a man and the testimony on the rise on a motion for summary judgment from down below in the bankruptcy court went through the district court we did not have oral argument there and the district court gave a kind of summary approval for the bankruptcy court action and set up a company called john gunn inc services as we call it v g i asked for simplicity services has always been separate from john a completely separate company the testimony below one contradicted is that it was his company slacken becomes if you will wish stockbroker for him now not a stock broker because he's taken a series seven and whatever what happens is he promises to buy securities on account of mr  in the record and john the man starts to give money ultimately gives two hundred forty eight thousand six hundred ninety three dollars almost two hundred forty nine thousand dollars mr slack and now we never go to trial thousand dollars approximately fifty one thousand three hundred eighteen dollars and then now go back to my statements or do you want me to break the bank ok you know what i what i don't understand about the case is even if they are two entities why couldn't the bankruptcy judge issued judgments against both the individual in the corporation the bankruptcy court could if there was a ground certainly the bankruptcy court could have issued a judgment against b g i asked for one hundred seventy nine thousand or if we would say hundred seventy nine thousand unless the restitution rescission client and a separate judgment against john based on the timing looking at the statue imitations and deciding where to draw the line and could have issued separate judgments and should have rather than issuing one years of following corporate from alleys and so the question was why should it be responsible well under five fifty this odd section we have in vegas a code of void ability and then recovering there separated under section five fifty five fifty if there was a transfer to the g i s and then a transfer to john from the g i s a direct transfer sort of passing through the bank accounts there's an argument that mr von brunn would be responsible no proof with respect to a transfer from b asked with respect to these various monies so they have to show that john is responsible because he was quote an entity for whose benefit the transfer was made closed of an entity for his transfer the benefit ma mean if united airlines was the recipient of a preference in a case in tennessee and united airlines received one hundred thousand dollars all of the shareholders of united airlines would suddenly be responsible would be entities for whose and the reason as i put that little hypothetical in my in my brief if you have an asset if you have a balance sheet for the g i s it has one asset which is a receivable from mr slack whether to claim the securities or claim the money it has a claim for one hundred thousand shares john in the company is exactly the same assets that are collected versus accounts receivable all go in the balance sheet as positive assets now if it ultimately is uncollectable that's a different thing but here we're talking about there is no there is no advantage from an accounting standpoint i'm glad i took that accounting class in law school to look at that now as a practical matter it's good that money is flowing into john and this is evidence of his good faith many years there are there are payments going back if i may argue about the statue of limitations for just a moment i'm going to waive my right to take that last minute or two as other counsel don't watch the court suggest that i do that there's approximately fifty six thousand five hundred dollars that's beyond the seven year period  trustee in bankruptcy is for the first three claims for relief is right now on the uniform transfer act and there's an absolute bar under thirty four thirty nine doubt away an absolute part of transfers beyond seven years if you get three hundred seventy eight thousand eight hundred which is what counsel suggests the money judgment was i can't tell from looking at this judgment i've got five different pieces it looks to me like it could be cumulative or something else the court has to have counted fifty six thousand five hundred dollars that's just outside of the seven years the four year to seven year reach back doesn't work because the trustee can't just pick up the uniform project transfer the trustee has to have a creditor to ride on the back of and there the question was will who would much they don't have hearsay it's they don't have personal knowledge but there were two declarations that are literally dusted off from the chapter eleven part of the case photocopied and put into the record and they would be a declaration as to poitiers mr h beyond a four year period so we can definitely trust we can go back four years and have someone if you don't strike the declarations completely and my final minute let me say this this is a difficult case because it's bankruptcy and it's something that is convoluted and i apologize for violating the ultimate rule of they call the shotgun appeal because you have i have many issues i think the judge rebut below respectfully missed the boat on about a dozen different issues any one of which could result in this court saying and what i would like this court to say is send it back to the bankruptcy court try the case have a court resolve these open issues and set the proper amount of the judgment so i know when we have properly paid it that we're done i think that's my time thank you thank you very much  let me first take issue and let me give the court just one minute that mr slack and operated the longest standing and probably the largest ponzi scheme in u s history it went on for more than fourteen years and he took in more than a half billion dollars in connection with asking the scheme finally failed when the argument was this like an operated a ponzi scheme and ultimately slacken pled guilty to that in a ponzi scheme trustee in bankruptcy can recover the bogus profits that are paid by the ponzi scheme operator to investors and he's able to do that under either state law or federal law in this case california law and federal law apply the federal case claims are really subsumed within from accounts and purposes the federal claims and mr neilson suits more than two hundred investors who were beneficiaries of slackens ponzi scheme including the balance here he sued them under california law and federal law under california law to set aside and recover actual and construct of fraudulent transfers and the same thing under federal law one of the confusions that i see in the appellate argument is a reliance on a case called the sequel here for the proposition that i actual fraudulent transfer you have to have an investor who's claim arose before the transfer was made and that's simply not true under california law and actual fraud only transfer one can under california law is recover by a subsequent creditor and that by the way is mr portress and that is important in the context of the seven year claim and so that's that's legal the framework his capital in the case of ungoverned the g i s they had put him a sum of money and more than seven years before had withdrawn fifty six thousand five hundred dollars this is all he could have gotten back was part of the principle so the starting vallas is what they put in before the seven years less what they took out before the seven years and we were faced with a number of different cases and here with possibilities someone could have put i hundred thousand dollars and taken out nothing less that simi did it ten years before the bankruptcy started bounce one hundred thousand dollars someone puts in one hundred thousand dollars takes out twenty the starting balance of eighty thousand dollars someone puts in one hundred thousand dollars and took out two hundred thousand dollars before the seven year period starting balance zero not a negative just zero it's just a math calculation and it's a math calculation based on the premise that whatever you got paid legitimately could only be in your principal and so that's how you get to the fifty six thousand dollars that's not mr bovis wants to say we've we've taken it away from him but he says he wants credit for all the money that he deposits but he wants to ignore any money that's taken out before the seven year period which was return question and that's just unfair i'm not clear why you can get a judgment against the individual or the corporate investments in the absence of a finding that the corporation is the alter ego of the individual well because if i think you the bankruptcy code has a different standard so you can recover it from the person for whose benefit the transfer is made and this is not simply as mr bovis would have you believe a case where it's united airlines and he's a shareholder and that's why he's liable now the evidence or was far more than that first of all the g i s was mr von got his personal service company number two what does that mean it was for his he was rendering his personal services and whatever business he was through a corporate entity ok but if it serves a legitimate corporation of his keeping the books separate then and then so be it that's why you can do that by itself that might be fine but that those are not the only facts it's again it's for whose benefit the transfer is made and what are  have the other face he was the sole shareholder the sole director the sole officer he expressed which set up this corporation by his own admission for the purpose of minimal minimizing his personal past consequently that's permissible too isn't it  is but there's more he retroactively change that it was his money he retroactively changed an account in his name to the name of a corporation and then most importantly on what he does is that he then directs the payments out of the slack an account now in the name of the g i s not for the g i s his purposes but for own purposes for example to rebuild his family home in puerto rico and that's what he testified to and if i can't find a clear case of for whose benefit the transfer is made this is not simply a corporate shareholder this is a man who used in asset that he proportionally transferred into a corporate name for his own personal benefit so i can make the he doesn't talk about alter ego five fifty congress that we want to get the guy for whose benefit the transfers make it's a very expansive deal it's not just the initial transferee the g i s in this case it's also a person who gets the benefit of that transfer let me also address for a moment mr overshoes calculations of damages benefit pension plan a separate legal entity what mr bovis is doing is he's taking seventy one thousand six hundred ninety three dollars that mr van gotten gave to find gotten services which in turn made a contribution for the separate legal entity he's trying to get that credited against a totally different account the same thing with respect to fifty one thousand three hundred eighteen dollars that  contributed for a pension plan the pension plan is a separate legal entity it may have a claim for the money that it deposits but that's not something that the appellant you're entitle to take credit for it wasn't their count and it wasn't their money that's like saying it gives a a gift to uncle fred uncle fred makes an investor now says i want the credit for what uncle fred invested something fresh money doesn't work there's no set off there's no recruitment under those circumstances there's no set off because there's no mutuality there's no recoupment because it's a totally separate transaction with separate partners let me address for just one moment the one mr slack and files bankruptcy mr parker says a person who could not have a claim and who could not have discovered this the fraudulent transfers until within one year of bankruptcy that claim now belongs to the bankruptcy trustee under section five forty six the bankruptcy trustee has two years from the petition date of petition which can within which to bring that claim it's clear under the supremacy clause it trumps california law there is a two year time period to to exercise that seven year reach bacteria and that's what the trustee did in terms of honigman mr honigman didn't have one account he had two accounts one was an individual account which the pounds ignore they say w what this isn't stock in back and forth this is hunks of money you've got a right and her united energy decided from this court you've got a right to rescission got a right to restitution of monies paid there's money paid to forget all that entities the accounts whatever it is it's money from slatkin to a company it's money from slack into an individual and the individual's entitle to rest rescission claimant of the uniform project transfer act on a five forty eight if you are paying money to somebody who has a rescission claim or restitution claim because you stole the money that's good value that's good faith and that is fair consideration coming back thank you for the opportunity to make a supplemental thirty second response