i'd like to reserve about five minutes for rebuttal question before the court this morning is whether the california legislature in the unfair competition law and consumer legal remedies act intended t erie doctrine applies that is a question i think that the erie doctrine does apply and under erie when a state law provides substantive relief state law also appeared to be to me but i just wanted i wanted to clarify that because back to judge so sarah what we think under erie clearly california law applies and california law on remedies but what about justice frankfurter statement in guarantee trust for york which has not been repudiated in over seventy years and has been adopted by multiple circuits that even when a state court supplies an equable remedy for a right to remedy a federal court does not the federal court cannot grant that remedy on those statements in erie have been regarded by legal scholars as unfortunate they do not change the ultimate holding in guarantee trust which affirms theory which is and these are the words from guarantee trust that the essence of erie is that the outcome of the litigation should be substantially the same in federal court so and this is where the quote starts so long as legal rules determine the outcome close quote as it would be as if tried in state court so you don't get a different result just because you're in federal court than you would in state court down the street but there's necessary trust says erie stance will guarantee trust says both i'll go with you that there's tension in the language but nonetheless the but the th circuit in seems to be kelly and the th circuit in mckesson on applied california law when the renegade issue was injunctive relief it applied you have in california you have compare canadian life decided in two life case and i think and there's another one that is a similar thing in those cases the court really said we don't get to erie because there it was whether like it was i've got that that is you know the but the carriage the got really like that you know it's state law isn't going to affect the outcome of the case the quote from the case counsel is that the statute does not change the nature of the federal courts equitable powers so even though they're talking about receivership in that case it seems that the th circuit case on maybe mix that would be a valid point for you to assert but we nonetheless have a pretty substantial body of law that applies the doctrine that you need to show there's an inadequate remedy a law to allow equitable remedies and that's a requirement federal court even when we're sitting in diversity and even when the state court state now provides something else i would disagree with you the nd point because what you need to slow your roll listen to the question and then because we've got a lot to talk and not talk over us please i'm sorry your honor but i don't think that federal law is submission the rule there is that the legislature whether it's congress or the california legislature can enact a law providing equitable remedies or inadequate around the law is not provided it's not required and so under federal law what you do is you look to the instep intent of the legislature when the state law intent of the congress when it's a federal law and so you really come to the same result to dissolve well if it were not in the area but if it weren't  eerie issue i agree with you completely on how you decide what the substantive law is spot on the area issue it seems to be separate and apart from that analysis to a bit extent and troubling language i mean you know i'm going to say i you know i'm really i'm listening to all of that what you call the unfortunate dicta that it it does seem to say that you can't that the federal equitable powers  not circumscribed by what the state the statute would say so i'm trying to get a put all of that together as far as that goes and you're saying well we have to look to it should be the same result in federal court is in state court but you're using that in a way that you know i'm i'm just trying to sort of practically look at this as a sword and a shield because procedurally what you did here was at the midnight hour as it were that after you prevailed on summary judgment and for whatever reason decided well i think a court trial would be a great idea now you made a strategic decision to have a court trial get rid of the damages but and just go for academic relief or for us to titian but interestingly the amount you're requesting restitution is exactly the same as your question damages and it would be easier to show the restitution so it seems very important that that was advantageous to you and you made that determination there obviously squatting over they wanted a jury trial and they would want to jury to decide that so it is really crucial whether if the federal act equitable powers if it requires that you have no other remedy available then you're  equitable remedy is required under a statute you look to the legislature's intent in an acting that statute under federal law under state law to say but under federal law so if let's let's apply federal law under federal law to determine whether an inadequate law is required you look to the intent of the statute you look to its text you look to its purpose and you look to its history so under federal law the job of this court is to look to the u a you look at their the language you look at the intent and you look at the history of those statutes to determine whether the legislature in an acting those laws wanted them to to to to  provide for equitable remedies with or without an inadequate remedy at law and then downslope by me interrupt for one second because i think judge beatty asked you the guarantee trust be yo california law well it way to say not so quick in guaranteed trust the court said that the then in order to do the analysis you ask with a reply in an adequate and complete remedy at law be wanting in other words you're saying ok so you said well there may be a remedy at law but we waive it because we want a jury trial so it seems to me that in doing that you availed you said ok i'm going to go into federal court and at that excuse me i'm going to go to the bench trial and we're not going to pursue the alternative remedy am i wrong about that  allow you forget the statutes we're still under we're still under area we're still under guarantee trust and i would i don't think that damages can be seen going to a bench trial provides remedies legal damages do not in a jury trial the bench trial lets you seek restitution which is subject to different standards of proof than damages it like you should legal advantage but not necessarily you're seeking thirty two million either way but by different standards there are different standards of proof the sense if you had left the damages then and you went to a jury trial then we wouldn't have to do this area and now it's this and then we would just be look we would be doing it but we wouldn't be deciding are you trying to expand federal equitable remedy we would be looking at it as to what is california law what's the use what's the use and what's a sterile way and we would have to we don't have a california supreme court case but we would look to what the courts of appeal do which people here sometimes keep i was on the court of appeal and people want to call it the courts of appeal or the court of appeals but now i'm on the court of appeals but anyway so we would have to look to what the law is and the  judge could a certified it chose not to but said i know what i know what the you know what the law is and the district court sad i don't think that california law you're not getting it right  the judge said you didn't have it right under california law right the judge didn't really make the area analysis that we're talking about right now right that's so we've got two levels of variance going on right now so if if we were back if you had gone forward in a jury trial we would be making the analysis of whether the district court predicted did the right read the tealeaves right about california law but we still have to do this other wobble before that's that's what's causing me heartburn   under the cannabis case it's you look to the statute but wait wait i think i think you're mixing apples and oranges here so i agree with you that if we were there if we did term and that the federal court had the power to issue the remedy that you seek we would then be looking to the statutes that issue the california statues to determine what california would require suck of course a related issue of would it be appropriate for the federal court to certify that question if there's significant certainty about what california courts would do but before we even get there before we even look at the statutes we have to deal with the the doctrine that i just quoted from guaranty trust state law cannot define the remedies which a federal court must give simply because a federal court  diversity jurisdiction is available as an alternative tribunals so before we even start analyzing your state laws to decide what california intended we have to look at the federal jurisdictional issue of whether that remedy is available in the federal court not whether california would allow it whether it's available in the federal court don't i frankly disagree because if you did it that way you would be changing the intent of the legislature but the intent of the legislature does not trump federal jurisdiction california legislation cannot trump the powers of the federal court and what it can and cannot do those are separate matters and so you may disagree with me or disagreeing with justice frankfurters comment over seventy years ago that has been adopted and followed by multiple circuits and i know there's tension between the outcome determinative test under erie and this issue with federal court power and  most of the courts quite frankly are coming down on the side that i'm articulating to you so you're arguing to us with the california legislature intended we're not even there we don't even get there until we get past this   is there any basis that we could avoid this issue is there some way that we could rule on other grounds morning here on earth my name is jessica grant and i represent premier nutrition in this case counsel before you breathe too easily i do have a question for you and that is that the sims case which seems to give an out contrary given the seeming inconsistency between those cases don't we follow in the circuit the earlier case of the one thousand nine hundred and eighty eight doesn't it trump the later inconsistent case or what is the status of the law on the night thank your honor i believe that the guarantee trust case and i think counsel said that there was dicta there it's actually not picked the supreme court held very clearly th equitable relief in a federal court is of course subject to restrictions the suit must be within the we know that we know that i language but i think it's i think in fairness it generally has been referred to as dicta by other cases but it's need a little more familiar with th circuit authority and the general rule is that the earlier case in the federal systems throughout the earlier case controls i think the sims is actually not it's an opposite and basically all that court really held was that federal courts in similar cases have come to convert contradictory conclusions in two thousand and nine this court specifically relying on guaranty trust that and ignoring simms because it's it was a non point helding that a federal court sitting in diversity may exercise equitable powers independent of state law and so i think what's going on here and i think we cannot lose sight of the fact that traditional principles of equity apply under and for a court sitting in diversity and here the court did not exercise his equitable discretion because the plaintiffs had an admittedly and admitted only adequate remedy at law under the c l r a to compensate them the thirty two million dollars that they had pursued for four years and when they recognized that unlike a lot of defendants this defendant we were ready to try this case we were going to try the case we're actually making a better argument for you right now than you made for yourself right the district judge didn't really was not as hung up on this as we are right now now and you really i think all my kind of gave it a throw away and you're brave so i think there's two ways of coming to the same place one is the way we've already been talking about today which is guarantee trust and the other way is if you actually do look at the text of the u c l which of course is not abrogate any fundamental acquittal france oppose it actually says that it's merely caught of flying the equitable principles and powers that are already inherent in the court well you're quite you have a problem with me as a california girl here and terms of him being pretty familiar with the california courts and the california supreme court and having certified issues i'm not i think that appellant may have to better argument of what the california supreme court's going to say i'm not sure that district court was right on that but that doesn't matter if it's resolved at the at the st level the attorney general does not support your position the top cop in california basically says hey they got it right right well with all due respect i think what's being lost by me and the plaintiff here is that there is an adequate remedy a law we all know and i think in the consumer advocates case the court said that because the plane have had an adequate remedy at law and the song beverly act a court had no business a court in equity it was not proper for the court to act so of course the courts in equity we never get there if there's an adequate remedy a law meaning by definition the remedy for compensatory damages the thirty two million is adequate under the law so you don't get to equity and what the plaintiffs have done here they've cited not a single case anywhere in the country where a plane of has an admittedly adequate remedy at law for compensatory damages for their past harm and they have been allowed to get equitable restitution for that exact same past harm there's not a single case anywhere in the country that they have cited and we're not aware of any such authority but to your point your honor i'm a california girl to the supreme court in cortez i think we do know what the california supreme court would do because that case is completely contrary to their argument the court held that a trial court should consider equitable considerations and that equitable defenses apply to the u c l so we know that the l did not abrogate fundamental acquittal principles of which one of the most fundamental is the inadequacy of law requirement because it is what safeguards a defendant's th amendment right to a jury trial to prevent exactly what happened in this case literally on the th hour when they realize we're going to try the case they dismissed their their adequate remedy at law we warned them the court gave very stern warnings about doing so and they went ahead and did it would you be a little more explicit than that what did you say and what did the court say so basically what the court what we said on the motion to amend is i actually made some of the same arguments that i made later on in the motion to dismiss hearing citing other decisions from i think it was eleven district courts all of which had concluded that where there is an adequate remedy at law you're not entitled to a little relief and judge seaboard said to plaintiff counsel if m grant that's me if miss grant is right on the law i might dismiss your claims for epidaurus to to sion so be very careful and think about whether you want to do this and we literally left the hearing your honour's and i think was with an if they went ahead and file their amended complaint dropping their c l araik damage claim then does that have any reference to whether it was done with prejudice or with oh well so then on we have a say so we had another hearing on the motion to dismiss where they tried to resurrect their previously dismissed c l r a claim and the court gave three different reasons why he did not believe a man was lead to man was appropriate the st was fundamental fairness we litigated this case for four years so there was the fairness of doing the strat i think he called it a stratagem at the th hour the nd was the prejudice to the court and the rd was a prejudice to premiere we were ready to try this case we were ready to defend our product and they balked at the th hour thought they'd get a more favorable result well for you were ready to defend the thirty two million dollars so it didn't really you were you kind of still bad writing we were  it was thirty two million either way and that seems to be exactly the same thing right we have a constitutional right to a jury trial they tried to unilaterally circumvent that right because they thought they would get a better result from judge c bork as he denied our motion for summary judgment but the problem is they have an adequate remedy i mean we can't lose sight of the adjective adequate because by definition the remedy under the c l o right where you don't have a constitutional right to a jury trial under an equity right now of course not we had a constitutional right to a jury trial but i understand the other a claim right so but you're argument and i i think it's well taken when you're arguing there was an adequate remedy at law but that assumes that it wasn't abrogated by the california legislation and even assumes before that that we're now at the point where we believe the federal court would have the power to provide that remedy and we're now going to look at state law so there's so many steps we have to get to before we go to what your you're arguing but you argued that if we're going to look at the state law  that the california legislature knows how to abrogate equitable principles they did it in fifteen other statutes and they explicitly abrogated the requirement of an adequate remedy inadequate remedy at law before you leap and then you also argue that if the so no argument were correct that it would have breathtaking results it would be unprecedented have you seen those breathtaking results with respect to the fifteen other unusual at this case but the point of your argument is that this would be you know upsetting the apple cart it would be breathtaking to be outlandish it would be shocking but your other argument that the california senate fifteen other times at least that you know of and cite to a sort of undercuts  what is going to be so radical about this if their interpretation of california lost correct i think because what you could have is any plaintiff by simply styling their claim for equitable restitution could then strip a defendant of the constitutional right to a jury trial when they have an adequate remedy a law that would be breathtaking that would be a radical departure from fundamental equitable jurisprudence and th amendment your friends it's over one hundred years old but i also think you don't  there are some i'm a key you could have gotten or we didn't go out shopping for making i don't think there's any any reason for i mean the law is so clear when you look at the legislative his already a cock up copy of the state doesn't think it says clear if you do well with all due respect i think that he's misinterpreting the law when you look at the text of the statute it does not abrogate fundamental principles when you look at the legislative history it says that it is not the u c l is not creating any new rights and it is merely kata firing the power already inherent in the court's equity power but i agree with your honor's you actually don't even have to get there because dept wine when you look at guarantee trust and this court's decision in two thousand and nine in canada life assurance it's very clear that a federal court sitting in diversity is bound by found fundamental principles of equity and as we know whether is in the gwinnett case the one of the most fundamental principles of equity and it was expressed i think over  and one in scott vs nearly this court and more united states one of the most fundamental aspects is that you do not are not entitled to equity when you have an adequate remedy law and so to to depart from that where the plaintiff here has an admittedly adequate remedy a law with not citing a single case where a court has allowed a plaintiff to seek equitable restitution when she has an adequate remedy for compensatory damages the law it would be a radical departure from some of the memmott inequitable our simply follow sims to win or lose i think we well we would still win because i i think that this the the lower court pro properly decided not to exercise its discretion in equity again there's no automatic right to equity i mean and that's sort of what the plaintiff in the are suggesting is that you just have this automatic right to equity no you don't when there's an adequate remedy at law the at equity does not step in it's only a stopgap measure so even if you were to find to your question i think i think you get to the state statute analysis the u c l does not abrogate fundamental principles how do we know that the court has decision by the california supreme court also what about the the language in the statute that says it's cumulative the remedies are cumulative and that's in addition to all of the remedies allowed by law right so cumulative does not mean an abrogation cumulative is just a supplemental to other remedies this issue is expressly decided in the sallis case by the central district where and other courts as well i think it was also in the farmer's case were in the california supreme court where the plaintiffs had argued in those cases that because the remedies are cumulative somehow that means that there's been some aggregation of the equitable principles in the supreme court and farmers and the salish case also said no if you look at the legislative history there's not a single mention of even a consideration that fundamental ethical principles would be abrogated or the inadequate remedy a law would be abrogated do you agree that california could choose to do that they could if they did it explicitly abrogate those principles yes and i think it would as if the woods court made made clear then why would that create the settlement problems that you're addressing you're suggesting that you couldn't be the case here because it would violate your right to a jury trial but they could do with other statutes i think the difference is if the legislature makes a decision that it wants to abrogate fundamental equitable principles like the united it has done so expressly it has not done so by silence or implication which is essentially what the plaintiffs and the are arguing every time the legislature has abrogated the inadequate remedy a law requirement it has done so expressly it did not do so here in the u c l or the c l r and in fact we look at the legislative history there's no mention of even a consideration of that instead the legislative history makes clear that they were not creating any new remedies and they were really caught a fine the equitable power already here in the quote i need to understand how this would have played out that ok so you lost that summary judgment and had appellant plaintiffs not made the move to get rid of the money damages so you were you were prepared to go to trial on both the u c l and the c l r a right we were prepared to do the jury st on this c r l r a s and if they prevailed there but that have been the end of it that would have been the end of their money damages and they would have had for looking injunction that we would have tried in the then then the court would have to decide if they could go ahead under california law no i and that's where i think this is what they're i'm just trying to logistically and see what are all the implications because he has to it's logical and i think this is your question and i apologize if it's not what they're trying to centrally do is turn the u c l into a nd bite at the apple so we go to our jury trial under our adequate remedy at law i'm going to ask for thirty two million and i got zero ten million or zero whatever the number is and then you don't get to go around again in equity and say well you know what your honor i'd like the other twenty two million and like you to give me that because i wasn't whole that is not how this works your honour's the only way out but what that's what the california supreme court sad if this had gone forward with that and be able to have the nd bite at the apple what would be a nd might be the st bite because there are situations where a plaintiff doesn't have an adequate remedy at law and they can go and for restitution or some you know unjust enrichment or some other remedy and so that's essentially the st bite at the apple because they don't have an adequate remedy law and they can only get equitable relief so that's the the st bite at the apple you only get one bite of the apple and that st by the apple here is under the c l o array like the st bite of the apple under consumer advocates was under the song badly act so where you have an adequate remedy at law that's your st bite of the apple if you don't have an adequate remedy law then your st bite of the apple would be in equity because an equity would step in because there's no adequate remedy at law right but that it would all be contingent on the california supreme court saying that there has to be an adequate remedy at law and i true and i think when you look at the cortez decision it's already indicated mean their argument is equity does not apply the  fundamental principles does not apply the seal we know that is not true because in cortez the supreme court said equitable defenses apply of course an adequate remedy would be one of them and equitable considerations should be taken into account when the court is deciding to exercise its discretion of whether or not to fashion to apply an equitable remedy and i don't even as a matter of practice here is that submitted under a special iraq retore bertie i'm sorry under california practice it is special in iraq a doric verdict go to the jury asking their advice on the court on the equitable aspect i see you saying so basically it would usually be a special verdict form as opposed to a general verdict form in these types of places at least every two you don't want to draw as but you could theoretically get so usually what happens is is yet the judge whatever findings the jury makes the judge is bound by those but then the judge can have a bench trial on like for instance the injunctive relief and then will issue a statement of decision that's the way it's been when i've done on the plaintiff side on the defense side both both ways it usually does that but again i agree with your honor's that you don't even need to get to the analysis of what the california supreme court would do when you're looking at guaranty trust and this court's decision count but with no call to respect judge callahan i must i ask you if we get to the point where we have to decide whether sims are or canada life applies which one governs i would say canada life which is relying upon guarantee trust all right thank you thank your honour's thank you for your argument appeal case where the plaintiff went to trial under the labor code for unpaid wages for damages there was a mistrial they then came back and said we're going to dismiss our labor code claims we're going to proceed solely under the u c l for restitution and injunctive relief and the court of appeal said that's fine you can do that for strategic reasons and this analogy is not a dirty word california court of appeals this is the california kind of appeals but that is how it works and yes you can go to trial it's not you get one bite at the apple for legal damages and then see if you have a need to get restitution you do both at  time like to clarify something with us so distinction between restitution of law and restitution and equity would you agree that what your clients are seeking was restitution in equity yes yes and they are different forms of relief legal damages are not necessarily inadequate remedy for restitution restitution is easier to prove you have a different standard of proof with different evidence you get to have a quicker trial it is not just because you can get legal damages in the same amount does not mean it's an adequate remedy at law when you can also get restitution so normally the way it works is you can go to trial as we initially planned so we're talking a lot about what happened to the california law and you may have gathered from our questions that our st concern is whether we can even go there in federal court  and i ask you right before your time expired whether there is a way this court could do with the d c circuit the th circuit have done in other circumstances and somehow get past that threshold issue  let's look at sims sim snowboards th circuit nine hundred and eighty eight dollars and there the court told that state law trumps federal law when the state law prohibits the issuance of equitable relief so the the court said quote the general equable powers of federal courts should not enable a party sitting in diversity to obtain an injunction is state law clearly rejects the availability of that remedy seems like a basic federalism concern if the state law didn't provide for injunctive relief the federal court can't then provide it which is sort of the opposite it's not suggesting that that means that state law can then expand a coal remedies in federal court it's saying federal court can't this court should apply should not come to should not apply rules where it's going to then come to a different decision by the mere chance that we're in federal court as opposed to state court down the street where in federal court is required to be in federal court where it's aside from katha we would be in state court and frankly i don't think we would be having this discussion and i think we would then be clearly talking california plaintiff a missile or are in a much stronger very very strong position we thing so i think that's my my answer is that under guarantee trust and under eerie you should be coming to a different conclusion in this court than in if we were in state court down the