thank you your honor good morning and may please court my name is paul benson and i have the privilege of representing the trustees of the melvin s cole and trust the melvin s cohen trust was created in one thousand nine hundred and eighty with a gift from the donor the kohen foundation of seventy thousand dollars at that time the cohen foundation's officers were melvin cohen his wife and his daughter mary jo from then until two thousand and fourteen through the singular generosity of the co family the melvin s cohen trust has made over thirty five million eight hundred thousand dollars in gifts to various charities none of whom were the federation today the trust corpus exceeds sixty eight million dollars not including the over nine million dollars in distributions representing gifts from two thousand and fifteen through two thousand and eighteen that are currently being held in reserve by the federation pending the outcome of this map for over three decades the cohen trust operated very simply on or about november th the beach year the trustees would provide the federation with a check in the amount of the colon trusts annual grant as required by the i r s rules along with a letter identifying the charities to whom the money should be distributed and the amount in the words of the federation's former executive director joshua full sun the federation would accept a check say thank you and then cut new checks to each of the designated charities and this was true whether the charities were or were not familiar to the federation and this was the protocol from the cohen trust inception for the rest of melvin cohen's life and for six years thereafter when mary jo assumed the role of president of the cohen foundation and trustee of the cohen trust but that all changed in two thousand and fifteen when upon receiving the colon trust check and the trustees letter identifying charities to whom the money should be distributed the federation claimed for the st time that the trustees did not have the authority to make these designations under the trust agreement and ultimately refused to distribute any of the debt of the money to the designated charities even the charities its executive director had previously agreed fell within the functions activities and grant programs of the federation the district court ruled for the federation on this issue which it call the central issue in th case remarkably the district court found as a matter of law that the parties handed doing it wrong for over thirty four years in the district courts view the trust agreement unambiguously did not give the trustees the right to direct to the federation to donate the annual gift to a particular charity as part of its reasoning the district court concluded that the cowen family gave this money away to the federation when they established the cohen trust and determined that the trustees had no say whatsoever over the ultimate disposition of the funds because it was their duty certainly not what the district court said and you don't advance your argument by making transparently false statements about the district courts in district court said that the trust had the authority given in the agreement which was to designate the money for quote a particular district judge said the trustees had no authority at all to designate because the net effect of the rapidly grappling with what the actual trial says and what the district judge actually did really helps  and i apologize your honor if i didn't make my point clearly the district court's position is that the trustees had no power to designate specific charities and that's  either and the judge didn't say that either your honor i did drugs i said that he did and no he did not it really helps to be realistic about what happened your brief is also in denial and that's why the district judge after the trial removed a trustee and appointed an institutional trustee because he found that the trust and its warriors were simply in denial right you really need to be realistic about what's going on here your honor i i believe and i can quote from the court's opinion on this that  it says on page two of the district court's opinion dated let me make sure i get to correct a it's the opinion on summary judg page two it's at our it's in our supplemental appendix at page four says for the reasons and those explain below the court concludes that the original trust agreement did not give the trustees the right to direct the federation to donate t trusts annual gift to particular charities so i give the trustees the power to designate the gift to any function activity or grant program of the federation i  grayson to give the money to something that's not in that category i and i holding of the district court it is not a holding that the trustees can't designate the money the designation just has to come within the language of t i respectfully your honor i read that language obviously differently than your honor does it was not my intention very long opinion one has to consider the whole thing but look i'm if you remain in denial about what's going on here you're simply encouraging us to accept the district court's decision at the remedy stage ok that was the district court's reasoning and if you show up here and show that you're still in denial what are we to do about the remedies while you're your honor i would submit again i am not attempting to be in denial or to misrepresent the district court's opinion i agree with you judge easterbro that it's very good the trust agreement is in my view very clear in that it gives the trustees the right to choose specific charities so long as known she doesn't it gives them the right to choose a particular function activity or grant program of the federation and at the end of the day that is a charity like for example torah academy which is listed on the truck on the federation letterhead as a beneficiary partner of the federation that's a particular charity like memory in the middle east media research institute even though that's not a charity that historically the federation has affiliated itself with it nonetheless was a function activity or grant program in terms of how the trusts operated for thirty four years so at the end of the day i think you we and if i've overstated my position i apologize but i think we're more in agreement than we are in disagreement the question of the control over the gift in my view is answered clearly  in article four of the trust agreement where it says that the trustees may in their discretion designate in writing to the federation their selection of a particular function activity or grant program of the federation for the benefit of which the trusts annual distribution or any designated portion of it shall be a plot so as long as the gift meets that criterion the language is mandatory the federation shell applied the gift to that particular charity and that's what they did for thirty four years the only time that the federation has ultimate control over the gift is in one of two situations the st situation would be if the trustees had specifically designated that the federation was the recipient nothing in the trust agreement prohibits that it never happened in the entire history of the trust but it was certainly something that is plausible the nd instance and this is covered by the language in article four is in a situation in which the up either all or a portion of the grant is not designated at all by the trustees in that situation it is treated as an unrestricted gift and federation is at liberty to use that money as the federation so chooses again that never happened in the entire history of the trust so in our view the language to the extent that there is a reading of the trust agreement that's unambiguous it's an ambiguously in favor of the trustees and the way that they have been giving gifts for over three decades and not the federation contrary to the district court's decision in addition we believe the district court got it wrong when it basically held that the coen family gave this money away to the federation that's language that occurred during the last day of trial and it's also can completely contrary to the language in the whereas provisions on the st page of the trust agreement where it says that the don't or has transferred to the trustees and that the donor and others may transfer property to the trustees now that money is to be held in trust in the cohen trust it doesn't go directly to the trustees me i want to make sure i'm very clear about that but the idea that the money was just given over to the federation and that now the federation has unfettered control over sixty eight million dollars in a trust corpus and nine million dollars in funds that were given to specific charities and therefore are restricted gifts to suggest that that now is something that the federation is just allowed to do with as it pleases to the extent the trustees have a role in this i'm not entirely sure what it is because let's face it the reason that the cohen trust was create was so that it could give charitable gifts to worthy cause the parameters as judge easterbrook indicated are that they must be functions activities or grant programs of the federation but if we're trying to ascertain what are the functions activities or grant programs of the federation  the reality is is that over the course of the trust existence really pretty much anything goes historically the melvin s cohen trust gifted money to the kohl and then of course as we indicate in our briefing from one thousand nine hundred and ninety eight to two thousand and eight over half a one million dollars was given to an organization called bridges for peace which is a christian organization and that organization was brought to the attention of melvin cohen by one of his employees an engineer at national presto industries and then one over a one million and a half dollars was given to the middle east media research institute which again was an organization that that the federation had no connection to to make matters more compelling in this regard in two thousand and six the federation amended its articles of incorporation to include support for numerous non jewish charities and originally the articles of incorporation of the federation were limited primarily to jewish charities as a consequence that really opened things up and if you look at the fo that the federation has submitted and that are a matter of record in this case you will see that there are gifts to planned parenthood wilderness inquiry can do canines and carleton college now please understand i am in no way shape or form suggesting that that these are not worthy charities but at the end of the day if those charities fall within the ambit of the up purposes the charitable purposes of the charities that you mentioned in your recent comment to they satisfy article four well ultimately your honor the determination of whether a  particular gift falls within the functions activities and grant programs of the federation is left to the federation and perhaps that's were judge easterbrook and i got up off the rails because i do acknowledge that the federation has what is a sense of levy told power over the gifts but again if you look at the history over thirty four years they never once exercised a veto power in fact when they were debating whether or not to give to bridge that the power expired by by the history is that your party well we do argue as one of our arguments we do contend that the trust agreement was modified by conduct and that that history should be taken into account as to how the trust in fact operated that those those charities and those gifts were ratified or modified by that historical conduct in  addition the the federation has a donor advised fund and through that donor advised fun it's given to greenpeace the a c l u doctors without borders again excellent worthy charities but when you consider that the jewish community foundation is where that donor advised fund is and that's also in its annual reports where the federation lists the melvin s cohen trust this language from the federation's website is significant giving through the jewish community foundation is up to you you and you alone designate how your gift will be used you can provide unrestricted funds to help meet community needs now and in the future or provide permanent resources to aid identified needs in minneapolis throughout the world that are of particular interest to you and your family and at the end of the day then we ask questions during discovery about you know federation what are your functions activities or grant programs and as we argue in our briefs the answers that we got were all over the board when i took discovery of the various officers of the federation their answers were all over the board so what exactly constitutes a function or activity of our grant program of the federation is again up to the federation but the federation has operationally defined it in such a way that basically anything goes and for that in the trust document your honor i confess i'm not familiar with latin to neri all right let me put it differently the trust document says that the foundation that the trials can designate the money for any program of the foundation until five years ago say the foundation took the view that it would establish as a program of the foundation anything the trust  foundation takes the view that it won't do that it will exercise independent judgment in deciding what is a program of a foundation you seem to be arguing that because the foundation was cooperative in the act it must be co operative forever is there any basis for that in the trust document your honor i i believe there is because of the language that it must be that the function activity or grant program must be of of federation exactly but you agreed that in that the decision about what is a programme of the federation is a decision to be made by the federation i do agree the question i'm asking is just because the federation in the past has been willing to make as its program what the trust wanted does not compel the federation to be similarly use the word again latitude in the area and similarly co operative in the future the trust document doesn't compel it however there has to be a principle basis upon which in terms of what it's doing in other words we can't just all of a sudden say as it did in two thousand and fifteen that a gift to tor academy is not a function activity or grant program of the federation but that's what it did why not a federation may have access a program one year and not the next well surely a foundation can decide what its programs are it adds some in any given year it drops some in any given year write the ford foundation in one year or maybe make a big gift to harvard university and in the next year the ford foundation may decide no we're not interested in harvard anymore we're going to make gifts to some other university that's within the scope of the ford foundation's parag give why is it not federation your honor i would simply say that if the it makes no sense for the federation to be allowed to say that a particular charity is no longer a function activity or  program visa v the cohen trust and yet recognise it as a valid charity supported by the federation in other contexts which is what happens here i mean the federation takes great exception to the idea that it's being characterized as a conduit for the funds here but in reality that's what organizations like the federation do they receive gifts from  charities and from individuals and they pass those gifts typically along to other charities and if there are instances obviously we're charities and individuals give the money directly to the federation but again that's not what happened here and all of the gifts were designated so i don't believe that the federation has a valid basis upon which to deny the gifts that are currently being held in reserve and i would further argue that to the extent that that is an issue that is in dispute factually it should be resolved by the trier of fact the court's decision resolved it as a matter of law taking the  position that the that the that all the gifts or excuse me that the trust language on this issue was unambiguous in favor of the federation well that's that's his position that suit your position as the the district judge says has no intentional basis because of the law the way we article four reads i appreciate what you're saying about history but i  concern about what limitations were placed on the foundation well you know again at some point there has to be a rule of reason that's applied in interpret ing a contract and you know if torah cademy has is continually you know a beneficiary partner of the federation what's the basis upon which the federation can say to the cone trustees no you can't do that well what is your view aim in creating the trust to aid jewish causes exclusively or primarily what what should you say we should look to and when and was initially created or to look at the evolution of the trials excuse me the federation over time and what what we look to well there are obviously there's a great deal of literature in this area that talks  about looking at the situation at the time the trust was created right and at that time it was very clear not only we would argue in the trust agreement but also in the writings of melvin cohen that were contemporaneous or shortly that is absolutely correct your honor and and other forms of jewish philanthropy and you know one of the reasons that there appears to be this disagreement between the parties is because  the function's activities and grant programs of the federation have expanded over time and now include non jewish cause now i want to make sure that we're very clear about this because i'm i can anticipate i think what mr we're not saying that the federation is no longer jewish and we're not critical of the federation for expanding its functions activities or grant programs for its charitable purposes but because they have done so that means that those gifts that were made in two thousand and fifteen through two thousand and eighteen there's no principled basis for them to be denied and at the end of the day that's the problem that we have with us and furthermore the district court compound the problem by taking the position that that nine million dollars that is being held in reserve which clearly were restricted gifts because they had specific designee charities it transformed them into unrestricted gifts that the federation can do with however it please now that i'm not trying to cast aspersions on the federation i'm not saying that the federation is going to use the money for some inappropriate type purpose but the reason that we are here is related to the control over the money in the ability to make the grants to a specific place and that's where the district court and the federation legitimate no not at all your honor i'm not saying that at all what prompted st of all the donor advised fund that i was referring to is a donor advised fund that is through the jewish community foundation the j c f which is affiliated with the federation ok the donor advised fund that your honor is referring to is the one that mary jo cohn set up for jewish education and support and quite candidly that particular fund because again the gift to that fund is a restricted gift specific for jewish education and support that gift is very very clearly a restricted gift and can only go in that direction and what prompted her to do that is that the federation in this i believe it was the summer of two thousand and fifteen a request was made to the federation to make a gift to memory the middle east media research institute which the record reflects has received funds from the cohen trust over one million five hundred thousand dollars over a number of years and an remarkably the federation indicated that it wasn't comfortable making that gift and so trustee cohen was concerned about this and was concerned that whether this was going to be a problem going forward and that's one of the reasons that she set up a donor advised fund for jewish education and support to make sure that money could get to organizations like memory whereas in the past they had always gone through the federation to an organization like memory if for whatever reason the federation wasn't going to continue that practice she wanted to make sure that the charity would still receive the money with regard to this issue that the district court described as the central issue in the case because the trustees contend the court got it wrong on that issue and because the trustees contend the court got it wrong when it stated very clearly that the actions of the trustees must benefit the federation and not the charitable purposes of the federation because of those two fundamental problems with the district court's decision a cascade of erroneous decisions occurred there after  decisions include the decision to treat the nine million dollars as an unrestricted gift i've already talked about that those decisions include the decision to remove trustee cohen not recognized the trusteeship  frederick franson and ultimately revised the trust agreement so that a bank could assume the role of the independent trustee which is clearly contrary to the language of the trust agreement and as we talk about donor intent the cornerstone of donor intent is the trust agree and the trust agreement couldn't be more clear that a bank was never contemplated as a potential trustee there is language in the document that doesn't even require the funds of the cohen trust to be invested at all there is no requirement that they be diversified so clearly a bank was never contemplated all of those decisions we would argue kaskade from that initial central decision and as a consequence the court's decision was wrong or right there's been some you used all your mourning your honour's my name is keith more bon and i represent me uplift jewish federation may have pleased the court no doubt the federation has been grateful over these many years for the generosity of the call family and the related foundations that have supported the federation through this trust i can assure you the very last thing that federation wants to have happen is to be here in court adverse one of its largest donors but along with the generosity of the cohen family when you create a trust and you set it up as a supporting organisation of the federation and you accept tens of millions of dollars in tax deductions for your contributions well you've got to follow the rules that you have set up in this case there are very distinct rules in the trust agreement that the district court construed improperly found limited the ability of the trust to designate gifts and trust agreement by any fair reading does not allow for the designat particular charities but we go a step further than that because this trust was set up to be a supporting organization of the federation and there are very particular in detail regulations which absolutely prohibit what trustees are trying to do here what they want to say is that they set up a trust that supports charitable purposes broadly and it's not tethered to the federation and therefore they can designate just any charity they want if it falls within the broad ambit of the federation and the money doesn't have to go to the federation that's what you do when you create a private foundation this is not a private foundation under the i r s rules this is a trust and the trust is a trust for something these are trustees and they have a beneficiary and one of the biggest robb's in this case has been you've been  to the argument you're hearing today these trustees deny that they had duties to their beneficiaries that's where the district court started in finding that they had a fundamental fundamental misunderstanding of their job they are not trustees to set their own agenda charitable purposes and decide how they should fund they are there to benefit and serve the federation that's how this was set up that's what the i r s rules require now what happened over the course of many years is something that you could understand which is the federation is enjoying the large us of a very large donor these were millions of dollars being contributed each year the designations the overwhelming weight of the designations were made for a function of the federation which was apparent needs in israel you can go through specific does ignition letters written throughout every year throughout the time period and you will find that language over and over again apparent needs in israel not designation to a particular charity but that was one of federation's functions to support israel that's why i think of and colin selected the federation as has supported organization and certainly they could continue to use that mechanism they could say federation we want you to use our funds to support israel that's what's what happened that's really what happened in and then each year in many of the years of a small portion of the gifts were were made by request alvin cohen would write a letter on behalf of the trustees if you would request that's the language not demand not insist upon over the objection of the federation we would request could you give seven thousand five hundred dollars of these funds to torah academy which was an organization that federation already funded and there were similar gifts like that that was a small portion of a large the federation was dealing with a large donor and and accepted the suggestions and agreed to do that not because it was required to do that not because  trust agreement allowed to fit the trustees to mandate it but they just did that as an accommodation and that's a process that continued for many years and what changed in two thousand and fifteen was we lost that designation to apparent needs in israel and instead the trustees said a laundry list of thirty some different entities that they wanted to be funded none of them were a function activity or grant program they were all specific rd party beneficiaries and the most concerning was a one million six hundred thousand dollars donation that the trustees wanted to make to a donor advised fund that was held by trustee cohen so the trustees at this point are sending the ball of their contributions back to one of the trustees and that was a donor advi fine which by its nature and the that we supported this in our brief that was a general advice on that was nominally for jewish purposes but that trustee cohen had soli the ability to change that to any type of charity that she might choose to support so that's the rub that really got us to the point where we we end up in court the promise of the trustees throughout this litigation has been that this trust is not for the federation and i want to take a moment to just simply look at the trust agreement and see how that is wrong in so many places and we can start with the title of this trust it's a trust agreement the melbourne esko in trust for the minneapolis federation for jewish service that's the former name of the federation it's hard to imagine you can get past the title of this trust and not conclude that it was set up for the federation the suggestion in the trustees brief was that melvin cohen and the his foundation didn't really care about the federation but the very st recycle in the trust agreement says the donor has been has for a number of years been a supporter of the minneapolis federation for jewish service if we're going to talk about settlers intent everyone agrees trustees the federation the district court that the trustee is this the sutler's intent is embodied in this trust agreement and there's no reason to go any further unless there's something that takes you out of the federation position as to how the gifts can be handled when we go to the bottom of the st article of the trust agreement this is the critical language in which this trust to set up so that it is the intention of the donor that this trust will be operated in connection with as that term is define a section fifty one thousand nine hundred and eighty three dollars of the code that's the i r s code operated in connection with the federation and then it goes on to say in so far as possible all of the terms of this trust are to be construed in light of that intent so when you're looking at the language function activity or grant program you have to consider that in the context that this is a supported organization of of the trust now it's notable in their entire opening brief on this appeal they don't even mention the requirements of the i r s code as to a supporting organization and an argument today you didn't hear anything about it again the district court however made that a fundamental part of its decision because this trust agreement has to be construed to follow the supporting organization regulations those regulations law a charity to avoid the onerous regulation of a private foundation and the premise of the way that regulation is supposed to work is that if you set up a charity that is devoted to a pub another public charity so this trust is devoted to serve the federation which is a public charity then that charity itself will be motivated to ensure that the trust follow its charitable purposes and so there are any number of very specific requirements that ensure that the supported organization is going to be attentive to the supporting organization and that means and the district court quoted the specific language from the rules that says the articles of incorporation for the trust can not authorized contributions to any party other than the federation and there are four different places that the i r s regulations make explicit that all the contributions that distributions from this trust have to go to the supporting organization and for this trust the only supporting organization is the federation when you get to this article for which is the designation language you have to read this in context of the whole paragraph when you're looking at functions activities and grant programs the language right before that says the trustees shall maintain a close working relationship with the federation to determine it needs and as a part of such a relationship shall consult at least daniel e with the federation to obtain information concerning its operating budgets proposed grant programs recommendations of the federation for the use of the trust income and then this last part is really important and reports of uses to which previous distributions were applied so the trust it agreement contemplates that the trustees are going to meet with the federation to find out the federation used the money from the prior  the language directly after functions activities and grant programs in the trust agreement also directly relates back to the i r s regulations it is the donors intention that the trust be administered in a manner ensuring the atte of the federation to the trusts operations and that as i go on i'm not going to raise every provision in the trust your treatment that ties this trust to the federation but there is a federation trustee appointed to ensure that close working relationship the federation is required to approve the accounts of the rd of the trust and then in three places under the amendment section the trust agreement expressly refers to the federation as the beneficiary of the trust because it says if the federation or a substitute beneficiary of the federation no longer exists finally if this for some reason  the trust loses its i r s qualification trust agreement provides that the entire balance of the trust funds will be given to the federation so when you read function activity and gran program in context of all the trust agreement language and the i r s regulations you can only conclude that these are contributions that have to be made to the federation and not to rd party charities so function activity grant program we advocated to the district court that these are commonplace terms that are can be understood in the ordinary meaning a function of the federation is its purposes the things that  does for example support of israel support of jewish education we see we posited that our goals of incorporation would be a good place to look to see what our functions are the argument of the trust is this language is ambiguous but they have never once come forward to say any alternative explanation for what these terms are an activity of the grant program again or activity of the federation not a hard thing to figure out federation has activities it has and missions to israel it publishes a newspaper these are all again commonplace understanding's of what an activity would be in this context and in a grant program i think this is where the trustees mistake a grantee for a grant program so a grant program is a scholarship program i g you can give money to a scholarship program and then the scholarship program will select the grantees here the federation has grant programs that runs an annual campaign where they collect money from a variety of sources and then the federation board makes grants from band this language consistent with the s rugs says that the fed or the trustees could contribute to a grant program but it doesn't say that they can do anything to select the grantees of the grant program which is what the if tried to do of the  both in the process that they undertook because they did it secretly even though there's language all over the trustee agreement and i r s regulations about the required close connection between the federation and the trust they went off and did this amendment to the trust agreement without even telling the federation and then they said in a meeting with federation representatives in april of two thousand and sixteen reportedly were going to discuss how to resolve their differences about this designation language and never even told the trust of the federation representatives in that meeting that they had already changed the language nor did they tell them that that same afternoon they were going to start this lawsuit which was brought by the trustees to do two things wanted was to remove the federation as  claim that they later abandoned which was essentially that the federation wasn't jewish enough and then they proposed their substitute beneficiaries which were to organizations to which the trustees themselves were closely tied in fact trustee cleena who is a lawyer was a general counsel and founder of the national community foundation and was intimately involved with donors trusts the other organization where trustee  so they knew that this the dozen nation language didn't support their position they tried to amend it to add the word don't need charity or they wanted to say function activity grant program and on the trust you dream of does not under any sun reading a law for contributions to rd party beneficiaries and then the i r s regulations as i mentioned in a number of places ma clear that you it's that what they want to do is prohibited the district court focused on this language to or perform any service for any organization other than those publicly supported organizations specified in this article that that's what is referred to as the organizational  in their opening brief in their reply brief they throw out a provision of the i r s regulations that they hadn't argued before and this is my st opportunity to respond to that and i just want to make clear that there's no confusion about this they make they make reference to provision the party of the regulations which isn't called the operational test and they cite some language that talks about that annex provision of permissible beneficiary would include making payments to or for the use of individual members of the share of a class benefit of benefit by the specified public support organization that's the language that they have relied on in their reply brief when they've when they provide the quote that quote to the court they omit the word individual which is critical because when you read the whole section it's quite clear that this is dealing with a very special case where i grant might be made to an individual not a charity not a rd party charity like they tried to do but to an individual it's a context in the in there are examples that are written into the rules and if you look at example three for this particular section in the operational test with the rules example three actually refutes exactly what the trustees are trying to argue example three says that if you try to make a contribution to a charity that's not you're supporting organization that that will not comply with the right and that i just don't want to let that go on answered because we came up for the st time in the replies for you and we didn't get a chance to address it in the  g another source that i want to put forward just to see if i haven't cemented this already we have the regulations when when the truck treasury department implemented  when they when they issued the final regulations implementing these rules on december th two thousand and twelve they issued to the treasury decision nine thousand six hundred and five and in two places  these regs they they stayed expressly says type three supporting are going to zation is generally are not permitted to make grants to organizations other than their supported organizations thus the final and temporary regulations do not permit supporting our going as ations to satisfy the attentiveness test by making distributions to rd party urbanisation so  the distribution language to sum up the truck the trust agreement doesn't allow all contributions to rd party charities the treasury regular regulations absolutely prohibitive of course feeling between the parties up until two thousand and fifteen was that the trustees generally designated most of their contributions to the function of a parent needs in israel and on a couple of occasions and each year if they wanted some small gifts to go to particular organizations that the federation agreed to that as an accommodation they can't should you can't change the treasury regulations or modify the trust agreement by just agreeing to make an accommodation too so that's why the district court was right finding these dozen nations that they have tried to make for the last four years are just improper there's a lot more to this case than just the designation language there were seven different findings of improper conduct or breach of fiduciary duty by these trustees none of which are appealed in this  so what the trustees chose to do was to serve up this does a nation issue and then challenge the remedies for breach of fiduciary duty but they do not challenge the underlying findings that these trustees breached fiduciary duties and had did other improper conduct the judge had the authority under wisconsin statute seven hundred and one which governs trusts and is undisputedly the authority for the remedies that were imposed here the judge who saw the trustees examined them at the bench trial heard their testimony spend two years with this case and saw all the things that were happening the judge exercised his just question to impose some common sense and appropriate remedies which are before you an abuse of discretion stand st thing the judge did was to consider whether these trusts one of the changes is costly  trustees it had seventy thousand dollars in it that was in one thousand and eight dollars knowledge has nearly seventy million dollars and it's a much more complex and has been a problematic trust so the judge looked at a variety of considerations the st thing is this trust has not been cost free there have been and one of the decisions of the current trustees was to invest seventy million dollars  essential is certificates of deposit so it's been ultra conservative lee managed from a financial point of view there was a cost to that there was an accountant who worked with cohen and and her salary was allocated and paid by the trust over these years and that was a lot of money was eighty thousand dollars which challenge did and as it turned out when we got into discovery in this case we learned that there were some serious problems and this was in fact one of the breach of fiduciary duty issues trustee cohen had a number of personal trusts and had this accountant handling her family's personal tax matters also handling personal matters like getting car repairs done and taking her to doctor appointments and then also doing the tax work for the trust and doing the investment in the city it gets a deposit there was no effort made to allocate her time or even keep records of what her time was on the various tasks that were that she spent her time on and then trustee cohen who had a clear conflict of interest because every dollar that was charged to the trust was a dollar that she and her family didn't have to pay she alone without the involvement even of the other trustees let alone the involvement or knowledge of the federation was charging fifty cottons time to the trust so yes there will be an expense to having us bank as an institutional trustee it will be perhaps two or three times more than what was being charged prior to this for miss ellen's and her services won't be fired any more but you can also anticipate at any kind of reasonable management of this money is going to more than pay for itself  the investment fee that will be charged by the bank to properly manage it the court looked at a number of real serious problems with how this trust was was run to try to we brought a claim saying that the trust had been prudently managed from a financial point of view that the judge found that to be untimely but the judge still was critical of the notion that you would invest seventy million dollars in c got the conflict of interest with trustee cohen charging her personal expenses to the trust we had the problem with trustee cleena who was an attorney who provided this is a trust that in forty years had virtually zero legal expense but trusty khalifa was both trustee and the lawyer for the trust in charge almost two hundred thousand dollars in legal fees to the trust in less than two years court found that that was a conflict of interest and we also found this was the subject of the bench trial that the work that trustee collene was doing was not to support the federation or you vent to benefit the trust but it was to support this notion that this is trustees had that they could basically isolate and remove the federation's beneficiary so we have this conflict of interest problems we had the whole situation with the secret amendment of the trust and we had the persistent notion of these three trustees which was that they they are not bought into a federation that they had no duties the judge concluded after seeing all of these things and and not in significant was the notion that they were going to try to designate money to themselves through this donor advice fine donors trust just concluded that they were not that it was such a pattern of conduct that was inconsistent with the notion of being trustees that these trustees would not be suitable and so they removed the trustees don't challenge the removal of trustee cleena trustee franson of course it was found that he was see was selected not because he had and he was supposed to be the federation trustee he was selected not because he had any connection with the federation but exactly because he wouldn't be involved with the federation that we've put in the record the the correspondence between trustee co and trustee france and where they discussed their desired to make sure that the federation would not have been put on a successor trustee the last thing all talk about is the finds that have been d m to be designated so when the when the trustees made these improper designations the federation did something reasonable they put the money an escrow they had just been sued by of by the trustees to see what would happen as a result of the case of turns out as the district court fonda federations position was correct our view is the trustees had a right to make a proper designation of those funds in each of those years they chose not to they read this trustor agreement they ignored it they made these improper designation so because they never made a proper designation it should be deemed done designate it thinkers oh thank you very much argument is very similar to what the district court it he says read the title of the trost apply private trust principles to it private trust require specific beneficiary and from there conclude that all of the duties or all would to the federation and because the trustees never took that position in never acted consistent with that position there were all kinds of breaches of du that's essentially what the district court did and that's essentially the argument that mr mole bombings problem is is that this is a charitable trust it's not a private foundation i found it very interesting that in all of mr moggs discussions of the various regulations and believe me they're streaming the complex but in all of his discussion about the regulations he never once said that the cohen trust didn't comply with that so yes there's an organizational test six yes there is an attentiveness test yes there's an operational test but each one of those tests contemplate each one of those regulations require that a supporting organisation be quote organized and at all times thereafter operated exclusively for the benefit of to perform the functions of or to carry out the purposes of one or more specified organisations and so our position has been from the very beginning that the that are owed are to the charitable purposes of the federation and not the federation itself and therefore these grants don't go to the federation they go through the federation two charities designated by the trustee there are a number of misstatements that were made one misstatement related to this idea that the parent needs in israel language appears in multiple rants over multiple years and is just splitting in the ether that is simply not true as we argue in our reply brief on page three with citations to the record the apparent needs language always included instructions that the funds for a parent needs in israel go to a specific charity or the emergency fund in new york mr mo bond began here by saying that the federation is disappointed that we're here  fails to knowledge is the fact that when we took discovery in the case we discovered that the federation was preparing its own complaint against the trustees and that we just happened to beat them to the punch we filed in wisconsin they were getting ready to file in minnesota the argument that he makes about the trustees benefiting personally from the way that they are handling these gifts not only is inconsistent with the findings of the trial court the district court in fact at the beginning of our reply brief we quote the language where the district judge said this isn't about greed it's about control and we agree with that but it's all based on these funds going into a donor advised fund and mr morgan misapprehend what a donor advised fund is when money is put in a donor advised run as a restricted gift it must go if it is accepted by the donor advised fun the restriction must be on the other thing about a donor advised fund is that once the money is in the fund it is technically owned by the donor advise fund it is not owned anymore by the individual or individuals that put it into the daf nor is that money controlled necessarily by the individuals who put that money into the death instead under the regulations they function in an advisory type  they can make recommendations as to where the money goes but in that instance the money is technically old or excuse me is technically owned by the donor advised on the process here is very simple when you read these regulations and you look at these arguments the man the fact of the matter is the money was always given to the federation the question is did the federation have ultimate control over it or does it go to specific charities the district court said it couldn't go to specific charities unless of course the the federation agree so if allowed to stand the district court's decision will have a profoundly negative impact on the law of charitable trusts and discourage charitable giving the district court ignored donor intent and construed the trust agreement in a manner to reach a desired result that the cone trust should exist to benefit the federation rather than the federation's charitable purposes