in in a check go out to the still supply room in typically progress payments and then the contracting for the shipping of the pipes across like a specific and a few other things the cop the accounting it should not be that complicated the problem was we had no idea and what we would look at the record company it was a lot more complicated than we expected your honor that that i can attest having tried to wade through these records  because the steel invoices work changed internally and did not always match the purchase price he would get the real invoice from the steel supplier for the manufacture of the steel he would then creating another invoice and do back to back and we actually owe it we don't have a loss for theft i suppose that's possible at trial and twenty thousand and there isn't going to be much money well except for the many millions that we haven't yet discover address mr alonzo statement i believe he was quoting from record page forty nine twenty but it does sound from what he read to us judge who was putting the burden on him rather than on you i don't think  hoyt put the burden on him i think what judge hoyt said is come forward and said show me some evidence that relates to the allegations that are being made i believe his judgment burden in what he quoted to us i'm assuming he did so accurately i don't quibble with his reading from questions and i think it's very important this is sort of getting lost in the shuffle too we had the one day of evidentiary hearings in the judge allowed the parties to engage in some limited discovery get something access to the quick books try to understand the transactions and go take the deposition of mr gross to try to get an understanding if he could so clearly walk me through the invoices and explain it to us we certainly would have listened but he could not only that more importantly he refused to do so  before we finish up i do have a question about standing of your clients because it is not clear to me that mr bennett was a shareholder of from the beginning if this fellow mr fletcher the chinese mr fletcher's set up shop and been a decent kind of an assistant open it until i didn't take it over into two thousand and thirteen i think there's some others standing questions about this case certainly are first of all with respect to defending america is the evidence is clear that the attorney in houston that formed america has issued the original minutes in two thousand december of two thousand and eight and it shows very clearly signed by the attorney and we have the original in his blue ink signature showing that mr bennett is mr cardenas were both fifty percent owners of the company in discovery some documents were produced by mr gross that showed that the stock was in the hands of mr fletcher and i called him for his chinese name in then clearly this is undisputed that mr there's some additional d should also add that those are appear to be stamped by the attorney knots and signed we've never seen the originals not withstand the fact that we've requested oh so the only originals are the one shown in two thousand and eight continuously that my clients have own the stock secondly the stock even under their theory of the case was transferred in two thousand and thirteen the claims and costs of action it's a red herring here are what they're trying to assert in the cases they cite are derivative standing cases were not asserting a and derivative shareholder capacity were alleging that the corporation itself owns these claims or causes of action we just happen to be the owner of mr bennett isn't parvenus and so the corporation has the right to sue for the fraud come in and  numerous that's an exaggeration he wrote several checks are wire transfers and one in the amount of seven hundred seventy five thousand dollars and we believe that in a cell phone is enough to give him standing he is not suing in his capacity as a shareholder of j and a proper plaintive a t n made i think it's to the tune of over six and a half million dollars in payments to gulf maritime one of the defendants in this case and there were numerous find out recently the gulf maritime was not the gulf maritime that actually owns ships this is gulf maritime hong kong company that has no just a show office in hong kong and it's worth noting your honor that of the six companies registered in hong kong owned by the defendants all of them have the same business address no phone no employees no business activity and mr gross testified in disputed no accounting no tax returns you are briefly my last couple minutes i'd want to just address a couple of the other arguments or points of issue that they argue that with respect to issues five six and seven we believe they're on timely as set forth in our papers but we think some of them well several of them are issues raised for the first time on appeal the order releasing funds the nose of appeal was not fall within thirty days of intrusive the order with respect to the secondly if there was the defendant showed up after the hearing on the primary junction in a motion for reconsideration which has not been appealed and fall is a list of three alleged transfers a condominium in south america a car and i think a country club membership or some club membership where he recovered a couple hundred thousand dollars seven years prior he did not offer a shred of evidence that the cash that was in the accounts  enjoined is the same cash and it's just not believable that that cash cash is fungible and he certainly couldn't trace it or didn't if i that had a segregated account in conclusion we believe that the district court's finding fact are not clearly erroneous we believe we've met our burden with respect to substantial harm we it's very clear that the monies can disappear as has already been evidence to admitted by mr gross that he's already moved millions of dollars  what is what is actually inconceivable is that they can stand before you and claim that they own defying america was when the documents that we offered in  evidence the defense exhibit show that the only documents that they provided to the venezuelan government were documents showing fletcher as the owner of  and there were several times that they did this they did this for bank loans they did this with regard to defang americas they did this with regard to either a copy thought of contract it's not a red herring and the reason it's not a red herring is because fletcher was the individual on behalf of shanghai's or fang who was directing mr gross's activities on the chinese side so is what we discussed earlier he had full knowledge  not only had full knowledge he was actually giving the instructions through two thousand and thirteen in two thousand and thirteen and they again signed in this is i believe there's no question this is the only time that both fletcher and the the principles for the plaintiffs who are not u s citizens are venezuelan citizens sign the same document and that document transfers the ownership of the company from fletcher to the toobin as well as nationals that of their principals and they sign those documents showing there's a transfer in january of twenty thirteen so there's no doubt about that there's also no doubt about the fact that you have a corporate book in front of you there are no certificates that have been ever been issued with regard to  americans at all and so the documentary evidence that we have in that we believe is is correct is that the but as well as principals did not want to show their ownership of these companies refuse to provide any information and you just heard counsel say well it was incumbent on us to trace how my client who has all the money that he has in a bank account thousand and eight they knew that she was involved and knew about the company for the company b m s side of yes she was a manager of the company but they knew that how can possibly be sued you know over  in terms of you know not you know transferring assets or aiding and abetting you know someone violating the practical difference as she's being super personally for not having done anything nothing nothing can you