in determining this appeal is was in the court's first order are you mr or was i apologize that i'm hearing west right for the appellant the most important thing i think the court said was in the first order the very end when in ruling on motions to dismiss the same six claims that were in the final motion the court only dismissed the second third and fourth claims and that's the final page on set the excerpts of record page thirteen so even though there were comments in the order which were of general reference to the way the complaint was drafted and things like that the actual dismissal did not occur for the first or the fifth or sixth claims so i don't think the average attorney would think that the entire pleading was in jeopardy if the court specifies that it's only dismissing we believe to him then so is your argument then based on the order you thought that the complaint adequately stated certain claims and so you sought to fix claims that you thought were deficient and it boils down to well i wouldn't go that far because it required me the things i had to do to the second third or fourth line required a certain restructuring and wanted me to be more specific and to specify certain n send it back for an opportunity to amend i take it correct tell me what contract was breached in connection with the the term sheet because frankly i  i share the district court's concern that the allegations really are very conclusory in nature and it's really hard to decipher the breach of contract claims much less the fraud claims which require a higher level of specificity in terms of pleading the who what where why how who made the misrepresentations who induced him into purchasing these fake artwork what specific statements were made i would expect those sort of specific allegations when you're trying to assert a fraud claim but but i realized there a lot of players here and and frankly looking through the complaint a couple of times now i couldn't figure out some of your claims so perhaps you can help guide us to more specific claims that if given an opportunity to do so that you could amend in order to survive  believed that the pleading as a whole was was perhaps adequate if not perfect and so on but i did not limit my restructuring and my changes to just those three now in reference to the first claim about  the raven contract there's not a claim in that one that the that that particular painting is was a fake order for us yeah i mean to me yes but let me just say a little further when you're going to talk about the first one and if it's the jackson pollock one but there's not a claim that it's fake can you explain what particular individual or individuals and what specific acts that allegedly cost mr carlson what definite harm it appears that the joint venture agreement contemplated by the term sheet never came into existence so what writings or writings if any govern the parties relationships concerning that pawlik pain i can answer the question about that one is the he was he was defrauded because he paid a million dollars to invest in this pollock their obligation with that million dollars was to use it in order to market authentic prepare it for its marketability and sale and instead what they did was they used ninety percent of it to just basically pay themselves out of their investment cast themselves out of their own investment and it to a place in london where it remains to this day because of unpaid bills and so what happened was is in effect is the the million dollars that they were supposed to use to get it sold was never used for that had they told him give us a million dollars now we're all just going to give ourselves you know nine hundred some thousand dollars and he wouldn't have invested he wasn't investing to give them cashed out of their investment and it's says it right in there in the in the complaint that one they moved it without his permission to a location and number two they did not use the funds for the intended purpose of getting it marketable authenticated some work needed to be done because sometimes these things are will beat up by the time you're selling them and you have to you know get experts to be working on them and that costs a lot of money so he was told that his money was going to be used to pay for the jet the venture of getting it sold for one hundred million dollars honorary degree well you had the term sheet the term sheet specified certain things including that it was binding unless by the actions of mr carlson not mr carlson elected to proceed on the term sheet paid the remaining nine hundred thirty five thousand dollars on the contract they provided there remain the other attachments that were supposed to be an part of the joint venture which verified certain things about the painting and its history and so on and so forth so the parties proceeded on the verge on the basis of the term sheet and he performed based on that and a term sheet does says that it's binding unless pursuant to an action by mr carlson it gave him the option basically whether to stay under the term sheet or to go ahead in complete the broader join ut his consent it's sitting over one hundred right now and almost impossible to get back and you have the further as i said though the understanding of the parties was that the money which he was paying was going to be used to pay the bills the kind of bill that's not being paid over there in london right now fifteen thousand dollars or something like that but but he didn't give them the money just to free them of the burdens of having previously invested in this take their money out of it and leave him as the sole person hanging with a million dollars invested in it in this painting and on one of the and so he was buying it became a joint venture in the sense that he didn't buy a piece of the he bought a percentage interest in the painting he didn't buy like stock in raven raven art he he bought a percentage so we only know one owner and he owns right twenty three and a half percent of the paint lot of these pollocks are it's easier to do the answer is no the answer is no that would not be immediately they need more money than just the fifteen thousand dollars they would have to spend money on other experts to make this work of the defendant well first of all day pretending to be an expert in that kind of transactions they told him that it was worth more than it really was worth to you the mr mangan was in a hurry to get it purchased because he actually used it as soon as they bought it to take his whole family in a bunch of people on a hama strip he got them to spend another two hundred some thousand dollars to fix it up after they got it under the pretense that the previous owners had stripped it when in reality it was just had some defects in it and then he also had promised he and mr force that they were going to give one thirty each of the investment which they never did so he was basically putting forward his money mr carlson with the idea that the other two within sixty days ninety days would put in their one third and also the understanding that if he had gotten it at a reasonable price he told them all this is a bargain at any price  yes he got his company got it but he had various debts that he had accrued over the years and maintaining it he had to keep it in a slip various things like that there were overhead that that were made a pretty bit of to really keep  that number one that it was worth something that was not and he pretended to be an expert in buying these boats number two they induced him to make the purchase with a promise that they were going to kick in their one third which would have also made them responsible for one third of the slip costs one third of the insurance one third of the maintenance so he thought he was going into an arrangement in which it was all going to be shared when in fact that was not true and mr mangan took very good and i thought he was kind of a yacht a i lived on boats so i have a little bit idea i've lived on sailboats i have some idea what we're talking about here i can say this that if you tell somebody oh i'm very expert in this and i can tell you that this price that we're buying it for is a bargain when in reality it's probably worth twenty three percent less than what we're paying for it but i'm in a hurry to buy it because i want to take a trip with it and in fact do it is soon as possible after it's purchased parties and i got more than i would correct and so he probably knew better and we saying that he knew better about what the real value of it was here down just so you know human man forty two it always happens you want to save the rest of your good morning good morning they please the court i'm richard look i represent some of the defendants mr mangan and also raven are thinking and are possible i'll see before i get all hired into the complaint i just want to ask you a quick question this i mean jumping to i've got a problem with the attorney's fees part of it even if i'm wondering what in the record justifies an award of over ninety one thousand dollars for ninety eight point six hours of work and the work that we're talking about i think was on was it on count claim one and then somehow you're saying that works for everything yeah so there's a both first of all the first issue you're talking about is really what's in the judge's discretion so the judge has the ability to ward attorneys fees in an amount according usually they used just can't make the math work here math doesn't work because what happened here is that there was evidence submitted there was an affidavit from mr megan's attorneys that indicated they spent some ninety nine point eight hours on the case and in the trial court mr white west right pointed out that the math doesn't work there because that ninety nine point eight hours you're claiming ninety thousand dollars in fees you're talking about nine hundred some dollars per hour so that clearly didn't work that was explained however in the motion papers so you know what bothers me here is ever seen such a poor submission on attorneys fees ok i understand you have all these experts to tell you what you know the value is that particular community that gives you an average hourly rate but usually at least in modern times you don't just say oh and i spent you know fifty two hours and this is the average rate and i get this number usually we get things that say to document that there were two attorneys working right you know two attorneys did this one review that when we do this so my concern may be similar to judge callahan is that under an abuse of discretion standard i would have trouble figuring out whether the court abused its discretion because there's no documentation ok no hours there's no which attorney there's no what they did so fees might be subject to award but how would we determine that they're reasonable all right first of all it bothers me too i'm an appellate lawyer and coming in not having been the trial lawyer i take what i'm given just like this court looks at what the record shows but i can tell you what was in the record because all of the cases say that this judge had discretion to use his own experience and the evidence that presented that was presented in the record and i would say which well let me let me tell you what i saw  record and we'll see if we can get on the same page first of all there was an affidavit of attorney's fees we all agree that there was some math issue with that there was a series of course sponsors between counsel that just showed that the fees that were claimed reasonable and then there was this report of other fees charged by other firms in the locality because and under california law law we use the lodestar method so we want to find not the actual attorneys in amounts that were charged but the reasonable amount of time so this affidavit was supplemented by explaining basically that yes there were ninety nine point eight hours that were totally billed but some of those hours were billed by two or three different attorneys  paralegals working at the same time and so there's overlapping billing i don't like that either as i said i'm appellate lawyer i'm coming in and i don't like what they did that we don't know what i didn't see though and i think this is important to note is that in that reply the attorneys for mr mangan did tell the trial court i have itemized billings we'd like to submit those and have you review those as well and the judge ruled without holding a hearing so the real question is how far does the judge's discretion concern as to the conclusory nature of some of these allegations why is amendment futile was just the first motion to dismiss and opportunity for correction you know so there's several first of all there was an original complaint then there was a motion to dismiss he didn't he didn't hear this very very long complaint that there are allegations that certain parties aren't possible arc force induced him into buying these fraudulent  pieces of art and that they had a story to go with that to induce him into i guess gaining him there gaining his confidence so to speak by you know talking about their own expertise and they promised him that they would provide him authentic things if occasion certificates that never came now that may not be specific enough to rise to the level of fraud but it seems to me that there is something they are there could be breaches of some sort i can't something that was in the reply brief at page three at the very bottom where mr west right stated that mr carlson's intent here was to hold mr mangan liable for things he doesn't even know about as long as other people committed those things well there's no fraud plain that doesn't have an element of intent there's no fraud claim that doesn't have an element of knowledge or falsity and there's no conspiracy claim claim that doesn't have some element of it can common purpose so just at the outset if you look at the whole complaint overall it's very long it's very confusing and these claims are not well stated two of you at least are english majors so i know that if you read the complaint you saw that it was a very very difficult to understand very that there's some kind of conspiracy allegation here not clear who made the misrepresentation but they certainly all joined together teams like this is the plaintiff's theory to gain his confidence in order to get him to make these investments first of all we don't get to see the facts because nothing was developed in the record but i can tell you that mr mangan had nothing to do well john ray and whatever he did those other those were other these are all people that deal in undocumented art so in some ways what mr carlson or what mr west right was telling you was correct that they had this plan to purchase these undocumented pieces find the experts who could show that they are authentic and then try to sell them jackson pollock paintings are worth one hundred million dollars or more so these are investments that were speculative at the outset mr mangan was involved in raven art which on the one pollock painting which is not shade we have already heard that admission and there's is that there was money invested to try to rehab the painting and then i guess in the hopes that he would sell it and he was defrauded into putting his money and because the other people including mr mangan weren't going to do what they were supposed to do he but that's is that you don't get the facts because it wasn't developed in the wrapper but what really happened if i may just i think that i try to figure out whether i notice pleading but recognizing the need for fraud specificity whether that's enough to put everybody on notice that we know what the general gist of it doesn't mean that it happened ok i agree but that is what i do divine from this as judge quinn pointed out there is no there is no full pleading first of all you have these incredibly complex mixture of tort claims contract claims the stoppel claims equitable claims and they're all mixed together so you can't tell what's being claimed but none of those theories are supported by a complete listing of all the elements of any one of those claims so that's that's one problem i want to talk about a couple of the cases that we know were cited in the brief because i think they're very important t answer particularly the questions that you may have about why should we let the court have discretion to deny without leave to amend and i think first of all if you start with a miller versus yokohama case you get a ninth circuit case is quoted all the time it's a very quoted case that once you were given the warning and the order wasn't followed the trial court's discretion becomes extremely volatile to dismiss a case without leave to amen and then there's three cases that i want to discuss real briefly that tell us why you should not impede the judge's discretion here first of all is i think the  gel versus north coast life insurance case which was called in the breeze i cited i'm going to say that here but in that case it was a policy holders suing insurance co companies for conspiracy any trust that was one of these complaints that was long  confusing and the important thing there though is that there's a great discussion in that case it's a one circuit case and there's a great discussion about whether the trial judge has to consider what other less drastic remedies may be available for example and one that's specific to this cases they consider whether the trial judge should have gone back and given leave to a man and told the plain if you should get other counsel you should really amanda different way and but then at the end of course said no even though the judge should explore less drastic remedies the judge has discretion once they've given the warning once they've provided the wrong map and that order was completely ignored then the judge is within its attorney lists or attorney appointment list filed an incredibly long complaint against the governor and a bunch of state officials it was dismissed with a warning that he filed a two hundred page complaint that was similarly confusing and and and in that case the reason i want to point that out is because the court there went into a great discussion about all the reasons why a judge should control as docket should not allow these kind of pleadings to proceed they cause all kinds of lengthy discovery disputes they are very confusing for litigants they put a high burden on the judges they a judge has a right to manage a docket so there's a lot of sort of policy reasons why discretion shouldn't be limited in cases like this but the most important case that i want you to think about is the mchenry case that we cited mchenry versus ran it eighty five for a third eleven seventy two in that case that plaintiff was arrested for handing out food and political literature in a city park and he sued a bunch of city officials and the important part here and it was a similar thing where the complaint was just unintelligible it didn't make a lot of sense but there were really issues  there were first amendment issues about whether this guy really should be given the right to do what he was doing and at the end of the day this ninth circuit court held that the plaintiff in that case probably did have some valid claims he probably had valid claims but that doesn't relieve a plaintiff of the duty to plead according to the rules and the judge has discretion to dismiss the case without leave to amend and and  that's what our judge did here and i had planned to go through some of those warnings and just to show that you've read if you read the complaint if you read the judge's order you see that there were very specific things that had to be done things like don't plead multiple theories in one plane and here amended the second amended complaint comes back with some attempt to try to say this is i'm just going to plead breech of contract here but then when you read the paragraphs he induced me it's duties they're just the complaint just never complied with specific orders from the court and the judge had absolute discretion to do that now i've got forty seconds left i'd like to jump back to that attorney fees claim because i want to mention here that i get that the attorney fees submission i don't like it i i do think the judge had discretion so i'm going to ask you discretion means something so consider that when you make your ruling if you do remand for a hearing say on attorneys fees i just want the court to know that in the event that the judgment is affirmed below that these attorneys these will include my fees because all the following emotion and and we may because of that we may have to have a hearing on attorneys fees anyway in my experience was things typically are remanded back into the trial court for those hearings but i want the court to just realize that this case is really not about the facts it's the position that he took earlier in his argument secondly it's interesting mr rome the second attorney came his sociate it in after the reply was filed on this last motion and he was associated in to be the litigation counsel so it sort of suggests where the defense counsel thought was going to happen on this motion i think he shared my belief for we have never had a chance to amend other than the earlier the first night what do you think if you hire a really good lawyer it means that they think they're going to lose well i think they were expecting you know that there was but after the reply i don't even know what he did on the motion but on the same it was after the reply was filed the associated in an expectation because the judge only ruled on the second third and fourth in the first ruling there was no willing on the first fifth and sixth  you know in that in that first order so it was really the first time on those furthermore you had the intervening conviction of mr ray you know who confessed to the fraud we detail at pages seventeen through eighteen of our describing what i could do with the leave to amend so that's what i told the court and i did submit the paperwork as exhibits and it's in the record and second finally conspiracy don't have to know everything that all your partners are doing so that's correct conspiracy and i don't think that there is any reason and by the way with the raven if you look at page thirteen of our opening riff i detail exactly where in the complaint we specify these promises were made and we do make the allegations in that brief in excuse me in that complaint so i think the record is there that and then establishes that mr carlson was for put up over two million dollars to these guys a group of individuals who very cleverly maneuvered him into putting up money after money after money for paintings that turned out to be false and sometimes when you have so much information and so many frauds there was seventeen contracts so that you could almost make a separate lawsuit out of the first claim out of the second claim with mr ray out of the third and fourth ones out of the six one and then number five we don't talk about it all is basically a loan transaction with mr james who was their so called expert who you know brought mr carlson in stand thank you ok thank you for your