the interpretation of that statute is what's at issue here the district court correctly ruled initially that this was an affirmative defense and the burden of that affirmative defense was properly at the outset placed on mr hamada if i can ask you at the outset if you can point to any case  characterization that there were no red flags at the initial sale but i would suggest that the leading case here is porter against words from the new york court of appeals which does lay out some of the aspects of red flags it's our view here that entrustment in the scope of entrustment is generally an issue of fact and requires full discovery but even in this instance the eighty nine transaction we were we didn't pass it by your honor i believe it was mentioned but not in the greater it was mention of the greater extent in the reply brief but the point is that there were that no i don't i do take issue with that because you cannot it is not the law that anyone who is downstream from a first sale by let's say by a thief or by someone who to whom properties and trust that it is not the law that no one downstream has any obligations we're talking here about up appropriate haps we don't know but perhaps in our deal or merchant purchaser and as the new york cases  t the cases that you're looking at at least as i understand it look exclusively to the initial sam no the case is the district court in bender against carroll for example and in the overton case those cases per se stand for the proposition that the merchant purchasers downstream have their own obligations of due  diligence no one can simply close their eyes and say well i just bought this and therefore and therefore i have i have title so the the district court here of defined the whole scope of  not that's that's that's not quite what i have my position is my position is that a downstream purchaser cannot merely say that there were no issues and therefore since the that it was sold and you can use you can look it up it's not handing there were citations to prior sales of benson paintings which seem to indicate that the price for the benson was considerably inflated  second highest auction was was much less significantly less and they had one thousand i'm sorry could you prove your question please what's the evidence that the second highest option bid was under that provision that star mark contemplates a notice requirement which was amply complied with here through opposing counsel's regular and consistent threats of sanctions and that story which is perhaps the best guide here makes clear that the standard here is that something must be utterly lacking in support that said it is our position that those sanctions in this case have to be reversed as the o'brien standard hasn't even been close to being met judge firman indicated in his order that there was no admissible evidence whatsoever to support galen's assertion that there were red flags surrounding the transfer of the painting from ramos to coke her and i understand that you're interested in the one thousand nine hundred sale so i'd like to address two facts that are indeed admissible and i would argue in fact dispositive of this case the first comes from the deposition the deposition the other was contentious deposition of ramus where he admits for the first time indeed that he was a daily heroin user indicate bottomed out over a month only a month before this transaction and on page thirty nine of his deposition describes his addiction and says the world seemed to be falling in on me i was dancing as fast as i could i don't even remember doing a deal with coke or then he goes on to indicate doesn't exhaustive analysis in in davis in davis v carroll and indicate citing porter vs works and the yale law review article that the purchaser and this record that you know what i'm saying what i'm saying your hon is that judge at can indicated that even if that a purchaser will be deemed to lack good faith the fact about the transfers brought about even if proof is lacking that the purchaser was aware of the fraud that is to say  object of not a subjective standard so even the even the unconvincing denials objectively speaking what is the current in this case we were unable in this case because of the severe discovery limitations we were unable to develop that particular part of the record but i would say the answer is there isn't anything there isn't there is there are merely an there are merely denials at this point that said it seems a perfectly reasonable a purse of perfectly reasonable belief view of the evidence that someone who was at the bottom of a heroin addiction at the time was subsequently indicted for fraud which took place at the very time of this transaction who admits that he indeed partied regularly and in fact that it's important that we look at what he said about that which is i would be god darn shocked if people didn't know i was partying pretty hard if we disagree with you if we were to disagree with you that  district court in limiting discovery wouldn't that be justification for imposing sanctions no in so far as ramus himself indicates he would be god darn shocked if everybody didn't know and admits that he was in fact partying hard with people in the art world and but i haven't had an opportunity and then of course there is what was produced in discovery our world were parting suggest that you are committing crimes or do you have money no but i would argue i would argue that a heroin you that a heroin user a daily heroin user who is about to bottom out who was partying hard and  indicates who would be god darn shocked if everybody didn't know it is enough to draw a reasonable inference that that may have raised a red flag especially in combination with the indictment the subsequent indictment that specifically involve fraud in this time period and the other end of one which i didn't get to which is the provenance also produced in discovery which indicates that cooper was the only owner and that is page two thirty six of the appendi being before the second circuit in saying those words as basis for invalidating a commercial transaction is hard to believe is true or not there is absolutely no evidence that in one thousand nine hundred nine when this transaction occurred that there was any that there were there pleads in his complaint that frederic church was the owner and sold it to koch her with and purchased her from koch her it's the subject of our rule thirty eight motion that that issue was raised for the first time and on reply and on maybe so i do know how this works one is auction houses disclaim things like condition and prominence because it's hard to find out particularly with painting so they don't necessarily put in all the painting so they often don't know all the probate aunts because they don't know and second it's not uncommon for the consigner the owner to not wish that his or her name be placed in the provenance because he or she does not want people to know that he or she is selling an art her was the owner is is really there's no evidence for it whatsoever the evidence is contradictory it's nothing more than a conspiracy theory that makes absolutely no sense that kolker would consign it and then buy it back at a  higher price particularly when it's here also says there was a question about the price of the bench and it's also pled that the why of painting was traded for more valuable painting so we think there's probably no there there is no there's there's no question there's nothing in the record that suggest that there is a question is a prominent there's nothing in the record suggests that whatever whoever mr ray misspent a social life that he had trivia about the second bid there's no evidence the record about what the bidding was the fact that there were auction estimates merely means that that's the the price the auction house said we think it might sell for this and in the fine print but we don't know and the the actual bit is not in the record it wouldn't be in the record but again the auction houses generally try to skew the extra bit slower so that people will bid and they don't go by double they don't generally go in increments of depending on the price five no estimate there's no evidence of at all that and frankly there's no evidence has a judge explained very carefully his decision we thought there was no evidence in the complaint because of the pleadings i just mentioned the judge and there are cases closing the brown case which we cited and which cases have just been dismissed as matter of law because the entrustment auctions very clear just determine gave them the benefit of the doubt and then when the discovery which was extensive and they got to speak to the people actually involved in the transaction revealed that there was nothing wrong here there were no red flags as there were import of the words which involved a sale by a delicatessen employee of an old master painting in overton which involved the sub market sale to a to a a loan to own lender there was nothing like that here and there was no evidence that in one thousand nine hundred nine that anyone would know and in fact ramus testified and it's in the record that he did his very best to make sure people didn't know that he had  had any financial difficulties and mr galen is not merely a person who owned a third of the painting he was his best friend and after he was indicted mr galen himself again this told people magazine that he just didn't believe that that galen had to put done anything wrong so there's this is this is a record on which it was clear to me from the beginning that mr that there was no case as a matter of law the judge i think reasonably said i'm going to give you the benefit of the discovery once discovery revealed nothing and the appellant continued to advocate that in the in the face of no evidence at all except his gut feeling that the trust in doctrine shouldn't apply which is why which that's a that's a point of view i do respectfully disagree with that for three reasons the first is in this case we had after the litigation was filed and again it's put in as part of the rule thirty eight motion an agreement between the parties that the artwork would be sold in the proces would be paid to the winner so we have an agreement that that that's what would happen when the when there was a final order in the case the second reason is that every plaintiffs has the duty to show a prima fashioned case before the burden  the consigner was and who the owner was and knowing that that something happened that that's not in the record that we don't know about that it must have been in the case that's the entire reply brief is that we don't have to address whether or not th that is that is money that is my view but my view is that even if there isn't a person defense was more than met by by both the lack of evidence in the record and the affirmative pern of evidence that the sale price was  was no evidence of financial distress because something some number of hundreds of thousands was paid for the pension painting by premiss and that was so there simply was no evidence and there was plenty of evidence that this was a standard commercial transaction between art dealers and the difference between it there is and we assess and question of sanctions yes and regrettably under i think the standard under rule thirty eight which is that is bad faith or kin to bad faith is meant here and i say that because  the motion to stay was based on an agreement that was signed i say that because the argument made for the first time in reply which is itself sanctionable was based on contradictory not only not on evidence but evidence that that he had that was to the contrary i say that because judge herman took the time to carefully explain why what was wrong with the law that the pre one thousand nine hundred three law couldn't be cited that the cases he cited wrongfully did that there's no way to look at it that this was  heard here a series of factual issues which which precluded that which should have precluded summary judgment as i mentioned the overton case before mentions four red flags that trigger  answer to judge jones question the answer to the judge since question was where were the valuations of the benson painting am i correct i had asked the big but i understand that from counsel that there is nothing in the record regarding the history of the history the bids for ice storm is that correct whether whether now all we know that's correct your honor all we know is what ramos paid for it and we know that he had a prior  deal with christie's to pay this off in installments i understand that's your contention is there any evidence to support that the bid that the bid for ice storm was higher substantially higher worth compared to other andrew wyeth paintings what what it was eventually sold for that's our contention is that he overpaid for it because he had an understanding with coke they're not evidence the fact is that we were precluded in this case cries out for evidence for excuse me for expert witness testimony to analyze some of these factors there are a lot of very well some of the range it relies on the limitations are very large portion of our argument lies on the limitations of discovery yes your honor that's correct we were precluded from witnesses we were precluded from experts we were pretty clued from  contention give me some evidence to show me i'm giving you right here to show me something in the record i've got here comes back with the bends with with the ice storm after six months after purchasing it he goes back to coke her and an art gallery that didn't know me and i offered and i and i asked for a loan of four hundred fifty thousand unsecured would they give it to me i think not and that's what happened here so this is another red flag he walks out with a painting which it turns out the benson painting is also overpriced and it's it it's a legitimate inference to say that the whole purpose of this current gallery had a buyer for the wyeth and they wanted to increase the price i think that's a perfectly reasonable conclusion from the facts that we do have in the record there's there's so many facts here which raise all kinds of issues there is no when that when kolker folded all of its records went to the frick collection library this everything and everything about her is in the frick collection a library not this deal there's a there is a foundation in pennsylvania which has records of wyeth transactions they have nothing about this deal so it's very it's not contention and it's not merely speculation to question whether this deal was kosher if you'll pardon the expression there's something very strange about this and we were barred from finding out what happened not even to mention that we have no idea if mr hamada has even owns this painting he never said one word under oath to say i own this painting so there are so many fact issues here that we feel that the district court just went a little far in granting summary judgment on this record thank you thank you if i may try to answer your question very specific very specifically and simply say if indeed you have to resolve resolve all ambiguities and draw all permissible factual inferences in favor of the party against whom summary judgment is sought then mr cahill just response to your question a good one saying how are we to interpret the provenance which only lists coke her and doesn't did provide significant evidence that indeed there was something on abnormal about th sale he's mr cahill essentially responded not with the record but by saying look i represent these folks i know how this goes well that may be the case and it may not be the case anything in the record just  then it is indeed strange that this is a circular sale this isn't it's not a conspiracy theory it's a there so if indeed kolker is the owner and if indeed a drug addled a drug addled man who  subsequently convicted them though it seems to me is the end problem of a lack of record agreed his answer doesn't actually help help you may not help them may not help you so in response to that yes yes and i agree i agree with that and i believe it is indicated indicative of precisely why judge farman frankly did not do as good a job as judge at can in resolving a very similar cases  material facts which if resolved in favor of the plaintiff clearly lead to straight down the road to red flags in the one nine hundred eighty nine sale among them this particular question of provenance which we've talked about so essential so essentially yes discovery is a problem but also there are indeed facts a deuced through the very limited discovery process which support the contention and allow facts to be drawn which would indeed raise red flags which as you well know are not it's not an exhaustive category so again between the indictment which clearly indicates he's engaged in precisely this kind of fraud at this time between his admission of heroin essentially notorious heroin use daily at the time between the admission that he bottomed out a month later and the provenance which only lists concur those are all things that could very reasonably lead to inferences