the bankruptcy court misapply collateral estoppel on summary judgment precluding mr google from getting a trial on the f t c is not discharge ability action and we're here because the district court only got it partially correct in reversing the bankruptcy court on the issues of fraudulent intent good faith and advice of counsel but affirming the bankruptcy court that collateral estoppel would preclude mr truly huge step from challenging the have p c s allegations that collateral would stop him from defending on the other three elements of non discharge ability to the merits can you explain why you're bullard we have action here since the decision by the district court didn't alter the fact if you look back to this court's decision and the bottom all from one thousand nine hundred two the rule that this court in its famous middle ground between the third and seventh circuit approaches to appellate jurisdiction said that the that this court can hear an appeal even if it's a district court order and into the bankruptcy court for significant further proceedings if doing so would materially aid the bankruptcy court in reaching its disposition findings how is that reconcilable with well because your honor if you look at this court's decisions all post bullard addressing the special context of bankruptcy appeals from the district court every single notwithstanding bowler we could do something as inmate erase as this is and that we could decide it so there's really no support for a case that's as where there's an for factual findings ye right i think that's correct except that if you look at the most recent announcer i would say maybe the best enunciation of the day before factor test for flexible finality that was affirmed in the landmark fence case and if you look at the factors under landmark fans and granted landmark fans went the other way in the decision it came to that i suppose what this court's going to have to do as a matter first in this case is determine whether or not the flexible finality approach continues to exist ninth circuit cases post board has said yes it does exist but we don't find it here ever yeah if there is a case where flexible finality should be applied this is that case this is that case because under those four factors this is a case where we are definitely going to have a trial in the bankruptcy court that trial is going to be on three issues however if the if this case comes back up for appeal again which it will one side or another is going to be dissatisfied with themself on trial we're going to back and eventually be in front of this court asking for a determination of whether or not the three other elements of nondestructive a fraud should have been part of that trial so we'll end up with two trials at a minimum just the piecemeal it is because it seems like there's judicial system to have two trials i don't believe the two trials will be necessary or the piecemeal litigation so i mean well in the factors are interrelated i would concede if we look at the systemic interest in preserving the bankruptcy court's role as a finder of fact this court giving guidance to the bankruptcy court saying yes these are the issues that still need to be decided that's going to be the final decision depriving the bankruptcy court of any actual finding  correct we're actually enhancing yes like honor mall it is not like a legal decision here could relieve the pain group secord of its obligation to find x on it and right there's nothing we could do that would relieve the bankruptcy court of its response that's correct but what this court could do is enhance the bankruptcy courts rule by telling the bankruptcy court this is the scope of the trial that's going to take place we already know there's going to be a trial we already know it's going to encompass these issues what we'd like to know from this court at this time is whether it's just these three issues or whether it's going to be all of the issues that mr guta wants to have try that's what we want to have determine for us and the fourth factor is whether  then all goes to the bankruptcy court the bankruptcy court does is back by the end the appeal comes back to us so probably it would be either less efficient or more efficient depending on whether you're the bankruptcy court or us  there will be another appeal more efficient for the bankruptcy court it's certainly more efficient for the bankruptcy court but i would argue it's also more efficient for the ninth circuit court of appeals because if the case goes back now without the court assuming jurisdiction will have one trial will come back up for an issue as to whether or not there has been whether or not the bankruptcy court came to the right factual conclusions as well as the legal questions that have been addressed but we've also got that intermediate level of the district judge the district judge has made a decision on those we're going to have to go through the district said before we get here the district judge is going to say i've already decided all these issues when my looking at this for so you know this is the bankruptcy court and the bankruptcy court finds that there was an intent to deceive you wouldn't correct what's wrong with that oh nothing's wrong with that your honor so so therefore we can which there is every indication they would appeal from the bankruptcy court then mr who use it would still have to appeal the issues that he didn't get that he didn't get a chance to try at the bankruptcy court so we'd still be have another trip back up the  well the irreparable harm is that mr couey is going to run out of resources he cannot afford to have two or more trials on this we'd like to have one trial rather than piecemeal trials that are separated by an extended appellate process and funded and the f t c has already collected significant monies the f t c has taken the position in the lower courts that it is not going to give any money back to consumers or even find these aggrieved consumers until all the legal proceedings are complete the longer that drags out the less likely it is that consumers are going to be getting their their redress you know consumers will disappear some will fall off the grid or pass on that so so the longer this takes the more his incentivizing piecemeal litigation and and protecting judicial efficiency are not advanced in this case because as runners have observed there a trial in the bankruptcy court on the issue of intent regardless of what happens in this appeal and as you noted if the commission loses on intent and it's by no means a foregone conclusion that the commission would appeal a fact based finding if that's the case this case goes away we lose and this court need never address the issue of collateral estop broader matter the systemic interest in preserving judicial economy are preserved by a rule which is reflected in the district in the supreme court's decision in in bullard in this court's recent decisions applying a flexible finality testin and not confronting the issue of whether bullard replaces that test those all of those cases recognize that that that as a general matter that when there is a remit and reversal and remained to the bankruptcy court for fact finding on a central issue which is the case here that that is a non final decision and that the interests of judicial economy are served by finding that that is not a merits and we were i mean you could do better on the merits than you did in the district court right if you reach the merits including addressing the issue of intent yeah well certainly in this particular case it may very well be that depending on what the outcome is that the parties would be happier with having it decided in this particular case but finality as this court has made clear in the co and in violin which which articulated the four part test recognized finality he should be addressing the issue the interest of protecting finality shouldn't shouldn't turn on the the particularities of individual cases and if there are cases where where because of harm to the parties or legal undisputed issues that  could that could resolve everything else that those are best addressed not by not by loosening the standards of finality but by taking advantage of the mechanisms for discretionary review so we would be perfectly happy to have a ruling in our favor now and know that in advance but as a general matter of litigants and the f t c as well are best served by clear rules on finality and when there is and is not  three determination and so that would be a rule that just occurred on these two things that it would go back to the bankruptcy court for a factual finding in the first instance right because it was a collateral estoppel misrepresentation knowledge whatever it was think in this particular case it may in fact avoid one additional step that it might not because as as we've already discussed if we lose on intent then then then that's the end of the quote the you know that's the end of the dispute if it's not appealed but but certainly that scenario that is one scenario and that may in the end be more efficient depending on how it plays out but again that this court's decisions and certainly the supreme court's decision in bullard looks beyond looks beyond the particularities of every individual case and seek to to a to address that the typical finality standards now what bullard the point that the supreme court made and buller is that bankruptcy is just different than other cases in that within a larger bankruptcy proceeding one can have and typically does you know that typically are subsidiary almost standalone disputes this adversary proceeding is one such completely standalone dispute there is one issue in this case and the question in this case is whether the judgment debt is dischargeable or not and that is entirely under resolved so under the bullard again teaches that that once you've identified that subsidiary dispute the question becomes whether the rights and obligations of the parties are settled and you judge finality based on that question and there's no question in this case that the rights and obligations of the parties are undisputed so as a matter of of of judicial economy and having eg a rule that one look to and be guided by in this litigation in future litigation a standard of finality that that doesn't depend on whether a particular case would be a little more efficient or another case would be less efficient depending on the outcome is is is what best serves a judicial economy though it's basically i mean if i were making your argument and hyperbole if we open the door to this the more open in the entire gate then everything and everyone could make an argument more efficiency and and turn the argument away from whether it really did it's really final and determines the rights of the parties or both want the court to exercise duress diction and issue a decision on the merits is fine or all reconcilable with the supreme court's decision and bullard because our model is the one that is most close no your hon r i don't think it is and i think that that this court's more recent decisions and certainly after landmark fence and certainly and after after the supreme court's recent decision  application of the looser standard and bannard model would be simply inconsistent with those decisions should not be followed in this you have other questions on jurisdiction i would like the opportunity to proceed to the issue of collateral a stop case the court decides to rescind merits of that that i won't spend much time on the question of deception because but if you have questions about that i certainly will take that i that the main point that i want to make is that is that the concept of deception that that is in the f t c act in the f t c is act cases incorporate the common law elements of fraud and deception that this court has applied in the context of non discharge ability cases both with regard to affirmative misrepresentations or our conduct to that that affirmatively disk that that affirmatively conveys a message to consumers that is false and as well the failure to provide information about the basic facts of a   of misrepresentation of false statements are all reflect the concepts of materiality of false impression of false to spy network oppression and failure to inform consumers of facts that are material to their determination that misleads them so we think it's quite clear that that element is established and there is no pace that we are aware of that has ever the presumption of actual reliance arises when there is materiality material misrepresentation that is widely disseminated and consumers have that is the case that that states that very clearly and what that case makes clear is that this burden shifting where this is how the commission proves actual reliance by consumers and this court's recent decision affirming the the district court's merit decision a reflects that demonstrates that that is a means of proving reliance and that reliance has been once it is a stablished regardless of how one established for five twenty three a there has to be evidence of actual and justifiable reliance that was feel telling us to rely on a restatement second of torts so i don't see i'm having his arguments conflates two different two different issues conflate how one goes about proving something and what it is that has been proved now that as the court's decision the district court discussion of this issue made clear and the court relied on figgy among other cases the presumption is how the commission goes about proving actual reliance and the other side has an opportunity then to come in and show and what what is being proved there is that as a result of material misrepresentations or deceptive conduct that consumers relied on that and based on that case where those are difficult to prove directly and so whether you call it a presumption whether you call it circumstantial evidence both of those cases addressed how that can be proved in in the context which i think is  is is fairly analogous to the difficulties of proving reliance on an individualized basis in the f t c act in in the in the credit card creating context which was what the court dealt with an shy there is there's not a direct relationship between the the credit card holder and the credit card issuer because there's actually a merchant in between and and so this core address that an addressed how one proves the elements based on a totality of the circumstances and that i think that's fairly analogous to this case where you have the federal trade commission which does not there are basically three players here there's the federal trade commission which is which is seeking to to to provide redress to the consumers who are injured but the direct relationship is between the consumers and the merchant so there are difficulties of proof and only added to in the context of the f t c is actions because we're dealing here with widespread fraud mass fraud and it and it simply cannot be that in the context of ability proceeding that there that  bring in every consumer you could find to prove on an individual lies consumer by consumer basis that they relied that would be akin to a rule that that there is no way to protect a judgment that i entered in this sort of action that can't that simply cannot be the case and this court's decisions have have not here is to such a rigid obligation to prove those elements in in a single rigid ron first of all your honor i'd like to make it clear that there has not been a finding of fraud in this case against mr gould so in fact the district court was very clear in its opinion on the appeal from the bankruptcy courts grant a summary judgment that there was not a trial in the enforcement proceeding on the issue of fraud the issue of fraudulent intent was not tried it was mr coo to not present a defense on that issue so it would not in the parties have not briefed the intent issue here on appeal i don't think  would be appropriate since there has not been any finding out on a lower court level with respect to that as for the issue of justifiable reliance counsel made a very good point there is a shift in the burden of proof and under the rules of collateral estoppel when the burden of proof shifts collateral sample cannot be applied in this case the very findings of the district a judge in the enfor proceeding are clear as to why clattering stoppel should not be applied here one of the statements that the that that stands out where the district court said in its memorandum decision the federal trade act is violated if an advertisement induces the first contact through deception even if the buyer later becomes fully informed before entering into the contract now that's that cannot be even that's not actual reliance let alone justifiable reliance in furthermore the district judge said and cited other cases saying that the f t c in order to obtain the relief that it did in the enforcement action need not show that all consumers were deceived or that they were lied on the misrepresentations and whatever it was that was necessary to make the ruling under the f t c act in the enforcement proceeding it certainly doesn't rise to the level of showing justifiable reliance in a fraud case that is being there having been misrepresentations i think it's also important to write it to look again to the district court's decision under the under the district court's decision in the enforcement proceeding the court was clear that it was not required to find that there was an actual misrepresentation or that anybody was actually deceived it only needed to find that there was a likelihood of deception and that just gets to the lower standard that's necessary to prove liability under the f t c act which has been a completely different policy and purpose behind it then the non discharge ability statute in bankruptcy it's a lower standard it's a lower thing it's an easier burden to be met by the f t c once you get to fraud under the not discharge ability statute it's a completely different animal same thing with the issue of damages under the f t c act proof of actual injury to actual consumers was not necessary even if the f t even if the federal district judge did find it in in its enforcement proceeding that there was a consumer that had been deceived it wasn't a necessary finding it wasn't something that was necessary for critical to the imposition of liability under the f t c act however it is necessary it is critical to a finding of fraud that is not destructible under section five twenty three eight to eight so if we can clear the jurisdictional hurdle which seems like it's a a heavy hurdle or a large hurdle in the court's going to have to decide whether bond or mall is still good law in light of bullard i believe that it is i believe the court has already said that it is when it it when it made its decision in landmark fence over time and then i think the court will come to the conclusion that the three remaining issues that the district court said were collaterally stops would not be collaterally and stopped and that mr woods is should have his day in court on those three issues thank you before we before we adjourn i think we should adjourn today december seventh in memory of our valiant troops who were attacked seventy five years