failure of the hudson directors empty directors to perform due diligence the court below made a clear oh in finding that there was no due diligence obligation of the directors that be as he sees letter the part of the due diligence is that the directors should look at the risks that are affecting the company if they didn't there w would they didn't even satisfy that obligation complaint please that the complaint please that the disclosures were simply generic they were they were general and they could have affected anybody in the industry obvious that it's when you have an offer for a checking account now advertising and then you change hands and you charge them that's not something that would have taken that much investigation due diligence and cover and bathe themselves had discontinued risks of the consumer law violations but you know the risks of the of the of the environment the risk that their worst millions of accounts that that needed to be reviewed that they didn't that they didn't know their customer but their disclosures were about future for example the disclosure was he was aware that there have been was increased i'll say activity with focus on compliance but it doesn't mean that they shouldn't shouldn't have complied with the laws all the time i mean this in the verification were these were accounts that had been open for a wrong time it wasn't that they that they that the regulators were asking them for information about current accounts the regulators made them go back to all their accounts to millions of it helps to poor verification  purposes to find out customer information it wasn't simply and it's not a difficult thing i mean as we all know when you go into a bank up to show identification you know you show your id you need to have a few different sorts of identification we don't know that level of detail but we don't have that kind of applies in these kinds of cases we also want to send it back and ask the judge to decide in the first instance where the you've adequately alleged loss causation so i would take that in two parts and the first part of this judge actually already decided that we adequately alleged and that we are the belief that it was brief it was argued and he made that decision so i don't think you have to go back remanded back to a decision on that i'll do don't think he should go back and remanded to the corporate decision on the facts as to whether there has been it meets the rule eight a standard i think that this failure in tents in terms of the failure of the court to find that there's any due diligence obligation is to that discussion a rose in the context of the court addressing plaintiff's argument based on the care and i think what the court was signaling there was as the supreme court's decision on the care makes clear simply alleging that you were negligent in front of an opinion th stated in a proxy statement or in that case a registration statement can't be the liability under the securities laws we were not and have never disputed bet in the circuit court to make claims or subject to a negligent standard what we've argued consistently is mean to me knows  the supreme court said in that case is that for example you're making a statement like the state we have here about it about legal compliance if you never consulted a lawyer on the question or you never looked into it at all and you failed to disclose that that's an important point you fail to disclose your failure to do what folks would expect which is an argument that was not really fleshed out in the district court papers and flushed out someone from this court of the courts questions that yes you see were very interesting that the point that i think has not been addressed adequately by the the plaintiffs in this case is that five or three is not a requirement to disclose all material facts this group started today by saying the correct ticklish of the law as this court laid it out is seinfeld there either has to be in the statement or there has to be a mission of something that is specifically required to be disclosed there is no  statute and also the implementing regulations five of three is not and there's nothing in it and no court has ever held does not establish some overarching catchall to disclose our material facts in this inquiry to disclose those facts that made the because of programs here at the time of the end the existence of the fed supervises all bank mergers that's one of their primary functions and you know the argument is made i think that this is just boilerplate and other companies have these kinds of disclosures and risks that's true but what i don't title three says is that you should not disclose risk that apply to every company such as for example the risk that our business isn't going to do well with the risk that you know we're going to lose employees or something like that completely generic quests it doesn't follow from that but if you disclose a risk that a few other companies in a few similar context would also have but that's generic boilerplate it would be i'm sure that our friends on the other side would have been complaining if we didn't disclose the regulatory risk that was inherent this transaction in fact we did disclose the rest  was considering making with respect to regulation s k and in talking about it in five zero three d the release sort of raises the issue of whether i quote one forty seven about two thousand sixteen release how could we modify our rules to require or encourage resit registrants to describe risks with greater specificity and context for example should we require registrants to disclose the specific facts and circumstances that make the best material to the registrant and then the f c c goes on to ask for comments about how making those amendments might affect the cost benefit analysis of disclosure so it's clear from the very release that the court was  that the discussion is supposed to be concise if there was an overarching view to disclose all material facts this is consistent with the second circuit which has had the most extensive discussion of this very same issue in the city of pontiac these allegedly problematic practices were in place at the time the proxy statement was issued but there's no allegation that anyone in any of the regulatory agencies implicated had ever raised the concern to and if the bank before the posse statement was filed  cathcart that's in the spirit of this you have to impose a requirement that once i graduate has raised concerns and you have a concrete issue with a regulatory the way or potential problem with the merger at that point there's a duty to the directors of the company was considering amending the bylaws to put in new indemnification protections for directors and the plane and said hey this company has issues with potential corporate misconduct and we think these directors may be implicated in that they should have disclosed in the process statement that they were potentially going to be subject down the road to litigation relating to their oversight of the company that allowed this one to work and this court said no there's a distinction between potential or speculative or theoretical here are the sick in particular the bank secrecy that we refer to as violations but that's actually shorthand it's unhelpful but they really are is there's a requirement that you have to have policies and procedures in place to deal with any money laundering concerns in the know your customer rules the company indisputable they had policies and procedures in place they made a statement about just gracious in the in the process statement that they believe that they were in compliance with the usa patriot act requirements it turned out which they did weren't a few days before the merger this is according to the allegations a complaint it turned out that the fed took a different view and had concerns that maybe the policies and procedures were not sufficient so it's not as though their people were going around breaking the law they put policies and procedures in place th consulted their lawyers and it put out a statement saying we believe this is enough the fed then raise an issue and said we're not so sure and then t bank promptly amended file the supplemental process stating which they sent out to stockholders that said in fact the fed has raised  concern this merger is going to be delayed and we cannot be sure when or if it will ever close it has to be enough because the notion that companies need to be disclosures affirmatively and essentially self report saying ar for the f c c to resolve there is no i c c regulation that says you have to wait a minimum number of days when you get your facts come out and it would have essentially required the company to the way the vote to give the stockholders you number of days a day that they believe they were entitled to and it's interesting acknowledge that one of the reasons why they were changing the rules was because in the modern era stockholders get information more quickly and they simply said this isn't an issue that should be left to state law essentially the plaintiffs cite state law cases an injunction contact saying you need more time to consider the facts that come in and that's a state law issue we think that those cases are distinguishable and one of the cases they cite it was a situation where material facts about the negotiation a transaction that could have been known significantly hair i think need to address that point i do want to touch briefly on the p s l or a standard i don't think there's any question under the statute that the be one requirement the factual particularly standard applies to any private action under the exchange act that's the plain language of have to meet both standards it wasn't all the plan to discuss this case where it is a negligent space claim and the defendants are saying yes you still need to meet the b one standard that there is a duty to say we violated the laws and in fact that took the third circuit said in clear magic magic said a violation of consumer laws at the substantially lately to be significant to a reasonable investor is a fact that must be disclosed even though the legal consequences of that violation made the contingency to another thing they have to say we all have to admit that i violated the law but they have to admit that information that they had that position that they were too late too soon and interesting and i was preparing for this argument i was looking at the product the statement again and again the practice seen when it's sent out to shareholders it was sent which is now three days it's a monday and there's a when c vote this do so it's not that you're going to walk in and hand in your vote on wednesday you're going to pick that vote in the mail so it has to have  one wants to argue that which is what defines what i do it's still an issue of material fact that should go to the jury it's not coming it should be decided as a matter of law with respect to another point sor