we're asking the court to reverse the judgment below with respect to both liability and damages and i'd like to begin this morning why talking by talking about why the liability judgment cannot stand global never should have been allowed to present its breach of contract claim to the jury global's theory was that the letter of intent was an exclusive agreement that bound a national to sell exclusively to global eighty airplanes but letter  experience she looked at it concluded you know really what we do with that sort of thing and well your honor we contend that that the trial judge erred in finding it ambiguous because there was no exclusivity clause in the agreement and there was no other textual indication on the face of the agreement that it was in fact an exclusive agreement so the two things that global sites that it says renders this agreement exclusive are the agreements reference to eight specific airplanes and the agreements  language of lesser and lesser but as to the reference to eight specific airplanes that of course proves too much because every letter of intent would refer to the goods over which the parties are agreeing to negotiate  it doesn't nest and automatically render the agreements an exclusive agreement to negotiate exclusively with one another and as to the lesser lessee agree language this to the jury all you want so why it's not as you say why you know all the things you were talking about and all that you talk about in the brief is so but this is ambiguous one can construe it in a different way you will make your argument the jury didn't believe well we're going to do with that so let's let's accept your premise your honor that in fact the agreement was ambiguous but the trial court further erred and at this point we have a new trial judge not not what judge morrow had said global needed to prove a trial which was one that global communicated to national excuse me that national communicated to global that it exceeded to its demand for exclusivity and second national intended for the agreement to be explicit and i think that that the whole concept of exclusivity which was the entire basis for global theory of damages was that was entirely absent from the jury instructions the jury instead was simply given character breach of contract instruction which said that they could find a breach if they found that national terminated the letter of intent without justification you are is what i on your seven fourteen and the district judge said you can put forth what you think the ambiguous term is through evidence during your closing argument and that can be presented to the jury in that way so i think i'm just going to rule against  done you want you would want the jury to decide that some of the judge wasn't going to agree with you you least want to have a shot of getting the jury to agree with you right right so we wanted the judge to actually instruct the jury on exclusivity in accordance with what judge morrow had said right was global's burden to prove it trial right but apparently this judge concluded that there was enough ambiguity that going to let the parties just argue with t make their pitch to the to the jury and let the jury decide well what this court has said in the in the global view versus b i see case and other cases are that when there is a concept that is fundamental to the defense's theory of the case and it's entirely absent from the jury instructions that's prejudicial error to the defendant or york law but i think don't recall whether the globe or versus the i c case was under new york law your honor that's an important factor in this case  not well your honor i guess under new york law but what the court gave was simply a generic breach of contract instruction versus the exclusivity that was the fundamental basis of global's of global theory of liability and it's the basis upon which global was then allowed to ask the jury for one hundred ninety four million dollars of its lost profits damages global contended that this was an exclusive agreement that  national to sell to global eight airplanes right and so based on that theory it was permitted to go to the jury with hugely inflated one hundred ninety four million dollars after pad but i pad got hot of course but the reality is that you know it's really clear you feel like there's a great this carriage of justice here i get that but i also see that the judge is saying you know under new york law this is a much looser standard you know what we have under california law we've got to play new york law here we'll let the jury decide that you give it your best shot you made it seem like this is a one person operation could possibly what happened this is not what the parties meant they presented their perspective when the jury largely bought what they said and awarded an amount substantially less than what they asked for it's you know it's a typical jury kind of situation so from my perspective what i'm wrestling with is the what is the reversible error here i mean i understand you not happy with the result i'm not saying if i been on the jury i the felt the same with the jury did perhaps quite differently but that's the role of the jury as  honor the reversible error here and your honor said new york law is maybe not as clear on this new york law is crystal clear on the fact that the breach of a preliminary agreement an agreement that's just an agreement to negotiate does not entitle a plaintiff to ask for lost profits damages and global below and continues here to try tries to wreak eric ries its damages as benefit of the bargain versus lost profits damages it focus your honor we're concerned about both but at this point if i would ask the court to focus on the damages where i believe that there was definitely an error of law in allowing the global to go to the jury to ask for lost profits damages or expectancy damages and i would ask the courts to look at the fair brooke leasing case which is an eighth circuit case applying new york law that's almost exactly on all fours with the case here it's a case in which the parties signed  cited in our our briefs in both the opening brief and the reply brief it's it goes through new york law a on this issue and explains that new york law does not allow a pro a party to recover expectancy damages for the breach of an agreement to negotiate because it's too remote and speculative and in that case there was a term sheet that actually laid out the rental prices etc for the aircraft over the length of time and fair brooks said after massage breach the after negotiations broke down before the final lease agreement was was reached and fair brooks said we should be entitled to all of the profits that we would have made over the lifetime of leasing those airplanes and the court said no you're not entitled to that there it's too remote and speculative we don't know what the terms and conditions would have been in the ultimate lease agreement and the same is true here this letter of intent left multiple issues open to negotiation between the parties but counsel forgive me if fighters incorrectly were plying the uniform commercial code in this right your honor ye s new york yes yes you did so under the circumstances there's a course a lot of law about damages when you have commercial code issues concerning the sale and lease of goods right racial  goods is this a big question legally from your perspective you're just saying the law is really clear it's and it's different than what the district judge applies there with your yes your honor we're saying that the law is clear that they should not have been allowed to ask the jury for expectancy damages and the goodstein case is the seminal new york case on this issue it's discussed in the faerber a case which i cited earlier but the goodstein case says you would be transforming an agreement to negotiate into the agreement itself the only way the global gets to to ask the court for its expectancy damages or ask the jury for its expectancy damages is if it can show that this agreement is not an agreement to negotiate but is in and of itself has all the final terms and conditions even your client's view again arguing that i know you believe that the whole thing should be thrown out the difference if we focus on the damages for a moment what what is the range of damages that you think would have been appropriate in this case as opposed to what was actually award global would have been entitled to its out of pocket damages in this case which consisted of out of pocket damages for four days of making phone  if if you take as a given for rivers's of our discussion that they had a contract an exclusivity contract in that there were millions of dollars involved they talked about what they did to take what the  sacks issues and so on and what was involved and the kind of dollars it would have been and would be derived from that if a contract is breached normally look to what would naturally flow from that would you not you do your honor and but i think it's if if the jury's verdict as to the nature of the contract is upheld the level of damages is more appropriate in the range that the jury found as a not not just out of pocket and well your honor on that on that point we think that the jury had to necessarily please the court k t o sullivan for global b g in many ways your honors on appeal this is an easy case you have a signed contract the jury deliberated for two days and concluded that national breach that contract a jury came up with a reasonable damages award doesn't matter that the jury had a problem it doesn't matter but that the jury had a problem let me answer that the jury asked a question after deliberating for about one  they asked about speculation how do we come to an award the judge gave them an instruction to which there was no objection from national and then the jury considered and deliberated again for about another full day and so states supreme court case on this the weeks case the presumption is that the jury follows all instructions and the presumption is also that the jury follows and understands a question and answer to a question how did they get the number they got on this have looked to see how did they get it other than some speculation odd no speculation your honor here's how they got it this is a case about eighty aircraft and the jury came up with an eight million dollar verdict simplest explanation and the easiest math is a million dollars per plane and you can find that in two places in the record one of the fact witnesses for global patrick yep he was the director of finance for global and he said that it would be a million dollars per plane he had a spreadsheet that was dependent on any video see him in a plane because he had a spreadsheet no no no i mean on this record yes there was going to be the purchase was going to be the one to eight million it was i mean one to eight planes it wasn't going to be a plane so it wasn't going to be seven planes one of the six somebody had to decide how many planes so under your theory somehow somebody decided eight planes i gather that's right you don't have the inside the planes on this craft on this record two ways if you're on a first they would look at the l o y and the plain language of the l o i said if acceptable financing it talked about that is not available to permit aircraft to be purchased the number of aircraft may be reduced or as agreed so the number was going to be eight that was the maximum number and less global global couldn't find the financing so how the jury found that there was that it was been answerable was based on global's expert global had two experts in the was two thousand and ten we were coming out of the recession of two thousand and eight and two thousand and nine he said the market was coming back for airlines mr cox to get back to the eight million and how there were two places in the record for a million dollars per plane that was mr elation of a million dollars on a six point seven five percent interest rate and mr cox had the same thing and it demonstrative exhibit that you can see in the record at e r one thousand one mr yaps spreadsheet is at the supplemental ex urbs pages sixty six to sixty eight and his testimony about that is in the supplemental record as you are sixty six sixty one here's what happened at trial global's witnesses starting with jacob hodges were sincere and credible and they were backed up by two experts in the aviation finance industry national for its part put on its case in just a few days called just a few witnesses and didn't have an expert in the industry so if your job were simply to reweigh the evidence it shouldn't be a hard call to affirm but that of course is not the standard now that we're on appeal and all the credibility determinations  made in global favor your sensually assume the jury believes global's witnesses all the inferences are in global's favor and you ask would no reasonable jury have come to this result and the answer to that question is simply no right your honor in the district court made a perfectly reasonable decision contract didn't say didn't have an exclusivity provision didn't have a non exclusivity provision let's look at the interest excuse me the extrinsic evidence the standard in the  industry and so we are flying new york law was asked about and as national conceded in his opening brief under new york law you don't need the word exclusive in a contract to make it so you look at the entirety of the contract and in a case where you have ambiguity you look at the parties dealings in the negotiations leading up to that contract now this contract didn't need an exclusivity provision because the contract as a whole was exclusive and that's why national propose a new language making it non exclusive this is in the excerpts of record page nine thirty one national proposed adding if alessi national receives a firm commitment from another financial institution that could be another reason to lower the number of aircraft in the deal from eight to some a lower number well they were national wanted him out if he got another deal somewhere else and mr hodges of global rejected it said no that's a nonstarter now it would have made no sense for national to propose that language if it were non exclusive to begin with and the reason for  in the industry was really practical and common sense and national understood that that you can't go talk to the banks and negotiate with them for lending in a deal of this magnitude unless you have and as mr stooks nationals agent told national they are not going to proceed on a non exclusive basis and i understand why let's talk about the jury instruction  couple of jury instructions or challenge exclusively damages and i'm both of these issues national says these are issues of law you were abused and over and the answer in each of those instances is no this is a discretionary review and let me first explain on exclusivity there was nothing wrong with the instructions on the breach of contract as a matter of all the judge didn't say it was national's burden to prove exclusivity the judge didn't miss e any of the elements of contract four elements the existence of a contract partial performance breach damages the jury was instructive on all of that and you can tell that this was a discretionary issue going to really the formulation of the instructions if you look at what the national argued below they said we have two reasons that we should get our exclusivity instruction second argument it would be consistent with judge morrow's summary judgment decision well that summary judgment order didn't say and that shall be of an instruction on exclusivity again it would be it was something entirely within the discretion of the district court and what he did was quite reasonable and you said this trial has been about exclusivity argue it in your closing and national took him up on it we know there was no harm in this instruction because national made the following argument in closing was the agreement exclusive or not that's one of your tasks when you go back in the room now this theory of the case construction argument that national came up with on appeal that's a red herring national's whole theory of the case at the trial was that mr hodges had misled them into signing the l a law in the first place and they had counter claims on that theory and national  instructions they wanted that quote mr hodges misled it into signing the alkali in the first place the jury considered that theory and rejected it so the jury instructions would you consider in their entire proper on the contract claim the jury was told global the plaintiff must prove that global a national had a meeting of the minds on all essential terms of the contract necessarily included exclusivity which was a major the major disputed issue in the trial and that global must prove that global and national entered into a contract whereby global agreed to buy from national and then lease back to national eight boeing seven forty seven aircraft and went on but that was they agreed to do it for all that was global's burden and they satisfied it to turn to the  the issue of the alleged error in the damages instruction again basic and issue of wall they misstated the law you review it to no no you don't what they're really saying is the evidence didn't support the instruction that the district court gave the district court gave you a perfectly correct as a matter of law instruction on benefit of the bargain damages what they're saying is that the evidence actually supported a lost profits instruction and the standard overview depends on the nature of the claimed error and if the error is that there is insufficient evidence to support the instruction you review that for abuse of discretion now there was no  because global was just asking for its general contract damages put me in the position i would have been in had you performed the national and the jury was told the purpose of such damages is to put national in as good a position as it would have been and of global had formed that was the same instruction the court gave for national on its benefit of the bargain and struction if you look at e r seven fifty one question about the u c c the new york u c c under the u c c global is intitled to the benefits of its bargain under the contract there are actually three district court cases in this case below three district court judges judge luke judge mauro judge brinn all each of them recognize the u c c applied here on this contract claim and the remedy it provides for is a benefit of the bargain remedy  talk a little bit about lost profits they say no again you know what you really were seach searching asking for is lost profits and under the evidence we were not this is not a case worker said if you get this deal for  aircraft with national or next going to do a deal with united airlines for fifteen planes and we want all of that those profits to know it was the damages that naturally flowed between this contract between national and global and finally to get to the point if you assume everything they say is right all these issues of all the mistakes of law were made there's a harmless error doctrine and we should w under that too because even if the jury was instructed exactly as national wanted the evidence supports the verdict they asked it e r to sixty has their proposed instruction and i said three things on the office profits first that global would have been able to secure financing necessary to purchase the aircraft and that goes back to the questions that judge ferris was asking me how many aircraft were there are so global already  prove that to get the eight million in the first instance and there was evidence on the record from one of the experts who testified for global that once you have a letter of intent ninety nine of one hundred deals close you have the other expert i already talked about that in the market is opinion these deals were finance a bill so second and relatedly national said they wanted an instruction on the final number of aircraft national grid to sell and then lease back its eight under the same  explanation i've already given now one national really hangs its hat on this appeal as the third thing they asked for the amount of loss the global is certain to have suffered were it not for nationals breach under new york law certainty means reasonable certainty there's always a predictive element when you're calculating the damages that would flow after a contract has been breached and the jury was specifically told three times you must not contract and fully performed and then after the question they were again told you shall not speculate so in conclusion as this court explained in an opinion written by judge smith in skydive arizona versus  you went on to write that the mere fact that possible arguments could be made that the jury's verdict is too high does not warrant reversal the same rule applies here on behalf of global we've asked you to affirm presentation war was the fair brooke case or the goodstein case or the other cases from new york law from new york that hold that expectancy damages are not available as a matter of law when what you have is a breach of an agreement to negotiate in good faith that leaves open the number of terms and conditions and on its face that's what this letter of intent was it was merely an agreement to negotiate in good faith they did not entitle global to go to the jury with one hundred ninety four million