really horner for capital options the appellate all three matters today we have to you tell me what counsel are proposing here we propose that we start today your honor with case fifty four the goldsmith's matter which is third on the calendar we then jump to the loomis matter of fifty two and then we finish with fifty three the administrative case ok so just so that i've got all my notes here but i didn't and then you want to go to fifty fifty two two and the is that the bankruptcy court dismissing capitols adversary claims against lewis and baker that is correct and then the last one that you want to argue is the denial of the confirmation of the bankruptcy plan that's right ok that makes sense because the last one is dependent on how we roll on the first two right  just just so that i know i have over here i believe i have counsel for limits and baker and goldsmith and t to correct can i just have you state your name ok and ok so that's warren stapleton and do you agree to proceeding that way ok and then the other party ok and you also agree and so i think we have an agreement on the parties so we'll proceed that way and so each of the three cases have ten minutes for each side and so it also looks like the way that you've divided it up that the other that to a pelleas won't have to come part they won't have to divide their parts right so we'll just when you have it so you have the whole time to yourself when if we divide the cases that way ok so then we'll start with by for right all right all right now let's start the clock and state your name and your parents on that lead horder representing capital options in the fifty four matter your honor i would like to reserve three minutes if it please the court ok and i guess the issue here because this was dismissed on limitations grounds is when does the limitations clock stop exactly there's been several points that  the statue limitations did not run contrary to what the court found as a matter of law the first is the fact that there was a state court receivership which was filed fourteen months after the j d c a the joint defense agreement the amendment did not require a finding that capital options was a member it said that the for purposes of the j d c m a it was a member of client member its called specifically and that upon receipt of i've i'm not sure that was your honor to be honest with you we got sidetracked on one stop the clock and the thrust of the argument below was it had stopped within the two year period the shortest period so we didn't reach the four year limitations period issues on the hill which means that we're now dealing with whether the two years properly applied not whether it's a four years that you first this two year budget limitation well i understand the record correctly you do your honor and it's whether the clock stopped within that two year period absent from california the clock doesn't start till you come back or it will start and stop depending on if you're in or out of california now in the record is the california supreme court do versus apple barry that says just that they said look this is modern day but the legislature hasn't seen fit to change it and until they do that is still good law now no court of his unless it's unconstitutional well they said it was constitutional federal and cons interstate commerce avel very specifically said it doesn't stop you from leaving california if you want to leave and no no court of competent jurisdiction has reversed that we did by the way early on file a motion to certify that question to the california supreme court and i don't see in the record where anything had been done on that but there was a recent request of the california attorney general and the applicable appellate rules to give a ruling is this in our case here the problem with the attorney general although that is proper appellate procedure as we look at the appellate rules is the attorney general has this limited scope of people that they will give opinions to and unfortunately the ninth circuit is not on that so my suspicion is they just took no action on your request of a couple of months ago to determine the constitutionality on that point well ok so stash of limitations on an oral agreement if that's that's what we're if that's what we're looking at are are would you agree that factual questions that we would we would generally defer to the bankruptcy court for that on determination of factual questions well it's really a mix question your honor which is you did novo review the it's not disputed when the j dca was signed executed and that's when the court said this is when the clock starts if you're going to dispute this oral operating agreement that's not in dispute the question then and also the fact that the receivership was filed fourteen months later is not in contest so that  becomes to the court properly apply the law to the facts of the case and we would suggest an over review is appropriate for that we did not agree let's see how well the other the other point that was concealed by a fiduciary would also told the the running of the clock but we didn't really get to that because this is a twelve b six motion  and the court felt on the face of the complaint it would not survive because the two years had run for the time the adversary had filed we suggested an evidentiary hearing is required and because of all this extraneous matter that seems to have come in on a twelve b six motion we also asked that it had been converted to a summary judgment proceeding so we could have some sworn testimony to sort this out the court declined to do that so that's that's money back but because capital options have not yet been determined to be a member of g two which has that that cause of action the court said we're not going to get into that so i just submit on that because it's it's in the record and it is what it is does the panel have any questions for me at this point how that would be three minutes to reserve a very well client pled that the limited liability company operating agreement was at all times an oral agreement he confirmed that at upon questioning from judge nielsen in the trial court so the four years comes up later the four years comes up later and in fact the four years doesn't actually appear until and both the four years and equitable tolling this idea that the receivership had told the limitations period doesn't actually come up until the motion for reconsideration so both of those arguments were dispense with by just nielsen because judge nielsen asked instore you know could these have been raised before and of course they could have been there's no new evidence with respect to those things all reconsideration and before i go for that i did want to clarify that i think what the court did in this case with respect to the the california attorney general was simply give notice under federal rules of procedure forty four and twenty  twenty four zero three b just saying hey you know we're going to pass on the constitutionality of that we have to give you a chance to come here and say something that's collection exactly right ok so so i just want to make sure that that was understood to want to come here and say anything  that that's right and so what we so i mean from our standpoint then it comes down to tolling if the two years applies there's just simply no way that capital options can win simply because even if you told for example let's take the receivership if you were to told the receivership proceeding from june of two thousand and eleven to its its conclusion which was dismissed by the chapter seven trustee on july fifth of two thousand and twelve so you have you know  period of approximately thirteen months if the statue limitations had run for about fourteen months before then and then it runs starting again from july fifth of two thousand and twelve well then that's only ten more months that gets you to july of two thousand and thirteen but this wasn't filed until july of two thousand and fourteen and even if you were to stack the section one away tolling which wasn't raised in await that only carries you to two years from the petition date which is june fourteenth of two thousand and fourteen again this complaint against my client wasn't filed until july twenty eighth of two thousand and fourteen so no matter whether you know i don't think either of actually expired before the bankruptcy was ever filed so section one away which saves statute of limitations for debtors doesn't apply and so it just has no application because that the lawsuit was dead before it before the the debtor filed for bankruptcy so do we have to do we have to get to the three fifty one argument because you were there claiming that it told the statute of limitations while goldsmith with outside california right that's correct your and your position is that that that would violate the commerce clause it would and it's it's been held by this court it's been held by a number of california court of appeals decisions to violate the commerce clause i think it has to be addressed and here's why because if tolling for by absence from the state is a political it's i'm not sure it's completely part of the record but certainly it's true from the record from two thousand and twelve to two thousand and thirteen at least those from the tax returns that should that have been mr goldsmith's montana address on them that he's been out of the state so yeah the court would have to rule on that if it's it has to basically say that this tolling is not allowed and it's clearly not allowed under this court's decision and  i relied heavily on the heritage marketing case which was a california court of appeals decision that occurred after so just so the timeline is clear do versus apple b was in one nine hundred seventy nine decision basically in the california know the defendants absent from the state statutes provide you know centrally negatively impact the commerce clause then the ninth circuit had occasion to review section three fifty one in a case that involved a person who recently in massachusetts with a new york they had done a contract the person in california and the ninth circuit said no the section three fifty one as applied to this person in this instance is unconstitutional your point is this is controlled by s that's right as far as as far as i know there's no there's and there's no indication it was for business purposes he just simply moved yeah there's no surely one way or the other record is  there is no showing one way or the other and that's the point there's no showing well there's there's a in terms of where he was in montana in the record there's indications in the record that he was in montana during that time and so that's in the record  why he moved i don't know that it matters under either the teaching of abramson or heritage marketing or the other california court of appeals decision which is dan clark family limited partnership and specifically respond to the court's question case relied upon by judge nielsen in that case you had defendants or plaintiff was a texas l l c the defendants were were residents of mexico transaction occurred in california that's why california is implicated a little you know kind of question as to why california has an interest in preserving any of these rights but that's how it fell out the the and it dealt with moving and it said nine in that decision so so i mean i think it is unconstitutional under the teaching of abramson but it's also unconstitutional least under the california court of appeals interpretation of federal constitutional law in heritage marketing and in dan clarke familiar family limited partnership with respect to i think really the only other thing i have really touched upon is the four years statute of limitations the for the statue of limitations again does not arise until the motion for reconsideration it doesn't rescue he even if bless you even if the even if the four your statute of limitation applied what happened here was there was an agreement between the parties someone extraordinary written agreement between the parties that says one you're not a member of g two two there are going to be any distributions from g to unless we reach a further agreement and three you're not a manager of g two and that was in writing and signed by the parties on april twentieth of two thousand and ten that's why there's no you know sort of question about when did this really start to accrue and so the the  even if you were to go from that day four years forward you only get to april of two thousand and fourteen and again this was not found until july of two thousand and fourteen and even if you can you stack one away tolling you still don't get to you only get to june of two thousand and fourteen question with respect to whether or not they could amend they didn't ask to amend so i see that my time is just up so unless the court has questions i have nothing further  briefly going back to the issue of the california supreme court sitting and bach by the way and they do versus apple barry case they didn't say that three fifty one was constitutional that case did not involve interstate commerce a all the other cases that first of all the inferior courts of california cannot overrule and you know the california supreme court the way they get around that though is say what they didn't consider the commerce clause and these people that are engaged in interstate commerce it does affect them so from that standpoint it would be unconstitutional but as as your other pointed out there's nothing in the record that shows mr goldsmith was engaged in interstate commerce certainly if if we follow your interpretation section three fifty one and told the statute of limitations while he's outside of california would there be any limitation on whether an action could be brought if he remained outside of california why would such a result violate the commerce clause well if he's engaged in commerce that's one thing but he wasn't at least according to the record and your honour's right there would be no limitation that's what the statute says until you come back into california the clock doesn't start or stops while you're out i guess is a better way to put a bendix certainly was a commerce case the other cases that were cited was were commerce cases so it's our contention that three fifty one is entirely constitutional as applied or as should have been applied in this case  ok so that matter will stand submitted