and yes we are right how are you going to share the time curtis is going to take three minutes and i thank you mr nader appeals from the district court's expressed and final injunctions which permanently bar enjoying him from pursuing any claims against the settling parties the district court lack the power to enter those injunctions for two independent reasons first the district court lacks jurisdiction because the plan trustee has no standing to prosecute these be no waiver just as there can be no consent in my case that you rely upon for your argument that is not a preemptive affirmative defense and therefore cannot be way there is to our knowledge in our research no case ever addressing the question of whether sluice operates as a withdrawal of subject matter jurisdiction or whether it is in effect a preemption there are cases that thang it is the preemptive defense there are cases that use the language of preemption but never say it is a preemptive dispensed nor do they ever analyze the question of whether it amounts to a withdrawal jurisdiction the statutory language is the starting point and in the absence of cases is all we have but the  is no covered class action based upon the statutory or common law of any state or subdivision there of maybe lane taint in any state or federal court by any private party it says no action may  maintained that language we submit is consistent with our reading which is that it is the withdrawal of subject matter jurisdiction here and i can't see you asking us to be the first kind of court in the country to make the ruling that it's not a preemptive affirmative defense but rather it will drop to extinction from court you would be the first court to address the question whichever way the court went there is to our knowledge and my colleagues have not cited any authority either so i take it they were searched disclose nothing on this issue as well and there is no court that has undertaken to analyze whether sluice operates as the withdrawal of jurisdiction or whether operates as a preemption we submit that the language of the statute which here we are writing on a clean slate because it says no cover class action may be maintained that does not sound like we're preempting claims we do have expressed preemption language in other statutes and they typically say the actions are hereby preempted and nothing about implied preemption because this is obviously expressive language but when you see some of the governor statutes where there is likely a reason this particular argument with need to the district court in just the way you're making it well we certainly presented it on the papers and we did tend to argue it to courtland just rejected the school's arguments that those happened at different points in time but in the context of this precise injunction matter yes it was fully presented to the district court and the district court has one instance in its injunction which is  r within that brief pages nine through sixteen which are with i can give you the east sides may begin at six forty eight and then they  problem because of the judgment reduction credit now i'd like to have you assume the judgment reduction credit would would play again how would you be prejudiced but how would your cli let me start with the very threshold issue your honor raises which is is there standing for my client understand is there standing for my client under section twelve ninety two and one we are dealing in this court with the appeal of a expressed injunction under the plain language of twelve ninety two a one there is appellate jurisdiction to review every injunction that means that we do not move to the carson factors the supreme court's decision carson because that does not deal with express in other words look back at this we have this court's decision page in the page decision this court distinguishes very plainly between expressed injunctions on the one hand and those orders that have the quote practical effect close quote of an injunction on the other hand if it is an expressed injunction then under this court's decision in page that's it there's appellate jurisdiction five herschel the language of twelve ninety two and one if on the other hand you're not dealing with an express injunction if you're dealing with an order that has the practical effect of an injunction then you're kicked over into the carson decision the supreme court's decision cars and grab bag of factors that you go through to determine whether or not there's an injury and in that setting you look irreparable harm and so forth but if it's an injunction the finding of an injunction both as a matter of a statutory language under twelve ninety two a one and this court's decision in page we're here we have an absolute right to appeal now it's hardly for me to answer the question whether when the congress does something it makes sense or not but it certainly does make sense in other words if one thinks about it the in the notion that someone could be enjoined from doing something and the person so enjoying would not have the right to to get to the plaintiff i heard and so maybe you could tell me how your client was hurt what your honor we do say that we and we cited to the district court that while our case that our client is injured in a this company if the allegations are true about some of the participants here he could go to one of them just stop right there you're not talking about cases in which your client might think you're talking about cases and with your client has a right of action the other officers perpetuated of proud unknown client of appeals just now he'll be unable to sue that other officer if the officers entered into one of these that i'm in agreement that's correct and we have exactly that situation with the chief financial officer and company your honor says fraud but for example there's no reason why negligent misrepresentation wouldn't be such a claim my client could in the absence of this injunction take an action against the chief financial officer and argue that the chief  engaged in negligent misrepresentation in the statements to him concerning the subject matter of issue but mr injunction wipes that out goes to your client's personally or is that one that he suffers as a result of owning stock along with everybody else now it would be a result of the fact that because of his personal ownership yes it's true that he would have that action but if it's a statement made directly to him as opposed to everyone else then obviously that would be unique to him if the if the statement is because of it circumstance of the chief financial officer will make direct representations stock in boston market and and two if there was something to think statement that was made to him in his capacity as your president of boston markets but note that it's the second one that's a unique injury to my client not the person on th individually to the extent that my client might seek to take a claim against the law firm based upon either conflicts of interest and that representation or failure to provide adequate representation to him in connection with those matters that action likewise would be barred but the injunction first and i understand your honor wanted to analyze them separately but first even under waller formal legal prejudice exists by virtue of the fact that injunction is entered against him if the court enjoins an individual from doing something that the individual could stipulate he has no intention ever of doing nonetheless that individual has the right to prosecute and appeal from the injunction under twelve ninety to anyone to set aside the injunction if it's tallaght as to him on any grounds and that is precisely the holding a page in addition under woller you would have the opportunity to show it was a separate arm ok we're talking first about injunctions under twelve ninety two  penny not settling party object and the answer is one must file one must demonstrate formal legal prejudice we've satisfied that one here as well although our position is that by virtue of the injunction arm of this case it's unnecessary for us to do so but it is satisfi here for the reasons i've described i'd like to turn with the court's permission to be issue of constitutional standing under article three and address that with the court as well our position is your honour's are aware of me just so i understand you're talking here a law school exam quality to it there's no question about it the standing issue on the part of the trustee that we want to address obviously is our position is your honour's are aware from the briefs are that the tests are set forth both in the kaplan supreme court's is there a risk of inconsistent actions that's pursed test who is the real party in interest as applied here we believe the record is quite clear the real party in interest is not the trustee real party and interest is that it's the beneficiaries of the trust the creditors not just because they're beneficiaries of the trust but because it's a claim that really directly should be raised by them first the plans crossed was funded by the creditors initially with a five million dollar cost retainer or war chest with money i don't see where that gets you over the hump because the creditors are going to have to go through the debtor before they get their money is there something about them putting in this litigation money that taints the whole process i think it's not a matter of changing the process but it's certainly one of the factors that one looks at other words if you are funding the litigation and not only funding it but you're going to a twenty percent grant a preferred return by virtue of the interest rate on that that that transforms you from your typical setting there it's just a shell doesn't have any money and the trustee is representing the shell and you're trying as i understand your argument to pierce that shell or pierce the corporate veil and say it's not really the corporation it's the creditors they're  benefit no i don't think that's correct your honor and respectfully the analytical framework first is the williams framework and so the question is who is the real party in interest and to answer that is not a piercing the corporate veil question the question is when you look at the reale he of the nature of the direct action by the creditor because the creditors are affected and equally not comparably so if one looks at for instance the analogy between direct direct and derivative actions in a in this setting you would not be able to say that a class an analysis that says you were packed the point of no return not only were you insolvent there was no hope no legitimate range of business judgment ever could be brought to bear here to take on more debt and you have therefore in your creditors in some increasing amount as a result the answer to that is those creditors therefore have been injured directly and individually in different consequences by virtue of the conduct that's alleged it is not derivative in its nature it would not be property of the state it would be a direct action that's consistent with the law in this subject which says that at the point of insolvency the five usually duties shift to the creditors who have a direct action to vindicate a breach and so what you're arguing here i any time we're in seven automatically the creditors have to bring the claim absolutely not we are not saying that we would take her so in when ever you're having an liquidation although that's a relevant factor first the creditors do not have to bring that contains for garden variety contract actions current right a contract action someone fails provide conforming goods customers are lost or businesses lost the debtor brings to the point could there be a circumstance where a creditor would have a unique claim yes i suppose if there was some contract that no they must be inspected under williams piece by piece so you could have for example a related party transactions that's alleged to be a breach of five you surely duty if the consequence of that property was bought or sold it better or less terms and it should have been there's just a diminution in the value of the estate ok that becomes essentially a debtor oriented claim why because creditors participate sensually as a class and therefore it is in its nature not direct but if the claim is unique to the creditors such that a direct action properly would lie which in that even insolvency we submit must be the case as our illustration shows then the direct action trumps and prevails because that's the real party in interest under williams and i don't want to lose the other two points as my time escapes me as the in party the lack of concerns and this is critical here because one of the things that has happened that is absolutely essential to this court's analysis under williams is whether the proper parties are confronting one another in court such that the doctrine of imparted to lecco is properly applied or is it distorted and in this instance if a direct action by the creditors had been maintained against my client my client would be in a position to assert the  leko defense against the creditor who we submit there's good facts to support new these issues now this court doesn't have to conclude that we would prevail our point is and is a much narrower one and that is that when you're focusing on who is the proper party under williams who has the standing here the court always must be mindful of whether the answer to the stand in question has distorted or been faithful to the impaired electro operation he has not only your time  trustee in this action the ability to growing claims that are owned by the state the focus of the underwriters argument the reason we join in this appeal is because the trust e seeks damages here that do not belong to the estate they are uniquely the damages of the creditors in order to state a cause of action the trustee need not only state finds any provision enabling the trustee to collect money not odu to the estate the point that mr maher makes in his argument that the parties the appellant's have made in their br the core of the damages that are the issue here are the losses to the creditors the bond holders and the shareholders not only has merrill lynch and have the underwriters been sued by the bond holders and shareholders and resolved that action the very fact that these damages relate to the creditors themselves they are their property not the property of the estate we're the trustee and this the significant issue we're the trustee here for granting a series of tort claims and then seek damages that close to the estate this appeal would not lie the critical issue here is that the trustee that under kaplan under the article three construction both under kaplan under her should be arthur andersen the issue here is you cannot segregate the issue of standing to pursue damages from the standing to pursue or the court to do that segregate harm from damages you would have separated the fundamental elements of a cause of action there cannot be a cause of action without both actionable harm and damages suffered and our point time i want to address one issue when it really is the question the judge wallace raised initially and that is the standing of the appellant's to bring this appeal it's our position that they do not have the standing because they have not been aggrieved they have not suffered any harm or injury to any legal right as a result of the approval and bar order that was energy here let me make clear at the district the non settling defendants were harmed or agreed that the settlement was unfair to them in any other way there was a question raised on august nineteenth regarding one of the provisions in the proposed bar order and as a result of that all of the parties agreed to accommodate the concerns raised by the appellants and modify the language to clarify that not only did they receive the full benefit that would be provided by colorado law but actually that so no issue was raised below and indeed if you read the opening briefs here no issue was raised here regarding the fairness of the settlement where the protection afforded by the to the helen's by the bar order and i think they've waived that issue they have not preserved it for appeal are you saying that they had a responsibility when entering into settlement with other defendants and they're not involved that they have a responsibility that will bind them that they have to object at that time there was a settlement here and there was an approval hearing on notice they appeared they objected to the settlement on two grounds standing of the trustee to bring the actions and mr warmer raise the solutions issue they did not raise any issue regarding the fairness of the settlement and yes it is our position that at this noticed hearing they had standing to object at the district court they raised issues the court resolve those issues against them  they did not raise the issues that mr marmor is trying to raise today i believe that issue was waived with respect when you say today you're talking about his argument that he is unable to sue other etc correct that was not raised in the district court at the approval hearing they appeared they argued at the district court they did not make that argument if you look at their opening greet in this court they did not raise that argument in this court mr marmer argues that twelve ninety two a one provides appellate jurisdiction from any injunction that's true but it doesn't mean that the procedure that if you haven't adequately preserve unusual law when you've had an opportunity to raise the issue is way well that's part of my concern is for and when you apply that to a non party in the context  their reply brief and raise an issue that they haven't raised any time below i mean i thought an appellate record is set by i mean it is not as if there wasn't a hearing in the district court they were parties to the action i think your answer is that you don't have a case i don't  simply to address the public policy issues that are implicated as a result of the arguments here under the appellant's theory if as they argue happened here district court mistakenly finds that a plaintiff has standing so that the case goes forward then none of the defendants can ever settle the case they are stuck they are forced to litigate that case to its conclusion and that's the dilemma that the that the settling defendants are faced with here we tried to buy our piece we thought we had the court blast the settlement agreement there were no objections to the terms of the bar there has to be a way for a defendant to effectively settle the case to receive a bar order as is always done there has got to be a way but it can't be at the prejudice of other people well that's correct your honor but that prejudice has to argue whether that settlement is trail to them or not and and they didn't make any arguments that the settlement was unfair and packed just a briefly quote what the what the judge concluded i'm reading from the transcript of our settlement in fairness sharing and the judge concluded their review of the papers indicates there are no objections to the trainers or reasonable must of the settlement or to the terms of the bar order were paid your green ground i'm reading from from our excerpts of record tab one page fourteen from the peterson and helped excerpts of record thank you sharing and number two that type of objection courts have held is doesn't amount to prejudice where there's a corresponding judgment reduction credit built into the settlement as there was here  aligned one of the cases would be the result of the focal case nine eighty nine f second ninety three second circuit case included thank you thank you the facts that eventually unfolded in a very few short months which he already knew about at the time he was the chairman and c e o of this company are not claims that he could then because of what mr mar notice we can't we can't divine what there may be out there well your honor let me tell you the problem with tact the amount of discovery that's been done in this case would not give them one conceivable way in the world independent from what we're talking about here that bar order might have had different language and everybody might have been very satisfied with that but what they want to do is they want to come by at the end of the game in or we ply brief that there is no standing on any of the appellant part and therefore we should not get to any of the remaining issues before us well your honor that's a very good question but we have made two additional settlements and we've settled with two others and those are on appeal not on a question of fairness and reasonable but on a question of standing so we're going to face an appeal every time we go through this whenever we settle with any if they have no standing or we have no standing let me deal with i don't think they have standing because i think they waived then if that's true then we would never enter a judgment on the rest an opinion on the rest of the issues raised before us that's probably true let me let me turn you to another area and that's the area of damages i understand what you're saying but i have difficulty  being able to conceptualize that this issue of increased debt is strikes me that the increase in debt is a problem with the lenders and i made i understand your argument and it may be that that is a problem with the corporation but i thought just initially before i read all the arguments that the damage to the corporation would be collateral damages of and maybe those collateral damages are the increase that but if you just say increase debt and nothing else i have difficulty seeing where that is a corporate harm is distinguish creditor and you responded there sure are we're clearly not saying increased debt is our damages here's what our damages are we went out and borrowed from several sources banks public debt and trade creditors we we we had about a one point three one point four billion dollars in debt we took the money in meaning the officers and directors took at it and they then wrongfully dissipated over eight dissipate the assets and what r p m each expert dr michael has done and it's very clear he's done in a valuation of what this conduct has done to the company he took a business enterprise value with the time they breached their duties i understand the valuation when it started in the guy that makes sense that's collateral damages to the corporation but why is the measurement of those damages the increased debt it's not ok that's not what art that's not what our damage study says we take a business enterprise value we take the fair value calculated you have to take the debt part of the balance sheet as part of you take the asset use a practice that the difference is a plus or minus number  a business enterprise value then you wait and that you do that at the time the particular defendant creates or breaches their duty to the corporation when they loot when they do the dishonest things they do you compare that to the end of the day and you take those and you do the same analysis and the difference is the damage to the company and it may not be the increase it may not be the increase that in fact it isn't the increased  and the deepening insolvency is a different number than increased that we can calculate the increased debt quite simply barkeep so if it if it calculates out to more of an increase of debt then the corporation is going to end up with something that the creditors aren't go result of the deepening insolvency as i described what our expert has done and if we're successful in recovering that we'll have distribution to a number of creditors and perhaps shareholders i hope that answers the question i mean it's not just an increase that notion and they would like to say that i have fifty nine seconds left and i guess what i would really like to do is deal with one of the  i'd like to deal with the williams case which three really misconstrue i'd like to deal with williamson kaplan in williams what happened is the trustee took a sign claims there were bondholders out there who had their own claims just  marmer described and the trustee was given an assignment of those claims in williams and then i think it's sad because of the way those assignments were put together but that was improper the trustee was going to go be the lawyer do the work and then when the money came in after all the recover after all the expense of the litigation was that was finished then the net proceeds after that expense was going to go back to those creditors well that spring  it will go to the credit for what happens in our case when we get through whatever happens will go pursuant to the plan of liquidation it'll go to creditors it'll go to administrative expenses it'll go to shareholders if there's enough creditor there's some other plan for beating there are there are several trochilus of how various creditors receive various portions of money and i wish i could give you the exact numbers but like the first i'm going to say thirty million dollars goes to the two creditors they really don't like the two banks i think of america and she c c them the money starts becoming distributed to other transfers of creditors and now ultimately if there's anything left over to shareholders typical plan of liquidation that was litigated before judge case the bankruptcy court as to how that was going to take place if and when there was any recoveries including any recoveries from sales of assets let me not sit down however before i deal with kaplan and i want to put kaplan in its context what they feel to tell us if you look at no twenty of kaplan it makes it crystal clear i'm over my time but i let me just put in a twenty makes a crystal clear that the claims that were assigned claims from the bondholders were not allowed to go forward all of the claims were the company is damaged was allowed to go to i'm sorry three feet what the trustee has done is to say here are the damages that the corporation has suffered and as a particular dates and  recites he walks through every public offering and every financing by the bank in other words he sends the creditor loans to us are the measure of our damages he the creditor loans for the very reason that mr maher alluded to in the appellants papers make clear those creditors stand in a relationship to boston chicken and have their own claims not only against boston chicken but against anyone else allowing the trusts to assume those damages as its own is contrary not only to overwhelming damages of the creditors and that's not surprising the creditors got a good position on suppose there is some money left over that goes to the corporation that is in the package a lot of it's going to go up and some benefit comes from the suing on tort claims that belong to the estate and brought in monies that were related to those injuries those monies are the trustees to pursue would go to the corporation and with flow out however it might through the plan our point is not that these monies will ultimately flow through the corporation that's typical of a bankruptcy or state our point is that the fundamental nature of the damages that are being sought do not belong to the corporation and are subject to s starts discussing the law or case goes to some other cases and his pocket after the fact that we have standing because there's going to be a bar to claims that's what he's addressing but critically in this was something that got glossed over there are two different avenues here  at must be analyzed separately the first is if you are the party subjected to an injunction under twelve ninety two a one that confers standing you don't have to show you're injured in addition the injunction itself is the basis for your stand your party but you're not a party if your be enjoined party if you are in joint if you are subject to an injunction it is inconceivable if one thinks about it that you could be subject to an injunction the injunction is directly pointed at you and yet you are said not to have a right to review it it can't be and that's what this court says and page it's irrelevant if it is an expressed injunction that we look at the rest are you saying you don't have to raise the issue imo no i'm saying ok think the question we asked was not the merits but where it was raised can you tell us where and in your opening brief you raise the issue the issue of the injury that there is nothing in the opening greek on that i don't want to mislead the court at all on the point is that under twelve ninety two and one which is in the opening brief there's a direct injunction pointed at my client that under twelve ninety two a one and under page renders standing sufficient but if the issue is not raised in the opening brief we usually considered wave of how you respond to that because your honor what we are obligated to do is cite in our jurisdictional statement the basis for being before the court which we did we started twelve that doesn't rate the argument finding us fighting th statute doesn't raise the argument whether or not you were injured at the junction again your honor the injury inheres in the injunction itself a separate question is a while a question a separate question is whether a non settling party in the absence of an injunction has a standing to complain in the absence of an injunction we inspect wallach factors and as i point out while i was raised below our argument before this court is that by virtue of the  injunction that is in of itself sufficient to confer standing upon the party and that's thing you're missing the point you're making a good argument with you're going to come to grips with it we have legions of cases saying if you do not raise the issue regardless of it's a good or bad if you don't raise the issue in the opening brief way they have complained that that is the situation here we have to confront it but you're on to that that that formulation sharpens it up and i appreciate it because the answer is the opening brief very specifically says that we are here in harmed by virtue of an injunction entered against us that the district court lack the ability to enter that and therefore we should be able to  to look in the context of an expressed injunction to the carson cluster of factors which deal with whether there is an irreparable injury or some harm in other words if someone enjoins me i understand that where if i was going to look in your  lacks jurisdiction to enter findings of fact a bar order and an injunction when we go through the statement of the case where we're describing what's involved in it we explain what the nature of the injunction is when we talk about in the analysis in our opening brief how it is that we are no longer going to be facing the correct party by virtue of the district court standing where explaining how we were injured in effect by what the district court has done that's throughout the brief the specific teacher because we're narrowing down we're mixing two different issues here we have counsel over here arguing with you you needed to raise a precise issue below that the scope of the injunction was too broad and if you didn't raise below that the scope of the injunction is too broad then you lack standing to prosecute an appeal from that injunction to this court that's their argument that's wrong if there is an express injunction prohibiting us from doing something that in and of itself gives us the right under twelve ninety two a one and this court's decision in stoller is addressing waller and he talks about the intention the breadth of the injunction i will tell you he does not fairly raise i'm not submitting that i will tell you as mr abuse candidly admits that there are a series of additional cases where this will come up but but on this one let's be object at a fairness hearing to the court having jurisdiction both on standing grounds and on subject matter grounds the court is without authority to proceed to make findings of fact or internet injunction and that that can't be right to address the the right nature of the injunction what would be your response to that i think the answer is that the court would men still have before once the court concludes that we're properly before the appellate court looking at an injunction then the issue of the jurisdiction of the court below absolutely must be inspected by the court even if we didn't write it if it occurred to your honor's in bench conference independently that there was a lack of article three standing or lack of subject matter jurisdiction the court would have to reach out is that a jurisdictional issue absolutely graph of the injunction while that no no no i did not mean to say that if i did i apologized what i'm saying i don't understand your honor to say if the court concluded that we were properly before the ninth circuit under twelve deal be obliged to address the breath of the injunction no because the court would address the issues of the jurisdiction of the court below if the court concludes that the court below lacked jurisdiction the injunction would be dissolved if the court concludes that there was jurisdiction article three jurisdiction and subject matter jurisdiction below then the court would not entertain any issue about the bread