disclosures relating to the financial impact of impacts when additional manufacturers were absorbed into the conspiracy starting with the government action the district court in correctly applied an absolute rule to the correct standard for causation in the th circuit and when first or when the panel and in st of all are ruled they ruled that the ultimate issue is whether the defendants misstatements as opposed to some because plaintiffs lost the question here is whether these disclosures related to government action on the price fixing issue or the foreseeable consequence of defendant's concealment  case this is kind of unique it seems to me what my understanding correct me if i'm wrong is that on may th it really two announcements were made by the company one was this drop in margins from sixty one percent to forty seven percent but the same day an announcement of by the way we got a subpoena eight weeks ago first of all do i have that right to announcements the same day after all ok so plaintiffs are going to have a probably i would think although where the trial be six level of challenging time trying to figure out what the market was reacting to they allege there was that drop the next day i don't know two seven percent or something but but setting that aside for a minute recorded i think you're right it was clearly relied on loose where we said that's not enough announcement of investigations not enough but there were two announcements that day and my concern is this strikes me as a really significant are issues for experts and the experts use economic tools to separate out the cause of the decline what we have your honor is is that the standard is that the disclosure has to be a multiple multiple factors is long as there was a substantial contribution from one of the factors that contribute to the decline in this case is there any is there any forgive me for interrupting sometimes you freeze up just a little think it's likely a factor of when they disclose their financials for the quarter but the point that i was going to make before before this last question was in this case we allege that both of the disclosure on that day were in fact related to the fraud and i had separated them out because i think that they were sort of distinct legal issues one is the government action and the other is the is the conspirators you know new conspirators joining in the loss of market share there but even if the court finds that one or the other of those is is legally its vision and i don't believe the court should the other one would stand yes deficient because each is a contributing factor and at this stage i don't believe it's appropriate to sort of dig assessments that are that are really left to the experts at the end of the case organization but then the governmental action and lew says obviously governmental actions speculative it cannot be lost causation but that's only one particular government action here i thought your point was there are melted problems in later disclosures like one not one but two c e o s of competing companies pleading guilty to felony is allegations that the plaintiff or the defendant would have been engaged in criminal behavior and there's an investigation for criminal behavior it's not just the disclosure of an investigation it's much more than that and it's something i thought you were arguing degree at some point you go from loose the situation which is not causation if i recall correctly you are clearly in the loop opinion limited the whole thing to internal investigations by a company and i guess you're arguing that it should be limited to that i guess i want to know you have any other authority the limitation that st solar imposes on leaders and metzler and horrible is that these are these cases don't state general rules the the st the question  in st solar was is it required for a plaintiff to show that the fraud was revealed the fraudulent practices were revealed and the answer that question was no and that these cases should not be viewed as general rules now a criminal investigation is more serious to the market than an internal investigation so to the extent that we're assessing the market's reaction and whether it's reasonable the answer is that lost cause rationing and i guess again mary you're saying sort of question why isn't this just another investigation that you're arguing here that because it was a criminal investigation that is a significant well it's significant not just because it was a criminal investigation but because there were a series of investigations and then also your honor the way that the plaintiffs in lieu set up their piece in the standard that you supplied was based on that pleading was that the fraud had been disclosed to the guilt the market knew of the guilt and we don't do that we haven't played that and that's not required st of all  express lead addresses the question that was the question posed to the court an interlocutory review on the on the only question there was going to plan to show proximate cause asian or just fraud have to be revealed and  that and then you're meeting you repeatedly referred to her seller but now the sorry luce also has a footnote right there right at this very broad holding that says well look we're just saying that standing alone that's not enough that's judge sessions as point seems to me your idea of what the point you're really making is your contention is not that the investigation criminal or civil standing alone is enough if i've got that wrong i seriously need you to correct me it's two points the st is the question is whether these were forseeable of a perceivable consequence and proximity connected and the answer is yes and that gets us to causation to the extent that there is a question as to whether there is simply just an investigator here are the announcement of investigation we've alleged or we've alleged that the government intervened in a civil action instead this civil action case that we have on the defendant share point is quality systems where the court found statements about you know a good pipeline or sales and  analogous statements to be actionable not puffery and defendant share isn't it the share is a metric it's not an opinion and in the same statement they also they also make a false statement about price so their point was the last share of the order before and they were in the middle you know those are two different things those are that's the point right there you just said they admitted they didn't defend share because they lost share what that tells me is maybe they didn't defend it successfully if they lost but the but the but the statement made that you're challenging is that they defended share is it really your contention they didn't that they didn't attempt to defend their market share well with this what they said to the market was we've defended share but had to give performing and yes sam as you said is that you can tell it's false because in fact they lost market share the statement actually made was we've defended share so it's not a match up with the vendor share indians is that we didn't give up s we defended share and we gave a price if competition in actually competitive market comes in and you have two choices if you want to stay in that market you can either give up market share or you can i resent that but you're not you're not responding false basically is that in fact they lost market share those are two different things the statement was we defended chair why why why should we construe that to mean you know we've attempted to defend our market share a big this did within the context of the statement one potential problem that you have but the but i had thought the nd falsity essentially was the ten percent figure which in fact was twenty one percent so it was an underestimate and that was a falls from present i had thought that was your position is that is that your position as has two or three pieces of falsity depending on how you just them st the defendant share and even if that even if the defendant share is not objective lee false and you believe it is it still in the context is materially misleading to say that you've defended share sacrificed a bit of prize and then say that the pri regard to defending sure you were actually specifically saying ten percent as opposed to twenty one percent which in your view is a material misrepresentation that's correct your honor and list walked away from  that all observing that that things were fine with types of men and that was the message that was given when in fact not only had they ceded market share when they said they defended it but they had isolation but that it has to be viewed at a because if you view it in my isolation it could be you know we we tried or even that we successfully did so you have to view it in context with the other ten percent discrepancy that you've just mentioned is that right justice action in intervening in a civil case in which impact was named the defendant in indicting executives of another company i guess since the tight let me ask you does the type of investigation matter as a psych mr brooks is that this is arguing that it does and that it shouldn't be limited to internal investigation announcement that there is greater whether it's simply the announcement i believe on whether something happened after the investigation is announced that revealed to the market that fraudulent practices or bad practices and been going on and discord you lose and wanted made that rule clear the difference lloyd was that in lloyd there was a subsequent confession if you will by the defendant that bad practices had been going on and that permitted dischord to conclude that the earlier stock price drop that surrounded the announcement of the investigation a opposing counsel is cracked that it says the announcement alone of an investigation without more you know that's that's not enough i'm concerned that the in this case the announcement on may th leverage that there were two announcements on may rule you're advocating for is that would really potentially put defendants in a position in these types of cases where a delayed announcement could actually work to insulate women what might otherwise can't rely on that investigation whether it's civil or criminal but why is it correct for us to do this at the twelve b six stage and wouldn't that really expand loops respectfully no here's the reason that the market reasonably proceed and then as revealing the falsity of the defendant's prior statements the market reasonably perceive that some objective standard of revealing the never been named in a regulatory proceeding criminal or civil this isn't a situation like you buy where there's a detail with many other generic drug companies  repeatedly held consistent with other surges have a reasonable period of time to make their disclosures and here there's been no suggestion that there was wrongdoing it would be one think your honor i ruptures where no one except these plaintiffs have accused them of securities fraud by failing to disclose their participation in the scheme so i respectfully your honor and i know wasn't briefed but the in the th circuit that the that the defendants had a reasonable period of time to make their disclosures in there at the scene filing and there's been no there's been nothing here would change that i am familiar with the case law counseling just waiting to hear their response to my question thank you i don't think it would reflect your honor i respectfully submit that it would not she would tell you we're talking about market response to a particular market response from investigation so it cetera so would a market a logical market response be a reduction of the stock value there's a two point seven percent reduction in market value after the may th statement would that not be a reflection of the fact that there is a market response to what was submitted in may yes your honor it does reflect exactly what you said the difference with last causation is it does not reflect a market response to the disclosure of bad practices what it reflects is market response to an announcement that gives raw risk that there will be bad news in the future and that's precisely the rationale lose and that's precisely the rationale that the market reasonably purred see the disclosure of what the plaintiffs call the very fast those have to be lent in some way to the disclosure d that they're challenging and here they have nothing more but there's nothing in that those paragraphs that suggests that the feds have focused on the impact whatsoever and then the decision by the department of justice to intervene in the district litigation to protect the integrity of kristen you've been all as being consistent with the rule that i have just articulated that is that is your honor code that if you will to that and that is important here to make correctly stated that the portfolio price the client excluding that post and in another drug was about five percent there's no question that was that was truthful later that day repeated that accura and the overall kites the and perception and judge sessions focus on the ten percent and judge kristen did as well we agree that was a mistake what he meant to say was that the with the impact in the impact on impacts is something that the plaintiffs themselves plead that paragraph three hundred and sixty dollars of the nd amendment complained says quote but in going back to commentary from the st quarter conference call it impact of pricing was roughly ten percent around ten and a half percent and that is true there's no question that the impact of the price the client on revenue was ten percent and the analysts understood that and he understood it drawn from what's in the complaint and so they're not appropriate as a defense at this stage where the falsity or the securities fraud claim the assertion that mr wilkinson simply they gave up a bit of price and there was a ten percent decline analyst walked away from that statement saying we're comfortable with the guidance we're comfortable with the the way that the market has developed here and then with respect to that last analyst on the on the next call when they actually disclosed the twenty one percent that analyst is is asking mr reasons the c f o hey you said it was ten percent last time and now it's twenty one percent  and the response is not in the in the complaint but mysteries instead ok i'll get back to you there is no indication that that's a discussion of of the revenue impact that's a question that was in direct response to the disclosure about the price decline as far as as corrective disclosure will necessarily take the form of contest the allegations of wrongdoing in that court looked at whether the market could have credibly reacted to the disclosure and whether the did whether the market  whether the market discounted the the stock price in a reasonable way in response that disclosure included yes that it did in that disclosure was an allegation from a disgruntled former employee that was a complaint allegation here we have a subpoena that followed a couple of other subpoenas the disclosure of that that impacts was one of the the company's that was and the bloomberg articles do mention impacts as well of the most exposed company or one of the most exposed companies and then you have the intervention in a complaint that a civil complain price fixing so just as the come the the whistleblower complaint alleges alleged misconduct in in the in the view of ips this civil complaint alleged the price fixing the same price fixing that we're talking about here there were only seven defendants in the case at the time into drugs and the government puts a premature on those allegations d by saying they matched up with its investigation all right thank you cripple just question do you have any further questions