we're here today an appeal of legal sanctions order issued by the bankruptcy court in three cases white to dwell in calloway and then three additional cases that  closed the time of the order but which the bankruptcy court reopened to interviewer in those cases and impose sanctions the sanctions order that were appealing is the product of a show  basis for the sanctions and i do need some clarification on this is that's the disclosure statements contain false statements that was one of the things that the that the bankruptcy court found getting to the merits of the bankruptcy code sections of the bankruptcy rules that the bankruptcy court relied upon to impose the sanctions in iran or is correct that bankruptcy court found that the attorney misstated was in the field what was covered by the fees that your client charged and i'm sorry if that's how it came out you're on and that's not what i intended to say i meant to say your honor is correct that the bankruptcy court made that finding and impose sanctions based on what it believed were violations of certain rules and certain bankruptcy code sections but our position our opening position is that the show cause that what are in the evidentiary hearing on that order disclosures that you filed don't violate this september two thousand and sixteen settlement agreement that was entered in in cook in the queue an adversary proceeding from my order that approved that settlement that's what he told us to do and we did agreement and it didn't specifically retain jurisdiction to enforce the terms of the settlement to those cases remain open and afterwards the computer one case is you're on it no those were done so the subsequently filed cases for clients covered by the settlement clients that retain the firm prior to march twenty one to two thousand and sixteen in the cases in which the in the cases in which the be a had filed motions all of those all of those disclosures of compensation had been amended your honor all sixty six i think in the six cases boy cause order were just about whether or not those filings violated the settlement agreement and under the could conan decision which was a unanimous supreme court decision the court says you don't have jurisdiction for that except th could conan decision did involve rule forty one your honor but you have to look at this austins of what the order approving the settlement did it was essentially the same as a rule forty one dismissal the bankruptcy administrator filed a motion to approve the compromise that had been reached in cookham mckeown and the bankruptcy court said that supplement in fact that was the one word that was in the order it just said approved and then the case was bankruptcy administrators examine motions in the right callaway intend wrong and absolutely your honor but by the time the show cause order was issued those motions were no longer on the table the bankruptcy administrator filed a motion for examination seven possibly run afoul of i think it was bankruptcy rule twenty six dollars how could you examine all of those things that without looking back at the settlement agreement that's fine you're out or the court had jurisdiction on that but we had a hearing on the motions to examine we had it on july th in the bankruptcy administrator requested a bunch of relief but the next day the bankruptcy court issued its show cause order and this is how litigation goes all the time i was going to show cause when the lady she's hearing on the motion to examined absolutely but then we had that show cause order in parties do this all the time they ask a court please you know enter an order grant certain relief and sometimes they get all that they want after that hearing whatever the whatever the be a file requested in its motion to examine this is what i'm having you show up on ok and that's what courts do you ask for relief you get some of it you get none of it here we got the show cause order and that's what the parties had and that's what teed up the hearing and to now go back after the sanctions order has been entered and say what wasn't at what isn't all of it on the plate it's relevant to look at the hearing on this show cause order not a single reference not the b s a not our attorney not our witnesses not even the court referenced the govt bankruptcy code section from the motions to examine didn't mention a single bankruptcy rule from the motions to examine sanctions order based on that the court then issued an order to show cause say here's what i want to examine and we also drop and limited issue it's all that was examined the proof required for imposing this different than under a breach of contract the proof required to impose sanctions and injunctive relief under section five hundred and twenty six dollars is unique not a single one of these provisions were mentioned during the hearing we're talking about due process meaning notice and meet the opportunity to respond and if your honour's look at the briefs and i've quoted it twice at the end of the hearing on the order to show cause after no one mention section five hundred and twenty six any of the bankruptcy code sections or rules i am asked ok i started whispering to my attorney asked this question but judge robinson my time is about to expire do you want me to may i please finish this thought you said and i have a question brief whether or not upright violated paragraph six of the settlement and the judge confirmed that was the case and our subsequent post hearing brief made clear that was our understanding and the failure to mention any of those code sections during the hearing demonstrates that it wasn't just uprights understanding it was everyone's understanding let me know how much of the eighteen months suspension is still  that civil penalties are by definition punitive judge robinson imposed one hundred and fifty thousand dollars in civil penalties well well not but definition if it's if the money goes to the people who were damaged for example that can be compensatory but the money in this case didn't go to going to impose this civil penalty but he imposed it pursuant to section five hundred and twenty six the five that's a penalty it wasn't compensation compensation is available under other bankruptcy code sections but not here and we did not brief whether or not a penalty imposed under five hundred and twenty six is punitive that really hasn't been disputed but if your honour's want us to brief it there's so the suspension part to the extent you're on that your honor but i think that given the other argument certainly the idea that that the due process argument that the court could impose relief based on sections that were never at issue in the proceedings that led to the sanctions order the court's ruling on that issue i think it's probably tied to what the court would rule on the monetary sanctions anyway but you're right we can't undo the suspension  to trace well they were sanctioned thought it goes to the decorations and those are all basically talk about false statements and misrepresentations yes or they don't basically talk about it statements not a fact but all that at the heart of the issue under the settlement agreement for these six cases upright was supposed to provide certain services that were normally excluded by their attention agreements under the settle that they violated declaration not the found declarations that were inconsistent with their obligation that indicated an intent about what they were to provide no register cost that was inconsistent with what the settlement agreement obligated with them took no extra cost current so where is the fact that they didn't say in those settlement agreements and we don't have and sixteen declaration it's their representation to the world of what they're going to provide they tell these debtors and that disclosure we're not providing a whole list of services these debtors and that's what drugs look at what about what and eighty eight to support support three which says misrepresented to any assisted person or prospect of assisted person directly or indirectly affirmatively or by material mission with respect to the the court as well as not just the debtors to disclose the services accurately and make sure the fees are correct they made misrepresentations in the bankruptcy court as well and that's where you get into this abuse of the bankruptcy process and that those were stated  and twenty six the things that are obvious and the rely upon so they had notice again from us and they had the opportunity actually to respond in writing so we believe that there was an actual notice an opportunity for up right knew that the authorities were allied upon in the most sions were fair game when they filed their principle brief after the show cause hearing it's in the record their brief the title of their brief set up right respondents it because they didn't bring it up before the lower bankruptcy court in a true you can't leave so the matter than the factual question did they violate the actual order and up rights initial brief after the show cause hearing they stated that they were under no circumstances i'm paraphrasing there no circumstances could they have violated the settlement agreement without violating the order or vice versa so on the factual question of the bankruptcy court was correct that they violated the settlement agreement they've waived the argument that they violated the order so there's a jurisdiction you can't waive components that are essential to the determination of no sir i guess not i was yes or in this case i don't think there's any dispute they had subject matter to the court had subject matter jurisdiction because it's rooted in the motions to examine that relied on not the basis for the jurisdiction for the court to look at what right but if we accept your position any lation of a sudden agreement the party on the term is subject to sanction by the bankruptcy court assisted person but of course the factual basis for the fact that misrepresented something to an assisted person is this person would be the debtor and the actual attorney disclosures or the representation so disclosures somehow could have been considered misrepresentation to the to the debtors the answer is no and i think that  the representations in the disclosure of compensation are somehow inconsistent with the settlement but that's not the point of the disclosure of compensation and in anticipation that the court was going to ask questions about this i did bring copies of the disclosure which i would like to distribute if the court will allow me to just give them to the deputy clerk a thank you you know those are in the record books here for the purposes of this oral argument you are correct they are in the appendix that document seventeen dash one page forty seven or ninety three the disclosure of compensation is all about what the green bay services were for the settlement agreement was different settlement agreement says you better provide services at no extra charge while the evidence shows we did that  but the disclosure of compensation says what did you agree to now right or wrong maybe upright law should have clarified something here i don't know but they genuinely believed if you look at this language put on my readers here looking at the opening paragraph and i'm going to jump forward in language pursuant to section three hundred and twenty nine dollars a the debtor agreed to pay me and then it lists the amount the st line under that i have agreed to accept that some out for services going down to section six dollars in return for the above disclose fee i have agreed to render these legal services so by agreement with the debtors and if you look at the final at the certification and this is really the main representation that this attorney's making to the court i certify that the foregoing is a complete statement of any agreement upright law believed that it had a say in this what the agreement said and the idea that he would falsely represent this to the court after just signing a settlement agreement where we paid fifty thousand didn't charge for the services but we file a document telling the court in the world that we did i watch a lot of crime on t v crime shows on t v that's not how it's done for you to follow the law secretly and then told the world that you know that's and that's an argument to the district and that the bankruptcy court made clear right i mean the bankruptcy court mean a finding of fact that there were intentional misrepresentation right the bankruptcy court did find intentional and that yes i mean the intent there is no evidence of it there's no evidence of intent we're looking at this document that everyone saw you know one thing the judge robinson said and i thought this was just he said you know guys this could have been avoided with a phone call  you have a panel trustee you have a b a let me all of these documents you are returned let me ask you this question which is not essential to the decision we wonder why exactly are we here you're out from under the fine like this but that's all you have to say a lot of cases given court because of monetary disputes and i understand that and that's good enough appreciate it we'll take that case under submission then stand in recess tomorrow morning