dismiss and a rule twelve b this was a lawsuit that we filed to upset a multibillion dollar settlement obtained by fraud by the plaintiff andrew schmidt mr schmidt contended that he was totally and completely disabled in his words he was an invalid he was a shoddy when his best days he could stand upright for maybe two or three minutes he had to be transported in a van that required reclining wheelchair ok now let me tell you what i want you to tell me all right just as i assume that there were good lawyers here before this settlement the term was confect man so tell me exactly what kind of expert opinion was put into this what was obtained by cal  maybe by the other side too before the saddle matt was confected i mean what kinds of experts did you have testified as to his disability they had an expert in diving accidents and he opined that he had what's called potts which is this post here ial essentially where he has difficulty when he stands up but then i ask her what the doctor it sure isn't one in this context well that you know the fraud was judge when this gentleman says that i can't do any of these things and he signs a release on december twelfth and he says in the release and he swears to it under oath injury to the odd atomic nervous system postural or static tech tauriel syndrome and other injuries which have left him totally disabled and the day before he signs that release he goes to the texas motor vehicle commission he gets a driver's license and the driver's license is unencumbered he can drive and do anything when i want to know is that how much effort went into the confection of this saddle meant and how much expertise was brought to bear on it because what's at stake here is a head injury and a head injuries are notoriously difficult to evaluate by the most accomplished actors that you can get very difficult to evaluate now you had two guy actors here who put an avid and so on his the degree of his disability in the district court before this settlement was confected right it was not tried that was not put in there that i know of but i mean state for depositions were taken yes ma'am and so this was not amateur week no it was not in which you only get in fact relative to that they spent a considerable amount of well as there was video of the depositions in which he would only get out of the vehicle to get in and out and there would be loaded in the back and would lay down the entirety of the time and and he appeared for the settlement conference wheeled in proof of he goes to taxes and tours a house a luxury a four bedroom house to rent we interview the landlord the landlord says i've met with this gentleman several times both before that lease as well as after the years two and a half years yes or how many doctors examined do yours and there's i'd my my recollection is that it was about three doctors examined oak and and dies doctors couldn't find any objective indication of brain injury is there anything in the record to say that those doctors relied on the statements or the physical verbal acts of the person that cal dive thought was really angry absolutely there were statements that were made to d who confirmed the diagnosis that he had the brain injury on the basis that he was incapable of remaining in an upright position and the fact that he wouldn't respond or didn't respond to the single treatment he said was further evidence in fact it was done to immediately prior to the summit conference they did it at the side of a pool and they measured is heart rate and said yeah this just confirms that this guy is incurable and he is permanently  say cal die before the saddle man said that they didn't have any objective evidence of a brain injury correct or the settlement yes ma'am you settled a lawsuit yes ma'am r i p no because judge a material misrepresentations were made if this guy is permanently disabled like he says that he is and he affirms that on december twelfth how does he go to the texas motor vehicle and get a driver's license but your authority for invalidating for or are five or six right in your pleading you don't go through element by element we don't don't we don't go element by element and so when you say well look how egregious the misrepresentation was that doesn't respond to the requirement that you have to make a showing with particularity about reliance how could your company your client have relied on the very person that they say it did they disbelieve and rely at the eve of trial from this wheelchair appearance it just strange one you didn't plead it and number two it's strange could credulity it doesn't fit with russell even because in russell what they did which would seem to me a prerequisite would be you would take this video that so damning you'd go back to your doctor and say having seen this doesn't change your opinion they did that in russell you don't have a single doctor that concluded he had a brain injury saying what we've seen now means we relied on him to conclude he had won his wheelchair position if if we had been permitted to do discovery we could have done that in terms of presenting the diligence in terms of the extent of what this guy claimed and then what he was actually doing i mean everything he said couldn't do he in fact was doing and did before the  grave reservations all the while from the day that guy got injured till the day you signed that settlement agreement that he was what he said he was which is tabula rasa or however you describe it you had great reservations about that and you thought you had reasons for those reservations you and i had and you had gawkers and you had experts and you went ahead and signed the salomon agreement no problem because we'll just revise it when we get through you no no that's not the case judge that was all that's right it sounds like what they're what they're confronted with this is that this gentleman a doctor who says that he is in fact purposely disabled it has this brain injury they have some day old him on and off for over two years and they can they did it or how many times i've grown more than once yes or in fact the most part in one was we got they went and got a court order requiring him to submit to fears to this therapist to undergo this therapy in order to attempt to cure there's postural problem he went one time he came in he claimed through his lawyers that he was not going to endure that again he would kill himself before he did that again because it was so painful you not you personally correct not to me personally i mean and your client signed the settlement agreement there you go correct judge but but they did so because they're  confronted with an expert who's offered an opinion based upon the representations made by schmidt about his disability that he can't do any number of things and he does these things a fact of the matter as the name of what he had supposedly was a brain injury and the nature of that but they're not brain injuries are not like when you have a broken arm or spinal injuries or your hip has been shattered or whatever they're very very difficult to predict the long some vegetable for the rest of his life but brain injuries are not like foam and they can vary widely differing long term outcomes very different and the and so your guys you had experts and they look at this guy and they said well we don't think he has a brain injury we don't think all these things and you want to have unsaddled i mean you this was not amateur or weak your client was well represented and there were competent people on your side so what you're saying essentially then judge if the plaintiff in this case schmidt is successful in hiding and if i school and rick and recovers praise god he recovers from whatever he had and he recovers then you're going to say king's x we get the money back yeah you're saying what no what i'm saying is that if he represents to us that i can drive a car i can't sit up i can't do any of these things and you know what happens before he signs it he does the very thing he says he can do we get there i mean we're not this thing zeal or the you were on the in the in the case it's only to deep water horizon getting out of the deal you know like wait a minute you know we are world class lawyers on both sides this stuff is you know traded back and forth and on and on and on and so we're off into the is your client has doctors and i'm trying to understand you told me they didn't rely on what the guy said they gave him diagnostic tests etc etc etc and what i thought you were going to say was that based on representations that he made your doctor said well you know there's nothing shown to come through but what you're saying is your doctor is in fact down to believe the status that he was saying and i'm trying to understand when they put it up that way what action if he was taken by your client either one further testing whatever whatever they just blew past the windows or that's what i mentioned when they sent him to the therapist and and did a session of therapy which he refused to return to which involve laying down except for a but the point is judge in terms of making a settlement you keep saying well they had suspicion that perhaps he wasn't actions they didn't have any evidence of a brain injury in their view they don't have suspicions they had no it might you said yourself good to a minute ago that these things are very elusive yeah it's very hard to calibrate and say this specifically that's right and that undoubtedly factored into the decision to settle that and the fact that for two and a half years this guy's laid down did nothing and refused to do anything because he could never stand up because he was a shine in an invalid that's why they did it because they're confronted with an expert who says let me ask you something best evidence you have that that was all baloney that he could've gone to the movies when was the first time that there was some evidence that he could do something besides the driver's license episode that we've been able to uncover a judge that's for the driver's license episode is very significant in the day after the settlement he goes to taxes he tours around eight am and i'm talking about in the two and a half years that elapsed between when he got hurt and when the settlement was signed up ok how far back in that two and a half year period do you have evidence that he was out caton around given the fact that i'm one of twelve these six motion just missing got they shut down discovery what i got was the driver's license information and i found out that he bought a korean into the parking lot the very next day before the release was executed he toward a luxury home in texas standing upright and needing of habitants that this was all baloney and that he was perfectly able to carry on dates from about the time of the settlement no ma'am we only came by this in july as to the so what happened was there was a private morning your honour's rick stanley i'm going to be taking about fifteen minutes to address the issues relating to mr schmidt mr ebbers and mr walker i'd like to begin by addressing a few of the questions the court asked represent which corey i represent mr edwards but i'm speaking on behalf of everyone but be h g who will take the last few minutes about that particular issue you should issue the the it the issue of whether restitution i'm going to discuss that are you that's your cover was wrong issue that's being the age g s issue is and which i can address now here is if there was a reversal with their interplay be reinstated and our position accident in this case took place in april two thousand and ten which is three years and six months before the settlement was reached and to answer your question judge king there is absolutely no evidence that mr schmidt was doing anything during that three years and six months inconsistent with any of the claims or allegations in this case so that that's a point that's very important the second point date wise is the settlement was reached before the magistrate judge this was a settlement supervised by the court on october fifteenth two thousand and thirteen that was one week before the trial and mr shonagh is referring to a december date the december dat when the release was signed but the settlement was reached october fifteenth two thousand and thirteen was put on the record and that's when the trial was continued pending the execution of the release which followed some seven weeks after the case was in fact settled the release is important because your honour's asked will was examined by doctors on page two of the release it lists every medical provider that he saw and there actually by my count twenty eight physicians who saw him throughout this case he has been diagnosed by the physicians with decompression sickness and the pot's syndrome i can't really pronounce what it was but which is medically observable by a tilt test they put you on a table they tilt you your heart rate changes and the doctors said well you can't fake that now one of their doctors actually said they didn't think you could fake it and in fact that was testimony in the record in the underlying case that they never didn't believe mr schmidt in fact their doctor their guys never did not really never believed him and in fact they filed a counterclaim in the underlyin case to recover back their maintenance and cure for mr schmidt so this is not we believed him we thought he was telling us the truth from day one they absolutely this was full on discovery twenty eight physicians and here's a guy concerned me just because your time's ticking away you know my background you've got it you've got it in the criminal area you've got a contract you're going to sign and things get really pressured before the drop dead date and it it's inconceivable to me that the prosecutor could have what's known as brady exculpatory evidence guy didn't really do it but we're not going to give that to them until we get this guy pled guilty so why is that not a fair analogy the district court relied on the strange decision but that's a mistake of fact and that will get you rescission if both parties that the doctors were just on the x ray show something else but this is their claim here is intentional fraud well they're more analogous to you've got brady exculpatory evidence and you're just not going to tell them until you can flaunt it and so the day after the settlement signed or two months later in december of two thousand and thirteen he's jogging two miles he's got the personal trainer he signs for a license with no physical restriction all the parade of horribles you heard him say there's something deeply offensive  in fact so so then i get to deep water horizon and it's mandatory you get an evidentiary hearing well and but and then they cite without a doubt approvingly the ninth circuit russell decision that had post settlement video evidence so why aren't we exactly in the mandatory they get in evidence you hearing we can all be reassured i'm sure your view is our client isn't this wasn't a massive fraud we need to vindicate him we could we could survive that hearing start there procedurally is in deepwater horizon you are dealing with motions and so you same with russell you're dealing with a motion to either not to set aside the settlement agreement or under sixty b this is not a motion this is a complaint cases the very diagnosis of an injury was called into question by facts that were pre settlement facts pre settlement facts that team into being in least in deepwater horizon the is that this guy had a very bad prognosis we thought as we foreshadowed what was going to happen in the future we thought he would never drive he would never run he would never recover as it turns out he did and by the way that jogging and all that i think that that all occurred seven months after the settlement the only thing prior to the execution of this release document was getting the driver's license he did say on restricted it's in restricted that's hard to lease says the allegation okayed not under any related to that that that that what really drove this settlement is as as the life care plan where it says he needs twenty four hours a day he'll need a new wheelchair every five years my question factually is in the record is there any evidence that his own statement and description of condition went into that the formation of that life care plan representations that he made that he was an invalid the answer to that is i don't know that to be in the record i know that i s an allegation ok so in this context we have to accept it but if you read the release document that cal dive prepared never do they say you're representing to us in this release document that these representations are true and without these representations one wouldn't say i was asking you and maybe i give my own question which i do but if which for you to win do we have do we distinguish or do we disagree with russell which had post settlement video observations of a seaman doing things that he couldn't do i think it first of all i don't think it's the law of the circuit i think deepwater horizon cracked the door but i don't think they wanted spars russell i think in under deep water horizon you've got to basically allege no injury or de minimus injury before you get the evidentiary hearing but and russell didn't seem to go quite as far but i think you can distinguish russell well i don't think you have to say well that's not the law of our circuit because of the diagnosis versus prognosis the evidence it came forward and russell was that the man was not injured at all that he had no injury and when it was presented to the experts they looked at it and said exactly as you said we would not our opinions are no good based on what we're seeing in this motion picture feel so that is a completely different set of circumstances than you have here where you have a better than expected recovery or prognosis so most intentional fraud cases even like russell you're suggesting correct me if i'm wrong that they've got some non disclosed facts of the doctors never got or you have a witnesses recanted you never you don't tell them about that it ties back historically to a pre settlement agreement yes and that calls into question whether there was any injury at all am i right that in russell the evidence submitted to get the fraud an inducement included a doctor saying if i'd seen this i wouldn't have made that didn't the diagnostic there's more than one doctor and that doesn't exist here does not exist in this at least there's no allegation in the complaint to that effect so is this a is this a failure to the district or below defined lack of particularity as to the elements of yes it did that was one of its findings that if the allegations did not satisfy the test under ninety and the district court relied on judge bar vs district court opinion which was prior to judge king's appellate court opinion so he was looking at saying i don't i don't even have to have a hearing on this this is this is obvious that there's a settlement agreement everyone's bound by it but i think the fifth circuit's opinion still doesn't get them there that in order to come within this narrow exception and this settlement says it's full final and complete it's a fifteen page hold me one more question what's the limiting principle that so that where there is got time limitation the substantive limitation is deepwater horizon and frankly i think russell that if you're going to have evidence for a man make the other side case arlo sure it's a vote you may win here but it doesn't mean people can walk to the bank with their twelve million dollars and think quiet pull that when the allegation is even with substance subsequently discovered evidence when the allegation is that the injury did not occur or was then i think you've got a basis to go back to court under sixty three when the allegation is that you thought you were going to do worse than you seem to be doing whether it's by the grace of god or whether because you're managing your symptoms better or whether you just got lucky and you're not as bad off as everybody else with pots whatever the reason that's not a basis to go back and retrace the settlement that's my position  have i can talk a little bit about the the lawyer issue whether if we obviously and if it's a firm for mr schmidt the lawyer issue goes away if you reverses to mr s we still have the lawyer issue as to whether the lawyers should have been brought back into this case lawyers in the world might have preferred to do it then a lot more time on that yeah well i think is it a simplistic way for me to think that just to court relied on lou rely if federal law is in conflict is that a fair statement that is a fair statement i think it was fair to rely on louisiana law for a couple reasons one remember this is an independent action the lawyers were not parties until they were sued in this complaint so you have to sue them under some theory and they were sued under restitution unjust enrichment and i think louisiana law fairly applies but even easier than that the restatement which they rely on so heavily when you dig into the cases in the restatement where the lawyers are called to give back the money they got in their feet all of those are direct appeal cases not a single one is an independent subsequent action these lawyers were in good faith that's alleged this is a contingency you may know these cases off the top your head i wouldn't muhammad versus care at circuit that i don't know most of the time ahead but i will say i think the answer is yeah they were contingency fees but what happened is the case went up on appeal and got reversed so you're still in the same linear appeal not a single one of those cases involve a final judgment and a settlement and then a subsequent independent action to take back the fee so i don't think the restatement addresses this issue you know a case that described what you just said as an exception to the larger world now that you know that every case we look at under the restatement isn't direct appeal with the exception of one which is a worker's comp case where the award got adjusted on review but we saw none that were independent separate actions and finally with respect to the amendment the failure to district court made a manifest error factor law well that's simply a motion for reconsideration if you accept their word that there were no new facts needed to complain then all we have to focus on is what the district court did in the beginning which i've already addressed so i don't think there's anything in the amended complaint that changes the complection case i will turn the podium over to would like this court to keep in mind through the decision process is if for some reason you do decide to grant to reinstate the plaintiff's complaint in this case that you also reinstate the interplay  that was filed as well whenever the district court dismissed the cross claim and counterclaim with the inner pleader where we requested that the funds being paid be put into the court registry given the disputed claims when that was dismissed it was on the merits there were no merits heard it was only dismissed because it became a moot issue once the complaint was dismissed so the only thing that we're asking of this court today is that should you reinstate the plaintiff's complaint that you also at the same time deepwater horizon case on two occasions both times he applied the restatement and said what the restatement says which is a lawyer is a real party in interest on a continued c p case he's not an need and for that reason in thong which was one of the deepwater horizon cases and in birth which was another one that occurred after that in both instances the lawyers were not involved in the fraud nonetheless the court ordered restitution because there are real parties in interest and again the restatement states a bona fide pay from a judgment call it a might of course be a lawyer as well as a bank however a lawyer who receives a share of the judgment pursuant to a contingency a what it returns and is being done on a regular basis in deepwater horizon in connection with those fraud he drew attention to the fact that you're probably complaint wasn't sixty motion it was a motion that was done in the in connection with that case judge but under sixty b you can do it both by motion and independent action is what the role did and which is why we file which did you do independent action with all the new pit action and then it was transferred his deposition russell stated he could not straighten his left arm and had difficulty lifting objects so we're talking here about the sabera of the injury whether he could actually do these things and what happened was after the fact the person the private investigators who were filming this gentleman didn't get word of a settlement and they filmed him and got him after the settlement within the following week private investigators have been hired by defense to observe russell and who were notified of the settlement notice substantial increase in the use of russell's left on motion pictures were taken lifting various sorts of building materials the district court without holding a hearing deny the motion in any judgment for the players i may not be how it was suggested to me distinguish which i haven't processed fully but that to me that was an important point of distinction they what they said was a defense medical experts are vocational so they would revise their opinions that sounds like some allegation of reliance right and what we allege in the complaint in the original complaint was a plaintiff entered into in funded the settlement agreement with schmidt as a result of his material fraudulent representations regarding his injury condition and alleged disability in other words we can't in a vacuum just accept the opinions of our own expert but we've got to like examine the realities what are the chances that we're going to get hit because this guy has not gotten up for two and a half now you could ask the question is will judge in terms of temporally what are the prove did we have that showed pride to the execution of the release and neglected to mention the note he appeared before a notary in texas on december twelfth two thousand and thirteen and the testimony from the notary will be he presented himself normally there was no wheelchair no one helped him in december twelfth was the date that the settlement was executed before notably by schmidt the summit conference was october fifteenth about medical care done a silly doctors that examined him so that's it but there were a lot of doctors in this field yes ma'am there were a lot of doctors and a lot of doctors were told i can't get up it kills me to set up my kid do this actors they're not amateurs you said brain injuries are very hard to detect right it's not that they're hard to pack the nature of brain injuries is that the prognosis is more different it's more uncertain but just like in russell judge to a large extent both the doctors and opposing experts have to accept or rely upon the history given to them by the patient and this gentleman represented that he couldn't do anything and we allege that in fact in connection with that settlement we relied upon those representations and this is a motion to dismiss and it's well big i think we should have gotten that opportunity to him and in fact he was supposed to have a hearing in the week before the hearing judge hike issued the dismissal with prejudice without an opportunity to admit thank you very much