yes hopefully this one more so than the last i think i'll agree judge this is the it's a hidden profits case in that this will be dealing with right now the two defendants is going to see more management neighbors of all services t dollars over to to asia that's what they were contracted to do and then something changed and what changed is the c e o of neighbors industries ltd is no longer a party but the ultimate power company came in and asked and tol  or these vessels this was a tell us not in the in the business of managing vessels they are investment company in different areas this was their first foray if you will into manageable vessels they  they they own and then hire managers for rail cars as one of their industries so this the in the there's no doubt you are that old a t l made a lot of money off of this deal it was a very profitable rate for itself but the reality is it should have been but if you answer my question after you dump these people did you make the same amount of money or more with someone else no we did not you are in this for and it is a testimony show that the market changed because in around them because busy when you had seem are working with you and then they kind of tanked after you got rid of them and both in terms of profits and utilization correct you're saying that's entirely due to market downturn and other factors i certainly believe that it be the case but also to say that that he has never challenged the utilization rate of the vessels during seymour's management of them in fact it's like knowledge of the was quite good but the reality is that despite that it was good efforts on seymour mashes part that the actions concerted between seymour management through neighbors will services resulted in ten percent of the money being taken on to do for you is limited to marketing services as they are generally performed by same are right and and the problem was that you didn't didn't investigate to find out how it was that they did that two points on the year are first of all the marketing provision that that you refer to was the lot was a catch all provision in section three j of which outlined all the different obligations that seymour had the last one being the catch all which did state yes marketing is generally before but i think the most important part is that eat first ate us on the belief they did do proper due diligence but the i think looking at what actually transpired there at the outset of this arrangement ok nothing had changed at the very beginning changed was that they will serve us is at the dawn the at the direction from on high said we need to find a way to make more money so to your point your honor the marketing which a tell was paying for and i on i point this to a general contractor scenario ok seymour here's a general contractor they operate contractually bound themselves before top to bottom vessel operating services everything from operating crowing repairing and marketing finding issue is that that it did those additional services were in fact charged back to a t l that's the a can of a general contractor who agrees or build your house talk to bottom for a set price all the sudden at the end comes and says oh here's the bill for the plumber for additional  companies marine companies that see more management was allowed to go some charter too without obtaining preapproval from a tail these are companies that were done the contract negotiations were  under this master but charter agreement that was the sole purpose of it was for seymour management to find such orders for these vessels the problem comes in is the general maritime law and the plain language of this contract number of very important respects the first the section eight b of the master be able to charter agreement provided that any and all time charters or other contractual relationships entered into with respect to the  hire or related expenses is issued in the name of simo that's exactly what happened here see i want to take the position well neighbors will services they did the invoicing we didn't know well under the plain language of the contract no matter  under seymour was responsible for all collecting all accounts receivable and remitting those dollars to a tale that didn't occur in this case and that's where the damages occurred well haski about some other things yes really come up yet what difference all charters that were earned that were entered into with respect to the vessels all expenses pertain to the vessels to seymour had that express contractual obligation and then you add on to it that pursuant to the mas tells vessels were earning more money and the testimony a trial should that daryl plays on see was a vice president essentially of operations at sea more management he heard from neighbors well services that they were going to be implementing this scheme the ten percent scheme he objected to it at a board of a board of managers me he noticed got started getting forms with a higher rate being charged when he was well services when general plays on to see more management question that rate all of a sudden the forms you started getting from neighbors will services have a charter rates block that at that point if not if not before darryl plays on seymour management had a duty to disclose what was transpiring with neighbors will serv out that i understand the contractual argument yes you're saying that because they were an agent in your view an agent and that gives him a fiduciary duty yes and that's where the diskos are what about neighbors well where it doesn't have an express taking place with seymour management so here you have the end to wit as the president of neighbors well services who's wearing multiple hots and he's going he's trying to claim that even though he knew and even directed that this take place as far as the s he is he was a no he's not he's not then let me ask one other thing which goes to this issue of kind of after the fact you didn't do as well in utilizing these boats and all of that the argument you're making understand the contract on the fraud and non disclosure and all that is if we'd known we would yank the contract and we would have done great on our own is there any evidence you would have done great on your own that's my that's really what my point was are and you haven't the only evidence of record on it was of their own expert of and the witness of the join the time frame of this of this entire event was in place that the market was exploding so there while there was no specific direct evidence as far as a second management company that was what that second management company would have been able to do there is evidence of right of what the market was during  entire time frame and there's no testimony that is a from their expert or others that what similar measure was doing couldn't be done but your best argument has to be though that the you were entitle to the money or not that if i had known i would have done something else and then i would have got to understand that's an alternative argument you're absolutely there's not your best argument migrate here are our  sir i may start at the end of it there about the damages yemeni's it's clear that they did not and they did not establish as to the judge's satisfaction the trier of fact if there was any damages as a result of this it's as simple as that the rest of their case fails can go into it i will little bit more detail ok that's what i was trying to get at it seems to me that they have an argument we should have gotten that ten percent so that's one argument ok but then the other argument is if we had been told that contractual argument the fraud argument is if you told us the truth from the start we would've done the deal with you or we were to yank the deal from you and then they have to show they would have gotten that ten percent from somebody else not recovering the ten percent from these guys and that's my the type of work that this type of work that was done by neighbors well services and service providers was what is traditionally responded that the rate of pay for that the rate of compensation was in the ten percent range the fact that there was a lot of activity after katrina significant and interesting but there is no other testimony about what the rates would have been and i might add that what you don't hear is they talk about this explosion of activity is that when they were working for we will they were working to see more management and then neighbors well services was in its job of going out and finding the business form and then paying what it agreed to pay their utilization rate was ninety percent plus neighbors has to get out of the business because of changes in the long so they get out of the business have to sell the boats they sell them to a company called hornback they go to hornbeck with the exact same player mr plays on who supposedly is a bad actor in this case he goes over there and they're there utilization rate drops off to practically nothing because jorge can't make any money they don't have any way to make any money by marketing the vessels so they move to another company called gulf mart again with mr plays off the bad actor they follow him around again terrible utilization they get tired of that now they go to be more this time as mr plays odds and there's mr vader with the same guys they say are so bad throughout the whole course is there follow him around and getting very little in the way of any kind of activity or utilization if you want to say it's all because  blew up after katrina that you don't explain how day last when you're with us here at ninety percent as soon as those contracts run out you're practically nothing there's nothing that happened that week or ten even thirty days a change that most say your position is a rise and fall on the contractual argument that we're case so a lot of to answer the contractual argument that there's a lot of stuff you all messed up this invoicing and this nagging disclose this you didn't meet the master service a contract and so on so forth why don't all of those provide some degree of really well the best answer to that is because the judge took a look at it and decided and with respect to the various provisions of the district court judge you heard the witnesses weighed the evidence had the best opportunity to seal that decided amongst other things mr plays nonce who was the part of their case as to what we as more management did or didn't do it was a bias witness and she didn't give his testimony much way the other part of course is that she looked at the various provisions and said under the contract because this was as the work was generally perform testimony seem friendly with decision makers apparently he was the guy was doing the marketing all along seymour had marketed its vessels through neighbors well services whether they were neighbors vessels that had to be owned by neighbors financed because a lot required that or whether there were any tells they're out there marketing the vessels or are for friends that ate it all made an awful lot of money that they didn't make after that right now let's talk a little bit about the rates they actually well michael back to the damages even under the contract they got paid the rates that were commercially reasonable rates they want to make a big argument out of whatever that it was that neighbors well services was the able to negotiate they could negotiate that because they had the commercial relationships they had the master service agreements with the oil companies they were the ones you could go out there and market these best they had a valuable service that they were providing they were entitled to be paid for this industry custom use if there's nothing wrong with that and the testimony shows that there was no communication between neighbors well services and seymour management where seymour management actually was aware of what neighbors well services was charging had suspicions but they didn't have the actual information is that matter i believe it well not contract is in all this stuff about what's in people's hearts that goes to the fraud question i see how it goes to the contract contractor cars or cars whatever whether you had a good or bad heart well we can't have knowledge if you're telling me i need to know about this you have to establish that i knew or should have kno that and if it was a lower number than they had before they would call back the sampras's going talk to the folks in a tail and say this is what they're offering is a good it was the same or higher number sometimes they did sometimes they did but that's what they needed how are they supposed to completely inconsistent with your whole argument no i don't think they knew that but they don't have a real i'm not sure that they had an understanding necessarily of exactly what neighbors was doing per se because they never bothered to find out how we traditionally are how we generally is it was a seymour aware that neighbors was working for nothing that was your is at the question i did not think your argument rested on the notion that cmara thought neighbors was working for free maybe i misunderstood  thought your argument was the contract didn't require you to account for what neighbors was making off of it it's making a percentage off of what it's sort of chartering for semur for a tow i'm not no man i think that that with respect to the contract that there were various provisions within the contract that required reporting and counsel was accurate in that regard i'm not arguing that that was what was in a certain extent and so i will see more management no water to whether it's rather and to what extent because even those two things that they know me want to terminated they would have had no where to go to make this there's no evidence they would all right so they there were no damages on that part and there no damages because the judge said they could have done it and it was another service they could have generally speaking that's correct sometimes they would have to if it was already a situation where they had worked in the same customer for or and the rate was at or above that but if the rate was down and generally make a call and then there were other times and make a call according the testimony even if they w knew already or they had to make a phone call and then and even if they accepted it they were then called back to a tell some point and you tell always improve the records it wasn't there's no evidence or data wasn't satisfied with the rates and they were checking those rain things they were supposed to do what a town know about seamers business when they entered into this contract me did they enter into the contract thinking that seem argued very well because of what were in effect neighbors this relationship with these oil companies the testimony established that what they knew about the business present reading about whether it was single business vs alter ego but your opponents said it didn't make a difference which one you choose i mean they would say it was single business and alter ego but i'm saying the distinction between the two theories i can be a number of points directed to to some of your questions and the argument is that to the army that seymour didn't know how neighbors well services made his money well there was testimony phone call when it solicited the business from a tale what matters is what seymour contractually obligated itself to do and under the specific plain language of the agreement seymour had these obligations and which th tethered to the damages you want to recover what's tethered to the damages you want to recover is if they're entitled to subcontract they're entitled to contract out to your neighbors and they did disclose to you what they got and that's what they got and if you're single business enterprise or blob theory goes out the window then that's it as a better thing that they did they met up with a similar management or neighbors will services never discloses additional ten percent right i understand that the problem to me with the failure to disclose is i don't think that gets you two point eight million dollars or whatever you're trying to get that gets you we woulda coulda should dump that contract sooner and then you'd be back sitting there with your boots on the dock because i tend to agree that if the day after you guys are done with with with this contractor you're both are sitting idle but that can't really be explained by the economy etc he pointed out first of all the day after seymour decided to get out of the business and home but first worth noting that the rates that it's always getting automatically went up ten percent that's because there was no longer any skimming being done hornbeck was was really limited one hundred percent of the revenue thing about the vessels and secondarily your honor that the district court's opinion or the basis for opinion that the marketing that well services did for the two point eight million dollars was his other service as marketing service that they were allowed to do under the terms of the contract that fails because that section  thirteen specifically stated that the in addition to performing services for which seem our management will receive management is seem our management may perform other services and belay tell for them well the section six right specifically stated that seymour management was receiving its management fee for services including marketing for billing solicitation bidding in negotiation of the time charters the marketing of the vessels could not be an other paying an additional ten percent two point eight million dollars today was well services before in the exact same services which is the consignment exactly are they going to get the digital difficulty with that is in a consignment situation there's knowledge the person that's buying it th spending the money knows what's going on there is it's clear you are a tell was intentionally kept in the dark about what was taking place and because a tail was kept in the dark both by seymour management and then directly by neighbors will services a tale suffer these damages our arguments we will resume this session of the circuit tomorrow afternoon