knopf this case this appeal seeks to reinstate the nobs claims that the defendants conspired to violate their right to notice an opportunity to be heard in connection microphone in order to protect their ability to execute on assets that mr sanford had acquired with loans from the knobs the st order dated  moving to quiet title he called up one of his lawyers and spoke about how kerry was an alternative means of obtaining clarification he spoke with i think judge winters trying to ask a question behind in connection with the informal proceeding in which the wife of defendant frank esposito clarify the orders and issue to mr sanford's benefit one of the order is a defense here i know who is wedges i can hear and i judge winter is asking i believe whether you believe what your position is as to the effect of the next party communication we go into the st department and get a new escrow water the new escrow order stated that the proceeds the remaining proceeds had to be paid into a new escrow that's just a small  four hundred and thirty thousand dollars in proceeds in the law school it's ordered escrow make sure i understand your argument then you're saying that if there had not been this informal conversation which you say violated the due process rights of your client if they had had to go before the court to get qualification and the court had told you at that time in january you don't have a restraining order anymore right that you would have immediately then so on a new one and would have prevented the because you know that because the circumstances were identical it's not that we were excluded from the call per se it's that we would have learned on the call that there was a sale and not distribute the proceeds and then  this the answer is presented by this court in its motors liquidation decision we say that this is the same as motors liquidation there is no difference in motors liquidation judge berber ruled against the argument the legal argument that the absent party would have made this court affirmed judge breyer risk ruling and specifically held that the legal argument the absent party would made was incorrect nevertheless in that same decision on the same page this court held that nevertheless the absent party was prejudiced because the after party had been part of the bankruptcy proceedings and it had you were heard on the june th proceeding in order to act we were her knowledge and sixteen proceeding just like the absent claimants in motors liquidation were heard before this court when in two thousand sixteen in affirmed a judge gerber's ruling the argument absent claimants would have made was incorrect so i'm i'm misunderstanding i thought you were saying that even if it proved that ms wrangles characterization of the state of play if you will was correct and even if that was verified by the june order you still in both department rejected their argument it kept the freeze in place so you have to look at the difference between the contempt application in which there was a ruling important criteria is was there a risk of air in gore versus connecticut a risk of here is decided is defined as a not uncomplicated question if not a complicated question both sides have to be there here with the point that the appellate division st apartment had ruled on two consecutive occasions that the escrow order that was issued in october two thousand and fifteen had because as i stand before you right now this division has now ruled three times that the escrow order was no longer in effect as of november two thousand and fifteen when the preliminary injunction of the nost was denied so even is that so i'm having difficulty understanding that especially in light of the inspector general's report why this phone call and paid for if you will so that you know although the substantive i mean i still see some room for confusion about exactly what the state of play was and miss wrangles advice may have in the enter and out to be correct there were still protective measures that may have been taken that would have avoided the dissipation of of assets here and this phone call seems to have allowed a sale to go forward sooner than it otherwise would have happened and for those proceeds to be dissipated in a context where no one disputes that the loans were made promises to repay were made and repayment did not happen except for these legal actions so could you tell me why i'm wrong taking that approach you had a couple of questions that were met and there are so let me try to address and if i don't fully do that please let me know number one there was nothing untoward about the january two thousand and sixteen telephone call judge code expressly held that there was no constitutional right on the part of the gnostic participate in a call that was merely designed to confirm a fact the fact is that on november of in november of two thousand and fifteen that escrow order was gone the time for the not to have done anything about of the motion for people under injunction they had the right to seek to petition for leave to appeal to the new york court of appeals they did neither that was the opportunity that they had to escape the legal consequence of ambiguous water that needed clarification but your clients did not go to the court as would normally be done but had a back channel and got an opinion from someone within the court as to what the orders meant i don't stand why that's not a due process violation if that's in fact what happened what aren't they entitled if you're going to get clarification an opinion of what it means to be present and be heard and to hear that as well i don't believe so this goes back so if anyone wants to know what an order of this court means or a district court order they can call the office and get a legal opinion on what the order means without going to the court is that your position our position is that as lawyers we are all obligated to interpret orders as they are received and as they are confirmation of that from the court and apparently other people wanted to make sure that that was what the court said before their point ok so if you haven't it's obviously wires have to interpret noise but when your client makes the decision to have someone in the court office a pint on what the owner means without notice or opportunity the other side i am having a hard time understanding how that's not a due process violation well i wouldn't say opine i would say to see confirmation of what they already knew to be the case i don't know i don't know what that sanction you're making there if she had just read the order and said nothing more maybe you would have an argument that but that's clearly not what was going on here that they wanted an opinion as to what the in order yond someone reading what in order says right in order to find that there was a due process violation that would preserve the viability of the claims that were surrogate in our our the routine course i mean there is a say although it was pending that wasn't going to happen the title insurance company wouldn't be satisfied and the sale wouldn't proceed without some greater confirmation then counsel was able to provide independently is my reading of the record is that incorrect there was there was a request for confirmation in order for the i believe it was the title company to have the comfort necessary a close like that so there was a very particular purpose for that phone call wasn't there there was a particular purpose for that phone call but i want to say two things number one to you judge bianco and then one judge corning i want to make it very clear that there has not been a single allegation that mr ackerman or dorsey in whitney had any knowledge whatsoever of either the existence of mr us as you know in this situation judge the question at the beginning where did the damages flow from that they flow from a constitutional deprivation of due process rights no as a judge found those damages could only have resulted from the order that was made by the division in november of two thousand and fifteen i don't understand why that's the case precisely because what i was just saying to you that the title company in order for the sale to go forward the title company was demanding something more than had occurred already that something more was provided by virtue of the phone call and the sale might have happened after the june further clarification or confirmation provided by the appellate division but it looks to me that the phone call was critical to the sale going forward when it did is that incorrect i believe it is incorrect because now we're adult ging and speculation as to what one of occurred in the event that i don't know i don't believe that's right because that you were just saying that the title company and the buyer were demanding confirmation that there was no escrow requirement in place and that there was no right of the that was maybe equitable or otherwise but that that that the they were free to go forward with the sale and that there was no escrow is a requirement in place and i thought it was that satisfies the satisfaction of that condition was sale to go forward when it did and therefore it was the phone call rather than the substance of what the upper division later did in june that permitted the sale and that caused the do part process violation here so tell me what respect that's inaccurate please i'm receiving a a note that that will be addressed by mr feldman but i do but i do want to say your honor that taking a or in place that required anything other than for those proceeds to be paid out and all of these arguments were made every single one of these arguments was made before the appellate division twice in november the morning your honor let me clarify counsel was was right in that you were incorrect in your supposition pursuant to the orders of the appellate division there was no restraint on the sale sale was going to go forward the only restraint was on whether the procedure should be held in escrow post sale i was the one who is representing mr sanford or pursuit and getting all the proceeds into my ask or account i called mr sanford who referred me to mr ackerman to save am i going to have to ask rowe these funds based upon my question as to what i have to do with my escrow account as the last thing i want to do is be in violation of a court order particularly one from the appellate division we got on a conference call mr ackerman called the numbers i still distinctly remember being transferred we spoke to a person whose name we did not know who confirmed that procedurally the decision of the board of the full panel denying the motion for an injunction as a procedural matter eliminated the t r o requiring escrow of the proceeds you know mr mr feldman this is yes this is not complicated if they had been on that call if we if if we believe they had a due process right to be on that call ok to be to learn what you learned on that call the they could have immediately said oh there's no escrow order in place we're going to get one tomorrow right they could have done that if they were on that call if they learned what you were and that the escrow order was gone they could have got a new one applied disingenuous the recent escrow water closing only dealt with what went to decorate the u s growing water at the time as a matter of law was dissolved tomorrow or something to hold these proceeds not the sale the proceeds in escrow the november order denying the other motion was again deny basically on procedural basis there was nothing to vacate it was a motion that was made and heard subsequent to the original very cure of the t r o very simple there was nothing a no opinion was group made by the clerk who we later found impermissible ex parte communication in so far as the appellate division had already made its determination and the evidence in the record establishes that the only thing said on that phone call was a procedural fact a political to any case that interim relief is just that interim that when a full panel decides the motion the interim relief is vacated we have two pieces of evidence the feldman memorandum and the subsequently obtained  memorandum that both confirm the only thing said during that call was the procedural fact that interim relief is vacated we hadn't had that call and i filed a written motion for clarification of the order where they have a right to have been present for that motion and  no i do not i do not believe they would have had a right to be present for a clear written motion for clarification you could do that ex parte without the other side knowing it is an initial matter your honor with all due respect no motion was necessary because to any st year attorney they know interim relief is just that in turn was no purpose of the phone call then right plaintiff's counsel did a fine job of creating an atmosphere of confusion where there should have been none but i'd like you to answer judge bianca's question he asked if you had filed a written motion for clarification would your opposing counsel had right to be present for any discussion of it it's a hypothetical question that really isn't a deal with hypothetical questions please answer the hypothetical question i don't know my role in this was very limited and i don't believe that any motion would have required the nobs input they had an opportunity a notice to be heard was inappropriate but c s reports of the the opposite the o c a report only said there was an appearance of impropriety but the o c a report ignored the fact that there was nothing pending and only procedural matters were discussed because nothing was pending and because only  procedural fact the political to any case was discussed no merits of the case why the st department repeatedly denied the naacp's requests to encumber the property which by the way they had an opportunity notice to be heard throughout several years yes because i know that interim relief is just that interim that when the full panel of the st department decided to deny the requests that the noffs repeatedly made and the st department was fully familiar with the facts and fully familiar with all of the repeated arguments over years of the nots attempts to encumber this property they decided that they were not going to hear it any longer and the full panel decided that they would not grant the relief  nor in their allegation that without this clarification clarifying phone call the sale it never happened and that it's a motion to dismiss and that's what they're alleging may i respond i see my time is up with all due respect the sale was going forward regardless the contract for sale had been executed years before any of this the only issue was was a certain amount of money going to be escrow the sale was going forward either way all right thank you very much thank you your honor we'll hear f one point i had been given originally four minutes and asked to have the full four because of what's happened in the questioning from the court and then i need to respond because i'm the only person present this entire courtroom that knows the fact fast and go through points i was the only person in the room with judge sweeney when that happened i'm not an attorney i'm not legally allowed to represent the like pursuit but because he had sued m no actually your honor there were about five what happened was my entities or elsie's and just for one second no the loans did not go to pursuit it's in the record in the phillips case that he acknowledged there were no loans to pursuit and his affirmation for summary judgment he said all the loans went to michael sanford and norman not was deposed after summary judgment and said all the money went to me to buy a piece of my investment business and that's what this entire case is about abuse a process that is in the record everything is in the philips record he said both cases be tandem if someone would please him since of all the respect please read my memo of law in law they mr enough was in prison for a real conspiracy in the southern district with fake financial statements and that is what is happening here mr berry left out deposition testimony and faked the numbers and then he changed procedural posture of having had a motion to dismiss granted in that posture as you're aware on that please do so and that judge bianco it as would they have not one and that was another misrepresentation because i was there for the entire series of events here's what happens in the record with dorsey's papers in july of two thousand and fifteen mr berry went for a prejudgment attachment against pursuit and so everyone understands pursuit simply on my homes and how it all my assets my other entities or my business right made money so i put my savings into pursuit and thus if they sued pursuit i did not have a lawyer i couldn't defend it and they put it was penance on his pursuit it got it all their properties i was renovating i couldn't get any money out or continue renovations so i was frozen it was penances and then they try to get a opportunity to file with the benefit of counsel as as you've chosen your rendition of the procedural facts that we're entitled to look at and your your brief and to have a voice in each of these multiple pending cases correct only a few cases some cases it was not allowed to and i did not have counsel on any of the ones the last four i had to enter into pursuits case on my own volunteered to be sued because it was no lawyer for pursuit there was hundred decision under appeal by suing attorneys with the most tenuous convect connection to the cell ph c out of good faith basis to bring a cause of action against them and by his threats to  lawyer for pursuit they run to justice sweeney i had to appear and justice when he asked me are you now going to sell ph c and i say yes to higher council for pursuit and he and mr berry says in the record he has emotion pending for a review of the notice apparency which was cancelled and could justice when he put on an order until the prior order resolved the prior order gets result remember twelve against enough's so what mr barry said to you well way to run everything went their way no when i was able to sell the apartment i hired decker and decorated voluntarily gave them that t r o in february march they did not win that hero there was voluntarily given pending the determination of the jew motion which we won they never won truly anything so they were on a call the prior history of losing repeatedly on the same issues would have come up and why would they ever receive restraint at the no expense he was cancelled in federal court judgement tash was denied an injunction was the risk that they would be violating the order they were calling ms ring girl in order to have a basis for persuading mr philips and mr phillips title company to close on terms of permitted the release of monies from escrow ackerman when mr ackerman was deposed he said that he took mr film and that he didn't think there would be a problem and so i asked him well if that was the case why did you need to make the call and mr ac says that wasn't good enough for him and mr ackerman says it apparently was not these are situ is a situation where all the parties to the transaction need a court clarification and that means that it's state action it's under color of law if you look at monrovia's paper which law and overrule them and their grounds is still good law with the definition of color law it was issued with close with the authority of law that's what they are insisting on that's  was insisting on recently the st department defined state action as if the government employee is doing what no private individual could do this guy the defendants have admitted that no private individuals opinion was good enough for them and there's a good reason for that the decision as of the day the call was as follows again please please  today was made in support of the motion of vacate and it will repel a division says defendants having crossed mood for voc of sure the certain interim order of october twenty two it is ordered that the motion for the argument is denied that our granted how many different times has every judge in this courtroom granted deny the motion of a candidate thinking i want to let that procedure go forward i want to keep that order in place therefore i'm going to write vacating our claim was not merely colorable it was highly reasonable our position was highly reasonable just leave us is issued a forty five pages issue on january th dealing with every single aspect of this thank you thank you very much the red lights on will our reserve