provide the court with a bit of background to keep everything in context here relative to the summary judgment order issued by the district court on january seventeenth of two thousand and eighteen the quick background  is there were companies involved and there were individuals involved with respect to the purchase of wind turbines that were going to be constructed in and around the one known to minnesota area the manufacture of those wind turbines was a company by the name of unisom based out of south korea there were a number of agreements and what eventually happened is that unisom believe that it was agreed by some of the actions undertaken by the individuals which are the insureds in this case as well as the companies so there are a number of claims asserted in a federal district court action which named the companies and named the individuals the quick background is that there were seventeen counts that were alleged in the initial unisom complaint three of those were directed to the individual in this case i think they'll be referred to back and forth as either the insureds or the appellants and those are the individuals  that the quick math keep in mind through this is that seventeen claims one of the initial positions taken by national union in the event that it was going to provide defense costs on behalf of the individuals was to take a simple math say there were seventeen claims asserted three of those were asserted against the individuals and that gets you to eighteen percent so when we get to the question of what is this case all about it's not a coverage case we're all in agreement about that it's not a duty to defend case what it is is a case to determine what is a fair and reasonable allocation for the recovery of fees and costs incurred by the individual insureds in conjunction with the unison litigation now again with context and how this plays into the summary judgment unison initially asserted a number of claims against as you mentioned the corporate defendants as well as the individuals three of those are against the individuals in that federal district court action defenses were certain behalf of both the companies and the individuals the key element with respect to the defenses that were asserted in that federal district court action came right out of the box and i was wait a minute unisom you misrepresented what you could deliver you did not conduct any cold weather package so you breached the contract by delivering to us defective wind turbines now the reason why that's important is that's going to be a string throughout the litigation and subsequent arbitration the sort of by both the company and the individual defendants and that is look at unison you breached first so regardless of what seventeen counts you have alleged against both the insurance and the companies they don't go anywhere because of not counsel i follow that i'm wondering though does that string end with the arbitration award i mean my recollection of the award is that it was not explicitly based on a breach of warranty claim as a matter of fact i remember some sort of comment in there about the arbitration panel found it to be not dispositive and then the panel went into some equitable relief  the contract does that matter you're it's your citing this chord through the process and ultimately in you may disagree with the way i'm reading that i may not be fair that but it seems to me that's not what the arbitration panel made their decision on then does that matter am i accurate there yes you're accurate secondly i don't think it does matter because keep in mind with respect to the policy and what the individual insurers are entitled to recover that's the cost of the fence doesn't say it's got to be a good defense doesn't have to say it's a bad defense doesn't even say it's got to be competent counsel at the end of the day we would submit that yes you're accurate about the reading of the order but eventually the insur whatever defense strategy was implemented on behalf of the appellant's in that litigation ultimately prevailed because as we pointed out one of the cases is that a great western casualty would require that the insurers receive reimbursement for their fees and costs associated with limiting liability that cited on page twenty six of the brief and that's exactly what happened so i agree with your assessment the court or the arbitration panel did not ultimately  dismiss the claims of unisom based upon the breach of warranty or the fraud but ultimately whatever defense strategy was implemented on behalf of the insurance one there was no liability whatsoever assessed against any of the individuals now one of the things that again the string goes from one of the issues is the case went from federal court litigation and then ultimately want up in arbitration the reason being is that there was an arbitration provision in one of the key documents for the purchase of these wind turbines now what national union has been arguing throughout is well wait a minute this policy doesn't allow for recovery of fees and costs in an arbitration proceeding yet when you read the policy there is no distinction whatever form is selected if they are reasonably related to the defense of the insurance and we all agree that the insurers are entitled to some recovery it's just a question of the allocation of that recovery it doesn't make any difference whether or not it's in federal court litigation or it's in the arbitration now eventually the case got arbitrated and what's important to remember is unison a t seventeen counts in a federal court litigation the insureds and accompanies a certain number of defenses the cases then kicked into arbitration and before that the defense counsel for the corporate defendants and for the individuals opted to put the case in arbitration it was a decision made because their conclusion was individuals are less likely to get stung by an arbitration panel as opposed to  al liability in federal district court so it was interesting then when the case then was converted to arbitration the exact same defenses became affirmative claims in the arbitration now that's one of the beefs that national union has saying well wait a minute that the policy doesn't provide an allocation for recovery of fees and costs in the event that the insureds in this case assertive firman of defenses well we've cited a number of cases that stand for exactly the opposite of claims in the delaware court and ultimately core concluded that b p was in paddle to whatever allocation was reached in that particular case for the recovery of fees and costs even though affirmative claims were asserted up in the delaware court now we get further string down where the arbitration is going and you decide on finally it's around to asserting its counterclaims because the arbitration if you recall was commenced by the corporate entities and subsequently joined by the insurance so unison does its counterclaims and then along behold guess what the defenses are there the exact same defenses that were asserted in the federal court litigation and now become the exact same defenses  arbitration ultimately prevails but in the meantime we have the summary judgment motion and this is the crux of the appeal if we take a look at the arbitration i'm sorry the just a quarter ward we don't disagree with the proposition that the insurers were looking to get a one hundred percent allocation of the fees and costs based upon the supposition that the defenses raised on behalf of the insureds which we claim were absolute that if they prevailed there could be no liability whatsoever on the part of the insurance and also the company so based on the assessment of counsel representing the insureds and the district court litigation  sought an allocation of hundred percent clearly the court disagreed with that however what's unclear about the decision is what that it say then because national union also brought its cross summary judgment it had argued early on that there was i think it's pretty clear what the what the court in fact the court clarified that it not i don't believe a bit that the parties asked the court to clarify to explain what what is what did the decision m right it meant that the entering or and the court said plaintiffs amended complaint sought a declaration that they are entitled to it to one hundred percent of defeats phase it cost no party saw it declared to relief as to any alternative allocation a mail and according to the court's january seventeenth the order is limited to the issues presented is not represented decision as to any other issue so as i read that the district court viewed this action is as a kind of an all or nothing i'm entitled to one hundred percent but no alternative request and the court viewed the action as something other  than a action for declaratory relief where the where the request is for the court to determine within a range as to what what the relief would be so with that being the case i wondering what do we have what do we have on appeal i mean way well apparently national union is of the belief that the court agreed with the forty percent recoverable fees in the litigation and ten percent in the arbitration because they continue to remit that amount to the individual insurers and that's why it's unclear let me let me ask it this way if this case is submitted and our court affirms the district court where does that leave your client i think it's going to wind up in another action a for the fees and costs that were paid subsequent to the issuance of the summary judgment which the national union can and i know but do you think affirming the district court in titles you to a recovery of some amount well i think it more properly should be remanded because i go back to the language in the court's order saying national union proposes that point of space forty percent of the exposure because they comprise forty percent of the units on made an argument for one hundred percent it just said i want to ward for one hundred percent period and the court said but but what is the fair and reasonable amount i mean of the dollars he requires here the district court out that you know the issue was not before it and i'm wondering if it's if it's before us that wasn't before the district court how could it be before or how could it be before us well the reason being is that apparently the order has been interpreted by national union to support what they had argued as a forty percent allocation for the federal court litigation ten percent only for the arbitration there's no finding and i support that now they've they've paid those those moneys correct the forty they sent to new to pay those because the arbitration award was subsequently submitted to the federal district court for final approval well under the piper jaffrey case it's in the papers isn't it your burden to overcome and if you didn't file the appropriate motion if i'm following judge shepard's you're below seeking that in the court rejected your one hundred percent aren't we left to the status quo and that's forty percent ten percent that may be but again that's not what i think the court order said and if in fact it is the ten percent that is a distinction without a difference because how do you say you only get forty percent for the federal court litigation when the exact same defenses and claims were certainly arbitration and you don't have a provision in the insurance policy that draws any distinction whatsoever between having it either mediated arbitrated litigated or otherwise and there's no finding by the court that in any way addresses the fact there is no reference to ten percent in the district court order so that's  why i'm thinking we have one party interpret it as a forty ten we have another agreeing that it's not one hundred percent and we did throw in there under rule fifteen that the court could you know look at alternatives that were put into the  pleadings such as the eighty two percent but it was the national accounts i'm looking at what the play what the what the complaint and the answer say and seems to me that all that presented to the district court was the single issue of was was one hundred percent i don't disagree with that but you also have a cross said no indications but you also have national union bringing its own cross s judgment motion it wasn't the finding against one hundred percent it brought its own motion and in that the court agreed with the forty percent allocation that it found to be more reasonable than the one hundred percent allocation that was being requested by the insurance so again as we read the order it seems to stand for the proposition that the court found that a forty percent allocation across the board both for that because she she lump i see my time is up if i can finish this this one line so that the court doesn't draw distinction between the arbitration and the litigation it merely continues to say the unison litigation so based on the court's own language group together and didn't distinguish between recoverable fees and costs associated with the litigation bursars those incurred in conjunction with the arbitration so by reading that one provision of the forty percent being the more reasonable allocation submitted by national union that's what i believe the allocation is at this underlying cases the arbitration in the district court action which is called unisom lawsuit of the motion brought by dell exclusively with one hundred percent recovery of costs and fees and both actions that was the motion that was brought a national union brought across motion for an order that apple ones didn't meet their burden of proof to demonstrate that and also brought up alternative partial summary judgment motion seeking to remove some of the fees and costs based on an expert's a review of the invoices but the court's disposition i e granting national union's summary judgment motion in denying appellants summary judgment motion brought into the case in as much is what national union had been doing before and during the case was providing forty percent of defense costs in the unisom lawsuit and ten percent as to the arbitration we don't call them defense cost because they were just fees and costs they weren't necessarily defense costs so that in our view that is the sort of the default if you will that the policy provides for unless until such time a new allocation is agreed upon or determined by a court so we believe that the case is over and that the allocation that national union has specified not having been changed by the district court in any regard should apply there's no there's no there's no district court order that adopted you're you're your percentage so forty ten there is no order that says well the judge did say forty percent was reasonable in the unison litigation but the court did not directly say ten percent is reasonable with respect to the arbitration in her order but she did grant national union summary judgment and not i appellant some of joe maybe i'm just looking at this it in totally the wrong way but as i look at the pleadings i see a complaint in which the appellant ask for a declaration that one hundred percent of the fees and cost should be paid correct and your answer is denied that correct presented to the court as i see it it was is one hundred percent yes or no that is correct and whether court said no and clarified that in this text entry on february the ninth of two thousand and eighteen and in fact specifically said no party sought declaratory relief as to any alternative allocation amount and the court's january seventeenth order is limited to the issue issues presented it does not represent a decision as to any other issue that's correct or are that was what was before the court and again it was our view that it was apple and burden  show an allocation in these cases it's important note that the coverage involved here has directors and officers coverages not general commercial liability coverage that brings into it into the case duties to defend and things like that this coverage does not involve any duty to defend the burden lay with the insured to demonstrate an alternative allocation israel is required or appropriate under the policy well the district court said no denied the request the claim the appellant for recovery of one hundred percent the court said no case over he think the appellate could bring another action in and the alternative amount no i don't believe so your honor and i think that was exactly what was being litigated in the matter that were standing before you today on we believe it was appellants burden as i said supported by the united health case puts the burden on the insured the appellant to demonstrate what would be an alternative alan ok let's put it this way let's say you quit paying and you've not paid even the forty percent what recourse would the appellant have i think that would create a new a new issue entirely it's an aside but the arbitration is now complete and it's been confirmed in the district court and so the bills have all been submitted and as i understand it paid but that would seem to be a separate breach of contract wholly outside of anything we're discussing here with respect to allocation in the underlying for the underlying litigations well that the appellant would have no court order or judgment that it could proceed on would it not this court's order but it would have the contract in what national union and perform how it nationally had performed in the past pursuant to that contract but again the court the appellant's didn't give the district court what it required to come up with a different allocation appellants had argued in the alternative for perhaps an eighty two percent allocation of forty percent allocation the response papers and summary judgment the court did get into the reasoning as to why she was rejecting  those allocations and she didn't specifically reject the forty percent although the court did discuss the reasoning that would have supported or undercut the reasoning for the forty percent and it was it was clear that the court did not equate the unisom lawsuit in federal court with the aaa arbitration for a number of reasons that was not those were not considered to be the same action and what opponents of merged is the court to sort of see these as just the same unison litigation when they really are they are different actions they involve different offenses detouring claims did the parties before the district court by agreement submit the issue to the district court of exactly what percent what percentage should be recognized and established but we certainly made the court aware that national union under the policy of insurance was paying a forty percent and the ten percent we did not squarely pose the reasonable those allocations but we did challenge app appellants burden of proof on the issue so what's the answer to that question so i think it would be rescue to kata there would be no further action so while they are in agreement was this an agreed issue that an issue that meant of the parties regardless of what the pleadings take up the parties agreed that the district judge should set the percentage you know what happened no i don't think that was the agreement that the judge would specifically kind of read all the facts and determine it all we knew is that we were chat we were facing summary judgment motion that sought one hundred percent recovery and we were challenging that also moving to say that appellant had met its burden but no there was not an agreement to say well we're going to allow the judge to come up with a specific numbers we just came out in the cross motions one side looking for one hundred one side saying no it's not one hundred and we've been paying we'll continue to pay the forty and the ten but you haven't met your burden of showing an alternative allocation so it's sort of like the policy itself crystallizes that that allocation until such time as the insured comes forward and says no no no it has to be different location for this reason and this reason and this reason and that that did not occur we don't think that they met their burden and that's why the motions for summary judgment were granted in think they could bring another lawsuit i disagree on to an alleged ninety percent this time and if they lose then bring another one that alleges sixty percent i don't think so i think that ship has sailed i think the time to have brought that motion would have been in the underlying in this lawsuit that we have before you a couple of issues with respect to the cases there's really the cases that parts of cited that deal with allocation many of them will involve duties to defend which i've said do not do not implicated by this case and other ones where appellants of a claim that we're entitled to affirmative relief for defense costs for the affirmative actions that non insured under the policy have brought in the arbitration cases always state that it is that an insured that would bring it across claim or a counter claim and the courts and so on some occasions when there's a symmetry to those claims when the the the affirmative counter claim is in essence a defense courts will say that that's there's recoverable costs there those cases involve insureds which didn't was not the case here the aaa arbitration was commenced by two non insurers there was no coverage for the contract claims and subsequent fraud claims that they brought in the arbitration but also so they weren't insured in the first instance but also the claims were not defenses they were affirmative claims that arbitration panel ultimately resolved and said that you know neither side had had neither unison nor the apple once including the non insured entities to prove their claims and so they want one wasn't a defense the other and they that should not be not fair to look at the aaa arbitration say well these are all defense costs and in fact as the court is aware in the papers the claims in the arbitration against the individual entities and those would not have constituted defense costs and the policy would require a claim against the insured the the issue with respect to the eighty two percent and forty percent allocation requests by the appellants as i said those were presented in response motions and summary judgment the court did it directly address the eighty two percent the choice selection of eighty two percent and found that it was not reasonable and the national unions forty percent was reasonable the ten percent appellants claim that there was no resolution as to whether ten percent was or wasn't reasonable again we maintain national union didn't have the burden of showing ten percent was reasonable or unreasonable it was the appellant who had the burden of doing that and so in that sense opponents are trying to shift that burden when you know otherwise the court found that the reasoning underpinning the request for forty percent of the arbitration was not did not justify it because of what we could argue that these were not insured claims being pressed in the in the arbitration your wanted to make it clear that these initial defenses became affirmative claims in the arbitration and then became defenses again in the arbitration so i fail to see the difference how there is no when you bounce a defense to an affirmative claim back to a defense with that's one thing i'd point out because to draw a distinction between the affirmative claims and defenses there is none because they became defenses twice and they were firm and of claims once