reporter went out for trading started that day and if not then shortly afterwards it certainly didn't have to take seventeen hours especially for wainwright yesterday interject from own please give me some swim as depressed to keep you in limbo here from it could proceed without a clock if if that's the only alternative because of that but i think it's easier for the advocates of they know how much time  your honored so i believe that with respect to each see when the complain pleads that it was a department whose job it was to check the activities of investment banking and then before approving the reports you had the motive you also had the disclosure that they will seek investment banking business from mankind in the next three months and this was the only investment banking business they sought in addition your honor believe the plane cleans  of the chief operating officer of wainwright edward sol there are he certainly was involved in the offer and he's the person who signed the placement agreement for the offering which i got a copy of which is that his signature is that he's ninety one to record excerpts and he was the direct report for the compliance department personnel so this is one other person besides the compliance department personnel who would have been in a position have one question for you then i'll add another bit of time where you are but my understanding is that you need to show a strong two factors one being the boat that they had his motive to inflate the stock price the mankind for that day and the day before only and the nd thing was they put this language in the report we will seek investment actually disclosing that there was going to be a below market diluted offering the next day as you know we will seek investment banking with the next three months i think both of those the motive and the language of that of that disclosure  and then i'll deal with the pleadings as a whole and that is how is there here any inference enter of a recklessness bordering on intend that is greater than any other inference and of course district court found that there was not and i'll start with my colleagues answer my colleague said well there's two reasons you can know that number one motive they want to make money number two there's a disclosure in the report that says that they're going to seek banking business with these companies that are mentioned in the report i think we can dispose of those very quickly because they do not comport with any of the cases under the p s al we have numerous cases and say that it shouldn't be surprising because every business is motivated to make money and in response to judge these question earlier on h c wainwright says the structure was that they were going to get five percent of the roughly sixty million dollars that was going to be raised it's always a sixty million dollars was going to be raised they're getting five percent of that regardless of the price of the stock to get there was five percent that's their fig wasn't based on the stock price engagement your honor and the raise was in order to hit that sixty million dollars number and so yeah there's going to be obviously when you apply the formula to the price there's going to be a difference depending on the stock price is what they're going to get to the sixty million dollars was the goal and the view was based on that goal and there's there's really no dispute about that the the the deal is what the deal was and that's what it was and so they they were they had a motive to make money which is not surprising for an investment secondarily there is in this draft in the research report is our two disclosures actually that were that were put in by or in live not who wrote the report what is the standard finra disclosure is required and it says that we are going to seek to do banking business for the companies listed in this report ask why it's in their it's to finra required disclosure it indicates nothing other than that wainwright was following the rules the other disclosure that's in the report is a disclosure that mankind which may or kind of been telling essentially the market that it was going to need money it was in a cash  raise more money to fund its operations so those are disclosed within the realm of no good deed goes unpunished those were apt disclosures one shows wainwright complying with their on the other was what mankind had disclosed to the market on it own on other occasions and was disclosed here let's remember something the complaint against live not was dismissed with prejudice planes this could not come forward with any evidence whatsoever and there is no allegation in the pleading that says that warrant leave not and i don't mean a conclusion the allegation there's lots of those but there is no factual allegation that says that or in live not had any knowledge whatsoever about an impending deal with mankind nothing there's no no no statement of when he knew that or whether he knew that or how he could have known that or who told him nothing so there isn't a single factual allegation that says that when he when wainwright he should report it for in the morning on october th live not the guy that put those disclosures in that my colleague just talked about had any idea that there was going to be even gauge sets number one there is some the motive is not enough making compliance and therefore somebody would have could have should have seen that's not enough under any definition of the pleading standards under the p s l p s r way or no i'd be and we'd be in this arranging the cases that require someone to plead to who what where and when there isn't a single allegation in this complaint that identifies any member of the compliance department that either knew about the offering when the report came out knew about the report when there was a discussion of an offering or knew about we we trust it would not we never qualify as an expert his experience was in solomon brothers and j p morgan and then just a research firm but he himself says that he was he's he was never at wainwright and he just talks about what in all likelihood in his experience at  bracket firms very different from wayne wife would have happened the confidential witness they call him an associate in the business they referred to his juniors their young their subordinates their work for research analysts and it was a subordinate that left two months before this for whenever it came out i'll also point out that when you look at the nd amended complaint this confidential witness doesn't say that in his limited view if he was a junior again they'd call him an associate that's what  junior is that in his limited view if there was anything wrong he said it was unusual not wrongful not that it violated any rule that he was aware of just unusual unusual doesn't satisfy nobody has made the allegation be because one couldn't that going ahead and engaging in a transaction within the twenty four hour period of a research report coming out and again where where there's no allegation at all that live not is simply saying that well you should have disclosed it if it existed but even the district court at page ten says there could be an inference that there was no deal at the time so what i would say is that i understand certainly your comment and the comment of judgment that it looks bad or as the c w said it looks unusual but there was nothing wrong full about it and so the stand at the transaction happened quickly and after the report was issued there's nothing wrong with it other than as their confidential witness said it appeared unusual so even their confidential witness didn't say that it was a gracious sit it appeared and usual and i think that's the point when you go back and look at this pleading and you and you and you take out the window could or should all of the guesswork all of the conclusions and you just look at what is it all rest on what are the facts the bab's actually plan what is the who what when and where where is anything but innuendo here's their entire case there was a research report that came out of four am and then there was a deal announced seventeen hours later at nine pm that's it those are the facts all of the other facts they allege so vera was the c e o he signed the placement of it that doesn't mean you negotiated it it doesn't mean he knew about it it doesn't mean in any role in betting anything there is no allegation and the allegations that he will puts in that says well there are all these things that we need to get done that may be true in the kinds of deals that he worked out at firms that are very different than h c wainwright he says nothing about overnight deals which i think the court can take notice of are not at all uncommon in this industry they don't address the overnight deals at all and according to kimball there would be no overnight deals because you need three days he says in his experience and that's key because this experience has nothing to do with wainwright he was never at wainwright he never spoke to anybody of wainwright as far as we know he doesn't say did and he doesn't know how those deals work that's not what he does and his last job was he was writing research he wasn't a bank at all so if you look at the pleading and you will apply t let's look at the pleading what individual what was alleged about anybody nothing not that any of them have any knowledge of the deal and the report and i think that's what's critical because if this pleading if this feiss under the p s l or a a nine b based on all kinds of innuendo and all would have could have possibly might have happened then i don't know what pleading wouldn't suffice and then we've got twenty five years or jurors butin less this sneak in the door and it shouldn't i think that really is the important takeaway there is no case that they cite when you look at the facts of those cases that is even remotely like this one because this one doesn't have any facts to back it up other than a report in the morning and then deal in the me that's it that's all it's got that's not enough and that is why the deuce for court said well that's not a strong enough inference for site enter that's not it's finra rules in place the st inference is that the engagement wasn't actually agreed to at the time the report came out another inference i believe was a possibility that judge van dyke mentioned somebody could screw this up the point is those are at least as likely and in fact according to this report more likely than the idea that there is some unknown person who on some unknown date having some unknown knowledge decided for some unknown reason beyond making money to go ahead and issue a report that on its own wouldn't particularly make that much of a difference one dollar way or the other because because wait right was getting five percent of the holistic approach to him please look at everything which is understandable but i think that when you apply the holistic approach here what you see is that other then innuendo other than what might possibly be there are no facts beyond the timing and a holistic approach is an alchemy it doesn't allow a pleader to take innuendo and try to turn those into facts the holistic approach says really look at it look at the facts together what facts here are they are beyond the timing none it's just the timing nothing is or the tribute of all to any of these actors and wainwright itself can't have any intent and that's the reason that we are urging the court to affirm the dismissal of the by the your honor first as to since this notion that it's just purely speculative said to person compliance department was in a position to be looking at the report and at department that was supposed to prevent something like this from happening is somehow the merits of the compliance department somehow as evidence and it would seem to me it works the other way like if if if the fact that if they didn't have a compliance department maybe crazy stuff is going on behind the scenes but the fact that they have a compliance department that i think your argument is this supposed to stop precisely this sort of thing from happening and i don't i don't think that your opponent is saying that the because if there's if there's a mechanism is supposed to keep something from happening but that something still happens most of us i guess for years each it would have to be the case that it's more likely that the reason it happened is because of some  us thing that happened as opposed to a mistake they screwed up something i'm having trouble seeing how that's evidence of affirmative evidence of c answer as opposed to somebody dropped the ball here judge and i could it shows that there were people who ordinarily should have been looking at the activities of investment banking and contrary to what my adversaries read about me that not only should they have been i don't agree i think  all agreed about that but your argument has to be and so the fact that they missed it back that this got through means not just that they missed it or screwed up or didn't do their job right which we're all we all know people do that but that these people were somehow like the various or something in that they actually were doing the opposite of compliance is that your argument and that is that is your argument in this case your honor that for this one day the factors are a good motive obviously every business wants to make money and whether or not the maximum amount of the offering was sixty one million dollars so whatever it's clearly better for subscription and just for the act they had to go line up investors for getting investors to subscribe for says that this disclosure is required if the company issuing the report expects to receive or intends to seek compensation for investment banking services in the next three months from the subject company so it's only required to be put on one of these reports since we're going to see compensation for investment banking from this company three months if it's true if you don't expect to be doing that and here there was no other about the bank and they did what six months for mankind there's no requirement that you put that disclosure in so it's not it's not a finra mandated disclosure and you has the boat also the other notion that seems to be outside the record is this notion of overnight deal that mankind that when right might not have been working on the deal whether some deals take three dollars to five dollars days and there's a possibility that they can be done overnight there is evidence here of what happened here if you look at pages fifty dollars to ninety one dollars of the record excerpts there are copies of the agreements that were fully executed negotiated agreed upon and signed up here they all we also know that there were multiple investors  and to finish our opinion which was discussed at the age of twenty nine to thirty three with the exact same evidence of knowledge that we have here a industry expert and a former employee who did not have direct evidence of what happened in that particular knowledge was played through evidence of what the defendant would have learned about its customers that pivotal leads from annual where the customers would have discussed inventory left plaintiffs had no direct evidence of the what the customers actually told defend that case like i said they had an industry expert who discussed what usually happened in the story and they had a former employee of the employee who couldn't speak to what actually happened with that defendant in a former employee of  type of evidence that we have knowledge here and this court again and that it is our opinion in two thousand and sixteen found that satish thank you thank you mr i think the court understand your argument so i think i'll thank