my name is only shilling and i'm here and we have a crystal seafood we would ask that this court reversed the judgment of the district court or in the alternative re man the case of that the court may hold an evidentiary hearing load the standard in these types of clawbacks is that if summary judgment is not proven if the special master does not succeed in meeting his burden on summary judgment then the court may hold it evidentiary hearing thereafter so because the court ruled that they had that they had presented sufficient evidence then there was no evidence year hearing the court basically concluded an evidentiary hearing wasn't necessary  i believe so i mean that's sort of the that's the process that's been set up is that either the either the the special mouser succeeds on summary judgment and there is no evidentiary hearing or he does not and then the court will evidentiary hearing i mean i did not do the briefing of the district court but that's my understanding yes my understanding is that that's the process that the judge has set up so it sort of is  summary judgment was met but because it was not because the special master did not resent it you know not evidence to show that there were no facts in dispute then the court should have held an evidentiary hearing you should have denied summary judgment that's in terms of the settlement claims process that's been set up and i'm sure that the the claims in the mr can speak to this more clearly but it's my understanding in these claw back actions that that's the process that  the special master initiate of proceedings saying that there was fraud and so that the claim should be clawed back that's judged based on a summary judgment standard and that as i said if diff that if the special master succeeds in showing that he has enough evidence that there weren't any facts in dispute then the court doesn't hold a hearing which to me is where it really i mean that's i think  came to this case when this when this club it came before the court that's the process that's been set so there's no ability for me at the district court level or at the at the appellate court level to challenge that process what i'm saying is that you're it the way it has worked in that universe out right i mean you seem to be saying the court applied this summary judgment standard which is garbage clearly said he's applying summary judgment whether that's the right procedure or not so if we were reversed that why should that mean that they're they don't have a chance to go get a hearing and prove their case well i think that's right i mean they could mean the cases to the larger cases still pending at the district court so i mean i think that like in any other case if you reverse and summary judgment they can move forward this claim anyway you know they can refile the clawback or you can remain and the court can hold an evidentiary hearing however sort of you know procedurally either way i think that that would make sense but you know our position is that at this stage that the that's the process of the court that just recorded shows and to use as a summary judgment proceeding but in this case there wasn't enough evidence for the special master to succeed on summary judgment specifically then you know the case and in this in this case there's a contradictory record with disputed facts where differing interpretations of the documents are possible and what the company i mean that's the definition yes under the settlement program and that's one of the main sort of factual issues in dispute is that you know we presented evidence in the form of a sworn affidavit that they haven't cited by the district court is the scott decision the supreme court decision which sort of outlines this example of when the evidence is blatantly contradicted by the record and in that case then there was an a plaintiffs saying that he had not been driving in a manner that endangered human health but then there was a videotape that showed him driving eighty five mph down the road swerving on both sides of the you know yellow line and forcing cars off of the rely upon the videotape and there's other you're right there there are several cases that you know for example in the kennett murray versus bone case which is of a circuit case then there were two sworn statements that were in conflict the deposition and the affidavit but the court found that in that situation that it's really that's really a credibility determination that this plainly kleiner dicta by the record standard is really more if you cannot possibly explain anything other than what the the visual evidence shows so in this situation then you know if if there are explanations why the tax returns may be incorrect maybe the accountant made a mistake a lot of there there well i mean the affidavit was submitted with the opposition briefing many of those arguments about the tax returns were made in the reply brief then there was a star reply that yes made some arguments about you know that what the meaning that there were other discrepancies on that tax return in terms of saying that the land and buildings had been depreciated but no one disputes that crystal didn't own the land so there's reason to think that maybe there are some errors in those tax returns and because that that that crystal as an entity continues to own that equipment that it continues to be on the site and can be used at any time to process shrimp so that at least tends to show you know it is sort of which is correct and which isn't but that's sort of our position is that the evidence is in conflict because we don't know anything about that right that that that's that's true but you know in in that situation it's to me it seems to be less of a summary judgment like standard and more that you know that we are as the nonmoving are being required to disprove to special masters case and we've come forward with evidence a sworn statement that's been corroborated by things like photographs to say that we haven't entirely disproven their position i think that that's that gets away from the summary judgment in terms of we presented a genuine issue of material fact  procedurally well that's part that's part of the problem is that you know the to the victor and christi were never made parties to this proceeding at the district court level so how they could even appeal to i mean they they may know well i mean i don't see how the judgment is that it could be validly entered against them when they were never made parties to the proceeding they weren't named in the motion you know they didn't the corporation and the principals which is why they should have been named so that then they could have had their own separate council or enter yes i mean to me then the  laws from the way that the procedure was done from from the beginning you know it's sort of in a very just goes to enforce it it you could defend or they could defend by saying we want parties there's no preclusion the fact but how does that give us the authority to review a judgment when they're not before us i'm running short on time but i think i mean it shows sort of one of the many errors i think in the proceedings below that very little evidence was presented in order to corporate veil that they were never made parties to the proceeding to be able to to defend themselves and the sort of evidence that was presented is all exactly the same it's all tied up all in the same the same sort  of they made misstatements supposedly to the claims program so then therefore that's enough to also pierce the corporate veil so you know we would argue that that's another error in the judgment and that it's another reason that it should be lasley then in terms of the elements of fraud themselves then there was not clearing convincing evidence that even if there was a misrepresentation that crystal knew that it was not an ongoing business at the time and this a lot of this goes to some of the issues about whether they had retained their assets or not but assuming the facts in the light most favorable to the nine movement if they still they you know they were selling shrimp after the oil spill they retained their corporate charter or they had their their processing equipment they were continuing to pay their debts it weren't declaring bankruptcy that from the light that they were looking at their own business they were an ongoing business that could resume disclose of all the diff they did dispose of all of their assets then that would make them a failed business then whether they knew that at the time in terms of fraud there it's sort of two separate things in terms of the intent to defraud  affirmed and i believe that several questions that were asked by the panel really focus in on the elements of fraud that the district court had before it that were presented and much of the attention that's focused here is on this one issue of the ownership of some seafood processing equipment at the plant but judge barbee is decision was really based on many more factors besides that to demonstrate that this was in fact a failed and absolutely out of business company by the time they filed its claim and remember that the only time period that's important in this claim is from the time immediately after the oil spill may first two thousand and ten to december thirty first tw so whether or not mr tran has an expectation that sometime in the future he may be able to open or that business conditions will improve is eventually no relevance to this claim form the claim form asks for a very discreet period of time and  focus on that period of time what judge barbieri said in that time period right after the oil spill to december of two thousand and eleven it had been over a year since crystal seafood had last purchase shrimp or last processed shrimp they last process ship in two thousand and nine april two thousand and nine and at that time period the principal of the company went away to federal prison for program fraud in another disaster relief program so he was in prison for that entire time period that's of relevance to the claim form was not even available to be able to work in that time period the what parts of the failed business definition did judge bar b a he clearly from the last one that they had and again those factors that that the court went over are clear and one of the most important factors before mr expand went to prison he had a large inventory of frozen shrimp that was caught before april of two thousand and nine that frozen s a processor in florida and then liquidated over the time that he went to prison by mid august of two thousand and ten that entire inventory of shrimp had been liquidated completely there were no more s t shrimp to a company called floor tac in florida and then a number of checks that were made from that entity back to crystal it's on page twenty two fifty two of our in her own words again several months before the oil spill she's explained that this is no longer an ongoing business the tax returns which judge davis said had focused on the sworn statement of themselves but the claims form that a claimant presents to the claim center also says that all of the paperwork that a claimant presents to the to the program is true and correct to the best of their knowledge so not only is it a sworn statement to the i r s but it's also  statement to the d t c see that those tax returns are accurate and there's no mistake about what they mean there's never been any contrary evidence presented to the district court of any other understanding of mr tran or his tax accountant for what the term disposed means the i r s guidance is clear as to what it means it means that someone has sold or otherwise gotten rid of a piece of property the tax return is consistent also with the profit and loss statement that the crystal company presented to the program because that profit and loss statement shows that in april of two thousand and ten they no longer have a depreciation expense on the profit loss statement so again consistent with the tax returns in the treatment that that equipment gets paragraph eighteen point one he has ongoing exclusive jurisdiction of any disputes that arise even after a payment is made under the program and that's the authority that we've relied on before the district court to bring several of these motions against claimants that made fraudulent claims before the program and he has denied a number of them and even this when he found you didn't that he found there was a fact dispute on the argument you made about whether christo operated if it's physical facility in the gulf in the cases where he's denied your motions have any of you then gone to a hearing to prove any of those with where he may credibility findings we have not there been no hearings on any of the cases and there have been because you've chosen not to pursue what's happened of those did not want to have this devolving to many hearings on whether or not there was fraud in the claims so he asked us as his investigator to special master to bring to him claims about a summary judgment threshold that is no dispute that it's clear on the face of the documents or presented to the program or other documentary evidence that we can gather that there's been some fraud on the program but if it doesn't meet that standard he doesn't want to have a two hour hearing to listen to a couple witnesses and see who's telling the truth we also mention of the issue of the affidavit that was filed that made a claim that this equipment this process of equipment was still owned by crystal seafood and i would suggest to the court take a look at the cop which i think is really the best authority for explaining the framework that the court uses in these types of situations this is a very well supported motion and as i said there were many factors besides just the ownership of the equipment that led to the allegation that there had been fraud here and all that was presented from crystal's for the most part crystal's own business records not from outside information that the program was able to present in response to them going to things you have to prove  intent and you know which of course is the case that you can prove fraudulent and circumstantially really does someone have an e mail saying i'm going to defraud this program so you look at the circumstances or they have this much benefit they should have known all of this but you're really in the posture of a plaintiff with a fraud claim that's essentially the posher that's been set up you're trying to prove fraud and you're saying you can use that circumstantial evidence to essentially get judgment as a matter of law to say there's no that framework to establish that i think that part of what you can find in terms of the intent of the dish of intent of a claimant is the fact that they realize that by making these false statements of false representations of their business practice that they're in for the potential of a very large payout from the program so that that motivation in itself is a very strong indicia of intent of climate i agree no doubt a fact finder could find fraudulent intent based on that but you're in the posture of saying as as a matter of law there's no dispute that they had that that's what that's what seems difficult for me and i will say again not this isn't in the court before this record but there have been other cases that are being addressed where a claimant contested what his intent was in filing a form and they presented sufficient evidence to draw into question whether there was a disagreement or some misunderstanding here i don't think that that took place there's nothing in mr trans affidavit you can read through all the different places where he says that he owns is a quick mint there's nothing in that affidavit that suggests that there's any confusion or misstate or anything that would give you an indication of how he came about ownership of this equipment and that's the sense in contrast to an affidavit that one of his other companies the lot company that owns all of this property presented to the the payments were made they explain the timeline of when the equipment was brought into the plant and of course they're in the best position to know all that because they're going to have the information of when they would have purchased machinery had actually been brought into the facility none of that was presented here is just a bare allegation that equipment is own and a photograph is provided and i'll point you to the alliance claim where alliance says the for the program of over two million dollars for a fugitive who is now in vietnam who never operated on this property and he's got pictures of shrimp processing equipment in his in his affidavit so anyone could have a picture of it of a piece of shrimp process program found investigators from one of their investigative arms the hub company go out to verify that the physical quit was actually in the building so they saw the equipment but seeing equipment again doesn't give you any information as to who the owner of the immediately after the oil spill they leased it with all the equipment inside of the building so a lot was able to make a commercial transaction where they entered into an agreement with another company and said use all the equipment in the building if the equipment is intact crystal's equipment how are they able to enter into that agreement they allowed another company to use crystals equipment there is nothing in the record that would indicate that crystal entering type of  a five hundred seventy five thousand dollar investment that's all remains on site owned by crystal top quality right and that paragraph stands in contrast to what their income tax return this is supposedly a half a million dollar piece of investment there's no way that there's a commercial transaction like this it takes place that is not documented by somebody besides chris told that they could attain a copy of that documentation from they did or so if it's remanded i think that we would go back with just by being discussed what procedure he wanted to follow on this this is a serious case this is over a million dollars and when you look at the totality of what judge bobby pointed to  t certainly appears that he's correct that there's fraud in this claim so to just say that we would ignore this i think would be a very difficult decision this is a lot of money  first i think it is correct that crystal has no standing to raise this argument victor tran and christopher tran did not attempt to intervene and did not attempt to appeal the judgment entered against them and the law as well settled in this circuit that crystal would have no standing to make their arguments for them you cannot appear and champion the rights of another so for whatever it's worth i think the judgments against those two individuals are not properly argued by crystal who in fact would be it would be to their benefit to have someone other than themselves as a corporate entity liable with them for the judgment step stepping beyond standing on the merits them selves first i would like to say the judge had a lot of evidence if you look at what was before him in the district court on facts that would support his piercing the corporate veil you had to claim and companies each owned by a different tran brother making a claim that they were seafood processors at the precise same physical address in fact the claims are remarkably  similar however neither of them neither of them bought or processed any shrimp after april of two thousand and nine the oil spill with b p occurs a year later yet both of these trend companies say we're active seafood processors and we're entitled to money from one of them venture in the victor tram went to prison and been trance is in vietnam leaving the country to avoid prosecution so that is the context in which this comes up alliance defaults and judge harvey it doesn't have that we can finally get respect to alliance the attorneys representing these two companies immediately forfeit their fees back to the program when they presented with this evidence so all we're left with is crystal and the question is whether or not there should be a bail piercing with crystal and these two individuals well mr trans affidavit victor trans affidavit he admits that when he got the money from the program he immediately transferred his crystals money to lot he says it in his affidavit we don't know why he just did when he received rental payments on this equipment from floor tax none of it got credited to crystal when he received money from the shrimp that was sent to cold storage it was sent to victor personally none of it was credited to crystal that's all in the district court record and so the judge bar b it was more than justified in piercing the corporate veil and saying the tran brothers who are associated with this claim victor submitted the affidavit he is the owner chris actually submitted the claim to the program so both of them have touched the claim both of them were aware of the district court proceedings because they put affidavits in neither chose to intervene or appear so for that reason we would ask if you affirm the crystal judgment you should also affirm first i just would like to say that i agree with mr parr that this is a very serious case and that's why it's concerning that this sort of war shortens procedure has been used without really the ability for our clients to be able to defend themselves and for the judge should be able to judge the credibility they're being it's a small business it's being asked to pay back over a million dollars and they're being accused of criminal fraud that in some of these other cases has has led to you know investigations and indictments or not not that i'm aware of but but that's sort of what the process has been in some of these other clawbacks to clarify a few just a few points that have been named the alliance claim and ventry and those are completely separate the only reason that it's even being brought up in this receiving it at all is that mr pod chose to link that claim and the crystal claim together in the motion that he filed he found journey payments against crystal and alliance but they are owned by family members but they're not there's there's nothing about the alliance claim that's related to the crystal claims so whatever happened with with his brother has nothing to do with this claim in terms of some of the other you know purported in germany than that these are related companies i mean they're their own and run by family members and with law when you know when the previously in terms of the piercing the arguments made that they just made part of the payment from the crystal claim to a lot that's not accurate lot owns the land so crystal would pay rent for the land by doing things like that it's actually for structure that the entities are paying debts to each other it's the same thing with in the the lot affidavit in germs of that there's two sets of equipment here and i think that's probably pretty clear from the briefing but there's a a set of equipment that titan oh and that was sold to lot and that's what they're discussing about the affidavit from christopher tran that's about how lot came to own that section of the equipment the equipment owned by crystal is separate from that and as mr victor trans as in his affidavit it was acquired in two thousand and four so was acquired quite some time ago he also attests to the fact that in two thousand and eight most of the documentation at the facility was destroyed by hurricane ike so there are reasons that they don't have the the documentation for how crystal originally acquired the equipment nor would that be anything that was required for this claim you don't have there was no sort of evidence that was needed about how they acquired the equipment and the equipment now is taken on this sort of exaggerated meaning in terms of you know what are their ongoing operations and what were they at that time between may twenty ten and december tw during that time then they were still selling shrimp they had moved their shrimp to cold storage they were selling shrimp through august of two thousand and ten that's when then the lease ended after the oil spill so they continued as i said before they continued to pay their debts like fuel that they had purchased for for sale to shrimp boats they continued to pay those debts throughout two thousand and ten two thousand and eleven two thousand and twelve because they were planning to go back into business processing shrimp actively that the multiple companies that operate there too in terms of tightening crystal their separate processing plants that's why they filed separate claims so while there's a a lot of sort of confusion about you know who did what heads and who own what when then this is exactly why it's not an appropriate case for summary judgment and particularly why it's not an appropriate cues to pierce the corporate veil when that same circular evidence is being used for example of one of the new arguments that they make an appeal in terms of piercing is that supposedly the crystal paid off loans to shareholders with what they say is the money that they got that crystal got from selling it we don't know that that was that was research the first time in the response to the server apply with this briefing so i mean there was never even a time in the record when crystal or its principles could could respond to that so there's a lot of moving christopher said so that's just what what we would urge is that the court reverses so that at least some of these credibility determinations and factual disputes can be sussed out during a proper procedure at the district court