i please the court i would like to reserve five minutes for rebuttal once you tell us who you are for the record germ of antelope and it proud to represent e t s ventures in two thousand and sixteen my clients purchased the assets of a field trailer company and then invested two hundred eighty thousand dollars to build a custom race trailer it's now been ordered seized by the government and apparently sold by the court and my clients need your help to require the district court to follow proper procedure i wasn't aware that the court had determined the ownership issue i thought the only thing the court did was to freeze the asset which is still in the possession of your client that not right i would say that the determination or the failure to determine the ownership issue is part of the problem in fact there's no claim ever filed anywhere by anybody claiming ownership to this trailer in the court and that's the fundamental well i thought that there was something in front of the magistrate judge were discovery scheduled with expedited discovery but your client didn't want to participate in that i just seemed to intent on getting getting selling ness in another state right ohio or something like that the trailer was constructed in ohio my client claims the right to sell the trailer because it's our property there's nothing controversal i'll agree with that we would like to sell the trailer at this point we're out of deference to the court by doing well and i'm biting of potential contempt if you sell it  very bullied by the courts contempt hours right now you know you said i thought you said the same trailer had been sold you had the trailer don't you right now i submitted a twenty eight j letter with the court's recent findings from you know from last week a interpret their motion for clarification they've now given the monitor the right to actually sell the trailer this trailer has been sold at this point it has not we were targeting for we were marketing it for a time trying to find a buyer so you ha right now and hasn't been told it has not been sold as of today and we are not making any efforts to sell it we do believe that the monitor intends to the trailer is losing value at this actually turn the trailer into cash ok but i'm just asking have you talked with the government about agreeing to a super latest sale and maybe depositing the sales proceeds into the registry of the court pending a determination of ownership we want we want to do that don't i thought you just wanted the money well we think we're the owners so yes we want the money but we would be agreeable and actually discussed with the f t c representative that that's exactly what we would do and unfortunately the monitor when they got appointed took issue with that and didn't want the monitor didn't want to sell the true they want to sell it themselves and they're going to sell it for less which is why we want to sell it a private party rather than auction and we just got held in contempt for having the trailer listed on our website so that issue isn't up at all yet because you couldn't reach agreement with the monitor in the government right i mean there's presumably if you could reach agreement with them then they wouldn't have any objection to whatever the terms you agreed to were and then you could offer the very over say their records they don't trust you to give them the money i don't know but i frankly don't think that's what they would say and there wasn't a monitor there wasn't a monitor at the time that we were doing this so we're incredibly puzzled and we don't think that this preliminary injunction that was issued in august and it is a preliminary injunction this isn't a state well you're kind of hung up on that in your briefs but what about the statutory authority under the f t c enabling act that gives district courts nationwide jurisdiction in order to issue appropriate orders in aid of collecting restitution and judgments that then expires twenty days later well you might say it expires under rule sixty five but it's not a rule sixty five order i mean we see these things all the time in s c c enforcement proceedings in freeze orders and rico cases i mean there there are a number of and ologies here and you seem to be just ignoring that whole body of case law insisting that it's nothing more than a temporary restraining order and a problem entering junction and i'm suggesting to you that that's that's not the legal basis on which the commission or the district court has acted here well i think it would direct you to the expert to record on twelve and thirteen look to what the court actually wrote she actually calls i've been in rem injunction twice if you look to the unusual in these kinds of that language that binding you know agents or anybody with actual notice of the order that's pretty standard language in my experience and i would submit to you that each eldorado as a party that has titled ownership of the trailer is not subject to that asset freeze without something more well it does actually notice that the problem and has now is that it knows about the existence of the freeze order so it is now bound order i think that the order if the scope you know is still under rule sixty five and before that just the jurisdiction of the court to reach nine parties what the f t c would need to prove the statu government has to satisfy is that your client is a company that does business in the united states and that it's in possession of a disputed asset that may or may not belong to the monitor and that the possessor has actual notice of the freeze order that the court has issued and you meet all three of those requirements so i don't know what we're doing here worrying about issues or personal jurisdiction well i think that's the  l requirement still stems from showing that this is an asset of level five level five is the defendant right and the district court made a poem or a determination based on the payment to bruce thompson and before this all occurred the trailer was titled in your client's name that the trailer was fully paid for even though it had not yet been completed at the time that your client acquired bruce thompson before that you know the government has to file claims there has to be some request for a determination that this actually is an asset of level five but dissipation of the asset before an adjudication of true ownership can be completed but we're not a nominal defendant this is like sheriff you don't have to be a nominal defendant you are a possessor an asset that the government has convinced the district court there's reasonable grounds to believe may be an asset of the i'll call it the receivership i'm still not quite sure i understand the difference between a monitor and a receiver here because it walks and talks like a duck to me but i think it's a receiver but in any of that and level five said defendant in this separate proceeding correct i agree and the amount that they're trying to get from those defendants for it's what it's unlawful lending and collection practices is way more than what the value of this is and they're claiming that this is in health that it's an asset of paying that off and that's what that claims never been made that claims never been filed and that's where you know i think when this court talk as you keep trying to sell it they're trying to stop you from selling it so that it will be available to satisfy but that other cases and i don't know what the status of the other cases but it's not done right one of their gives one the larger action with level five that case you know at this point so what then your next argument would be really isn't very much money so it won't even go very far to help out satisfy it so let us sell it and let us have it right no argument is that we are on the trail if you know we need to be able to address that we should have the procedural right to say that this court lecture stiction we have the procedural right to file rule twelve motion and this is i'm talking about what this court said and as you see versus ross which i think is important the potential doesn't mean that there's actual but you do you did have an opportunity to participate in a proceed where there was an expedited discovery schedule in order to reach the question of who owns the asset but but you chose not to respond to the government's discovery requests well that's not that's not entirely true i objected to the jurisdiction of the court because we're very conscious let's assume that you lose  jurisdiction based on the f t c enabling act so you are now a possessor of a disputed asset a putative asset of the monitor ship but you also have a claim to ownership why is that a violation of due process for the statute to say you have to adjudicate that claim in the district of nevada which is the court that issued the freeze order and which is administer a monitor ship asset and my answer to that is that the problem is that claim isn't filed or moving towards adjudication head that you could file a claim is what i'm suggesting to you you have the opportunity and still have you have to file a claim in the district of nevada and with the monitors saying hey this is our trailer and then there will be educational adjudication of that issue we took the opportunity to after judgment before matter existed before any state happened to join level five in ohio right and and the court found that you violated the terms of the freeze order by doing that gives federal district courts the authority to enter appropriate orders as necessary to aid their jurisdiction and in this case present preserve the dissipation of assets before adjudication to ownership can be resolved and i brought by the federal trade commission and that's a different creature than a private rule sixty five proceeding between private party but if the injunction or the asset freeze itself is styled as a preliminary injunction how can the enforcement order be something else and how can we never be entitled to a hearing to show that we're on the trail you could and what it seems like at bottom to me and going through this and everything it's like that you're putting up all these things that distract us from the fact that you want to sell something but you don't want to prove that you have that you have ownership of it you want to sell it you want to get the money you want to get out they've given you an opera you have opportunities here to actually prove that that it doesn't belong that they can't reach it that it is in fact yours but if you can sell it really quick can you can get the money and you don't have to prove that then it will be gone and there won't be anything that they can do about it this is really all seems like all of these distractions as to what's really going on here and we're stand ready to prove and we stood ready when we filed this motion to dissolve and demanded a hearing we stood ready to prove that we own the trailer ok when the court issued final judgment we believed citing this course of precedence that all preliminary injunctions dissolved we filed in ohio essentially a quiet title action to the trailer we still ready to prove the f t c or anybody else didn't take the court's opportunity to file a claim for the trailer pursuant to that expedited discovery schedule either and you didn't take the opportunity to pursue that remedy when it was made available and there isn't a claim for us to address we are in was needed to make the claim that that's what i'm suggesting and i think that the government has to make the claim originally that level five owns the trailer and we're defending it because we're the title under under the status quo they need to actually do something there needs to be maybe not a full storm formal proceeding but someone he has to file a pleading saying that level five owns the trailer and why as i sit here today i still don't understand why the government believes that this defendant owns the trailer precisely when did they acquire it i wonder what theory of law the evidence you've in fact your client i presume has the billing invoices for the work that was done by bruce thompson and the payments that were received from level five and it didn't you know we do and it does not follow necessarily that because they paid a different company money well that company that you may have merged with i know you insist that it was just an asset acquisition but i think the government has raised the serious question as to whether or not it was in fact an actual merger including liability and i think you're on to what the real case should be should be whether there's success or liability here you know and why don't you live a gate that in the forum that was provided to you independently claiming ownership of ok so and the second there's a fail of form selection clause between level five and bruce high performance that's in ohio if we are if they're going to argue successors liability your honor they're going to be required to litigate it where we filed we just want to do this once we just we we may tell you otherwise once you get the ruling from this court well it if i mean if we if we don't buy your jurisdictional argument and we tell you you're going to have to litigate ownership in nevada are you prepared to do that if you if you tell us that we're we have always abided by the court's orders as we understood them throughout this case trying to make it clear if we lose the jurisdictional argument i hope that the court at least requires whoever it is that's claiming one or ship of the trailer to file an action so that we can raise whatever defenses we have has that's what the problem is with this order i still think that should involve the dissolution of what actually happened here on this record because this wasn't proper you know just saying that trailer is ours and you're surrendering it to the government of your season or right away it's more than that i mean there was evidence that was presented to the district court suggests i'll call it this is the wrong term but probable cause to believe that the trailer is actually an asset a level five and it's not dispositive but it's a pretty strong showing and in fact there was a misunderstanding i think by the f t c in that bruce who's in our mind the bad guy here told the f t c this is the bill of sale but it wasn't a bill of sale it was actually the first page of a seven page purchase contract and that's what the court relied upon when may please the court jack mesler for the federal trade commission more in the course articulated our position pretty well but i do have a couple of points the main question here is whether a district court  in the midst of handling a one point three billion dollars that's billion with a b fraud is permitted to freeze assets that could be sold  satisfy a judgment and provide redress to consumers of course it can that's part of the court's inherent jury selection about five hundred thousand max or something here i think the purchase price was over over half a million dollars five hundred thousand right yes somewhere ok so so yes the court has inherent jurisdiction based on its jurisdiction over the parties including level five and level five there's no dispute paid for this trailer and normally when you pay for something you own it so the district court is allowed to say this isn't the only asset there's a lot out there there are ferrari's that are supposed to be transported by this there are houses there are assets and many of them are held with third parties so we're going to freeze them all and until we sort this out and that's the order that's under consideration here now they say they also are  complaining eldorado is about the the or that specifically apply the asset freeze to level five well i mean to eldorado in your theory is that all those assets are traceable to the frog is that correct that they were purchas acquired with funds that were the proceeds of the one point three billion dollars fraud that's correct your honor the yeah so so we gave level we gave eldorado notice the federal trade commission said it looks like you have this trailer you need to hold onto it because there's this freeze order and their response was we don't think that applies to us in fact we're going to sell it in the next two weeks unless you get an order telling us not to so due to fleet we went out to the court and said there they're not listening to the freeze order can we please have an order telling them not to sell it and that's the issue that we're complaining about so we're now can make can where what is there from your perspective what is their option in terms of now to establish that it's really there's and not the proceeds of a fraud so in the district court since that time has entered its final judgment and entered a second freeze order and appointed a monitor and i agree with judge tolman that it's the same as a receivership eldorado has the opportunity to make a claim against the monitor more up to us although we couldn't stipulate anything without the court agreeing because it was yes it was frozen and we did enter into some of those discussions the main problem was they wouldn't agree to put the they would agree in advance that they would put the eldorado i'm not sure they have the relationship where they're going to come to light they don't dispute that the trailer ought to be sold their concern that the monitor although i don't know what evidence they have to support this is simply going to dump this off at some fire sale and they're therefore they will not get the value out of it as a credit that they should otherwise get couldn't that just be resolved by the by the court i think yes the court could resolve that court can certainly order that the trailer be that there be some sort of effort at private sale in agreement at private sale and if that doesn't work then an auction sure to the it will it but let me ask you this it seems to me the only way they can get any money is they're not defendants in that one point two or three billion dollars judgment right the only way they can ever get five hundred thousand dollars whatever if they can get any money out of it they have to show it's theirs and that it's not derived from the fought right well i think that's right yes because if it's got if if a court finds that it's from it's part of the fraud and they're not it doesn't matter whether it sells for five hundred thousand seven hundred thousand or whatever it's going to go in to satisfy the one point so a fire sale if it belongs to the father doesn't really matter to them does it i think that's right your honor the well i'm just trying it it's everyone's got us all off out here and i'm seeing this trailer you know i call me simple and my thinking but it just seems like all of this is all distractions about what's what's the elephant in the room here yeah i think you again have hit the nail right on the head the i mean basically what happened in this case is eldorado tried to pull a fast one they bought this company they finished this trailer and intending to deliver it to level five and i just direct your honor to join the courts the excerpts of record filed by the monitor at about page thirty that they are supplemental excerpts of the writer record and there you'll find a police report when there was a dispute between eldorado and the former owner of bruce transporters think they're going to get to keep it in stead of giving it to level five so so yes i think it's all of that it's a distraction that the issues that are really on appeal here are you know was the core allowed to freeze it so that this could all get sorted out yes and then after the actual order that's on appeal was the court required to was it an abuse of discretion to say no i'm not ready yet to lift the asset freeze and i think that was also within the court just discretion there was a time in due process violations to one day they are but it's unclear if they really have been either deprived of a real property right they still have the trailer the only thing they've been prevented from doing is selling it and they did get notice of that and they still have an opportunity i mean they had an opportunity before judgment to use the expedited discovery process and adjudicate their claim there you know like goes exactly to my earlier my very first question to opposing counsel which was you have the trailer yes it hasn't been told yes that's correct so so yeah i think they still have it and it could still be sold and they had a process they could have availed themselves out before judgment and there still remains a process with the with the receivership to to to educate their their claim now to the district court with him about it i'm sure so there are there are two orders that freeze that impose an asset freeze on this trail one was entered prejudgment and then there was the second or that applied that asset freeze to this trailer and then there was a order after a judgment in which the court appointed a monitor and again froze all the assets of level five and just one minor point there it arguments in in eldorado brief are addressed to the pre judgement issue the prejudgment asset freeze even if any for the reasons we've talked about those arguments are not meritorious but even if you agreed with them  they don't provide any reason for lifting for for saying that the post judgment asset freeze is not valid lee restraining the sale of this trailer and in fact i think it's page three of the reply brief they they concede that the court had jurisdiction to enter the monitored ship order so all of the jurisdictional arguments are out but is it your position that there were separate orders or did the is that the january order that we're going to go did the january order simply continue employees the equitable remedy of a freeze that had been initially the order back in what was that august or september i think  render judgment so what does that do to your mood this argument i guess is what i'm wrestling with when i agree we didn't really argue that it's moot we just said they have to raise any arguments that go to the second order so but if it's a continuation of the same equitable remedy of a freeze does that matter i don't know that it matters all that much but for example their last two arguments are all about whether the court should have revived the earlier phrase i mean if you think that that's bad but are ok with the monitor ship order then you just don't have to consider those arguments or if you think maybe i were hung up on rule four but i thought that the notice of appeal the argument was that the notice of appeal should have been more specific in listing not only the initial freeze but also what i'll call the continued that were that was the monitors position that we did take that position so the f t c is not urging that inch which say well the earlier states or the monitor see it seems to me like it was the earlier stay and then you know you have a monitor say in the monitor stay and that's the monitors argument is argument is well wait a minute they're appealing something that well it's you know it's not one hundred percent either way from the kind of or when to get it seems to me like they've kind of bled together a little bit and they do blend together and this is why before judgment the immediately after the court entered the the initial asset  freeze that's when eldorado moved to lift that freeze so the only one they asked to lift was the prejudgment freeze well then some stuff happened and there was a post just an asset freeze and that's when the court decided this earlier motion and in the court's decision it says it refers to the asset freeze order using you know capital letters but it refers to both the prejudgment asset freeze that way and the monitor ship order that  don't really the we don't really need this point in order for the court to i mean there are different basis of their challenge is the core was without authority to to enter a freeze for longer than ten or twenty days then the fact that the freeze has continued to this point it seems to me that would be sufficient for purposes of the notice of appeal my client who is thirty years in the trailer sales business talking about how it's likely to bring about one hundred fifty thousand dollars more at private sale the other thing that i know is in the record is that a similar trailer there was another one that was like this that was sold at auction in a broad only two thousand and bid price minus commission so two twenty two twenty well and realistically the value is dropping nobody would buy a two thousand and sixteen cadillac new ok so right now the value of the trailer is less than three hundred thousand dollars and this paralysis this due process dare vapor deprivation we're talking about is the right to sell the trailer i also want to correct my understanding as to what our  eldorado always agreed to deposit the money in trust if there was a private sale it would have been put to the court for further order because the asset freeze allows but i think the disagreement we still had was where ownership would be adjudicated i was not willing to concede that nevada so you're tying the venue for the resolution of the ownership to your agreement to be late through deposit the proceeds into the registry monitor the board and what happened really was the c i believe agreed ok go ahead mark at the trailer you know if we find a buyer will cross that bridge when we get there we believe that the appropriate place to determine who owns the trailer was a child because it's all the form selection clause all of things one is before nine parties assets are put into a receivership they should be operative offered notice and an opportunity for hearing it's hard to see but at two twenty two i want to put one page of my briefing on the motion to dissolve but i explicitly asked for an immediate hearing and this trailer was put into the monitored ship of state and the monitor authorized to sell it because of how the court saying it's a level five asset so monitor go ahead and magistrate do that because the f t c asked him to there was no if you look at the transcript of the hearing and i put it in the record i can i can find it but there's the transcript of that discovery hearing your honor i was objecting to the jurisdiction saying what claim in my addressing is this is sesar liability is this some i think one argument is just well they paid for it they want ok well i don't think that applies to title because i'm entitled to know my client is just his title to know what theory of law they're proceeding on i mean title two if i don't think venue is proper if i want to jackson i'm entitle to think i don't think jurisdiction is proper file objection we were deprived of that because they took a shortcut what they needed to do is what this court required ross is that because you're really there need to to get to get ownership of this thing but i mean that you still have possession of the asset there hasn't been an adjudication yet of the ownership of the trailer and it seems it is incumbent upon you to make a claim with the monitor i soon you've done that at least informally maybe through letters or something insisting by proof of your heigho title that the trailer belongs to your client well i don't think and this is what i think that the were in the position of owning it at the status quo because with the title the owner presumed owner and you possess it and my point is that the government if they think it's actually owned by level five they should be incumbent on making a claim and serving us with a summons so to then bring that into your position if you don't have to do anything in the in the face of a federal district court order that says there's a showing here that this asset belongs to the receiver ship that that the government has to do more than that they have to actually initiate a new proceeding somewhere or in a state or federal court in ohio to do that is that is that your position they need to do they need to do something you know if you look at f c c versus what some what well have time trying to get an answer my question and that's what is it that you think the government needs to do what they've already done and is that actually at the very least an informal claim filed you  the one for discord cement or an application saying hey this trailer is actually ours you need to own it we believe we want to for this reason i think that more properly because we're really arguing successor liability here they should file a complaint in a a ancillary proceeding and had they done that this case would have tracked correctly we would have objected to the jurisdiction of the court at that time and in august of twenty six we would have won because there wasn't a receivership yet there wasn't a stay none of it had gotten to that point but instead you know they took the shortcut and i believe that what's really happening in this case is about the or meant not filing a claim so that we can't we can't say that we don't want to be government has made a showing that this asset was procured with the proceeds of illegal activity i mean i don't understand why you're in a position any different from the holder of an asset in ohio or wisconsin or wherever the asset  is where the government is saying it was purchased with the proceeds of drug trafficking and i think this is you know the difference between a trailer and a cause of action well level five did they paid six hundred thousand dollars and they didn't receive what they paid for so there's contractual let's assume for the sake of our hypothetical it it's six hundred thousand dollars of blood money it's money that was obtained from illegal activity in this case fraud so why why are you any different from an entity that is claiming title to the asset saying look i wasn't involved in the fraud i you know i procured this thing lawfully you know there are i'm a bona fide purchaser for value without notice or i acquired title some other way but my hands are clean and i think that if it had been just bruce high performance which was the contract an entity that received the money we were never received a dime yet when he was gone by the time we bought this this  thank you very much cases are going to submitted we will be in recess before we hear the last case on the calendar