there are four other related cases that we're hearing today as well and the parties have worked on an agreement for a presentation of the argument today and we are going to follow the suggestions of the part of the counsel in how the argument will be presented in all five of these cases simultaneously so we will begin with counsel for life partner spli please the court no night here on behalf of the life partners appellate members of the panel appellant respectfully request that this court reverse the rule two of the six dismissal by the lower court district court seemed to be troubled that the transfer was not identified and it's my understanding that the transfer is the sequence of pleading yes or no the light pours into t was into t who paid the fees and commissions can you identify where that is in the third amended complaint please because that appears to be an on you have been amended chart that actually has the specific date but do you have the transfer denah fide in the complaint or the documents that were attached the complaint that or have been considered i do believe that we do  because for instance in the first case the county records cite fifty three twenty seven two fifty three twenty eight paragraph forty one we just described the nature of the investment scheme that the life partners entities and life partners inc was the only operational entity that they were engaged in and in that description for instance roger we know that the way the mechanics of the scheme was for life partners in to purchase life insurance policies from the original policyholders were bought by partners inc then became the owner of the policy i reference but this method is duplicated in all of the other cases but encountered at record on appeal site fifty three fifty six paragraph one third of the lie pleading that was before the little specificity to clear even that meeting threshold just by way of example if i could elaborate on some ways in which we did but perhaps i should preface that by articulating if we are talking about before then we have to or disagree that there was not sufficient specificity after the nature of the life partners into t's and their insiders for a condom and i can provide several examples place to for instance three twenty not paragraph fifty the following to provide context for the who what when where and how as to the life partners into the fall and i quote the actual mortality rates continue to show their doctor cassie was terribly wrong by the end of two thousand and seven only seven out of these two hundred ninety two policies had mature as illustrated on exhibit one there should have been more than if only seven out of two hundred ninety two policies that life partners was predicting would have matured by this time if only seven had mature that means ninety five percent of the time life partners knew that's important because we're only seeking to recoup fees the commissions paid in two thousand and eight two thousand and nine teen eleven over two thousand and fifteen come let me interrupt you now that you've said that  what you are seeking to recoup which of the claims asserted do you believe do not require any intent element or santer of the claims are count two for constructive fraud transform this not by statutory edict the corollary claim one account for which is the federal bankruptcy and a law for the state count which is an account to this not required intent nor does the negras it mis representation which is a assign blame for the individual investors only actionable conduct but on that score what is important about even that claim it's tana believes that's not did not exercise reasonable care but that still as a rule nine standard isn't it i would really have to plead the particularities of reliance and what the representation was and the approximate date time it was made and to whom if a plaintive elected to couch the negligent misrepresentation in terms of the defendant's fraud and i'm not entirely sure why a plaintiff would do that in my experience plain we didn't just happen abstract sense that our methodology was sufficient we had a very particular lies concrete indication from a judge within the same district that the pleading methodology was sufficient if we hit had a contrary outcome before o'connor we obviously would have prophylactic lee modified r p v approach in all of the case why didn't we raced out as soon as the bankruptcy judge said you couldn't but then and in remand before you got to you're saying that when the bankruptcy court judge made a report your recommendation and said oh i think this is we care our perception was orderly course because the entire report and recommendation that is the ordinary course that you wait but you have a chance to fix something that could be wrong that you and the you know the most you had the moment when you were still under the jurisdiction of the bankruptcy court even and that day when it was already requested in and appeared to be granted and the even that day during the bankruptcy proceeding you could have done it and that's gone back that night and  me very well but but but the question is why did you not file then file a motion for leave to have men knowing that at that point it's not it's not a question of what the bankruptcy court said or didn't say at that point you're aware at that point that there are some perceived deficiencies in the fleet and you also have in your possession the fact to plead it would seem that the thing to do at that moment would be to file a written motion for leave to amend  curative amended complaint i guess that that's not was what i was in a sack same thing that you know rob was asking about but that is question is why would you not have pursued that at that very moment so as to remove this as an issue i think that's a fair point but i have to reemphasize this is not just a linear dynamic we were not operating back this pleat methodology that was being challenge that we thought adequately for some of the reasons that i've worked through th far articulate factual content the correspondent with the elements in the context of the fact that that approach had been effective in different contexts and we didn't even have the feedback from the bankruptcy court saying yes i appellate that there are these divisions you didn't know yet that the the court was going to rule that they were actual deficiencies exactly what you just the chance that they might and you could clean them up might have been but that's i mean that would have been maybe the more why is as i understand it there are three types of an equitable conduct any one of which could be alleged but it doesn't look as though you've played which if any of those three types of an equitable would apply again claimed this would be in the third the pleading that is operative in this case am i am i misreading that is there an example of an equitable conduct that is pled under that statutory authority all of in fact it count to your question about the count six eight and nine are all remedial provisions for the liability count two of those counts almost one in particular believe most abstract but mark philosophical approach in articulating that remedy was in essence that by providing the level of detail whether measured by what eight or whether measures are or nine to establish the liability that was the the we do have of your factual content that is consistent with the standard white factual content then there has to some particular person had a fiduciary duty and that they did not live up to it by a particular action yes sure we do because and we are relying upon a case of the west indies from texas principally for the notion that when a person with what we believe to be the legal elements to establish a fiduciary relationship and despite that content the court as opposed to objective lee acknowledging the content in essence engages him with twomey it will tell us that  court respectfully is not supposed to do make value just make qualitative or subjective assessments handicap the probability as to whether or not evidence may or not may or not be forthcoming at an appropriate guys shifting to what i think of as the second issue so the ball and the heightened particularity both sides a brief that it's complex given the number of claims here but just on your argument there was an of discretion not to grant leave to amend and i have two questions one is you're relying heavily on the oral request of the bankruptcy judge that was in june correct as director on looking at the record  it struck me that when you responded to the report and recommendation you embrace the bankruptcy judges statement that you should have been given leave to amend but in your brief you aren't embracing that as a request to amend and i was i think toughest times chevron would say is that you do not need a formal motion ok so i understand that portion but why isn't your stronger argument and maybe you've waived it or maybe there's a flaw in my thinking why isn't your stronger argument that you made an explicit written requests to amend and therefore the district judge was wrong factually when you responded to the report recommendation and said yes we want what the bankruptcy court suggested i think there's an excellent point your honor but you didn't it our framework was because the quiz provided the context for everything else that happened beyond their ok and given that the the this court's authority is so clear and unlike some of the police who seem to strongly imply that unless you follow on or request with a written request the or request is not effective well the implications of that would almost be that in this circuit we're doing away with or a motion practice and i would assume that we're not ready to progress to the point where we would cut off in advocates ability i understand the june argument and i know your time's running out so i just want to ask the other question and this is fairly basic but if we're just looking at the whole picture of the district court's discretion with a very liberal standard are you saying that the district judge abused its discretion because it was wrong legally in terms of seeing futility here where are you saying the district court abused court because this is the way that the lower court framed it he both made reference to what he seemed to be implying was unacceptable delay and then he went on to separately suggest that he did not think that the proposed minute pleadings cured the facilities so in fairness that's probably both the futility issue as well as the delay and how many how determined to do because our case law seems to go all over the place on this how determined it is it that a party point to prejudice from i think that it is in poor and what's been their best argument that they would be prejudiced by allowing the fourth amendment called only your own i would be curious to hear in their response argument what that is because i have not heard an argument as to why they would be prejudiced other than the fact tracked the vast majority of the downtime if you will in this case ost to the fact that the bankruptcy court judge stayed the adversary pussy and that state was in effect from june sixteenth two thousand sixteen to february two thousand and seventeen no one in the context of that state none of the licensee or pelleas objected to the effect that had on the timeline of the sequencing of this matter in fact none of that all of us have had to contend with and so if you look at the actual litigation time what you see is actually several examples of us proactively the appellant's proactively in response to a motion to dismiss saying you know what th how you've met the pleading standard for negligent misrepresentation is there in explanation of what the misrepresentations were by the license fee and how they failed to act with lew due diligence and how anybody justifiably relied on their offering materials where is that i understand the whole theory of the case is that they shouldn't have been getting these  thirty seven where we talk about the offering were to the offering materials were created by the life partners into these container forms and representations with respect to life expectancy the point that i would visit upon early in  respective individual investors and the record cite that this makes made reference to provide i think twenty separate examples of the substantive content of the offering materials but does is there something where how any investor justifiably relied on the materials in the interrelation with the fact that these individuals were not just passively selling the securities is r v or mit which is entitle to this most of the time you may answer the question is sufficient for the pleading in this case in that case they were suing pardo hayden insiders of cars and some into ts with respect to the fraud that they committed they were the insiders and they actually have a count for fraud and they were found guilty of fraud in the jury verdict but i think some of the entities that are agri that the main people are in the case but i also thought there were some peripheral entities in that case as well there were but they were all  and sold fractional interest in life settlements that was actual money paid to life partners not the licensees an actual policy was purchased by the licensees and so with regard  heart for or whoever when the life insured life person dies they get paid the question of whether they pay too much is really the issue in that case not over there he was a loser thing it was not the bankruptcy but the fact is though they did buy a product they may only get a part portion of their investment back maybe eighty percent seventy percent a lot of it depends on how long the personal lives how many put how much premium is paid it could be that they bought the policy in the next month as maturity they got paid and at a rate of return of fifty percent or sixty percent we got a lot of experience with these allegations of fraud against or claims of fraud against the licensees and under tough to that is a point why even bring it up if they received a check and that check was a fraudulent transfer from the into the life partners then that's a basis of a claim not to what actions they took unless it relates to the creditors claims in ten eleven and twelve and i just interrupt for a roadmap question because with multiple attorneys arguing are you to present different portions just so i know or should i ask you questions yes you are i'm seeing that can you just tell me yes can argue what quickly i'm going to try to go over as much of the pleadings as i can this was not your focus on the heightened pleading issue you're not posting on the rep are in fact rule eight pleading standard i mean i know we seem to spend a lot of time arguing between the nine b are a day standard but some of these claims would seem to be clearly subject to weight standards specifically i would talk i would ask you about the section five forty seven claim which is count five and the section five fifty claim which is count six the those in my mind are somewhat connected as  promise was and it was within a certain amount of time in connection with the bankruptcy and that it had it and a given result on the debtor made seems like that would those would be easier pleading standard under rule eight eight nine b then would apply we believe two counts one three but if you argue that even five and six have not met the rule eight standard correct for it in five we don't know who  life partners was the one paying it out by reading the text of the complaint in the previous in the third amend it correct correct so why can't you read the text in the third amendment tell it was life partners by reading the text and putting it with the chart you know that it's life partners on now now we can there were thirty three different entities we weren't sure but life partners was the only one that was alleged to have been paying out these  right it's even though burdensome and dealing with all those licensees they had the burden to come forward with it if information kept six i believe as he said is sort of a remedial i disagree with his issue on equable subordination that's a standalone tork that discord the fifth circuit has ruled on and has a lot of case law with respect to the elements required for that but with regard to the pardo i think there are two things that we can take of the case in take judicial notice and they have reference that obviously is parallel proceeding is that the jury found that life partners did not know in in question three of the fraud in it and they found no to that and that we did brief on that we're just dealing with whether the something was pleaded in this case right right and how did the judge deal with the pleading standard in the related case just so that we can know how if how the cases are being treated in what that so i'm we're only dealing with the pleading standards ok all right thank you with regard to the  be instrumentalities of the underlying scheme so i again i don't know why they're saying they're not suing for fraud when all these fraudulent statements are statements about fraud are before the court at least fifteen times be applied to the tufted claims specifically counts one in three counsel can you tell me whether or not you agree that count eleven about texas securities that claims and other things we just mentioned in our brief but is there something that is missing that says that it would be futile because it's still not satisfied enough for well the fact of stating whether or not they have a right to sue when they were not the original usually with regard to the issue of negligence misrepresentation are on that point remind me and judgment brides ruling and statements where he said that he was promising futility on a lack of standing i'm sorry say that again so how was the futility concern where is it premised on failure of standing what's the record cite for that or you the prejudice that you'd ask about before is there if if they were if they were allowed to replete then i believe that there would be prejudice to always people because of the responses if they were financial advisors and even if they weren't incredible amount of pressure on them not just financial pressure but with regard to these claims of fraud it even though it doesn't say fraud all these claims of fraud and what actions they took and how they respond to that i'm not trying to be too particular but when you assert there would be tremendous prejudice is that based on judgment brides finding or is that your assertion is to sort of common sense a common  motion for leave to amend i do believe that it was not a good motion if you read the transcript before judge nelms because it was an advisory opinion just like the district court said if you disagree then we would move to leave to him it didn't say we hereby move to me and what about my question is it correct that in their response to the report recommendation they did embrace the bankruptcy court suggestion that lead to a man should be granted did they put it in writing to the district courts no they did not know not until in three of the cases the  american safe and if they do they did it after the judgment was in or right but in two they didn't we all agree about that but we know i'm actually asking you to focus on the three where you've just said no they didn't write are you very confident that in their response to the bankruptcy judges report recommendation they didn't put it in writing to the district court that they agreed with that i don't believe that if if the record shows that they did that would be a significant fact it could be ok and with regard to the other issues of breach of producer duty and believe that that claims well of negligence misrepresent station claim requires the  heightened pleading negligent misrepresents taishan requires the misrepresentation of an existing fact they were talking about future facts of life expectancy trying to predict when someone would die or not and so we believe that away please cord tom ferrier represent gallagher financial and i have the somewhat unique perspective among the a police council of having one client and i'd like to bring the benefit of that to the court because it does allow me to focus on allegations as they specifically apply to one of these defendants which to some extent can filter around some of the flood or i do intend to address the insolvency claim but i also would like to do that that was not mentioned by mr brannan and that's that's why i mention it first though effectively stayed in the brief and frankly i agree with him that the that this insolvency at least as to the fraudulent transfer claims the insolvency claim is a core element that they are pleading to the problem i have with the insolvency claim when you imply apply a big ball and griggs type analysis i mean you look at it and you say let's apply experience and common sense and see if the facts as pled infer that now the court correctly noted that in many ponzi scheme cases as to fraudulent transfer claims this court in the past it's fair you're not purchasing anything and to me that is the key difference here between what's being pled this pleading incorporates a trustees report it incorporates lengthy descriptions from the bankruptcy and on its face it describes an entity that is not selling air now the allegation here is the life partners entity is purchasing an insurance policy issued by third party life partners is not liable on that policy the allegation is that like partners is then selling that policy to two third parties and that what life partners is alleged to have done is taken an actuary who used to testicle tables that determined these people were going to die sooner then then what they say is  correct statistical table that is just full title says someone has a five year life expectancy and they with that will know it should have been seven eight whatever in the end that's a six that's a difference in value what that is not th cassidy was wrong completely it was a complete sham so instead of seven out of two hundred twenty or whatever the number is there were none he was he had no qualifications would it then seem a point how could i when you keep saying this isn't a fair that's the question that's going to occur these are policies as the bankruptcy think shows on seventy and eighty year old people the issue is not whether the policies at some point are going to mature and further the issue is not as they insurance policy in this is again all on the face of the pleading and the trustees report so i do agree with your point to the extent that it is couldn't there be yeah you're right  do think inherently this is not air and i believe this is an important point for the court to consider when you all go back and consider this case and here's why look product liability cases where executives are contended to know something and have a defect in a broad product class action cases where x car insurance company is allez to have overcharged  executives known about it crossed poil and gas cases where royalty over charges should have been brought up when we expand the legal inferences that i think the court correctly is applying to ponzi schemes up i have no issue with that but when we expand that into fact patterns that are beyond we get what we have here but the  is attempts to draw inferences as matter of law on the tough to claims that are not supported by the fact pattern and i think that's really you tell me which claims you believe your point is relevant to count one two three and four all of the fraudulent transfer claims your honor ok the counts two and four is directly abundantly clear on the face of the fourth the minute well i would say they have the fourth amendment complaint because we have to decide whether it's futile because if they have the fourth the many complain it does what it needs to do then it now so what's your fourth amended point what do you want to make on when you look at the fourth amended complaint as to my client here is what you find you have a complaint that is several thousand pages long that has at one point my client mentioned there is an exhibit attached as exhibit and this is ok what are the various counts raised against these clients you turned my client who and this is very significant as to my client it's an elderly individual this is a life savings is positive then i know this court deals with important cases all the time but up but i do want to emphasize that point you turn to exhibit ten and you see that the fraudulent transfer claims all of them are alleged against my client well that's fine count one two three and four you turn to count two through four in the body of the pleading and you see this complete this count is alleged against the people listed on exhibit one who received commissions from two thousand that was a yes yes so if you turn to the thousand page exhibit one you find my client there's no missions within those states so you're not on the hook for that one that i don't know were bringing people to poor willy nilly but now we're in a three thousand thing that you have to cross reference so i well can't you just ask them do you have this claim against us it looks like you don't and then you agree with your non pseudo there are some kind of agreement she signed so that we don't have to do that and that's you have one cry and it seems like it's easy to do this your honor and we've asked you repeatedly and motions to dismiss and we're still listed on exhibit ten quite frankly moving and because it's a related point to your question on the third amendment the first time i learned this is after two motions to dismiss multiple hearings in the bankruptcy court and appellate briefing the first time i learned that the negligent misrepresentation claim was not brought against my client it was specifically referenced in the third amended was in the reply brief in front of the fist circuit that is not the reason there's a footnote in there that says we don't know why mr farriers talking we didn't see him by name but is talking about n misrepresentation it's not brought against his client it's specifically in judge notices recommendations about my client on that claim it was argued that's not reasonable to process is all i would say that's not a reasonable standard o the trial court ruled however case law is very clear that the court can look at the motion to dismiss themselves and affirm if there are grounds to affirm based on the record we believe that is the case i would like to first address i not sure whether they did it or not however i don't think that they had to actually bring forth for the other cases i do know mr brennan i did in our case we decide to send this on the another reason that we write a story the correct you similarly situated to mr fair his client where they have been all of the claims have been alleged against him including these fraudulent transfers one of my client doesn't even have any fraudulent transfers in the pleadings as far as i can tell well if  you aren't you it is impossible to tell and i would agree with mr ferrier that we have repeatedly asked we have motions to dismiss as far as we can tell we are still included in those claims regardless of whether the statute of limitations would apply regardless of whether one clients and even receive a transfer and i think that is the problem in general with this mask pleading that has been pledged by the apple lens is that we are unable to determine what is really being alleged against  and i think that's what you've heard over and over from counsel previous to me is that i know that you have talked about cross referencing but even the cross reference just doesn't allow us to determine whether my particular clients are included in the certain licensees which is an undefined term in the and because it's not it's impossible for my clients to know what's being alleged against them we believe that the motion to dismiss was appropriate under a day but also that the court can affirm under the affirmative other grounds that were alleged under the motion to dismiss such a statute of limitations the standing argument mr brand discussed earlier and  and in the accelerating wealth case eighteen one zero zero five six the american money group that police so a total of sixty two athletes that have been sued in these cases i think we should start by talking about the fact that the court's decision here on whether or not to dismiss really boils down to discretionary grounds and it should be noted although it wasn't mentioned in any of the argument up to this point because there was a discussion about the fact that there was an abatement of the case that had been issued to respond judge nelms in the bankruptcy court for a period of roughly seven months to allow the plan confirmation process to go forward the parties agreed on agreed scheduling deadline that's scheduled deadline was a rule sixteen scheduling deadline and it had  a deadline by which the athlete or the appellant rather the plaintiff was to have amended their pleadings and that date was march five twenty seventeen so that amendment happened in using as an example the  seventy to vest level three case that was the first amended petition i'm sorry they mended to the second a minute petitions so they were already by this point by the agreed briefing and pleading deadline were on their third complaint ok so what happened after that there was a deadline set for responses by the defendants the defendants filed twenty eight that i could count twenty six as reference in judge mcbride's memorandum opinion and order  different motions to dismiss there were three jointers the this matter went before the court on before the bankruptcy court for oral argument on june twelve twenty seventeen at this point the appellant then the plaintiff was defending their pleading now the problem here is and the case law in this circuit is relatively clear you can make a choice you can either defend or amend and that distinction is critically important because if you choose to defend you do so at your peril now talking about the procedural posture of the case do you think that's true even in bankruptcy bankruptcy is pretty a little bit more informal it's in it  these types of things in day to day work in the bankruptcy court they were everybody's rolling up their sleeves to get things done in bankruptcy court that is typically true in the case in chief where the matters are core matters but  this case is an adversary proceeding or five of them that were by order of the district court on recommendations from the bankruptcy court the reference was withdrawn so this is a case where the bankruptcy court was sitting in effect to hear matters before the district court and although the bankruptcy rules still apply to that decision making process so do the federal rules of civil procedure all of the full formalities of the district court were in effect including all of the pleading standards and by the way this is helpful and you don't have that much time but what's what's the suggestion make the bankruptcy court did say they should be granted leave to amend they so so we have that fact but then legally when you say case law is clear it's either or are you saying there could never be an abuse of discretion then if it's chosen to defend is that the case law and if so what's the case all right well i'm i'm i'm going to tell you what my review of the cases it's a non comprehensive review i just want your best case you don't need all right  it really helps to give me one best case judge mcbride in his memorandum opinion and order side of herman holdings which is certainly good enough and in which the case was seven months old and when i was  for what you just told us that our law is clear you can only defend or amend what's that case it doesn't say you can only defend or amend what the case law says and i'll do view an example spiller of the city of texas it was quoted in the loss of the right to amend and so this case very clearly stands for that and it cited badly dorman also if a circuit case with the same holding i looked over as much of the case law as i could and this is clearly not a comprehensive review i found twenty cases in which the first circuit had affirmed a court's exercise of its discretion dismissing a case after multiple pleading attempts had failed to cure the deficiencies and i could not find a single one is important because you would assume that the fact pattern that you would find here at least shows up once where on a second amended or third amended complaint the court dismisses the case saying you haven't gotten far enough we've been in this case now in our case it was two years you've been in this case three three amendments we've had twenty some odd different motions to dismiss after the second amended complaint was filed we had an additional twelve motions to dismiss the defendants have gone through enough the time has come as judg mcbride found to dismiss this case and i couldn't find a single case on that fact pattern where this court had set aside the district court's exercise of its discretion in my right that in their response in those first three they did embrace the bankruptcy court suggestion that they should be given leave to amend not exactly in your honor i don't believe they did i read the language of what was said at the june twelfth hearing differently not the june twelfth is the court tells us that we need to amend then we will do so as opposed to requesting leave at that point because as your honour's questions clearly pointed out from march sorry from april of two thousand and seventeen until june of two thousand and seventeen they had the opportunity to amend before oral argument from june seventeenth until september of two thousand and seventeen when the report recommendation was issued they had an opportunity to amend and they did from the time that the report recommendation came out for another two months until the trial court issued its memorandum opinion and order they had an opportunity to amend and they didn't i should point out that this court has in fact your hon written several opinions in which under not identical circumstances but not entirely dissimilar circumstances you have upheld the trial court's exercise of discretion that's true no one disputes discretion i guess and i'm not as experienced in my colleagues so i knew you likewise but but i would think there would have to be some statement or argument of prejudice there would have to be some statement as to bad faith we now have this final version that looks extraordinarily detailed in fact the arguments today are two extraordinary detail so i am having a difficulty without prejudice bad faith maybe error as to futility cause these causes seem you know you may win them but they don't seem to lack any basis so i'm just looking at what i think is the full spac it's of factors and i'm not seen many well i should point out that the thousands of pages that were attached to the second and third amended petitions in th using the seventy two fast example they detail transactions you know they don't specify why these transactions are fraudulent imagine if you will but it's clear these were exorbitant every money the the theory of their case you may again win is that the investors are paying money thinking they're getting an investment in fact it's going back to the licensee it's very high it's so so there isn't much money going into be back up the premiums but for every one of these individual defendants to know specifically how it is and why it is that they're supposed to be liable on counts that that in include fraud elements in them they have to know how it is that you get from the leap of there was a transaction to that that transaction was fraudulent and a list of transactions does absolutely nothing to enlighten them on that and this is important because as judge higginbotham health in the system technologies case there is a there is a high bar to get into the discovery process and rule nine b provides that bar and in order to engage in the discovery process you have to be in a position to be able to say how it is that you are being accused of fraud and all of these counts cover various allegations and aspects of fraud in fact in williams v w max the judge reversed and remanded the case for dismissal because the i think my time is a case that that detail right but the problem and if i may answer your honor my pleadings i asked you a question after your red lights on you can answer it thank you the fact of the matter is that alleging significant amount of detail in this case a significant number of transactions is not the same thing as saying why those transactions constitute an actionable cause of action it fails to me answer that is that there is no vicarious liability for somebody else's fraudulent scheme with an allegation as to the basis of that fight carious liability and there is none in the thousands of pages of transaction descriptions  that do not supplant the need for a wive pleading if that answers your owner's question pleading that talks about why it is that a cop not just that a transaction took place but that it that transaction  as to these people who only participated by selling the product do you agree that it's the transfer of the dead or who has to be doing the project activity well right in or that it's the  partners that's the fraudulent actor well but in order for the third parties to be subject to having their commissions discords they have to have more than like for example in count one there has to be some level of culpability scheme or the ponzi presumption we are more than happy to avail ourselves of the benefit of the ponzi characterization in that regard i want to direct the court to this court's holding in us vs marie counts one and three for actual fraudulent transfer do not require insolvency or even the equivalent instead it can just be proved that the person defrauded the investor which would be sufficient there or in that statute discretionary badges of fraud that a person may quote unquote may utilize to demonstrate actual intent to hinder the label of fraud but that does just respectfully in the fourth mary clay absolutely nobody could be confused but no one could have been confused in even the third amended complaint because we incorporate it by reference as we are allowed to do under rule ten see so much comprehensive documentation on the fact that life partners inc was the operational into t that was actually paying the fees and commissions just by way of example using cali as our point of reference at record site fifty three twenty no it's not in the sense that they're suggesting that we have the proof plead the negative we're not the certain claims against certain individuals so you're not going to found factual content in the pleading that accuses the individuals of happen in this case but i would say as a practice important professionalism thing that you make sure that you meet with the people so they know what it claims or when it's something th complex is this and there are various charts and tables in this that you eat until you people have already briefed things we should not be in the situation where they don't know and we don't know tell the reply brief to the claims or against especially them so you in cases where you have with this many people in this complex you need to make have coffee or something and tell the people what their claims are against their client and that's there i absolutely agree and candidly what i have thought as i've heard these arguments is this is a matter of us getting on the phone and agreeing to a stipulation the the distinguishing consideration is gallagher is in on some counts it is true that there may be a typographical error with respect to other counts to which we did not intend to hold him accountable and we will clean that up the difficulty was from the outset we did not include any factual content suggesting that they were liable on certain counts we got into this complicated scenario where we have to try to be done at least state and restate things that we think that we are taking lately and in this situation it did translate into  the only one that i'm aware of but if this court is inclined to remand this matter i can assure the court that we will take care of these issues so that they won't have to be resolved by the district court could do us a quick one fact one law question fact question is was there a happened here we were entirely proactive report recommendation judgment brought i say in no uncertain terms i'm not taking up anything that didn't have the new do with the grounds for this missile here under this court's authority aside the fourth circuit case just because it talks specifically about the bankruptcy referral statue but this court in several different contexts also has hailed in that position to a dynamic when you don't object when the district court does not take the issue up it is way for purposes of appeal was judge mcbride's futility intimation based on lack of standing in any way i do not believe so your honor there is an issue that has never been well developed in my opinion by a pelleas with respect to the measure of damages under the texas securities that to proceed on the merits the final observation i'll make is respect to this notion of repeated them it's my reading of this court's authority in the dail jan case i believe is a two thousand and sixteen case is an example this issue of repeated admin minutes is appropriately focus as a situation in which the court has ruled against you and given you repeated opportunities to add me and and then finally the court at some point on gets tired of it the first ruling that our claims were  deficient was the very same ruling the recommendation from the bankers because it was a bankruptcy court recommended that we be given the to a man again members of the the panel proper measure is whether or not the factual content corresponds with the legal elements and we think that in every respect notwithstanding some innocent mistakes which we will clean up we have articulated the factual content we therefore request that you reverse the whole course because of our claims thank you we have your argument th