they please the court they're requesting four minutes rebuttal four minutes you may please the court patrick doest from on behalf of the plaintiff charles serafin the plaintiff in this case the appellant's the crux of this matter is boils down to one document and that's what i'd like to focus on with the court but for saying that there are there are many issues i think we fully briefed most of them but i do want to focus on one document and one issue that really is the basis of the judge's opinion here we think was an error and that has to do what's called the may eighteenth two thousand and seven letter this is a letter that was sent to the f d a input from the f d a to biomimetic in response to a reply by the to the fish and see that was raised by the f d a with respect to the protocol the supplement was filed in april fifth of two thousand and five and what we're dealing with here  company's response so may eighteenth was delayed or from the f d a or the letter from the company that's the letter from the f d a to the company in response to its supplement that was filed away on april fifth two thousand and seven well first off this may eighteenth two thousand and seven letter was not part of the complaint wasn't part of the complaint because these types of documents are not public there's no way the plaintiffs could have known about this document in fact the way the process works the company has the luxury to say anything it wants to investors and to the market about whatever it's doing with the guard to its product the f d a is required to remain silent because this is an ongoing process when we filed the section we incorporated all public documents that we could find that were related to any of the statements by the f this document was presented on the motion to dismiss we didn't challenge it because case law is pretty clear letters from the government can be judicially notice however the purpose of judicial notice is only through the fact that the letter was sent from the f d a and received by the party the truth of the matter is asserted in the document are not ripe on a motion to dismiss to ascertain the truth or falsity  substance of this response that's correct but the point is that they receive the letter what the letter says and how it's interpreted is a matter that's how we disputed the court itself recognize this is  you take notice of of that you can only take notice of the fact that the letter was sent and we see what's asserted there the court could look at its intrinsic is for both sides but to make a determination of what truth of this is is a different matter and that's what the court did you know that's a violation really of rule two a one which says it's only supposed to be taken into consideration for indisputable fact or when you say he'd made a judgment as to the truth of the letter to help me there because it would seem to me the letter speaks for itself in terms of what the f d a said what it what is the truth issue beyond the fact the f d a said it that what is in the letter  the the letter doesn't speak for itself it needs to be interpreted like all documents their attacks occur curves in context this is within the context of responding to a supplement the first thing the f d a said is your you have corrected the deficiencies in our conditional approval letter therefore your supplement is approved so that is the truth issue what did the f d a really mean by these words that's correct it's what was meant by these words because we we as i say we didn't challenge it because it can come into the court and we said we don't mind because we're going to make an interpretation of it that supports us defendants make an interpretation that supports them but it time of a motion dismiss the court can't take sides and it can't switch the burden and tell us no they're right prove that they're wrong and that's what the court did it went a bridge too far here it went and made a factual finding about this document if the court said that the finance did have a basis for what they said and then ruled on this document in such a way says it this is what the document says you have a reference to what part of the court's opinion your spe i frankly i had focused more on what was going on on october of two thousand and nine so if you can point me to where you think the court was it was as to the two thousand and seven is this around pages seventeen and i pig sixteen before that you're on the court is discussing this very letter in the reference to the letter makes to the april fifth document and and it is contrary to that the primary study of population approved by the f d a was modified intent to treat in fact this letter says it isn't and the other the you had a chance to respond to this argument those are correct  document the way it is it's written the way it works within the context and we had the leading expert in the process of f d a approvals who supported our analysis of the of the the way this letter is to be read and in th context again they filed the supplement in response to criticisms of the f d a they call it the f d a is the march thirtieth letter we don't have that because it's never been produced the f d a had criticisms of of what was in the application by the company the company corrected those deficiencies therefore the f d a approved the protocol now as part of that  the company's slip something and they try to redefine what is called the intent to treat the problem that with this is twofold one there is only one definition of the intent to treat intent to orient myself you're talking about things that were put out by the defendants which were misleading or wrong right now and i'm like yes i am a witch witch what is this the the release whatever the october thirteenth releases is that you're talking about or when when did they make these misleading statements that you're talking about the statements made throughout the the class period at once by a century ago starts doesn't the class period star october of two thousand and nine am i wrong yes yes but i still have the same question what you were talking about misleading statements from the company right correct upset and i'm just asking what misleading statements what date what are we talking about are there dates for those statements are there in order wasn't an issue in the record i'm just trying to get the sequence here because this is judge box as the class period starts october two thousand and nine a lot of discussion has to do with may two thousand and seven because you're about to have statements or you don't have a claim right really that's correct your honor and i'm not asking for exact dates i just wanna know what the nature is of these things what are you talking about the nature of the statements have to do with the company saying that the primary test was supposed to be the modified i they would say that for instance in a press release they said that in presley's they also said in a conference the defendants produced again on the motion to this to this miss the conference in and conference call seems to me it's pretty clear that all of the data for both is released and discussed so does your case at least with this respect turn on whether it's primary or non primary it is they didn't hide the i t t ball they did what the what the hid was they said that the mit c was what was important and what was important to the f d a in fact the judge slate's to himself the the analysts the next day one of them that he sleeps through said that the show they did give both of the information but his last name is by one minute argued that the latter mattered more than the former the latter being the mit this is the they are in here they argue that that's a misrepresentation it was one that they knew from is from the very beginning of doing the first protocol until my name is randall bowden or i represent the apple e's before this court as i did before the district court blow i practice out of the massachusetts bar but i was born in the sixth circuit in danville kentucky congress passed the p s l or a requirement that the plaintiffs must plead a strong inference of science or to act as a filter at the earliest stage the pleading stage in order to screen out lawsuits such as this frankly that are not grounded in fact indeed to that point as the eleventh circuit says and has ereli claims based on bully statements by pharmaceutical companies were exactly what congress sought to avoid by enacting the p s l array and as this court is well aware the f d a approval process is well known as being a very multi stage complex process that takes years and it's a notoriously uncertain risky and often unpredictable and because of that uncertainty and risk the pharmaceutical and medical device industry which my clients are in is particularly subject to more than its fair share of lawsuits and that industry as much as any other industry deserves the filter the protection seller a report requires and when you apply the p s l or a filter to this case particularly in the scienter point it does not pass muster at all and let me go directly to have just saw understand the structure of the argument if we were to agree with you on that would that preclude the necessity of getting to these arguments about forward looking statements and i think your honor that we've actually i think it's a straight forward the forward looking statements arguments are quite straightforward the law on the six circuit is very clear question i'm sorry if we agree with you on the first point that you were making do we need to get to know you do not so the issue as to whether any current facts are assumptions afford looking you need not reach that decision because even on their interpretation that that the safe harbor doesn't apply we prevail on that issue and you need not to get into the forward looking statement and to address the m t i t t point the point is what was the relevant study in i t t study is only a population that a statistician can love because it involves everybody who is randomized for a drug drug trial whether they actually received they could back out at the very beginning they could die they could decide in another procedure if they'd been randomized there in the i t t bucket in the populated council i understand as one might like t t better than i t t i would kind of agree with you yes your honor me it's clear pretty that what you've got here is both you and the f d a recognize that there are these two different populations you've got data from both populations and obviously you hope that everything will fly on mit correct f d a at a minimum is saying we want to know the i t t your adversary focuses on did you assert that the m i t t was the primary and that that is a big misrepresentation can you focus on that part of it absolutely your honor the first off is the company did refer to the mit as defined tell us why the language the intent to treat population should be defined as all randomized subjects in the treatment group that seems to suggest that that's the primary data we why you're given permission to  and those figures rather than the mit figures in your honor to to that regard that's why in this instance as the district court did below there is you need to roll up your sleeve to see what's actually going on here because there's a little bit of a definitional confusion that the district court didn't understand and in fact it doesn't really we don't have to rely on we do we stand behind the may eighteenth letter the company put in a supplemental protocol that said we want to analyze and as as the primary data population patients who actually receive treatment that's mit that's not i t t they submitted that in their supplemental protocol pursuant to f d a regs regulations and the the may eighteenth letter otherwise known as an unconditional approval letter said you were supplement is approved meaning your proposed protocol using that ocular is approved but you need not get into a debate about what was or was not meant in the may eighteenth letter because you can go to the record and it's the it's the very briefing documents that were toward the end of the class period submitted by the f d a and put in evidence frankly by the appellants not by us you need not look any further than what the f d a says about this definitional issue as to what was the the primary population but you need to read it carefully and i'm referring to eight hundred seventy four of the record this is a two thousand and eleven briefing yes the briefing documents and it's twenty of sixty four of the documents eighteen sampling the stock plummeted when that was well the stock plummets because because of a whole lot of issues there was a lot of that when the stock on the stock did the stock did go down but stocks go down for a lot of reasons and twenty five is not an investment insurance status on the stand that but this this thing you're about to talk about is the public briefing document of may tenth that is you know may tenth or within hours after the stock that that that's correct it's a very large document and and analysts track these things because of  approved in the ideal that's the submission for the protocol with the primary analysis to be performed using the i t t data set and p p being confirmatory now on its face that doesn't seem very good to us but you need to read on as to what the f d a was really saying here in the very next bullet point it says intent to treat all randomized study who receive treatment post randomization patients who are randomized but determined to be unable to be treated will be classified as surgical screening failures and excluded subjects analyze according to treatment randomized what they're saying here is exactly what the may eighteenth letters and is exactly what the company said using the correct definition to the public that the primary point the word is used by the f d a itself has to do with the population put together what's the population it's the people who receive treatment that's an mit t population there's no bait and switch here in any way shape or form the f d a says that they said it may eighteenth they say that of two thousand and seven they say here in this document before the at toward the end of the class period they are confirming what the company sent all along which was that the mit population of the vote that had where where your side prevailed but there was a substantial debate when the very next day it was two days later the days after this briefing document two days after this briefing that's when the when it occurred or when it was publicized that's that's when it occurred and was publicized these are open hearings so the briefing document is essentially the analysis that goes to the panel the panel you know some say yes some say nay and in the end wind which is good but you don't win by much which is bad right well accordingly we lost by winning your honor according to the plaintiffs in this particular case which i challenged them to find a case indicates you may have trouble down the road it your honor it indicates you may have trouble down the road but that's probably why the stock dropped well that's not it did drop when the briefing document came out because the briefing document practice they do not want companies and do not publicize the exchange between the companies while it's going on so this is the first look that the market gets in detail at what the f d a is saying and believe me these briefing documents are huge and it covers a number of different things the plaintiffs are cherry picking things they like to cherry pick out of those documents there were many other things they can't complain about that the f d a rose but it doesn't fit their theory of the case that the market did not react but he did indicate there may be trouble down the road but certainly did not indicate that there was securities fraud and i ask you something about the numbers at page and this is a page eighteen nineteen of the judge opinion which is page six of your press release this is the paragraph where you you say on a strict intent to treat first you say now there's not that much difference the m i t t is ninety five or ninety percent right then the next paragraph you say on a strict intent to treat population basis so you're putting the data out there what does that data mean usually a p with like p point  in other statistics that means there's a statistically significant difference is a big difference in reading this is it supposed to mean in fact that even on an i t t basis your stuff did well or is that supposed to me that it didn't do very well know your iran or what we disclose and what the market understands the market believe me this is very closely followed by analysts they understand what is being referred to a p value which is the basic measure of whether there was  typical significance or not is it good or bad if it's below zero point zero five that's good ok it's above point that's a look at this whole thing the the bad revelation is that one of these is is six and a half rather than five that's not good but of the stock didn't drop at this time is that right back in the press release time no actually at the top and it's not in october in that we make the point in our  dropped actually quite a bit but came back what happened at that point they disclosed to the market that's why how is their deceit when the very thing we purportedly kept from the market was in fact disclosed to the market what we disclosed was mit the people who actually received treatment statistically significant on the i t t which included people who did not ever receive they didn't even get in the operating room but were randomized that was statistically significant albeit not by much it was close but not a game of grenades and in here it was not statistically significant not only that was disclosed to the market at the time there was a press conference and what did the company say in that press conference the kind of is that worst everybody knew that both of these were in play you hoped that the f d a would rely more on mit because you had some basis for that others would say they also wanted i t t so you knew that you could be in some trouble because of that is that fair well i think your honor the way i would put our position is that there was could not be any strong inference of scienter here when the very thing we were accused of keeping from the market we disclosed to the market and referring to the mit te as the primary data point all we're doing this for using the correct definition but the subset of definition that the f d a uses in its own briefing document you knew that you knew there was potential problem you were just hopeful you would end up overcoming it well of course we were hopeful we were going to overcome it and you said this is the data everybody can buy or sell on and not only that your honor one hundred thirty three times we counted turn the class period we warn the market the f d a may interpret this data different than we are it is a fortuitous process we gave specific risk disclosures to say that there is a risk here and it place we should look at in the record to where you say one hundred thirty three or is assist account you made before it's a count that we made before the district court we actually have an attachment in the record can you cite to that or you tell us where it is and we can find it if we have to as a part of your summary judgment it's part of our motion to dismiss brief and it's an attachment of the measurement of the motion we can probably find it go it would just require references that although it said i didn't do the counting myself but i you know basically take their word  district court there that is correct your honor and there's been other communications from the f d a to the company that they're presumably in for the action of the company but haven't yet been disclosed that would come out during discovery how are we supposed to know along the way by the f d a well first off you're not to be glib but that's what the parade the what the p s l or a the supreme court intel abscess as the second is that i think the court can take great comfort in the fact that what the maybe eighteenth letter says is actually in the briefing documents say the same thing he'd now we've got that right so so so as a result and it's a it's a difficult exercise for all courts but it's what the p s l a requires and it's what tell abse mandates is the court at this inferences to be drawn fraudulent verses not fraudulent as to whether the plaintiffs have met their burden that's the mandate both from congress and the supreme court and that is exactly what this district court did appropriately here thank you thank you have your letter which says analyze one and you can analyze the other what it means is that you need to have statistical significance for the i t t population that's what it means and they were and what the company said throughout here  especially at the conference is they were telling the analysts who do to follow this that's why they were telling me they were asked about the i t t and they said that the that the f d a was more interested in the n c that's the primary one that's the important one they were making the arguments at that conference the same kind of arguments they would they're making here tonight of a conference call the conference call yes and the they also say in the same sixty four page  page fifty as was introduced about this in the statistical plan section the sponsor use the following populations for analyses a primary effectiveness point in the pm in this was a change from the approved id protocol and was implemented without our approving the change from the f d a in an approved modification of the idea it was never approved by the f d a and they're claiming how does that square with you know it's an accurate statement of the letter that it says it is approved right it's unconditionally approved yet if you read it what they say is you have corrected the deficiencies now this is also before  unapproved that's their term the tuchman is not an unapproved letter it doesn't mention that we are unconditional it doesn't say that anywhere in it what it says is you have corrected the deficiencies cited in the conditional approval letter therefore your supplement is approved it goes on to say that neither the defendants nor the court cites this language you should give serious conditions to the following items which are considered essential for the analysis of your data for the purposes of the term safety and effectiveness essential it doesn't say this is some recommendation we want you we have the rate is essential they provided it that's the question is how much you weigh one or the other or which one you look at and which one you don't look at that's correct and it goes on to say the intent to treat population should be defined as all randomize subjects in the treatment what they're claiming here they keep pointing and saying oh this is what the i t t is  they misstated what i t t means it i t t is not a modified i think it's not this thing they put in the this is a bait and switch that the f d a caught in the protocol i t t has only one meaning and that's the random zation before the testing and those are the words that they use in the press release on a strict intent to treat population blah blah blah they release those figures and there's no such thing as strict or not as d have a question i know your time is up can you explain in layman's terms that is so a high school student could understand it why t f more probative for a safety than mit yes because once you start as soon as you start taking people out of the program before you start the testing you're putting in bias you're saying we don't want these people remember this is not a blind test so you're still are taking out people it's a cherry and see if they're you know if they satisfy the requirements for the test a completely blind it's people who are appropriate for the well know the test is blind the individuals they know going in need to have this medical  e basis that's not related to which of these two products you use take out the people who never get either one of them high school students asking what's the answer that the answer to that is when you take it out you change the way the to sticks work when you're testing to see if it's effective or not even this was of a we did not use that and i take it like if they died if they died after they were randomized in they're still in the that's correct but the way they get into it there are there's a series of questions you know the words you don't put a person into the pool who doesn't need to graft right so you put them in and then you don't take them out of the pool if they don't that's correct  of the people because they don't because it turns out they don't need one but when you start once you have the study and you and you start taking people out who have who could receive the procedure then you have to ask why are you removing these people no one's to no one has agreed on with those determine how in layman's terms could that introduce a bias they were removed some of them were removed because they might have used one rather than the other i just i'm just  don't see what the problem is they're the experts i'm sure they have a good reason i have said asking if you can convey to me what their reasoning is but i'm not the way the randomization rick your honor you have people who are going to get this new procedure and people are going to get what is the accepted norm the the regular grafting randomization is we don't look at who's going into either category we put them into this now once they're in there we make then you can make a determination you may they may have fallen out of the graft and not this autographed is inserted is that fair to say that the the reason you don't want to take anybody out even if there's a very good reason is there might be a bad reason you don't be the i t t he is no matter how good the reason for taking about is you don't want to let the clinical trial people make that choice because they might make a bad choice but that's one of the reasons but there's also a mathematical reason in terms of what i'm trying to explain is that once they're in one of the two categories they may fall out but it was it when you say you're taking money out then the autograph is automatically going to look better and the problem with the test was when you compared the auto process to the regular grafting process after they took everybody out if only one of the people who took the graft was positive rather the negative it would have made the autograph  statistically significant so when you start removing people here and move putting bias in but you're also taking robustness out of the analysis now we have yes we've met cisco significance but if one person would have changed then we well had then that's always the case you know because i mean it's always the case that there is a law and if you think point zero five is the perfect line there's always going to be a situation where one person getting better or worse would move you one way or the other that's quick but in the way it worked here is one would have made it not statistically significant and the reason for that was because they removed people before without randomization they took them out of the process had they left it in with random it would have been a different result is it fair there was a statement somewhere in there that that anybody who was removed who never got the treatment is considered as an automatic failure under i now adequately set forth what we were so we were submitting additional a testimony in facts about how to interpret the may eighteenth letter how it fits into the process again we focused where in the word in the record would we find the proposed amended complaint would get the number fo