represent teenagers and their parents who used a form of bitcoin essential to virtual item to illegally gamble online both the teenagers and their parents had in the pen that claims against an american company valve that created this virtual item hosted the accounts of the illegal online gambling websites and as the arbitrators in this case found knew about and turned a blind eye to illegal gambling going on on their servers using their accounts we asked the district court originally to decline to send this case to arbitration based on a clear exception in the delegation issue that was not really presented until this process here the district court decided that the unauthorized use was required to be by the plaintiffs only which we think was incorrect and then found that that it was their own authorize use that triggered the exception we think that was factually incorrect and we cited in our brief numerous times the arguments we made showing that it was that the plaintiffs use was an author as when i say point of the teenage  us the moms of these two boys filed claims on their son's behalf as well as individually because it was their money that was used and lost that's the nd error that we think the district court made was and those claims by the parents to arbitration we think that's incorrect because they did not benefit at all from the contract and they did not use the services themselves they were not in any way shape or form beneficiaries of or some people who would be a stop from claiming that the contract didn't apply to them but big could have benefited from it right if it was their money that was being used i guess this could have turned into a profit generating thing by the teenagers have done it  know i don't know why i think that's one of the issues in this case john is that there's that teenagers gambling illegally with rd party sites from across the world were ripe for fraud and abuse and that's what happened this wasn't a case where this made would have benefited from it right i don't think that you nobody benefit every this was a everybody who gambled lost here the two points of sue we represent lost if i understand that i'm just saying if i'm wondering if the equitable stoppel argument can be supported because even though these two plaintiffs lost you know others could have benefited and if if there's others who benefited you know the parents in effect would have benefited and so does that then mean that they are beneficiaries  potential beneficiaries that could have supported the equitable stoppable i can speak for my clients and i speak for myself as a parent and i don't think i would ever benefit from my children illegally game with online even if they won i think the point of this is that illegal online gambling hurts teenagers hurts families and our clients specifically our parents both of them lost so at that washington supreme court case i think it was talents and which was very  the that the a stop will argument would apply if the parents or if the non signatory actually benefited and i don't think that's what we have here i think both in fact our plaintiffs did not benefit and in general the idea that think that while that's unfortunate i do think unfortunate that is the law that the thirteen and seventeen year old children who signed a contract would bound by it even if it was really go activity but i do think that the exception applies and i think that's where the claims for the  award and so we reviewed the ad under a very deferential standard the section ten standard so so wouldn't why is that totally erat we'd have to say it was totally irrational or an a festus regard of law or something along those lines sure and have two responses that st i think the original april twenty seven thousand order finding that the unauthorized use exception didn't apply should be reviewed to novo and i don't think that that that was correct and once the court makes this formation that was and correct we can look at both the citizens independently and i think you can review them independently under their under the separate standards i don't think that the original district court's order gets cloaked in a section ten standard because an arbitrator later decided on different grounds that that was the case but i do think even under the section ten standard i understand it's very narrow but the cases that we cited in the late night circuit all have something in common which is that cases where an arbitrator award sanctions illegal conduct or conduct that violates a statute those stopped other rd parties from engaging in illegal conduct with its virtual items the claim was that valve knew about which are better greed and did not stop and continues to this day if you go out today if there's a internet available to you you can skins gamble online today teenagers can do that illegally today valve knows that that's going on and the arbitrators found that they turned a blind eye to it they had unclean hands that they didn't stop it for a long time even though they knew it was going on it's illegal only as to the teenagers not generally or it's illegal for anyone even adults to do it under it's illegal for any for adults to do it it's illegal to host gambling activities under washington law it's the bar with the you know the gambling is going on by rd party and i guess getting back to the original section ten point that the reason that arbitrator's are afforded that differential standard is because the we want to officially we adjudicate these disputes but the standard  the way i view it is with a judge ever do this with a judge ever say i know this this bar has been proven to know that there is illegal activity has been proven to allow teenagers to enter into a back room to gamble on  and i'm going to let it keep going because the teenager should've known better i think that's the section ten standard a judge would never do that and i think the arbitrators ignoring the law and ignoring that both washington law from a public policy standpoint and from an illegal gaming standpoint  and from a protection of teenagers standpoint do should not allow this activity and i think that that's where the arbitrator going the law so i think originally the district court erred on the an authoress use exception and the arbitrator even if you look at the  standard i think there disregard of the law in disregard of once we prove that it was illegal gambling that valve knew about it and al didn't stop it and to this day hasn't stopped it i think that that was sufficient to say that we didn't prove our case i don't know what else we need to prove when teenagers are illegal gambling online the last of the rest of your time unless there's any more questions it please the court gavin scope gun behalf of defendant appellee valve corporation we spent roughly two years litigating these cases on the merits in front of two different arbitrators and in that time the plaintiffs twice asked each arbitrary they also submitted all of their claims on the merits after a full evidentiary hearing the arbitrators ruled on arbiter ability twice the arbitrators ruled on the merits and then the opinion was earlier or wards were both confirmed by the district court our position on this appeal is simple when an arbitrator has authority to decide an issue and does decide that issue that decision is subject to review under the very deferential standard of so that gets us to the front end question which is should this have been sent to arbitration st plays are based on what you're saying are you are you suggesting the plaintiffs waived that argument because they once they got sent to arbitration they just followed through on the process or what i'm suggesting is that this court should do here the same thing it did in the power agent versus electronic data systems case at three hundred and fifty eight fed rd one thousand one hundred and eighty seven that was a situation almost identical to this procedurally where the issue of arbitron was presented to the district court a case was filed in district court defendants moved to compel arbitration district court made findings of the claims were arbitron sent the case to arbitration plaintiffs didn't like that in the st thing they did an arbitration in power agent was they challenged arbitron realty arbitrator ruled against him arbitrator then ruled against the plaintiffs on the merits district court confirmed the award and came up to the th circuit on peel the court said in that situation the conduct of the plaintiff submitting the arbiter ability issue to the arbitrators taking that nd bite at the apple means that when we're on appeal you are you to use the f a a section ten standard you don't go back to the original decision and look at that de novo and that makes sense because you don't want to have a situation where you essentially throw away two years worth of work with multiple arbitrators and power agent was in some aberration it actually built on an earlier case out of could have done what judge kozinski in that tries pictures case a party could do which is simply object to the arbitrators jurisdiction throughout and in tri star pictures you had a party tristar that instead chose to argue arbit the arbitrator and present the merits of their defense to the arbitrator and this court said when you do that instead of just objecting to the arbitrator jurisdiction you essentially consent they called it tacit consent and when you say object i want to make sure i understand you say object to the arbitrators jurisdiction you're just saying look you don't have jurisdiction we're not going to come in a defend ourselves so that gives you an award and then they have to take the risk without trying  outlined is very similar to what the supreme court thought of in the st options the kaplan case where in that situation you had a party that felt it wasn't subject to the arbitrators drug addiction they simply refused they essentially refuse still in force i do think st options is good on the facts but the way to look at it is there are really two routes here that we have to a delegation of arbitron military to the arbitrator there are two independent ones one is the conduct and that's what we see from power agent that's what we see tristar that is still good law that says that conduct in affirmatively telling the arbitrators they have authority to resolve the issue and asking them to that conduct by itself is an agreement and that makes sense the other route though that's independent is the one that the courts spend a lot of time talking about in the last case which is the delegation through incorporation of the aaa really here's the aaa rules were incorporated by reference but there is an argument of whether they're absent all the unsophisticated parties edges the teens you want to address that sure i'd start with saying though the court doesn't need to reach that issue because it can get to the delegation through the conduct but  with respect to whether it's applicable to the teens or not what we have from this circuit is the oracle america case and the brennan v opus bank case both of those held the delegation was there i'm sorry that incorporation into tripoli rules should not be interpreted to require that the contracting parties be sophisticated and there is a weight of case law within this circuit with and others that apply the same rule to consumer contracts as well as to business to business contracts i don't think the court townsend case and let's put aside the issues a waiver for a moment the judge in this case held that the parents who are suing were actually all stopped you can read the case is saying that the majority of the court on the issue of equable stoppel said that the children in that case who were not signatories to the contract were not not not bound by the arbitration agreement discuss that a little bit taken in two parts in the st part though is to go back to f a a section ten i think of the standard of review is f a a section ten then we don't need to unpack whether the arbitrators got it right on the non signatory parents keep in mind the plaintiffs submitted claims to the arbitrator on behalf of both parents and children they presented testimony about the parents had a parent testify on the merits they a signatories were bound the st one was they looked at the complaint they said all of the allegations here phrased in the plural plaintiffs and the group the parents and the children and there we have the same thing here the complaint has just group allegations for  and kids same factor nd thing the court and townsend look that was the claim that can i ask on that though i mean i guess i have to go back i didn't catch that when i reviewed the complaint and i think because i viewed distinct actions by the two separate parties two separate groups me seems to be breach of contract effectively by the by the children but the parents i mean i know equitable stop trying to bring them into that townsend court approached it was to look at simply the text do they separate out allegations between the plant and the plaintiff's parents and the plaintiff's children in that case and i think the key here is to go back to a finding judge who now were made when he originally compelled arbitration fine in it's not being challenged which is that there is no duty separately pled to the parents in the complaint what there is is there's played a harm the allegations in the complaint the only thing that it says it's paragraphs eighty nine dollars through ninety one dollars in the complaint are the only references we have talking about anything to do with the parents and it simply says the parents gave their children some money and the kids lost that money that's a harm but there's no duty played and so judge who now or when he compelled arbitration doesn't that put  in the that puts him in a different bucket i mean that they've they just provided money i mean it does seem to clarify that the claims are based on different rationales between the parents and the children they may be but they're not played that way and in towns and that was significant the other the other two factors in towns in that mattered a lot were the clue that claims that were pled all eight of the claims in townsend were played on behalf of both parents and kids that same here all six were pled and the key factor one of the one of the key factors a rd one in townsend was that a couple of those claims directly related to the contract and we have that same factor here counts in the complaint asks the court to make a series of judge declaratory judgments on the contract that it's contract if they trying to enforce the contract because that is the situation in towns and say and it's in trying to get benefits from enforcement and this case i thought that the plaintiffs were saying the contract isn't binding and their claims were based on edge it orient or it claims well they're saying two things they're trying to avoid the arbitration provision in the contract right to that extent they're saying it's not binding but the other thing that's throughout the briefing is the idea that valve has a duty to enforce its contract against some rd parties on the internet to protect the plaintiffs that's really inherent to all of their claims and keep in mind this contract we're talking about is a license it's a license it's a permission to use valve software and so it's at the core of all of these allegations that valve is somehow allowing people to use its software wrong and in a harmful way so you certainly have the contract that the heart of all of these claims and i go back to how did the plaintiffs actually try to prove their claims when we look at their post here in brief in both arbitrations after full hearings on the merits and look at the evidence they presented what we see is not them separating out claims of parents and children we see them trying these claims all together now this is exactly why we have section ten deferential review though because we don't need we don't want or need a district court to go back and try to unpack all that evidence and essentially act as a court of appeal for an arbitration instead we reserve section ten only for those very extraordinary cases where there is actual manifest disregard law and that manifest disregard is clear from the record we don't have either we don't have a situation where there is evidence that these arbitrators  applicable law and disregarded it nor do we have any place where that's clear from the record that's a situation where deferential review is appropriate and i submit that that's the proper result here thank you may it please the court i think that the parents issue is not as simple as my colleague suggested i don't think that the parents are trying to enforce the contract such is like the parents and like the children in towns and excuse me  think that the claims of the parents were pled factually in those paragraphs but throughout the counts plaintiffs were referred to generally and so plaintiffs did allege independent duties they did alleged violations of duties beyond just those in the contract and so i think that the underlying parents claims are distinct and or do not arise from the contract and i think that that's an important point in the townsend case and the other cases such as montoya that that look at rd party claims or non claims and how important they are as it relates to the delegation issue i think that the original briefing valve did not ask the district court to delegate the decision on our debility to the arbitrator and i think that's significant to the point of whether we would have waived the argument by not making it in their trace and i think that that's sort of where our we agree with that concept and i think that by not asking the are the district court to delegate authority no i don't think so i think that once they were they are one of them was on behalf of a minor child so she sort of had to be there on behalf of her child and i think that was sort of where she was there the other point if it turned eighteen by the time devastation so his mother did actually not actually did not give any testimony or anything else i think once were sent to arbitration i think they were required to participate as part of the rules but i don't think they waive their argument that they should not have been sent arbitration in the st place  then we say they say that we have agreed to the arbitration so i think the parents the j p s mother was testifying in the hearing on behalf of her son is more of a function of her having to be there because he's a minor more than her participate in the process in a green that her claims are subject arbitration i do want to i'm just going back through the complaint is this is the there was one there's not an amended complaint right there's just the st complaint that hadn't read it is carefully is as in light of the defendant's arguments here but it you don't distinguish as much as i had initially thought between the claims i made for example all of the claims  brought by all of the plaintiffs so there's not separate tort claims vs separate contract claims right there no contract claims from our perspective there's no breach of contract claim i think it's the client's and i'm sorry breach of li or what would you call it well i mean i think that the individual plaintiffs the teenagers have their own claims for negligence for violating its own protection the parents the the mothers who filed this plate complaint also have the same firies right that they would each be covered by or not because i looked at the class definition in you have you have both you asked for one class that covers both the children and the parents together it strikes me that if you were trying to bring separate theories you would split those up and ask for two different classes well i think that as i stand here today of course i wish i would have done that based on those questions but i do think that at the time that the way that it was written they were brought individually and on behalf of the minor children and so i think that the class definition is always subject to change always subject to review as the case proceeds and i think that the language in the counts is broad enough to cover the theories for both the individual plaintiffs and for the individual breach of contract are they and the fitting from enforcement of the contract i don't think that the parents require are required to prove that the valve should have been forced the contract against rd parties i think that  was broader than that and i think the allegations of val's conduct we're much more broad than just unfortunate the contract so the consumer protection claims sure some of the conduct we may have talked about would have been something we could have said was a contractual obligation beside i contract that underlies or is required for those going well i read the contract now it almost seems as if you included the parents to sue on behalf of their children and i had to be if i'd come in thinking the parents had separate claims it's both i'm sorry no i don't know that it's both i mean the complaint doesn't seem to be clear on that if you look at the caption if you look at the introduction of the individual plaintiffs and we tried to be clear that it was both individually and on behalf of their minor children and i think that that's to the extent that that's something that can be cleared up with an amended contract or minute complaint more than happy to do so but i think that sort of substantively we put that in the complaint and i think that that was