may please the court counsel my name is christopher hegan now i represent the plaintiff appellants in this case christopher white and rep go to lp this case arises pursuant to two federal statutes eighteen u brown leasing versus cosmopolitan bank for the brevity with which you mentioned your client's criminal process was surprising and aren't you really just making a collateral attack on his on his conviction we're not your honor because the issue of whether or not these defendants of creative false statements has not really been litigated before you could have convicted mr white of the crime that he was convicted of and not what crime is that he was he's been sentenced for fraud on a financial institution for what fraud on a financial institution are you saying he never would have been prosecuted had had the had the bank officers not made the false statements i'm saying that he may well have been prosecuted in fact he could have been convicted even without those false statements due to the presentation of the five hundred thousand dollars check however that doesn't absolve these defendants from having created these false statements and have further cause actually cause further damage to mr white and to the other plots to further damage while mr white  his sentence and he's completed all that but he has no ability to conduct the business that he was in for but that's because his conviction right i don't i we don't think it is just because of the his conviction it's because of these ongoing harm because alleged part is that they created records that said that he transferred the money order that the money be transferred from the refco account to the p p usa account and there the evidence will be that that in fact did not occur so that part is alleged so you're saying that the mere fact that he drew and that he knowingly wrote a five hundred thousand are check on account of the thousand dollars and it would not have precluded him from we would not by itself present the bars pulled away because of the bank's false statement as opposed to his check we haven't had a chance to develop those in this case but i can tell you i mean this obviously have back in two thousand and eight and he has long since satisfied the criminal effect of the bank's false statement that was independent of his for oil slick his memory he presented the check at a time he was at a real estate closing thought the check was going to be good it ultimately turned out not to be good we know that we can't dispute that to be convicted for fraud on the team solicit to show which is what he was convicted of it may well be enough that he presented that check at a time when that account did not have sufficient funds in it as we read the indiana statute that may be enough in of itself for him to be convicted of the crime he was convicted of and you're saying that the f b i did didn't have to be evidence that he knowingly presented a bad check he could present a bad check that he believed to be ok and would have been criminally excuse me the the statute for a fraud on a financial institution talks about using a scheme or artifice to try to defraud a bank or obtain credit from a bank ok and i believe that through the presentation of the check that he presented that could be enough for him to be convicted but that's different than the these bankers having made all these false statements and created these false reports trying to further implicate him saying he was the one that asked that the money be transferred from one of company but i don't understand what is the incremental effect of those false statements on his conviction and its consequences or check what was the i'm the incrementalist incremental effect on him of the bank for state yes because the bank has created the false statements that and in which they are saying well what what are  harm to him beyond the harm he did in selfless check well if if again if the five hundred thousand dollars check had stayed right where it was and not been transferred by the bank employees all that would have happened is that check would have been rejected and sent back well if ross write that letter this is why i asked you whether you're making a collateral attack on the conviction now what i just heard you say funder stood correctly is that the only reason he got into trouble was these was the bank fraud that's what you said again and this is not the way in the three that imposes the personal liability on the officers and directors of a federally chartered bank or a federally insured bank excuse me for making false statements that cause damages what's the one other  about do to him well i don't know if you were soft because of that well honestly i think part of that will be developed through through this case and if in the court and you know you have to when you go into a case you have to have some conception sure what the harm to your client was and i thought i know what is it the harm is that there are these official bank statements and reports that have been created that said he asked that money be transferred from one account to another knowing that there wasn't sufficient funds in the first account and that's simply not the case so i don't understand what it that sounds exactly like what is offense with the five hundred thousand dollars check  even if he believed in his heart that the account had five hundred thousand dollars in it he wasn't doing anything wrong but even if that's true i think the argument you're making yes and he now suffers worse because what the bank did with that check is moved from one account to another pay some some payroll and that second that second step is what is somehow standing between him and some you know amorphous employment opportunity now now you're saying that you'd like ever to develop that by way of discovery but surely by now he knows because he knows when he's sought out opportunities that what's standing between him and those opportunities is not the five hundred thousand are check that he wrote but the mr rection of that shack and part of the bank yes your honor and s so who got the cash when the check was ok the what happened was the five hundred thousand four hundred twenty five of that was transferred by the bank into a payroll account for the usa right and that went out in the form of employee paychecks ok so they made a false report about the money how does that hurt because it they have now reported they he put in a phony check or rubber check and asked that and directed that money be transferred from one account to the other and he never ask for that money to be directed from one account to the other know what what is this slander suit or something it is not a slander so much brought under five o three were saying that he sustained damages in consequence of but his only damages was from misrepresentation of what he said the misrepresentation by the bank officers and directors you know that sounds like defamation but we're bringing it pursuant to that very specific assented reports that said he did he didn't transfer it but they all said he did and it is hard for me imagine anybody telling him mr white it's really not that you wrote a five hundred thousand are check an account they had no money in it it's instead the fact that when the check out to the bank the bank put it in a different account that you control it is hard for me to imagine that that would make a difference to some employer some you know some up somebody who otherwise has an opportunity available to him i remember that the pleading standard is possibility that just doesn't strike me as plausible that that there was some opportunity out there that he's been denied not because of his robert check but because the bank mr directed the check or lied about what they were doing with the with the rubber check ok stand your pointer out of i all i know is from his own experiences the damages he sustained and continues to sustain so the bank so the bank said that he had wanted them to put it in some payroll account and really it was their decision so where should it go was it improper for it to go into a payroll account was it just the complaint is that he told them to do that he did it if i understand you're honest question i apologize there's no doubt that the money was deposited or the check was deposited into the rough go count and that was the way it was supposed to proffer that was proper that was done properly so the only complaint is that he told them to do that and he did not tell them to transfer the complaint is there's a couple of layers to and we haven't had a chance to go into it but the evidence will be we believe that the bank had already made the decision to fund the payroll prior to them even knowing it was going to be right at the most right so you know that so they'd we feel they did that on their own to cover a decision they'd already made without without the knowledge or the will without the knowledge of mr white and without even knowing there was going to be a credited or blamed or something with the money going to payroll even though that's a perfectly proper use of money he is harmed by the false reporting that was created to justify what these bank officers and directors did to see transfer and so what i want to know is what rule the want us to come up with because we already have precedent that says that when you have false statements and bank records when it's illegal use on a civil e the plaintiffs have to rely on the alleged false statements now here we know the prosecutors relied on but the plaintiffs don't rely on the false statements so what kind of rule would you like us to come up with i  going to rule in your fate sure we believe that this court's ruling in brown leasing when it went it said that you have to have his criminal reliance by the plaintiff but that goes too far because section five zero three does reliance i'm still lost and how he could be harmed by being said to be the author of the decision to use this money to pay for the payroll when there's no impropriety in the money that well there would be in for me right being blamed for doing something on the law he's being blamed for ordering the transfer of money when he knew that the five hundred thousand dollars check when written did not have sufficient funds that's what he's being blamed for against him yes and for that full amount if he had a number of different relationships with and b i or national bank minneapolis and so when he said the full amount honestly well let's just just let's just take what we're talking about here to for twenty well it wasn't i don't think it was for the four twenty five because when that after they reversed that and collected monies from other accounts and did everything else on which he was a personal that would be like an affirmative sounds more like an affirmative defense on his part you know no i wasn't responsible for this for twenty going to your your your employees were responsible for it correct but that's different audience and raised in the civil suit at all is the defense i don't know what if it was raises the defense or not i was i was not counsel to him at that time but i do know that none of the defendants in this case were parties to that other case oh i understand that but if you're saying you're putting the finger on them there's not i just don't understand why they would be brought well i think under the whatever loan agreements and other account arrangements he may have had with an be id entity he may well have been may please the court are brought jordan on behalf of the defendant officers and directors of the national bank committee map was the district court's grants of the defense motion to dismiss mr white's complaint should be s because the district court properly relied upon the controlling precedent established by this court in brownlee's seen in holding that the complaint failed to state a claim upon which relief can be granted because mr white did not plead to the supposed to just add language to state that's you know what you are supposed to determine whether a plaintiff has the requisite standing to bring a cause or statute seems to be seems to say everything you need to say instead what it one thing the fraud is is it consists of lie to you it's another matter if the fraud is is lying to someone else but you you're you know you're you're in the line of fire the cases have universally distinguished between harm sustained as a result of why why do they want to make that distinction because it is a matter of the who the duty is owed to if i purchased stock in a bank and then down involved and a duty of god to if you harm someone the harmed person gets to why shouldn't that be true with a fraud even though you're not the actual person who is deceived by someone who is deceived and whacks you and the responsibility goes back to the person who committed the fraud that to see the person who harm you because of the deception in this case the alleged harm arises from the conviction not from the alleged fraudulent documents but in general you would not want to do that because you would have potentially millions of unintended third party bank based upon a record that turns out to be false each and every individual in that mutual fund should have a direct claim against the bank although we never knew that our money was invested in that bank much less was done so based upon a false report it's the people who read and rely upon the report and make the investment decision predicated upon that who have the requisite standard because that's what the case is l h s all of them so that's completely arbitrary to cover it the criminal trial found and it was affirmed on appeal that m b i talked to mr white and said if he said float me the money i'll send you a check now mr white wants to take issue with that for purposes of this litigation and that's fine let's assume that what he's alleging is true the bank didn't call him the bank decided on its own we're going to make that provisional credit and then he's going to give us a check later in the day to cover it if in fact they did that the harm that was sustained didn't result from the decision to move the money which all that did is cause an overdraft mr white wasn't convicted of having an overdrawn account he was convicted because he decided to remedy that over drop account by providing a five hundred thousand dollars check written on an account that he knew never contain more than a thousand dollars that's why he was charged with and convicted of three counts right felf bank fraud and fraud on the financial institution at sentencing those were all merged into one but he was convicted of all three so the harm that he wants to talk about is is predicated solely on his decision to write a bad how he is harmed by by what the banks did yet i don't think anyone understands that including his counsel what the at best if the bay did everything that they're being accused of all they did is make the unilateral decision to fund a payroll class which caused an overdraft and that could that situation could been remedied a number of ways right mr white could have told the bank you fund it you made the decision fund the difference or he could have done nothing let the bank come after him for the difference for an overdrawn account but he made a decision to write a bad check for which he was convicted of course he can't get back into the development business because no bank will work with him because he has a felony conviction for fraud on a financial institution that's where his harm comes from not from any action or inaction that the bank took one of the reasons that we've requested this court in addition to affirming the decision of the district court but to take the next step and award us attorney's fees for alyssa appeal is that the arguments that have been presented to alter the decision in brown least amount to nothing more than the statute doesn't say reliance well we know that no one's ever argued that it has to we have consistently advised wolf the district court in this court that this is a standing issue co has chosen not to even address the issue of standing until their reply brief and then their only argument was third party reliance should be sufficient well there's absolutely no authority for the positions and federal rule of a pulp procedure thirty eight in addition to allowing sanctions when the outcome is for gain also allows them when the appeal is made for purposes of bad faith for harassment and we would respectfully submit that that's what's occurring here mr white wants to punish the people at the banks who provided the report to the prosecutors and who testified against him that it's criminal trial this occurred in two thousand and eight in the seven years since that time the national bank of indianapolis has been in litigation with mr white in one defense i'm not liable the bank moved the money without my knowledge or consent and judge metz in rejecting that argument said that timing argument provides you no safe haven because it's irrelevant it doesn't matter whether the bank move the money before or after you provided the check providing a bad check is what got you convicted it's your responsibility it's your fault and accordingly we would expect would request that the court affirmed the decision of the district court remand the case with instructions to hold a hearing on the amount of attorney's fees to be awarded thank you ok thank you mr jordan mr hagin now i'll give you a minute all your time if you have anything you'd like to say think your honor i just wanted to briefly address the motion for sanctions of this case with this case hasn't been ongoing for a long time and clearly the dispute between mr white and b i has been ongoing for a long time however this case not frivolous in this appeal is not frivolous the plain language of section five zero three given the fact that this court and others have said have overruled its own we are told rulings before the fact that the supreme court has talked about how it is not for troll to add additional elements to a cause or baksh and to a particular statute in the second in this particular situation is five o three there was absolutely a good faith basis to bring this lawsuit it may prove to be unsuccessful the trier of fact may find that in fact mr white caused his own harm and he wasn't hurt as a consequence of anything that these bank officers and directors did that does not make the case frivolous the case was brought in good faith