that there are there were as of january twenty eighth seen in twenty six million series ee savings bonds that had been assured but not yet been redeemed so the chart that they cite in footnotes x the same regulations which seem on their face tube or trains for overpayment to anyone except the original owner except specifically provided in the regulations so are we really confront of soloing with the question of what these regulations me whether they allow for recovering through se or they don't yes and no yes the decision the controlling legal issue turns on the meaning of treasury's own regulations these are the prior regulations but in understanding what this particular regulation means it is crucial to understand the background principle set out in the third circuit decision which is that under the general regulate treasury regulations a bond on our has the right to surrender her paper bond for payment at any time so the question  of the purpose but also in light of the specific treasury regulations and subpar age that give the and now we're talking about this under one percent of people who wait and don't redeem their bonds at or near maturity but time passes and as the chart that plaintiff sent in last week illustrates millions and millions of people redeem bonds by taking the paper by turning it in to their local bank and getting paid federal government well after they mature and the they have the right to do that under the payment regulations and what we're saying is knowing that it is not plausible to read this other we know there's a case in the supreme court called cars or which involves the court whether howard deference is going to serve well what role should our deference play in the interpretation of this interpretation which the government has previously given to this regulation and putting us in the position of having to figure out what the government meant points earlier statements well the short answer is that the regulations clearly for close the plaintiffs attempt to redeem bonds that they do not have in their possession and can't even identify the owners so this is under the explicit terms of the redemption regulation historical record has been consistent over time treasury has never allowed a state to come in and set and redeem a bond they didn't commit to the states possession understand the possession is not a technicality well i get it but b that that's inconsistent with your interpret you say we pay bonds where the state has possession is a matter of grace as a matter discretion were true under if the if the treasury agrees that these regulations  limited very limited circumstances is said when you've come forward with evidence that these bonds are actually abandoned meaning to start you have them and you've gotten them under circumstances that show that they were in fact abandoned in  those contacts even assuming those valid judicial regulations of regulation applies and all that will be treated as a valid judicial proceeding treasury has all of what you're saying is contingent on a certain understanding out if it does then what we have this federal law that contemplates and permits what the states are doing here no your honor the question as judge cooper recognize is not whether this regulation recognizes the state proceedings but which perceiving he's the only actual that that's when we dig down further yes that that's the next question but the first question is does the contemplated street proceedings and between what you think are valid the sheep proceedings when they have our full physical possession of the ball on and therefore you know and have gone through whatever due process rights they need to go through to get the bondholders notice that they consider this a band of property and the cases like this where they have not only have no possession and have no idea whether there are even bonds in existence that yes there are a series of reasons that this regulation the valid judicial proceedings doesn't apply i'm going to start from the beginning of the sentence the regulation treasury will recognize a claim against an owner of a savings bond so  will let you finish but i want to ask you that to set up a hypothetical which is suppose somebody puts a list of all of their bonds serial numbers in their safety deposit box but keeps the bonds with them somewhere else and at some point that safety deposit box gets turned over to the state as a bearded property and the state now has a in its possession a list of bonds and it go to treasury under the regulations that permit holder to ask or if they have the serial numbers no your honor because there needs to be evidence that the bond was in fact lost after receipt by the owner so and haven't done it what if they went through the same proceedings with a list of serial numbers they published in the newspaper and said we we found this was property in a savings box and here are the numbers if you don't claim it within a certain amount of time we'll consider this lost property and it will become ours no no because again that's not what's the difference between that proceeding and for proceeding that's in the session because the vine it's a piece of paper that can only be in one place at a time if the if there is just a list of serial numbers and us a deposit box that's not evidence that the bond owner doesn't have her vines and i sent the image in not as evidence but just to make the point allows kansas or any other state to take that right four way from her so having a list and you know it's it's just like if they broke into her home and said you know i got her bonds now i want to redeem it treasuries are going to allow that either well that seems to me honor not the serial numbers alone the serial numbers plus an affidavit with specific evidence that shows that the bond was lost if the state comes in with the serial numbers alone which of course they can't do because they know nothing about the bonds there is  from the third circuit case but the central proposition which is that a state cannot just pass a law that says i deem us savings bonds abandoned whether it's one year after maturity three years after maturity or the way louisiana and louisiana and south dakota said you know decades before maturity there is a want of authority these federal bonds are pledged on the credit of the united states and the federal regulations promise that the real contracting party is the registered bond owners you can cash them at any time and the state can't take that right away from them and they can't say you have to go to kansas instead i want to talk a little bit about your alternative or even hear about stepping into the shoes o so what if what if a bondholder individual bond holder has lost the bonds but doesn't have the serial number after six years after maturity if i understand correctly the bond holders i don't walk right correct ok and it used to be that for bonds that were issued later i guess in seventy four or whatever there was something called treasury hunt there was a website where you could search for your missing volumes by serial number that's correct i believe it was i'm not sure of the year and i believe there were at least for some the social security number was included in the registration information well enough that it's referenced in footnote six of the third circuit and ok in the text there but but that website no longer exists what's what's happened here why why understood even for i don't actually know the reason why it doesn't currently exist but i'm fairly sure there were was our prime min to enter social security number and that may have had privacy implications so i don't know i don't nobody and this is not an argument for extinguishing the rights of people who have their bonds to cash them which is the issue in this case that's what i just want to try i know the statistics may seem dry but they're very important the chart that the plaintiff sent in last week leaves no extent there are such people and we treasury doesn't work you know well maybe if people came to treasury and said i think i own bonds i don't know anything about them except that they were sold in kansas hundred seventy eight is actually the arkansas date seventy two is the kansas state treasury would not be able to help them the records are indexed by serial number there are three point eight million billion bond records they're on microfilm they're not search with the website and that was definitely more recent bonds than the ones issue here but i just want to make sure the fundamental point is not missed which is that treasury is being asked to violate its contracts with its fund honors they pay jan is paid three funds are in fact abandoned there's abandoned property it came into estates possession and the state has done try to identify unknown owner unsuccessfully can't find any errors under those circumstances that's the  then there is no preemption question in fact of federal law no permit is at the flag of that that is not a reasonable interpretation of the regulation there is still the independent problem this is important that they cannot if their interpretation of a regulation is correct there is not a preemption problem i'm resisting the kind of general use of the term if steve because this is nothing like real esteem as traditionally recognized as we understand your view is there's a traditional people who lived in kansas are mine and that would be it as long as they got a state court to say yes they're yours that's how they read this regulation it has nothing to do with the number of years they put on as an abandonment period they're saying that all it means that these are valid state orders within the meaning of that term because they comply with the rights of the bottle yes but after the conflict with the rights of the bond holders of the regulation whiles they the regulation does not allow a state to and then page seventeen to the left turn okorie for most of the questions that you asked are he answered by the text of the regulation and so judge hughes your question about the list in the safety deposit box if there proceeding and those ponse would be transferred their ownership to the wife and treasury will recognize that that's what the valid judicial proceeding part of the general rule to be means now treasury doesn't actually want to talk about the plain language of the regulations but it contains the only two specific references where treasury will not recognize a valid judicial proceeding  way that's when there is an proposed intra vios transfer or there is one that would interfere with the co owners beneficial rights so to take your example again judge hughes if there was a list in the safety deposit box and it was a world war two veteran who had listed these in the name of himself and his son and there was a divorce proceeding that would be covered by eg so that the state court that sought to transfer the ownership interest to the wife would not be permitted to do that because that would be an attempt to interfere with a co op to nurse beneficial rights we don't have either of those hypothetical situations here what we have is a situation under be where a general validity of a state judicial proceeding under state law applies and treasury has this a valid an interest in knowing who the owner of the bond is they've done that throughout three twenty three fifteen point twenty eight b and c and so the only question now is is there room for state law to apply there clearly is because the regulations set that out and then the question is do the regulations provide for to tommy what a valid judicial proceeding is and that's what b says the pointer of there is to look at three fifteen point two three and the way you prove the to have more specific evidence three rules for the divorce contacts or for a judgment creditor context but in the general context we're going to allow the validity of the general should proceedings to apply so if you were to take other kinds of state law suppose it wasn't just a divorce but suppose it was just a property settlement those are common in a case of a separation those would be covered under the valid judicial proceedings they're not specifically covered by divorce suppose the person intestate and the question was what errors might apply classic state more question valid judicial proceedings would make that determination and it would be done on the basis of what a certified state court judgment would be  which is that when a state law deals with transfer of ownership by virtue of it you have a proceeding then you will be able to trigger that transfer of ownership rights or satisfy point five point one one has that right now  have a situation where the state went to court you know but that's not them but that doesn't tell me that three fifteen fifteen doesn't apply what you're saying is the specific provision that's required by three fifteen if the is in fifteen point twenty b is a general provision and we know from the other surrounding regulations that three fifteen point fifty doesn't make any mutable right to ownership in the original bondholder because treasury has recognised state transfer rights in a number of different circumstances and the only question is whether the general rule that says if you're going to seek to use state law to transfer ownership interests will you have it through valid judicial proceeding and so that question has been resolved by treasury and to further his or your question judge hughes about the list that scenario happened the state of florida had a list of serial numbers it sent the sufficient proceedings to conclude that it was lost by the original over i think judge tuesday you would take their let's look at the worked question about possession ok there's a plain language answer to that one too which is three fifty point twenty c the only place where possession of the bond is mentioned is unfair and that's where congress will not recognize notice or sorry the treasury won't recognize notice of a if they're in the hands of someone else a contentious divorce for instance where the husband says i'm not going to give it up even if the state court says give it to the wife that bonds are permitted to have  and that's why we know that the mere possession of this is never been enough and treasuries guidance throughout the years has been possession is not enough all you have is a piece of paper or  photocopy of a piece of paper and possession has never been enough unless you also have title ownership and that's why the secretary of the treasury nine hundred fifty two said if the states want to do this they are going to have to change there is chea think this raises the question of the government's alternative argument that she if you step into the shoes of the bondholders you can't have any reason right from the bondholders how is it that you have the right can redeem these bonds without serial numbers there are two different routes to that judge dike one is through the sub part that concerns that allergy to actual proceedings which provides in certain circumstances for treasury simply to do what is necessary to determine the value of the  can't buy so in the event of a try judgment creditor or in the event of a divorce where the bond is going to last or mutilated or whatnot treasury then pays out every deemed amount of money judge kaplan in the quote i'm sorry i'm not following the under the regulation under those circumstances in the regulations that i'm talking about there are two different sets of regulations so let's be clear i'm talking about those that are in the sub parts point twenty three twenty five part of the those say that you do not necessarily have to know the serial number or have possession of the bond but if you have other identifying information that would enable treasury to determine the value gone they will pay on those who are down sions judge kaplan said because of this preemption issue she's not going to sell it is that within the six year period no those are not so you believe that even after the six year period that you the individual and redeem a bomb with the serial number if there is appropriate identifying information yes and treasury with which regulation we're talking about well i think it depends on an individual who had lost the bond if other identifying information could be as didn't know anything except they thought they might have a bomb is there a procedure for that individual person to go to treasury announced from the bottom and we bury it in the regulation we believe there is and it's i shall be in the regular i can't show you on this standing here right now i'll be happy to send a letter to the court but what i would say if the person can't do it can you do it the per the person let's just assume we read the regulations as prohibiting a person f bond after six years without the serial number or some other kind of identifying information they just can't do it they're out of luck treasury gets keep the money if they can't do it can you we stand in the same shoes as the original owner judge hughes and that is i didn't know then that if they can't do it you can do it we don't pull yes i think that's correct but i think that the point is what the treasury represented the thirty state would have the same rights as an original owner and i think it would be unconscionable to think that treasury is confronted with the names of people who had kansas last known addresses or had other information that  get to that is there a process or requirement imposed on treasury to actually work with the original bound owner who is in fact the person who loaned the money to treasury in order to figure out  some identifying information that would enable treasury to do this and notably they don't give practice we didn't get to do discovery on how they actually implement this regulation judge kaplan the only regulation you have the waiver regulation yes basically by which the state would try to work with treasury and there would be an exchange of information in a way that would enable the state to assist in identifying in using searchable means to go through these old records to determine if there are treasury to waive all of those rules and help that bond go in or far in the serial number we don't know treasury has not but you're standing in the same shoes that arms are so you're telling me i think that there's something special about yours we have i would say what's special about us is we have the status as a sovereign of this country to go to treasury and have the have to be able to do this someone who ha try to comply with the ever changing requirements that treasury has imposed doesn't mean that it's all that ever changing that won't be factors they've always required you know possession of the civil law well no actually that is not correct because if you this situation i would i would note that they're the conundrum on the redemption issue i would ask you not to resolve the case on that we argued before for judge kaplan that there could be a process to determine which of these regulations whether or not they are lost or have a process for identifying serial numbers and last known address is that process should play out if this court were to agree with us that the general valid i just don't understand why if we're going to force that process on the government with all the costs that it entails why we would force it on them to at least first of then apply the actual bond holders because if you were to do that judge you would be then saying that instead of loaning money to the get united states these people are making a gift to the united states if they lost their bond or lost track of it and there's nothing in the statute that does that well if that's the regulations that were place that it could be on six years you've lost it and don't have the serial numbers then they  them with that printer in place there's all kinds of things that you get and if you don't redeem it in time or the like you don't get your money back your honor on page forty five of our brief we point out all the statutes where congress had put in express and it says there are limitations but it says that image information will ordinarily be disclosed only to the owners of such securities the point here is that if the state is the owner by virtue of the valid judicial proceeding awarding title  they get to keep all of the money where they have no record of a hole down the treasury hunt website so there's no practical way for people actually to easily identify whether or not they have an ancestor who had favor what it does say is that if i'm an owner of a bond i have a right to go to treasury and say i don't have the identifying information i lost my bond but here's here are identifying pieces of information that would allow for some search have any of that up we know to a certainty judge hughes that there were people in kansas with last names addressing kansas who had bought these bonds and they are now lost and they were subject to the  submit that the state because if there is an indemnification provision we will indemnify treasury and engage in a process to use computerized search techniques in which the states are willing to contribute to the costs we haven't even got that have question and so all of these very difficult questions about redemption which will supply or premature because judge kaplan did not think it was appropriate at x stage of the litigation to answer that back question and i appreciate that it's a limitation on the general disclosures under four and she probably recognize that a kansas had wanted to seek review of the denial of their foyer claim they would have had to go to the district court in d c the reason presumably they didn't is that it's well established in the d c circuit that foyer doesn't require an agency to reorganize its records and treasury doesn't maintain records based on the state of the address of the bond on or on the actual bond regulations they are asserting rights that no bond owner would have this is the plain language of three fifteen point twenty nine the adjudication of a claim for lost fons no claim filed six years or more after the final maturity of the savings bond will be entertained unless the claimant supplies the serial number of the bought and that's because treasury doesn't index its records in a way that will allow it to find these bonds without the serial number there is no need for discovery further proceedings to apply the plain language of the regulations that govern all bond owners we moved for summary judgment on this ground the court denied our motion it's before this court and the point of th scope of what the value should proceeding to answer i'd like to go to the regulation the judge that i was quoting which is the background rule three fifteen fifteen savings bonds are not transferable and are payable only to the owners named on the bonds except as specifically provided in these regulations and then only in the manner and to the extent so provided so then you go to three fifteen and twenty b it says nothing about it has specified proceedings divorce bankruptcy judgment creditor and gifts in anticipation of death and that's it this is what treasury explained in its regulations but then if you keep going down to the provision that three fifteen twenty b cross references which is three even the specifically enumerated proceedings like bankruptcy you cannot do those things that are sat out as general restrictions on ebay but then i just want to make sure i finish the point drop down to three fifteen twenty three there's no doubt that this is just the first step before presentation of the bond so three fifteen twenty three talks about if the judgment or decree is more was entered more than six months prior to presentation of the binds then you need to get an updated  is then only leading you to the redemption regulations that all bond owners have to follow which means either are surrender the bond which is in the mind of cases what happens or in the rare circumstance where the rightful owner has evidence that she in fact lost her bond and can supply the serial number if the bond which were more than six years ago then there is another way to get redemption but only if the plain terms of those redemption regulations are m