that as a matter of law the evidence here proof storm warnings that triggered the plaintiff's duty to engage in a reasonable investigation of wrongdoing second the court held that the investigation they did take part in was unreasonable as a matter of law and theory that would reprove every factual predicate conclusively and reverse when you just you know of course that your problem is with the two thousand a quarterly statement i think that's right your honor that that's probably the hardest part of the question about storm warnings  have an answer for that i think it's important that we embrace the district court's opinion about the initial statement we think that is correct but i have a bullet list of answers the most important part of the account statements is to realize that this is an insurance case not a securities case as a matter of law it's insurance because texas law treats a newbie's as an insurance product and it's also insurance as a matter of fact but your question regardless of how it characterized the question is whether the principle declined in those quarterly statements unequivocal ability showed it the principle declined not only slightly but in most cases substantially i take your point that that's what they show but i disagree with the premise the question is whether it amounts to klein because i think the promises here are the promise of the monthly payment that came out every month and preserving the principle at the end of the day those are the real risks that we would look for to materialize the statements did indicate that the principle was lower than what had originally been tendered is that not right that is correct your honor but that's not dispositive here i think it's a point in their favor we certainly wouldn't move for judgment as a matter of law but on our side remember the promise here was that the monthly payments and those happened on track every single time it's also important to note that before the downturn and after the downturn the accounts performs just as were promised or this is that this is only a question of time are of this is not a question of ultimate liability the question is whether those plain quarterly statements would have put a reasonable person on notice to take action i think that's right your honor and we submit that they did not right and one part of that part of the question is that even if they triggered the storm warning that's not the end of the case because we still want to ask what would the plaintiffs have discovered if they pursued the storm warning and engaged in an investigation and that's the second issue here is the reason all of us again they did take part in these places did exactly what would barry told them to do the very same documents that show the declining balance say if you have questions call your agent mr mirador or call woodward and that's it they precisely did is called mr mirador and pursued the matter so much so that he answered their questions directly again and double down he of misrepresentations and the general rule is if that is a question of fact we saw it also in the illinois central decision and if the special parts about this case make it more factual not less and this is why i say it's an insurance case because it's a long line of president and there was someone and twelve this is the person who eventually discover the wrongdoing that's not conclusive here for a number of reasons number one there's a timing problem that happened in two thousand and twelve and we would need to prove what would be learned in two thousand and nine and there's also a to the county problem we don't know prior contact this is the two thousand and nine incident involving harris and harrison sent a written request to heart for the company that issued the annuities and she said what's my payment amount and how long is it going to last and the response they came back is not should've gotten is look a major going to end soon at a date certain because you can calculate it and it's so obvious that's not what they said they said the following you are currently enrolled in our automatic income program and scheduled to receive three thousand seventy four dollars and ninety cents monthly from principle guaranteed and the income guaranteed for life this is saying we don't really know because we don't because guess what this is an investment it could have turned out you know i'm old enough to remember when interest rates were twenty percent or whatever so yes if things went really great with the investments this could go way up the principal go way up the amounts could go way up so that's why they don't know but that is very inconsistent with what mirador was telling them which is we do know you're going to get this amount from line and then you get your principal back that the statement from harper was nowhere near that i think it's both consistent inconsistent your honor when the statement says the program is set to run in definitely i think a reasonable person can take that to mean that their payments are going to run into w we don't know how is that consistent with get it wrong to me which apparently mr meridor kept telling them that's true your honor i'm not saying this is no point in their favor i'm saying it's not a point in their favor as a matter of well it can't be conclusive evidence that here we have at least one instance in which they write directly to the person they were asked to choir with and they don't get the kind of response that would be says they're going to get there but i want to shift back if i can not to the idea of reasonable diligence that asking near indoors was sufficient because if that was a reasonable step for them to do then that he says over it is a matter if they could have discovered it in some other way the question is whether it's reasonably diligent for someone in this position to seek out the answer one hundred ten or that's what a reasonable person what a perceived and i guaranteed income into had a principle out at the end of the day that the details are and how much it costs to interface with this product absolutely does exist and so when he made this promise it's not ludicrous for them to think that this is what they were getting it's not what they got it right but i industry as a whole takes the position higher us because we know better than you right this is why they supply the advice because they are experts in this matter and texas law is ok with that is that you can make those representations so long as you're very careful of what you say it's why the insurance context for an important reason because texas law has helped for decades that if there's a choice between trusting your advisor and mastering the documents themselves it's not unreasonable as a matter of law to trust the advisor they certainly get a fact question on this and they can make all kinds of our games including insurance agents just believing somebody who keeps clearly lying to you and it's clearly belied by the document you're getting i agree that it was mississippi law i think the underlying principle of limitations is the same and no on it because it was having to do is very very specific about counsel and in the context of a lawsuit and very specific to the facts in that case it wasn't some broad pronouncement that anytime anybody tells you anything you can rely on it well which is kind of how you're characterizing it so yes i remember the case and i think it you have way broadened it beyond its actual moorings well if we need to recede to texas law that's fine because we do assert the oil until or more aggressively for a reason i think it does stand for this proposition not that we're correct as a matter of law not that you can always rely on the asian but it's it's not unreasonable as a matter of law we've given you both supreme court decisions on that point if you can a recent texas court of appeals decision but that gets you past the original documents it doesn't really get you forever and his second round of you know he says the market splotchy way whatever he's starting to kind of be they and as judge smith pointed out it's inconsistent with the documents of the second time that you talk to be read to work it's a very different thing than the first time and follow your clients on the first time she kind of spotted you that she said what you're getting these documents are the same ones that walk your way through an area now and it's kind of getting big then you know you've got a problem with this guy that you at least need to pursue further that's the argument but i think your honor if someone's double counting it's them and not us i think they get to count the initial documents once to say that you're on the storm warning i don't need to count them again and say that you should disbelieve the new explanation because of the original documents we pointed out to run around are you talking about the quarterly statements sure so after the statements come out then he gives you just no misrepresentations i think this is why this fits the hooks pattern from the texas supreme court where you have initial statements  representation that starts out and so we can in that part of the decision hook because i think it's squarely on point here about truth first then the misrepresentations and the plaintiff isn't obliged to go back in time i think that's exactly this case and to emphasize again we're asserting this is a matter of a point in our favor it's intimate there's a fact question somewhere i think we all acknowledge that generally the question of reasonable diligence is one of fact that generally the question of what they would have discovered is when a fact and i think it's very hard to write this decision and still leave that as a general rule now if you hold for the plaintiffs in this case you're not going to accept the rule that applies in the minor cases in most cases you have documents only but you don't have that here because they're both documents and for representations in most cases you're talking about classic it rich on the stock but here you have a different kind of promise and so i think that's why this really is an extraordinary case there's a reason woodbury doesn't as a challenge liability here it's because this agent essentially what off the reservation it really is an extraordinary case that i don't think will open from the time they purchased the annuities would have put a reasonable person on notice of their claims against mirador that's why judge was involved ended her underlying order the way she did why isn't that a question for the jury because the  this a court has ruled as the texas supreme court has recently ruled the issue of the discovery rule can be determined as a matter of law based on all facts and that's what judge rosenthal did judge rosenthal looked at the total mix of information be reasonably diligent because what we're doing did is he basically disclaimed two of the three promises that he made he didn't say anymore that the principle was guaranteed he certainly didn't say anything about it earning seven percent each and every year and by that point they had to know based on the statements and selves that it wasn't going to earn seven percent every year all the same as if there was some concept of insurance someone with all the investor all the investor cares about is whether he or she ultimately at the end is going to get what he or she thought the promise was so if there was a reasonable belief that hey insurance is going to cover any any problems here then a reasonable person might rely on that and that's a jury there's insurance at the end we're paying a little bit of extra here in a premium for a for insurance just like an insurance company that covers i mean a small bond issue or something like that it's going to all come out ok me end right and at that point it was a  go back and look at what the insurance was where is this insurance where's the policy where's the language what is a cover where's the premium what are the exclusions to it if that is the lone safety net of your entire retirement savings you have to determine insurance company that they're talking about and so that made the move very close to to saying if not you are saying that they this company is guarantee the company is guarantee and if not vague insurance probably in i would disagree on i don't think it's reasonable for them to conclude that once married or walked away from to the three offices that he me and all these folks had to do is then go back and deal with this  found and it's certainly a good place to start the two thousand a quarterly statement yet those statements show a reduction in value when the record is very clear that the appellant said that if there was a reduction in value of their annuities that that would be your dog said everything don't worry about it don't worry about the fact that i lied to you about the principle always being preserved don't worry about the fact that the seven per in your r v the there is no way that you can look at what we are going to said and look at the total mix of information and dealing with the promise of earning seven percent each and every year there is no way to hear from that promise he told him that your mark your investment is now subject to market risk it goes up it goes down the market's going to come back but don't worry you have insurance and it's in it's our position that it's at that point the objective reasonably objective person would have gone back and looked at the underlying documents to see whether or not the recession this insurance what is that insurance again what is the scope of coverage is there is there anything in the record or was there anything presented to the jury regarding some separate insurance component no no there was no separate insurance component that was part of this policy the underlying documents had they looked at it would have put them on notice caring gallagher testified in page thirty thirty three of the record that had she seen the third sentence of the says that the point about the being very bill doesn't apply to income guaranteed under the principle writer's right when i think then that all of these warnings i'm getting don't apply because there's this guaranteed income in your home or that or is a great example would have a look at the underlying documents on page one of that writer it says that what they are guaranteed to get back is essentially the amount of their investment that is the heads they have against market risk is if they put in five hundred thousand dollars they'll get by can't get less and five hundred is what they can get less than five hundred they can only take out a certain amount each and every year but they're only going to get five hundred thousand once it hits five hundred doesn't matter if they're alive or if they pass away obviously they're not going to get it and that isn't clear but it wouldn't so i could never do better than that even if the investment did well you could do better than that i could get or set up can't do worse but the better is not guaranteed so many other words if i chew up the five hundred thousand by my you annual or monthly payments and then the investment didn't cover that i'm done that's what you're saying that this set is just a little bit less important i will say it doesn't say insurance but it's not working you know i was an insurance lawyer hundred years ago and i was looking for an insurance policy and i didn't find one it doesn't say insurance in and nothing in there says they're going to get payments for the rest of their mean there's been a lot of debate about apple which a source says in part is you know once you realize and he was you have a reason to go back and read the policy then you can't keep relying on this site and read the policy at least as far as discovery rule of applicability of any hey honey do you remember where that thing was and you go and pull it out and oh what is this i don't see insurance in here you know whatever that that even if judge rosenthal was correct in saying the initial documentation has put you on notice really because in boyle you don't have to read it once you get the quarterly statements then you need to go back and look and then there's nothing in there that says insured this is your insurance policy you know governing your principal right if we were to accept the new the world what you'd have to accept is the notion that the texas insurance code incorporates a rule under the insurance code is applied the same way as under the securities laws and again in that context this court has identified the steps that he reasonable investor supposed to take they are supposed to take reasonable steps to look at what they purchase of your input your life and another case in other cases a graveyard look at the application of the statue limitations on unsophisticated investors can be a harsh thing but there's a public policy behind the statute of limitations and this court has not shied away from in forcing that right and i think here that the decision of who decides is clearly separate by the law judge rosenthal it the right thing she gave it to the jury she won't have a full development of the factual record of the full development of a legal argument and when she determined that as a matter of law there was no legally sufficient basis on which the jury could find the way did she employed the statue of limitations and ruled in favor of of woodbury and i think if we step back and we look at the major touchstones the cornerstones of her ruling we'll see why she did what we what she did those statements those two thousand and eight annual statements are so alarming so concerning that those in and don't themselves put them on  notice they could have found the cause of action at that time against d'avignon her based on those statements there was no guarantee of principle there was no guarantee of the seven percent rate of return if you then go to what mary to have told them where he basically says yeah those first two promises not true you got the insurance well then a reasonable person would have gone back and looked at the underlying documents and it's drugs rosenthal found the prospectus would put them on notice the annuity would have placed them on notice the application that all the appellant said they signed in blank or might have signed a blank that said may lose value would put them on notice in the fourth thing she bought that were the other quarterly statements that never showed or didn't show for example ms harrison if you look at her december two thousand taken together would have put a reasonable person on notice that they had a claim against david mirador and no expansion of the oil taylor doctrine or elevation of the fraudulent concealment doctrine is going to change the that and when judge rosenthal did is consistent with what courts have done around the country as we've cited in our brief that coke versus the full nicholas case from the eighth circuit said that a person that is receiving in will statements that shows that their investment is going down should have is a matter of made to her for the basically said how long is more my payments going to last she didn't ask are the guarantee for life she said how long i meant he was going to last and what harper said is we don't know if it was guaranteed for a wife they would have said so what do you do with the statements that your clients signed that said it may lose value how does that fit into the record here i think it's part of the circumstances the jury gets to consider their points going both ways and that's a point against us now importantly inquiry is an objective one so the question is what a reasonable investor would have taken from these documents for the same reason that we can't say our investors were unsophisticated they can't say that a particular piece of testimony of our plaintiffs cuts against us so i think we need to both play by the same rules there i think would be has done too much in defining the promises when the court lays its hands on the record what you'll see is that when the plaintiffs are asked to testify about what the promises were are what we have in our eyes on the record and it's  much when i say they were promised indeed your honor there is my goodness and nowhere in there is there a promise that there's like an insurance policy it's this very big thing i assume that it sounds point i would get the money bag and other guy assumes that the money will be put in as it comes out that someone said well maybe it has to go down to zero i don't really know this isn't consistent with having a representation maybe you just imagining a bunch of ways insurance could work so yeah we look at the record and it doesn't really help your map point well iran will put in there's a reason we didn't challenge the liability findings that's what that would go to is whether they believe the promises and what the promises were if there's a play in the joints and some made just saying well i didn't you know i didn't really know how the insurance work i just assumed this or that is no evidence of anything we have much more than that your honor respectfully appoint me to the best explanation of what mirador told  the insurance would do the best you know you did in this long involved record what do you want us to look at that you think would go oh my god this was a backlash and we really need to step back if you want the definition of the promises you can look in the first  quotes we've given you block quotes of string citations for us for plaintiffs that showed three things he promised the monthly payment at the end of every month he promised that the principal would be there when they die and be protected by insurance those are the three other insurance works is to me the harder thing because i understand they were promised insurance i get that but then the question is since this is a limitation is case with the discovery rules when were they put on notice and so if let's imagine that they had clearly said the insurance was if the principal went down began more money is put in they would know from the quarterly statement that didn't happen if it was it would go to zero and then the money would be put in then the quarterly statement would tell them that know they're all over the place on that so how can we i mean that's that's their burden ultimately a trial i think they do your honor it's on page twelve the reply brief in the record it's page fifty one twenty five that says the insurance context with a jury head wind remember there was an expert witness who testified to this functional idea that even if it says it literally when barry says that a layperson can't contemplate what these documents actually say on specific matters like this and so i think both of these things  were a case where the notice effect of a document is a fact question i think it's got to be this case where you have extremely complex winkie documents plus fraudulent exchanges occurring so that's our position as to the storm warning analysis the last thing i want to say is that it's important for the court to keep these three inquiries distinct there are three separate parts of the analysis that would be had to prove as a matter of law and i'd like to think that i do well on all three fronts but even if you think i lose really badly on the storm warning fro there's the instance of attacker in two thousand and twelve for the wrongdoing was discovered and the instance of harrison in two thousand and nine where the plaintiffs do exactly what the documents tell them to do you call the insurance company it says interest on the cover and she gets a mixed response