go to the next case on the calendar g e funding may please accord gregory joseph  does not apply to the appeal on pre judgment interest which wasn't as susceptible of a rule fifty motion are position which is clearly explained as we're peeling an issue of law which under the precedent of this circuit does not require a rule fifty motion to renew if it's been decided on an interlocutor in an interlocutory order and under new york law whether or not an agreement is ambiguous is determined by the terms of the agreement for jurisdictional purposes the issue we've identified is an issue of law and it's not necessary to consider facts to determine that the issue is an issue of law when we look at the merits of the issue then g e s custom in usage evidence enters the picture and then the question is another legal question and that is can it properly be received for the purposes for which it was offered in the answer is that it may not could i ask you just something to clarify for me yes  d and here correct me if i'm misunderstanding you seem to be raising on appeal only the issue decided in the order denying you or your motion for partial judgement on t pleadings whether the investment in agreements are on their face ambiguous and if that's the case in what sense are you also appealing the summary judgment order which way the extrinsic evidence of the investments in green agreements mean on page seven of the summary judgment order which is page seventeen of the special appendix the judge says where is here the court has determined that the agreement is ambiguous so it reiterates that finding that's the only way that we're doing that we're not challenging the evidence on appeal that would require rule fifty motion and we did not make that motion so it is only the pure legal question whether on their face you're initially are you saying that we could look at the investment agreement and the maybe the other agreements that were all part of this investment package yesterday and determine that the district court was wrong  concluding that it was ambiguous as to whether they terminated on the redemption of the bonds correct your honor and so you say the district court has erred in determining that it was in big us that we don't even need to look at the custom and usage evidence is that that's correct your honor and i'm i'll just spend one moment on it to say that it would have been appropriate to use custom and usage evidence if there had been some evidence that one of the apparently unambiguous terms had a specialized meaning in the industry but there was no evidence to that effect and they have citations to the record of pages seven and eight of their brief and if you look at those citations the expert very ably explains what the terms mean but doesn't suggest they have any meaning other than as they are defined in the agreement and in our case relies only on the expressed terms of the agreements investment agreements and the indentures they incorporate the only time  ambiguity exists is if you accept the ease implied terms that the accounts created by the investment agreements either disappear on bond redemption or cease to hold funds and there is no provision that say that g e says a page thirty one of its brief that's logical our position is it is not logical to be implying terms into integrated complex agreements between sophisticated parties is it  interest at the rates originally negotiated until two thousand and twenty six yes your honor and we all look at things now with the hindsight of two thousand and eight had two thousand and eight not happened g e might be considering the commercial reasonable of these extremely wise because before two thousand and eight everybody was trying to get deposits now the interest rates are high that wasn't historically the case and you're really to expect interest rates may revert to the mean but you wouldn't expect the extraordinary levels we've had so that's why we have an agreement that says the determinates and section two point two the duty to pay interest terminates in two thousand and twenty six or whenever the specific date is particular investment agreement that's what the deal is and these agreements contemplate use of the funds after bond redemption they contemplate them for example the definition of float fund in the investment agreement includes the revenue fund accounts and section two point three any of the investment agreements it says that float fund withdrawals may be made for permitted withdrawal purposes and the definition of permitted withdrawal purposes are any of the uses permitted in the revenue fun provision of the general indenture which is section five point zero three and if you look at five point zero three b one it permits use of revenue fund uses for debt service and it says debt service on any interest payment date which is defined in terms of all bonds not just bonds in any particular series if you have to convince us not that your interpretation is reasonable or correct but that it's the only one and so you need to show it because it's a court found that there were two competing irreconcilable reasonable interpretations of this complicated set of agreements that and so you need to demonstrate that your opponents interpretation is untenable yes i just on the face of the documents what is the key but your strongest point for that position agreement specifically contemplate uses after the withdrawal or after the redemption of the bonds the they specifically are contemplate that interest is going to be paid until determination date they have withdraw a terminations your opponent would say that the definition of vestment doesn't reach that far that once redemption has happened there are no more investments but your honor guy was just explaining why their debts completely wrong if you look at the definition of float fun because the investment includes the float fund the float fund says you can use it for the uses permitted in the revenue fund provisions in the indenture and it's clearly wrong because that doesn't require nothing stops that at the time that the bonds are redeemed there isn't an interest active  other bonds they mean it and there's nothing in this prevent in this indenture that says to the contrary and there's no warrant to be using they used custom and usage evidence to convince the court and it was inappropriate because you can't very or modify the terms in their modifying to terminations provisions for these indentures me for these accounts created by the investment agreement that do not exist so your hon all respect to the very distinguished district judge it was simply iranians to say that these are ambiguous there is i'd like to spend a moment i've got no time i'd like to spend a moment on prejudgment interest and ask you a question e had unrestrained use of the amounts that it credited to knife as interest there was no evidence that its use was in any way affected by the fact that there was a liability what sort of evidence would need to present there is the example given by g e that it could not use money on a new building and your argument i think is that g e in part needs to offer evidence of opportunities like that that it could not avail itself of what sort of evidence your honor may i go one step further and to say that there is case law in this circuit that holds that the existence of a liability when you have the use of the money does not permit the drawing prejudgment interest in the bulk of oil case the plaintiffs who won the contract action was not given pre judgment interest on the contract price because it had taken out a loan all it was awarded was the interest payments on the loan and the pre judgment interest on the interest payments but the court held it had use of the money now a loan is a liability it was irrelevant in the donald sheldon case the trustee in bankruptcy was seeking attorneys fees from the date it received the bills prejudgment interest on attorneys fees from the data received the bills bills or liability the held you had use of the money until you paid here they didn't pay and they didn't they the way they presented evidence they had an expert who just said it's the return on capital for g e now if they wanted to say the  return on capital as a whole is affected by the fact that a certain percentage of this is reflected by liabilities they could have had that expert address it but they never had the expert address that so your honor on prejudgment interest they had the money there's no evidence that they couldn't use it as they chose it was an immaterial amount to g e also but there's no evidence that they didn't use it as they chose thank you very much your honour's thank you you'll have two minutes in re good morning may it please the court stephen shackleford for the g entities i'll start where mr joseph started which is this question of what a court under new york law is to look at when determining ambiguity and mr joseph said that it has to be determined by the terms of the agreement and that it is improper for any evidence of custom and usage to come in at that stage of the analysis that is the exact position that this court rejected in the international multi faith case international the court held that the district court had erred in declining to consider the custom and usage evidence that was offered by the parties as part of its assessment of whether an ambiguity existed that was at footnote four in that case so new york law is admitted pharmacy that whether disputed contra contractual terms i'm quoting aren't they generally discerned from the four corners of the document itself yes your honor and that is that is the norm when you don't have the industry custom practiced introduced into the equation but this court has has frankly affirmed numerous summary judgment cases where industry custom and practice evidence was introduced in an attempt to influence the ambiguity analysis and in each of those cases the court is a from that while recognizing that the industry custom and practice evidence must be addressed in the court in those cases addressed at that's the british international insurance case and the law devon case and the sample japan case so it's simply black letter new york law that industry custom and practice evidence is properly before the court at the ambiguity determination and must be considered so the next move that knife makes trying to avoid that here is looks at our record  sites where we cite industry custom and practice evidence that came in at trial and that is precisely what the rule fifty motion would have done the rule fifty motion would have given the court a chance to consider ambiguity based on the full trial record not based on the pleadings but based on the four developed trial record and determine whether custom and practice evidence that either party had introduced at the during the trial should influence the ambiguity analysis we introduced a lot of custom and practice evidence industry custom and practice evidence at trial night for would like to argue well it wasn't credible or it wasn't the right kind or it didn't really go to the right terms but all of those were arguments that should have been made first to the trial judge who sat through the trial and could have assessed that and we would have been had the chance to make the argument in that briefing were or were to have happened that our industry custom and practice evidence we put on trial for buttresses we do consider to be the correct ambiguity ruling in the first place i redeems a series of bonds there is and i quote no longer an account that's established in connection with those bonds that's in the red brief a twenty three twenty four but it would seem that there were accounts that survived the redemption of the sociate of bonds i understand in your view improperly and you paid interest on those accounts so in it as a technical matter what do you mean when you say there is no longer an account redemption so there are there are two different issues going on with with particular question your honor the issue having to do with the indenture is this issue as to whether a capital a count survives beyond redemption that's an issue where the indenture is ambiguous as to that now as we try to explain in our briefing that the court doesn't need to get to this question of whether a capital account which is a construct of the indenture continues to exist as a construct after beyond redemption because we point to language that the court has spoken about earlier which is the in connection with language out of the definition of fine so even if a capital a account still existed under the indenture this contract it would still not be an account in connection with the bond series once that bond series is has been redeemed that is it reasonable reading of the definition of fund and it is that is indeed what judge schofield and judge failer both found that sort of rating was reasonable under the two contracts now as for the question of whether the capital a account which is a term that is incorporated by reference in x whether a capital account continues to exist you look at five point zero one c of the general inventor at page two eighty one of the appendix and the sentence the key sentence there says there is hereby established in each fund a separate account for each series of bonds seems like a simple sentence one problem is at the date that with that this general indenture came into being there were no series of bonds the indenture came first and then various series of bonds were originated so it is at least reasonable to read that sentence as saying providing for the possibility that different bond series will be issued at which point different accounts will materialize as a concept for accounting purposes under the get under this  and it is reasonable to assume that once those like bond series of gone away those particular accounts that did not exist at the beginning of a general indenture would also stop looking would also cease to exist and what would happen instead and what there was testimony about at the trial happened in real life and the site there is from one of my physio nine employees at page thirteen seventy six of the record is in real life when the bonds are redeemed knifer stopped tracking any funds that at some point had something to do with a pretty in bond series they left it all in the general capital f fund and it is undisputed that g e does not pay interest on things in a capital f fund we only pay interest in the bond seri pacific capital a accounts in connection with the bond series the other sentence i would draw the court's attention to in the indenture on that same point although coming off if i'm getting too much into the weeds actually i could finish what you're saying upon earlier redemption but the agreements themselves did not that's really my question and it's a very good question your honor and to understand why the these agreements don't reflect all the same exact language is there in the bid specs one would need to understand the how the worked at the time that these gifts were in consistent practice some of them reflected in the summary judgment record a very small minority of g e gets things like fifty out of seven hundred had language similar to that of the one could read like that the vast majority of which of them did not have that sort of language is the same sort of form as is it used in this case is the terminations the determination day provision yes or order because the normal practice was to rely on the interest payment provisions to do the work of deciding when g e still had to keep paying interest in real life what happened in these sorts of cases with these agreements is that when you reached when a bond series was redeemed g e would be notified they would stop paying interest upon that redemption because they'd be notified thirty days in advance and then they return the money because there is no provision no explicit provision that is a matter of law between the parties that it's all over when redemption happens the the the agreement itself could theoretically keep going it just would under the terms of section two point two in the definitions of investment the judge schofield traced there we would know no further interest on the deposit so it wouldn't make much sense for for the for the counterpart to keep the money with us if we didn't know the interest and i thought i get that there may be some skepticism on that i did a little bit of looking to see if there were any simpler types of accounts that might have a similar approach to interest payments and one example that i found relatively quickly is the u s government offers military accounts for people who are posted in combat zones and they earn ten percent interest for so long as they are posted in a combat zone and ninety days thereafter and if they then leave the combat zone the interest rate goes to zero they can close the account that point they can leave it open this case like that this is as though nightfall went to the combat zone came back and never told us and we kept erroneously paying ten percent interest to them when we didn't know it so the fact that the contract itself contemplates that some money might be left with g e that we don't know interest on is not unusual and one of the provisional point that or two for that is at the bottom of section two point zero one there's a few sentences handling what happens if the trustee since g e knife is money without proper notice and there is language that said unless g e accepts it which is not bound to do except that as an investment capital investment that money will not be deemed to be a capital investment so the contract already contemplates g e could be holding money that was transferred to it by night without without  having to pay interest on it and this is one of those circumstances once there is no more bond series in connection with the investment agreement the interest payment obligation ceases on the prejudgment issue interest  would be happy to have a certified to take another shot at it your honor i do think because it's not a windfall though under these facts and certainly judge schofield it was within her discretion to find it was not a windfall we would argue with that certification that the court of appeals in new york would not get to the question because they'd find it wasn't a windfall anyway and now it's that question was certified as you know i guess in two thousand and seventeen in your court of appeals they accepted but decided on the basis of another certified question and i what what would happen in this case in our opinion your honor is if they were to take the certification and look at the facts of the case given that the jury apply this offset and cut our damages figure by over nine million dollars the jury would find the court of appeals would find that even if there could be a windfall exception judge schofield was within her discretion to find there was no windfall in these facts you your honor the distinguished district judge made a mistake she relied on the offset to damages as a reason not to award pre judgment interest the offset was an amount the g e earned on the monies that night they had deposited not on the interest it was on the monies that night had deposited and that was those are monies that had there been no breach on the jury's finding she would never have because it wouldn't have kept the deposit the deposit would have been returned so that was an offset to damages which was appropriate given the findings but it has nothing to do with prejudgment interest on the i just want you to appreciate what on the contractual analysis you just heard on she's analysis the accounts disappear or no longer have funds and the investment agreements remain in place for twenty years on our analysis the investment agreement accounts remain their monies in there they continue to earn money they may be used just as the indentures provide and as the float from provision of the investment agreements provide to pay off of the bonds and that is what the agreements say so yes your honor judge carney i do say they're wrong it's not reasonable to be coming up with this superstructure of construct to imply terms that sophistic super sophisticated parties did not put in the agreements  the issue of ambiguity and your comment about the difference between the specifications and the actual agreements that's meaningful you say your honor it's we accept that the bid specifications said one thing in the agreement said another thing and we also accept that the bid specifications also said the ultimate agreement shall conform to the bid specifications and in this respect it didn't but that doesn't mean that the bid specifications then supersede the final agreement which g e drafted they didn't put in the provisions they want and then it has a merger or clause so it is meaningful the bid specifications that's why this background evidence was never appropriate you know council cited five hundred one c of the general indenture that's the one that says that withdrawals may be made for such series of bonds as well as any other series of bonds i'm a specific lee prohibited in a supplemental indenture there's no prohibition in any of these supplemental indentures counsel points the court to the two thousand and two decision that the court made international multi foods the court i would say that in two thousand the court relied on the phrase context that the court can consider the context in two thousand and fourteen in the directions case the court held the context doesn't mean that it doesn't mean that you go beyond what new york law is and this is from the first department in two thousand and twelve and ashwood the court looks soley to the plain language used by the parties within the four corners of the contract to discern its meanings meaning and not to your honor's the last thing i would say is that  this reference to the fact that you didn't get notice it's the trustee that is supposed to give notice and the truth is that if you look at page a fifteen forty nine of the record she couldn't find whether or not there's a notice there's an email internally a g e saying bill i genuinely don't have a clue where this notice could be i don't know what lynn or kim did with these notices could they have thrown it away because they didn't know what it was for a never asked anyone that's a possibility but it's certainly not any malevolent conduct by knife thank you very