to the original complaint everything we've been complaining about from the outset is mentioned in one way or another in the original complaint and we clearly pled that this bribery and corruption and f new parties they were on notice if we look at crop ski ski teaches us that we have to look at what that the fence new mr rank was the c e o of wall max the day we sued wal max mr rank is making public statements all the time including in the annual reports and in press releases which we added mr rank we found out later and this goes to what the defendants know we found out later that m rank personally vetted the december eighth two thousand and eleven wal mart false statement they bring the false statement to the c e o of warm x and say hey take a look at this we know the new york times is after us they've been  trail since october of two thousand and eleven we need to say something we need to spin this in some way take a look at it mr rank and he vets it along with a jew a war on list of wall next board members all next officers and a long list of war more offices so missed the rank knew he was up to his eyeballs in this situation and knew we would have sued him if we knew what he knew and he also was the executive driving the growth which is through the bribery as far as walmart in the original complaint we named ten individuals by name that were involved in the corruption and in the coverup five of those people worked for wal mart so wal mart also knew or should have known that it would be sued and it was being sued in all consort for the same false statements and coverup that we're trying to bring on behalf of the purchases of the wall max a d r s so i submit we satisfied as to those two people and everything in the second amended complaint i also submit relates back to everywhere he's on the board the chairman of the board of war max and the chairman of the audit committee from two thousand and four if not earlier all the way up to two thousand and twelve they get they have a long laundry list of people they've admitted vetted the false statements knew about the bribery knew about the coverup he's not on it so i say it's a close call i concede it's a closer call as to mr vega but you'd have to believe that the chairman of the board and the chairman of the audit committee in a case involving a full sophistication of what it records when the walmart unit the investigative unit comes down to mexico to investigate going through their books and records finding the evidence of the accounting  falsified cations the just story illegal payments paying the mexican lawyers to bribe that that the only person in the whole building who didn't know that this was going on is mr vega what you're is what yours is a fair statement of what you're suggesting that you're not just relying on his job title as might be the case if there's some kind of skullduggery going on with cooking the books and he should have known or should have been advised or something like that based on his title it's not that kind of inference you're saying that since this is really about the cover up that this is a situation where once the wal mart people are sort of crawling all over the office and people in the company are complaining about  the intrusion from arkansas and all of this that under those circumstances it is in the building he has to know that this is going on is that is that kind of the idea yes you are it's the context of the entire controversy that it doesn't get much bigger than to have the investigators from wal mart to have the general counsel of wal mart international fly down from bentonville to get to try to get to the bottom of this to hire willkie foreign gallagher which they argument that they are false statements here but you started with the idea of this is a scheme and surely what is alleged is that the scheme is it a scheme to defraud the tax the shareholders well it's a scheme to break the law to benefit the seventy percent shareholder wal mart to grow the business of war max and it's a scheme that if it benefits the seventy percent shareholder doesn't also benefit the other thirty percent shareholders too it does except for the people who bought the stock in the class period based on the coverup still going you know going well and the other false statements being made and then the bottom drops out when the cover up is exposed and that's what my clients in the class they're the ones left holding the bag it sounds like again you've said because they bought in reliance on the false statements and that i understand that brings it back to the false statements though that's not it's not just the fact that it sounds like when you talk about the scheme you're talking about a scheme that may violate the foreign corrupt violate mexican law or may be morally corrupt or whatever else it is the scheme to do the bribery and then hide it from everyone is that in the shareholders it is you wrote it because it's benefiting to the corporation because it's using its subsidiary to break the law to grow its profits and the high level officers and directors are either doing it or covering it up say something that sounds like it's almost condoning misconduct just a question of what kind of misconduct it is if they had a successful cover up everybody would have benefited among the shareholders not just the seventy percent shareholders and seventy percent shareholder and when it collapsed everybody lost including wal mart right there the value of their shares goes down to yes but the difference is they're guilty and my clients are innocent i think our concern is what you're saying is basically any conspiracy to falsify accounting records cover up a conspiracy and when you say you're not doing that that you're in compliance with the mexican market securities law you're in compliance with the audit practices committee and such when that's not true and you know that's not true this is a case that has a combination of the scheme and false statements there's a good case as c c i think we started in our brief judge cram decided it it's a combination of a scheme and false statements you can have both because that's how people do it that's how they pull it off so with respect i don't see to the full statement just trying to break that  can understand what we're talking about do you agree with the analysis in the at least brief that we are down basically to eight alleged falls because all the other see those years of drumbeat of saying we obey the mexican securities law we obey our accounting is proper we're not corrupt we say that's evidence of the scheme we're not trying to sue upon them we're suing upon the false two thousand and eleven and you report statements and five of those eight statements are basically statements about what the books and records show which are effectively accurate there's no suggestion that they didn't make this money in that year or they cooked the books in a way that is relevant to how many dollars they made or didn't make your effectively saying any financial statement is false if the money was made in a way that was illegal and if it's exposed then it will turn out what they still made that money yes run up five of these are just flat out earnings that's correct and i put them in part b i'm not hanging my head on poppy i'm banging my head on potty but just quickly on poppy if you're constantly telling people you're growing your business but secretly it's because you're bribing the question is are you putting in issue how did you grow your business so well if you are then you have a duty to disclose it if somehow you're not there in poppy in this year but your first book for your hat or the three statements that say were complying with the law right when they weren't and that their controls are in place and that they have to know exactly and and in the context of a kind of you have a few minutes left for rebuttal what we hear from mr wal releases that factually narrate year over year comparative store sales and opening of new units they say nothing more than that mr mckenna does not claim that they say anything more than that this is clear we submit that where you do something like the factual narrative of you know arguably accurate financial information and you don't go on to say that you have achieved that financial result as the result of something that mr mccann is complaining of that's not actionable the beyond cases that marsh mclennan says that correct complaint as mr mckenna allege that the there are two statements one is a press release makes is committed to act with integrity in full compliance of the law and the other is from the two thousand and eleven wall makes in a report honesty and integrity continue being non negotiable core values nowhere in the second a minute complaint does the appellant argue that the statements are false there's no allegation he does not take that on the only thing that he says when we raise this is that while you have to understand they were false in context and the context that he offers is the third amended complaint nothing from the original complaint nothing from the second amended complaint and as the court is well aware the third amended complaint is not not in front of the court and so what we would submit your honor is that he's waived this argument and this is he stands up before you know and makes argument it's not before this court on appeal in addition your honour's these statements are classic puffery as the court has held in cases like indiana public retirement system the e c a case and others that are that are cited these are statements which reasonable investors don't attach significance to because they are not specific and this court's jurisprudence and in all of the cases that we cite in our brief finds this time and time again mr mckenna argues in his brief that the question of ethical compliance and integrity is an important issue and as we point out it is this court has pointed out that many times and i don't have any quarrel with it as a general proposition that of companies say repeatedly over the years we have a code of conduct where we always behave ethically and then turns out that  no one can really guarantee that and they did something improper appreciate that is normally puffery i thought the context that mr mckenna was referring to in his brief was actually the context of but they also know that the new york times is likely to bring out a story that does considerable damage to the idea that they always behave with integrity and they're trying specifically to to counter the the public relations hit that that may be a in effect denying the story before it even comes out does that make a difference as compared with just a generalized statement that we always obey the law well first of all your honor i believe that his allegations with respect to mr rank again are taken from the third amended complaint with of violations having been made six years previously and those had surfaced and the company was then proceeding to investigate them that is the most that is alleged anywhere in the new york times article or in mr mckenna's argument so that's that's the that's the background when you when you ask the question does the pendency of the new york times article even assuming that it's part of the sac not the tack for these purposes  does that change the question of integrity and i would submit your honor that the answer is no because it's really important i think from the point of view of the consistency of this court's jurisprudence that what you need to do if you want to can transform a generalized statement about commitment to integrity into an actionable statement is what this court found and judge once you were on the you were on the panel in the indiana public retirement system  where it says a company's specific statements that emphasize its reputation for integrity or ethical conduct as central to its financial condition where there are clearly designed to distinguish the company from other specified companies in the same industry there's no indication of that here mr mckenna doesn't argue it it wasn't raised in the district court it's not raised in the briefs so it's one thing to stand at the podium and sp tale it's another thing to be able to point to allegations you know that are well formed in the complaint in the operative complaint and to be able to demonstrate that those allegations meet  challenges with respect to the question of compliance with the mexican securities market law i would note a couple of things here your honor first of all mr mckenna doesn't argue that that statement of compliance is not puffery he never takes that on he doesn't in his brief or in his argument disagree that that's puffery he does  as judge fail and found he also doesn't claim certainly doesn't allege in this in the second amended complaint that it was false the second a minute complaint no where says what provisions of the mexican securities market law were violated and in what way they were violated and so on appeal he does not contravene the finding that it is puffer again has consistently time and again held that statements of compliance with the law this is the u b s case and there are others that are cited in our brief mere statements of compliance with the law are not material to investors and therefore puffery and he does not contravene that so even if one were to go down the road of falsity and we certainly agree with judge fail of that that the appellant did not raise this issue below it's of no moment because he has conceded that this is a puffery statement you're runners i'm happy to respond any other questions but i really do think we're down to those two statements as the only two statements that are issued at matter but you are you are correct judge lynch i would i would note though with respect to the website statement with respect to the the only part of the website saying that that's actually quoted in the in the original complaint which is the  practices they've abandoned that on appeal you will not find that in their brief yeah so the only thing really i think are the statements that you that you noted and for all the reasons we've said there puffery that he doesn't contest that and they're not false with respect to the relation back issue if i may just very briefly with respect to the parties with respect to wal mart representations none of that matters correct only if we find that the case because that's the only claim against wal mart the only statement against wal mart with respect to mr rank mr mckenna said in his address look at all the things that we put into the complaint he must have known i would flip the analysis your honour's i would say look at the things that they put in the complaint that show that they knew mr rank was and what his position was at walmart and yet they didn't sue him what is to be taken from that if you're mr rank the obvious which is  he has no exposure because he didn't do anything wrong and the only the only thing they come back with is something that is in the tack not in the sack and as i said it's simply a review of the in iraq  it's nothing more than the misrepresentation claims it's not independently actionable under a n c s a scheme that leaves the cover up and as judge fail a found the cover up is not alleged to have extended beyond two thousand and five there isn't a extended beyond two thousand and five and in paragraph twenty six of the original complaint mr mccance complaint he quotes the following from new york times article this is page ten quote one very interesting postscript mr halter wrote in an e mail to his boss mr lewis all payments to these individuals and all large sums of money paid out of this account stopped abruptly in two thousand  so not only is there no allegation in the second amended complaint that it extends beyond two thousand and five but mr mckenna relies in the original complaint on a statement that there was no evidence that the bribery if there was bribery at all that it ok my adversary began by saying that we didn't point out what was false about the february twentieth two thousand and twelve audit letter from vega which is also incorporated by reference into the two thousand and eleven annual report which doesn't come out until april of two thousand and twelve so vague you first does a press release saying what the audit committee has found and then they put it in the two thousand and one person really report which comes out two months later that is explicitly in our second a minute complaint and we mention the audit letter by vega in the original complaint from the beginning of the case and we paragraph two thirty five to thirty seven of the second a minute complaint page eight to fifty eight it screws me to sixty of the record we cite the entirety of his letter and we say in the next two paragraphs that it's false so that's not accurate those that same letter that i don't know anything else it's the same document showing up two places and we're saying that it's false because they're not in compliance with the mexican securities market law they don't have proper internal controls and they because of what we're talking about the altering of the books and records so that is in the second american point and it's also mentioned in the original complaint paragraph twenty two so that's been the case from the beginning of for e we don't concede that that these that these statements of puffery we say that when you look at this in context what you're supposed to do under the case law there is no corruption known in mexico this is wall max the little brother of wal mart they copy word for word the wal mart website on to there is a copy word for word scuse me the code of ethics and over there things about how they're they obey the law from wal mart too so so investors who know about corruption in mexico will be assured it doesn't involve the wal mart family might be on the mexican companies but it's not us and it's a drumbeat that goes on for nine years we started three cases in our breeze from brazil very similar fact patterns where there bribing the government officials the covering it up they're cooking the books and records it's called the electro case the petrobras case and the banco case three district court cases here in the southern district of new york all found that in context statements that you obey the law that you or your your books and records are accurate when you know they're not when you're bribing government officials actionable so we submit those cases are good for us  report included the they go on at letter of february twenty two thousand and twelve so i'm not exactly sure what the judge was thinking about but we ruled on it as on time your arguments including this one or many of your claims did not relate back so yes assuredly they came after the start class period but she found they didn't relate back and i thought you told us on your main argument that you weren't disputing that i responded to judge lynch's question that i was not challenging as actionable statements made before the start of the class period that's all i said these or eight statements  held to be outside the quest period or outside the staff limitations you're not challenging those what you are now talking about is a statement that was made in womack says twenty eleven annual report which comes out in whatever date in two thousand well april that was not dismissed for being on time well that's correct and though there is some question that these are mostly present tense statements about two thousand and twelve they're not statements that say we had great internal controls in two thousand and five or we were all we've always been the goal or back in two thousand and five we didn't do anything like this either correct judges that the cover up continued they know the new york times is on their scent in october of two thousand and eleven and they go into two companies going to spin control and keep the cover going have a chance to come clean right then in october but they don't they want t