stokowski morning again good morning again your honour's may please the court i'm here in behalf of stillwater liquidating which is the successor to twelve investment funds for purposes of this morning your honor is the district court denied these funds restitution without hearing or oral argument and its decision rests on significant errors first the court emphasized that the drover transfer and the transfer to the sheeny were too far apart to be related to believing there was a two year gap and this is a page seventeen of its opinion and on this conclude there are two attenuated in time to be directly or approximately related which is the standard however the court's wrong the drover transfer was in january two thousand and ten as the indictment pleads a paragraph twenty eight the sheeny conduct begins in that latest may of two thousand and that's a four month period not a two year period and it's actually a shorter period of time than the five months between the shia heaney conduct and the tallia ferry nine which is before the drove a transfer and then it says that the drove a transfer to took place and it talks about that as the overview of the scheme to defraud it then under the heading of  deception to ensure drove a maintained its listing on the new york stock exchange lists the drove the transfer and the acquisition of still waters assets as important and then these allegations and there are several more are all included in all of the offenses that's incorporated more importantly at the hearst trial the government repeatedly told the court that the drover transfer was a fundamental part of the conspiracy and one hundred percent part of the conspiracy and repeatedly said things like that and then before the jury in closing at page fifteen ninety one of the transcript said that the injury to drove for not giving any consideration for me to daughter rather for not giving any consideration was material was a mature material injury resulting from the offense conduct so the government itself put the injury to the funds central government did attempt to prove and what is stated is that the funds never received the stock they were promised for example page one forty six of the transcript which is that exhibit eight of our petition the government asked mr do it before the jury did you actually receive the actual shares and he answers unequivocally no and that the testimony is repeated four times before the jury pages one fourteen and fifteen page one nineteen page one twenty four and again page one forty six the court in its opinion takes makes an error in saying that these were stray comments that were made outside the jury again neither of those were true the government itself put these at the center of how it tried things so it's in the indictment and it's in the question the still waters name is mentioned from time to time how is an abus part of the offense conduct but again it's part of the scheme to defraud and i've cited to the pages of the indictment that say that that is incorporated in each of the charge crimes the government told the jury this is material the injury to to the to the funds caused by the fact that they were hoodwinked into giving their assets was material and remember even the judge castello agrees that there is this is a but for cause of the conspiracy that without the assets that were specially stolen from stillwater this could not have happened he didn't have to make any finding the guy did that transaction for them to convict the individuals today no they did not but because they were example the offense conduct was importing illegal lobsters into the united states south africa nonetheless was entitle to restitution even though it was not part of the importation because it was injured by the over harvesting and its waters which was part of the offense if you look at villa are in if you look at the whole our case that we cite if you look at the archer case when something even if something is not part of the offense conduct itself if it is the mechanism by which the fraud is achieved or the scheme is achieved the victim of that is nonetheless entitle to restitution and here there is no question that the the see the seizure of the assets from the funds was fundamental to the conspiracy again the government said that at the first trial they told the court when mr hurst counsel objected that this is one hundred percent part of the conspiracy the conspiracy your honor is the charge defense they told the jury this is material that it was material to your honor the charge defense and the court said it is undisputed that without drovers acquisition of assets the fraudulent scheme could never have come to fruition the fact is your honour's heard yesterday and again today these funds are out of at least three hundred thirty five million and perhaps up to a half billion dollars of funds and now we know that had wrongdoers criminal wrongdoers who are coming forward with restitution the mandatory victims restitution act provides that usually will give restitution to make someone all these parties are anywhere but whole and therefore we believe the judge did it abuse is discretion thank you very much for the time this morning from the government good morning or honors and may have please the court my name is brian blaze and i'm an assistant united states attorney in the southern district of new york i represent the united states on appeal and also represented the government in the proceedings below judge cristol did not abuse his discretion in determining that stillwater was not entitled to restitution and he recognized that there were three fundamental problems with the argument that still water advance that they are entitled to restitution one legal one practical one temporal first the legal problem and i think your honor judge wesley appropriately recognize it which is that the indictment in this matter does not allege that there was fraud in the inducement that stillwater was induced fraudulent lead to contribute their assets instead the indictment alleges a scheme by which the defendants in this matter profited by causing shares to be issued to a foreign nominee and for those shares to be sold through various mechanisms including inappropriate in illegal match trading nor did the trial evidence stablish that there was fraud in the inducement of course there was mention of stillwater at the trial and evidence about the formation of as necessary background to the conspiracy but it was not it was not a fundamental part of the scheme the fraudulent scheme which was the issuance of the shares and the disposition of the two the four nominee and the ultimate leader disposition of those shares so problem number one is the is the legal problem that i articulated which is that the indictment does not encompass the fraudulent fraud in the inducement or any fraud in the inducement with respect to the initial drover transfer to the practical problem is that the still water assets were not used to carry out the fraudulent scheme that was charged in the indictment they were not the mechanism by which the defendant in this matter profited from the disposition of those shares of course and judge has to recognize the government didn't contest that the transfer of those stillwater assets was a but for cause of course of drove it didn't exist the defendants would not have been able to later profit from the scheme but the issue is whether whether stillwater was approximately harmed by the criminal conduct and we think that that answer is  my old job at the new york feels like it towards case relevant to the creation of the entity but not not the mechanism by which the criminal conduct a cur that's correct you are that that's the position we've taken below that's the position that judge to stele took and we certainly have believe that that was not an abuse of discretion of his discretion for him to so find i was in stillwater a victim really i mean it was part of the overall scheme that's been described without the certainly stillwater as every shareholder was injured to the extent that their shareholdings injure over were deluded by the improper in a legal issue ends of the five point three million shares to the fo nominee and judge castello had a separate finding with respect to those dilution losses that given it infected every juror over shareholder and that it would be simply too it would be too time consuming and complex  to determine what the value of those dilution losses were second it was is what we labeled the transfer losses and and we believe that judge appropriately founded to not abuse discretion in so finding that stillwater was not a victim of with respect to those any losses suffered from that for the reasons that i just articulated which is that the criminal conduct outlined in the indictment did not in compass  fraudulent transfer of the assets to that it was not that the mechanism through which the defendants in this case profited and three the third problem i talked about was the temporal problem and that is that there was a there was a period of time yes judge cristol incorrectly found that it was two years but in fact it was four months but nonetheless doesn't change the conclusion which is that there was no evidence at the time that the transfer occurred that the store assets were transferred no evidence that the later scheme the shaheen e share issuance scheme had been formulated or put into place i see that my time is expired thank you don we'll hear from a coll we pointed noted the government noted the transfer losses allegation raised by stillwater was not the basis of what was charged in the indictment it certainly was not anything that my client pled to it was not a basis of anything in the p s r the findings in the sentencing stillwater tries to rely extensively on the hearst trial and as the court below found and we agree with this the he trial also does not support still waters findings but we would argue that even if it did it would be inappropriate to rely on any of this testimony in the first trial in which my client had no opportunity no fuller fair opportunity to participate in it would be essentially equivalent to an offensive use of mutual collateral stoppel in in this situation i think my client is able should be required to be able to depend on the government's own statement the court's own statement of what the charges against him are and that an unrelated third party cannot come in after the fact and essentially usurp the government's prosecutorial role to expand three in either of a couple of scenarios one of which being when there are complex issues of fact that would prolong the sentencing process here not only did the district court not abuse its discretion in finding that for reasons that it addresses at length that page twelve in particular of its memo but in trying to show otherwise stillwater is relying on about three hundred pages of material that were not even presented to the district court these are noted in a in a footnote in my response footnote four identifies those three hundred or so pages of materials an audit we have no idea where the audit came from but it was never part of the district court record in the first place so it's difficult to see how the district court could have abused its discretion in not considering these these materials  and secondly i know i'm just about out of time but when the court itself believes that it needs an expert witness for example to determine these complex issues of fact it seems difficult to see how that that the court's own determination that it wants expert assistance is something that stillwater can come along and say well you don't need any expert assistance you can just trust what we have to say about that so unless the court has any specific questions