Legal Case Summary

As Abraham, Mrs. American Quarterhorse in Succeedion, and for the American Quarterhorse, we will hear from Mr. Kelton. Thank you, Your Honor. Read registration rules adopted by voluntary nonprofit organizations, or not with the antitrust laws were designed to address. And at Pellance, or Appalise, trying to squeeze them into the antitrust laws resulted in three years, I intend to talk about today. First, of course, for Section 1, you have to have concerted action. But the association spoke with one voice and with one interest. Second, the Appalise had tried to restrict the market to an imprecise definition of the legal order horses that results in boundaries that are so vague as to be meaningless and to fire real world realities. And finally, there's no injury to competition. The association did not control prices and competition remained strong and vigorous. Let me talk briefly about concerted action. As the court knows, the single entity ruled dictates that a single entity cannot conspire with itself. That's the lesson in American needle and copper weld. There are two elements the plaintiffs must prove to get over that. First is that there are separate economic actors who have separate economic interests to advance. And second, equally as important, and what is missing here is that those actors are pursuing their own separate interest rather than that of the association. Well, weren't they? No. Were weren't the so-called elite breeders pursuing their own interests? No, you're honor. And here's, and let me explain why. There are, remember, there are only five people that are considered by the Appalise to be elite breeders on a committee of 30. And the issue is, of course, five couldn't control that issue. So what they say is the five control the rest of the 30. Well, that was my point. You may have five each pursuing his or her own independent interest, but five, you've got to go farther than that. Yes, your honor. That's right. And they admit that their testimony on that is about control is assumption. And they do so specifically. And additionally, the other members were pulled on that. And they said, of course, they weren't controlled. There are other things they bring up, like the Good Old Boy Network

. It's one thing to say it. And it has a nefarious tone to it, but it is quite another thing to prove that. They talk about a number of additional things. They say, for example, there was a meeting behind the back of the president and secret in a furtive type of meeting. But the truth of the matter is that didn't actually occur. They refer to Exhibit 92, which is only an email from the president, so they couldn't be conspiring behind his back, two members of the Stubb book committee to meet with the board of directors. And there's no evidence that meeting occurred. And as a result of that, that doesn't help them at all. They claim they're a lot like either American Needle versus the NFL or Nortex, especially physicians. And let me address that legal point, because I think it can be put to rest rather easily. First thing is, and the facts are roughly the same, just change the organization. In the NFL, 32 teams combined together, each of them had their own trademarks and logos that they were going to market as souvenir uniforms and the like. And they wanted to have one manufacturer to do it. So they formed a subsidiary within the NFL to pursue that. They sued their own secret economic interest in doing it. And they did so collectively, only to one purchaser to restrain trade. Of course, that made sense, but that's not us at all. There's no indication that anything like that happened. Interesting, the breed registry was what drove this issue. Additionally, in that regard, it's very important to note here, there's no evidence that separate economic interest were actually pursued. If you look at page 25 to 31 of their brief, you'll see that they don't even take on this issue at all. They don't believe it is an element to overcome the single entity defense. And that's important in this case. I mean, there's no evidence that they were pursuing this. Well, there was testimony from the members that they called to testify to reasons for their voting for the rule. There was no evidence that they pursued anything separately. Well, they, now in their brief, they cite some things about, you know, stud fees going down or something like that, don't they? You're honor they do. And they talk about that perhaps stud fees could go down, perhaps that there could be, some type, there could be more horses in the market, but the issue is they've got to prove that issue to be able to do that and they didn't. The other thing, remember, is on concert of action. Is it this? Well, actually, I mean, you don't have to, actually all you'd have to have is a few stray remarks by people that the jury can infer their pursuing their own economic interest. You're right, I agree with that

. And there's no doubt about that. And we were looking at a no evident standard and we obviously have to take that on. And at some point, what I, it seems to me what you have to take on is that you were not able to impress Judge Robinson on this and you weren't able to impress the jury. So it's just harder. It does make it harder. Our point is it never should have gotten to a jury at all because of the lack of evidence on those, on those points that we think are terribly, terribly important. Let me talk about the relevant market because I think that's the big problem in the case. The relevant market here was defined as elite quarter horses. It was described by the witness as tippity top or the best of the best. It's narrowed to a point of absurdity. It also is so imprecise, it blurs the boundaries to the point of non-existence. And it's completely inconsistent with real world realities, which is independently, is your honor held in Dr.'s Hospital, something that will destroy a class. Here's what happened. There is no, no one disagrees that in the total quarter house horse market, there is not vigorous and live competition. So they couldn't limit it there. So they eliminated by their own testimony, 99.5% of the quarter horses, to limit it to an elite group. And here's their theory of shortage. And this is how they got to shortage. This is what they say. Sparm taken from stallion in one taking can breed 1 million mayors. True, by the way. America can only produce a few eggs a year, and typically in an embryonic transfer situation can only produce 2 or 3 embryos a year. Therefore, they claim, this is it. This is the shortage. Their claim is there's more male reproductive material out there than female. That is the shortage. That's always the way that has been though. I think females understand that. Yes, you're honor

. And I was excited to make this argument to a mixed court, as a matter of fact. But where is the testimony about there's a shortage in the market of mayors that will give birth to successful offspring? Where's the evidence in the record there's not that the supply? I don't understand what you mean by that. You're honor, they created a shortage to get out of the regular market. That's my only point. And I probably ought not to take that. You're talking about elite mayors. Yes. You're talking about, oh, I see. And why do you need an elite mayor to breed a cloned horse? You don't. Okay. You absolutely don't. The idea is that perhaps you could get more doing it that way. Could you breed an elite horse with a sheep? I assume so. I assume so. Big sheep. Right. But here's the issue. The real problem is you can't define this class. And actually the court's instructions just use elite quarter horse. And it's an imprecise adjective. It is difficult to quantify in way too vague and useful. Dr. Flum who came up with it said these things. And these are quotes from the record. It means alternatively. He said these are synonymous high quality best of the best top drawer aspirational. Well, where where is it in all this issue? Why do we why do we define on quality of an animal? And you know, actually courts have have shied away from defining markets based on quality. What's your what's it? I mean, do you have what did your experts say about all this? Did you have an expert? He says that that one. Yes, we did. It was not that you got doctor. You got to say two things

. He said first this is too imprecise to have a direct meaning. And second, he admits there is such a thing or as elite horses that perform better than others. But questions whether a class can be drawn on it. And equally is important questions where this one was drawn. And let me explain that because I think it's important. In a core course, and this was the applies theory was at yearling sales where there are a lot of the lot of yearlings sold. The real truth of the matter is only we ought to consider only 350 horses in a that 175 or mayor's and that's pretty much their class. And you reach that decision based on price. $35,000 and up was initially what Dr. Flom said. So the issue is how do those and but in the input he said is this and it's fascinating. He said all these characteristics I came up with. He actually you're going to hear characteristics and it was in their briefest characteristics. Actually, Dr. Flom said indicators of what would happen that the real truth of the matter is he said the consumers don't care about that. What they really, really care about is the situation where you have a horse that performs well that wins right races or will be able to make money in breeding. That's what the consumer cares about. So the question obviously is going to be a horse's outside his alleged elite market going to be reasonable substitutes for the ones in it. And we know there are from undisputed historic evidence. In the 2011 the top 10 winning quarter horses by money in races. Four came from non elite or would be termed by Dr. Flom, non elite horses. Only three came from the yearling sales in his elite class. We did the same thing for 2010. We did it for all the top 42 horses in 2010 and 11 and the statistics were roughly the same. Their answer to this is one case and it is international boxing club of New York. And in that case, the United States Supreme Court said that a market was properly put together for a market for championship boxing bounce. Not championship boxers by quality. Not champion boxers themselves, but bounce in eight categories. There is a championship belt. There's only one champion at a time decided by a belt that everybody knows, just like the Super Bowl

. We know that the Vince Lombardi trophy is going to be on the line. It was precise. They didn't quantify the market by the quality of the boxer. If they had that case would have been analogous, but it's not. And let me say one other. Wait, was this other restraint was in not letting somebody into those bats? Or was this restrained in organizing such that other people couldn't organize competing bouts? Yes, it was where they couldn't organize competing bouts. They got all the venues tied them up and made deals. So only they could. That would be more equivalent to monopolizing the racing, you know, the race tracks. That would be what it would be equivalent to your honor. It would not be equivalent to the horses themselves. No court that we can find at Appleese site none have ever quantified a market based on quality of an animal or a human. Finally, let me just turn briefly to no reasonable unreasonable restraint on trade. I'm going to say two things. First off, they say, well, our hoorses are worthless because they don't get registration. And if they don't get registration, people don't like them. In consolidated metal products, this court in 1988 said a refusal to promote or approve. That has the effect of excluding a product from the market, even when the consumers like the product or accept the approval. Doesn't do it. You got to have more. You got to show that the agency that did that coerced. There's no evidence of coercion here. They don't even suggest that. Of course, I mean part of their argument, I think, is that these clone, these clone horses can't even compete in these top money races, right? Yes, sure. Because they're not registered. That's right. And that's a matter of state action. And we're not claiming immunity. Don't get, don't get me wrong. What we're saying is states do that because they value our registration. We don't encourage that

. But remember, this court recently held in Marucci sports that even if there is an exclusion for purposes of an exclusion of a product because of a regulation there, the NCAA took out some bats because they could cause some injury. Even if there's exclusion, that doesn't cause an injury unless you go back and look to see whether. And in that case, there was a shortage, but you even go back and look to see if there is competition with the things that remain in the market and that is true here. Thank you, Mr. Caldwell. Thank you. Thank you. Mr. Monford. May I please the court record my name is with the one foot with me a council table of Nancy Stone from memorable Texas. And Sam Stein from Cherokee, Oklahoma. We have divided our time. I would like to address liability to the extent that's convenient with the court and this stone will address the injunction issued to the extent that that is desirable. If this is an antitrust case, I guess we ought to start with where the money is. Opposing council has not mentioned it. Our clients have horses which the district court has said are for all practical purposes identical to the breeds champions. But they want the association will not register our horses will not register our horses offspring. Where the money is and where the damages were in this case which hasn't been mentioned are in is in breeding of these horses. Well, you client, the jury did exactly what you're client asked him to do when he said this isn't about the money. He did say that but they also had another argument which is very interesting in light of posing councils. Contentions which is their expert said you put on damage of loss of breeding loss of stud fees and loss of sales of yearlings. But you've assumed that the prices are going to stay the same. And under our testimony there's going to be competition in the market and the prices are going to go down. So they said our damage model wasn't any good because we relied on all prices and hadn't said what the new prices were going to be. He says no harm to competition in the trial court they relied on the fact that there was going to be competition to defeat our damage. I accept all that but I mean the fact is you didn't cross appeal lack of damages. No, we didn't. And pleading 140 is the trial judge's opinion on attorney's fees and it talks about how there was injury. Plenty of injury and plenty of benefit to the to the market and to the breed from from our case. But the jury didn't award damages. Yeah, let me just ask you one practical question

. Again, you know, your theory about money only goes so far so I'll ask you a practical question. If this were a movie about, you know, Dolly the Dolly the clone torso misjust to or whatever the name is. Why couldn't your guy just create demand for this product by buying off one of his buddies and the good old boy team. Let's have a race. Let's see who the better horse is and you publicize it and you get a huge audience for it because your client is apparently not a poor boy. And then your horse shows his his or her worth and you know, then everybody else in Aqua says, Oh my gosh, we've just got to we've just got to open our arms to these new guys. Are they are they're going to take the market away from all the old fashion horses. That might have been an argument to the jury but it wasn't made to the jury. This case is not about racing. It's about breeding. I understand that. That's how you show that your breed is better than their breeds. Here's the barrier to entry. You want to be in the bear. You want to be in the barrier. No, the barrier to entry. You've got to have an elite quarter horse, okay? And in order to sell breeding rights traditionally in order to get in the market, the barrier to entry recognized in the economic literature is with mayors. They don't ovulate very frequently. It takes up to seven to ten years because you have to buy an elite mayor. You have to maybe put that mayor in competition and you then have to prove that the offspring of that mayor will succeed and are successful. And that's the way you prove that a quarter horse is elite. They didn't mention the characteristics of elite. They're about ten of them and they largely have to do the breeding value. Our people are a threat and let me say breeding value is tremendous. Mr. Wise has a horse, aptly named Corona Cartel. One horse breeds 88 mayors in one year at $35,000 a piece, stud piece. That's $3 million in one year from one horse for stud piece. Now Mr. Wise may be a volunteer when he serves on these committees and makes these rules. But he's certainly got a strong financial interest

. You know, I'm willing to accept all that but getting back to the issues here. The first one that they raised is that there's no concerted action and it seemed to me. I mean, I read through your brief and where is the evidence that these five elite horse owners control the committee of 30 and then that committee of 30 controlled the board. I mean, I just think that's a, I'd like to hear that evidence. First of all, a clerk, they, they, their brief is on this, they're opening brief is worthless. They don't talk about their own witnesses. Mr. Marell, Mr. Wise say that all 30 or 28 of the people are breeders. All eight of the members of the stud book committee who testified in this case own elite horses and are breeders. But I mean, naturally when you're talking about the characteristics of the breed, this is an organization of a quarter more than a quarter million people worldwide. Is it not? Something, yes. And so, that's, it stands to reason that the committee that's going to determine the characteristics of the breed is going to have more breeders on it rather than the person who has a little, you know, weekend farm and bellville with a registered quarter horse. So, I'm not, I don't see that that in itself. That's why you've got an error in your market, right? The, first of all, the, the evidence is that the stud book committee, the, the associations given this whole thing to the stud book committee, which is a bunch of breeders. If it doesn't get out of the stud book committee, it doesn't even go to anybody else. And they successfully killed it through sham procedures for four years. And the evidence on the, on not going to the board of directors is what evidence do you have? I mean, how? Did you have evidence about every one of those 30 members conspiring or a majority or voting majority? 13 issues. Number one, do they have independent economic interests? I believe we've established. Well, let's just say that's a possibility, but they're, but you're defining an elite market. And that's only at most five members out of a 30 member committee. I mean, the rest of it may be ranchers for all I know. Your honor, Carol Rose, who testified as a lead breeder of performance horses, Mike Jennings owns Mike Cap, last chapter. He breeds 150 mayors a year. John Schroeder bleeds pleasure horses, not all of them are elite, but she owns a horse named Blazing Hot, who's a delete horse. Dwayne Walker has registered 1700 horses with the AQHA. All of these people are on that committee. We have an octopus diagram in the record excerpts. They're not off-crowing 16. But your client says that he's being excluded from registration, but his damages have to do with the elite market, the elite sub-market. And therefore, I had the misimpression perhaps that the restraint of trade had to be tied to an elite sub-market

. Will that wrong? We can't get in the market at all. I know you can't get in the market at all, but if the market, if the market is everybody from Kingdom come, then you can breed just as well as they can, whether you're registered or not. And if you've got a superior mark, a superior product, I don't see how you're excluded from buying a marin and letting it carry your clone product to term. That does bring in the issue of state regulation. But just answer me this, Mr. Munford, to prove, this is not a per se violation, it's a violation of the rule of reason. You have to have a product market. Your product market was the market for elite quarter horses. More and more particularly the breeding of elite courses. That's right. That's right. And by your definition, my understanding, at least this is the way I read your brief, you were focusing on these five big bad guys, the good old boys, who remember often on, not all of them all at the same time. Even perhaps often on for several years of the 30 member committee. So you've got four members of a 30 member committee. I would call your attention to exhibit P147, which is the Oxpich chart. It's in record excerpts. It talks about 16 people, all of whom are tied to heritage place auctions. And I would also tell you attention to the testimony of Mr. Merrill and Mr. Wise as to all 30, or almost all 30, of the people being breeders. And there are denials that they're not occasionally that they're not all elite breeders. But everyone on who testified has an elite horse and breeds it. Eight on them. So if you please explain to me the conspiracy theory, I mean it just seemed to me that the association members are, you know, are some aligned. I mean they're not competitors of the association. The interest may very well be the same as the association. So how do you get this conspiracy between the association and the members? The test under American needle is whether they have an independent economic interest. The interrogatory to the jury was, do they have an economic interest separate from that of the firm itself? The Court of Horse Association's interest is in having more members, more horses registering horses. But they're not competitors with the association, but the Court of Association is not a competitor of the association members, that right? No, it's like, you know, Justice Stephen talks about an American needle. The association is being used by people who are competitors of the plaintiff to pursue their own individual interest, which are not the interests of the association. I would cite the Court not only to American needle, but to the hydro level case, where a standard setting organization was used by two employees of competitors

. I would cite the Court to Allied Tube, which is a spring court case, where they said that the process had been biased by members. And American needle in North Texas say the test is who controls. And the jury could find that they control. So what you're saying is that you have a bunch of breeders, and you're saying that in this committee, there were, of course, in this organization, with a quarter million people, there's going to be the whole 99.9% of the range of quarter horses from nags and old ones on their way to the glue shop to the elite crowd, right? And naturally, it's not, I mean, this is probably true in the Poodle Association, and that's why we have an Amicus breed from seven different other horse associations. That the breeders... That's usually in there too, yeah. Exactly. So, you know, all of those are vulnerable. Every time they make a change in their breed, I mean, suppose this change was, as it was a few years ago, we don't want so much white on the, you know, on the snout of the horse. That's a very important question. Because any of that excludes somebody, right? And anybody can make exactly the argument that you're making. No. Okay. Wonderful question, but I don't draw that conclusion. These associations have the authority to define the breed. They can define what a quarter horse is. And for example, with the white rule, if they have a white rule, and there's one horse out there who doesn't get registered because of the white rule, there's no effect on competition. Let me say, don't, if you, there's a lot of questions that we all have here, and answer the questions, and don't worry, we'll give you a little time to make an additional argument if you miss some of the points you want to make. So, everybody can just relax a little bit, and not worry about not making your points off, but we. As I said, the market is the market, elite quarter horses, but in particular with our damage model for stud fees and yearlings that would have been yielded. Now, under the injury instructions and the law, the first thing you do is you look for in elasticity of demand, and is demand responsive to price. And we have put before the court, both in record excerpts and a few additional pages. So material from P92, which is our experts report. Are you trying to shut me in? And if I could give the court any citations, it would be 2841, 3275, and exhibit P89, page 31. What those pages say is that the number of elite horses, elite quarter horses, is very small. One witness says, well, Mr. Oathlin, when he asked the question, said, you're talking about 100, not 200, not 1000, right? The witness says yes. Another witness asks, how many elite mayors are there? He says, well, they're 50 blue hens, they call them, and a few hundred that are good. The Court of Horse Association itself identifies 45 stayans that breed more than 100 a year, which is another criterion of breeding days. From the point of view of stallions or mayors, I don't understand. It's considered, if a stallion is bred to more than 100 raiders a year, and of course all of this is artificial. They haven't used traditional methods in many years. Right. Then that's one of our experts characteristics as elite, but the association itself keeps those statistics. How many stallions breed that much? The association itself publishes lists of horses by the value of their offspring. How did their offspring do in racing? They publish those lists. That's one of our criteria of elite. They know who these horses are. There's no denial that the horses we name in this testimony were elite. Now, let's go to the market. The market. This is something I haven't seen in any case. This is a chart of any last test of demand, which is what tells you whether there's a separate market or not. This is a chart for yearlings. That was one of our damage people. What it shows is the demand for the horses is very sensitive to price for the first 95% so. Then at the top, it's very inelastic. Their expert, Mr. which is the test for a separate market, you're not going to increase these kind of horses is not going to change the price of people. Their expert, Mr. Ugone, says this chart is right. He testifies there is a market for elite quota horses. Our expert said that if you want to pick a point where it turns, it's about $35,000, which is the top 5% of these yearlings and it's a selective group. Let's assume that's the market. I'm willing to assume that's the market. Although, again, do you have a single case where animals or humans have ever been held to be a sub market? Never held to have a case where they were. I don't know, I get it. I'm willing to have precedent, they have no precedent. Okay, but aside from that, if that's the relevant market, then you have to show that the conspirators who are in the relevant market had were the ones who excluded you from that market

. The Court of Horse Association itself identifies 45 stayans that breed more than 100 a year, which is another criterion of breeding days. From the point of view of stallions or mayors, I don't understand. It's considered, if a stallion is bred to more than 100 raiders a year, and of course all of this is artificial. They haven't used traditional methods in many years. Right. Then that's one of our experts characteristics as elite, but the association itself keeps those statistics. How many stallions breed that much? The association itself publishes lists of horses by the value of their offspring. How did their offspring do in racing? They publish those lists. That's one of our criteria of elite. They know who these horses are. There's no denial that the horses we name in this testimony were elite. Now, let's go to the market. The market. This is something I haven't seen in any case. This is a chart of any last test of demand, which is what tells you whether there's a separate market or not. This is a chart for yearlings. That was one of our damage people. What it shows is the demand for the horses is very sensitive to price for the first 95% so. Then at the top, it's very inelastic. Their expert, Mr. which is the test for a separate market, you're not going to increase these kind of horses is not going to change the price of people. Their expert, Mr. Ugone, says this chart is right. He testifies there is a market for elite quota horses. Our expert said that if you want to pick a point where it turns, it's about $35,000, which is the top 5% of these yearlings and it's a selective group. Let's assume that's the market. I'm willing to assume that's the market. Although, again, do you have a single case where animals or humans have ever been held to be a sub market? Never held to have a case where they were. I don't know, I get it. I'm willing to have precedent, they have no precedent. Okay, but aside from that, if that's the relevant market, then you have to show that the conspirators who are in the relevant market had were the ones who excluded you from that market. And this record is full of that evidence because these people set up the sham procedure through which they... I had two minutes more to each side. But again, you've got to assume there are probably some breeders in that that don't breed elite quota horses. And therefore, it gets back to, let's say you have an association of steel manufacturers and you've got a group of them within the standard setting. And a few of them are produced the most high-test specialty steel in the world. And they define their product in certain ways. But they don't control the standards committee because they don't have the votes. That brings in Consolidate Mow, which is helpful. And Footnote 21 and Consolidated Metal notices in that court that in that case, the standards were not a matter of law. As they were in high to high level. And as they are in this case, they in their brief have listed all the state staffutes that give them market power. Furthermore, in the Consolidated Metal case, at page 295, the court specifically noted that the committee was composed of users, not competitors. One final word about international boxing, which we believe is very much on point. In this case, as well as the other price cases, home foods, market, Geneva, Linux, and so forth. Here's the analogy. You have a leak quarter horse. There is a market for stud fees and for yearly. And then those yearlings go out in the world and do whatever they do. We say that the market for stud fees and yearlings is inelastic. And we have shown an elite market of a few hundred horses. And they are threatened by the fact that, for example, 300 horses have been gene banked possible future clothing. In the international boxing case, what was the measure that the court looked to define the market? It was not the prices paid to the competitors. Just like we're not talking about the prices, the horses so much. It was the prices paid for the tickets to the competition. Just like we're talking about the prices paid for the breeding rights to these horses. It did not matter whether the fight ended up being a good one or not. The market was defined by the ticket price. And in this case, the market is defined by the price of the breeding rights and stud fees. And even if some of those horses don't go off in windrises, it doesn't matter

. And this record is full of that evidence because these people set up the sham procedure through which they... I had two minutes more to each side. But again, you've got to assume there are probably some breeders in that that don't breed elite quota horses. And therefore, it gets back to, let's say you have an association of steel manufacturers and you've got a group of them within the standard setting. And a few of them are produced the most high-test specialty steel in the world. And they define their product in certain ways. But they don't control the standards committee because they don't have the votes. That brings in Consolidate Mow, which is helpful. And Footnote 21 and Consolidated Metal notices in that court that in that case, the standards were not a matter of law. As they were in high to high level. And as they are in this case, they in their brief have listed all the state staffutes that give them market power. Furthermore, in the Consolidated Metal case, at page 295, the court specifically noted that the committee was composed of users, not competitors. One final word about international boxing, which we believe is very much on point. In this case, as well as the other price cases, home foods, market, Geneva, Linux, and so forth. Here's the analogy. You have a leak quarter horse. There is a market for stud fees and for yearly. And then those yearlings go out in the world and do whatever they do. We say that the market for stud fees and yearlings is inelastic. And we have shown an elite market of a few hundred horses. And they are threatened by the fact that, for example, 300 horses have been gene banked possible future clothing. In the international boxing case, what was the measure that the court looked to define the market? It was not the prices paid to the competitors. Just like we're not talking about the prices, the horses so much. It was the prices paid for the tickets to the competition. Just like we're talking about the prices paid for the breeding rights to these horses. It did not matter whether the fight ended up being a good one or not. The market was defined by the ticket price. And in this case, the market is defined by the price of the breeding rights and stud fees. And even if some of those horses don't go off in windrises, it doesn't matter. That is part of the barrier to entry that we want to break down. We do not want to race these horses. Nobody's preventing you from breeding them. But we can't register them. You can breed them all you want. And you can create your own market because somebody, I mean, the only way, in other words, the only way they prove themselves is if they race and win a bunch of money. They can't race. Of course they can race. You put them on a race track and you race them. You can breed five or six of them and you can race them and see what happens. Judge John Staten law says we can't race them. And what law says you, that doesn't mean you're foreclosed from every state track in the country does it. Look at the list in their in their in their in their breed. You go to say we can't race these horses because they're not registered in the court of horses. Let me, I just saw. And and happily, if I may make close with just a reference to precedent. And happily this court said this court said that without registration these horses are virtually worthless. Without registration in American court of horse is virtually worthless. This court said this test was did the people who made the decision have an independent economic interest, independent stake in the illegal acts. We proved that it said that in this case they were acting in the best in association, interest in association. We proved that they're justification for shams. They did have the secret meeting. The people were called to meet with the executive committee. What's that email that I mean that is he right about but that's not. No, no, he's not right. Well, what's your. I'll just call your attention to look at. Mr. Vena Klauson page 2811 to 2825. And Mr. Tredway 2971

. That is part of the barrier to entry that we want to break down. We do not want to race these horses. Nobody's preventing you from breeding them. But we can't register them. You can breed them all you want. And you can create your own market because somebody, I mean, the only way, in other words, the only way they prove themselves is if they race and win a bunch of money. They can't race. Of course they can race. You put them on a race track and you race them. You can breed five or six of them and you can race them and see what happens. Judge John Staten law says we can't race them. And what law says you, that doesn't mean you're foreclosed from every state track in the country does it. Look at the list in their in their in their in their breed. You go to say we can't race these horses because they're not registered in the court of horses. Let me, I just saw. And and happily, if I may make close with just a reference to precedent. And happily this court said this court said that without registration these horses are virtually worthless. Without registration in American court of horse is virtually worthless. This court said this test was did the people who made the decision have an independent economic interest, independent stake in the illegal acts. We proved that it said that in this case they were acting in the best in association, interest in association. We proved that they're justification for shams. They did have the secret meeting. The people were called to meet with the executive committee. What's that email that I mean that is he right about but that's not. No, no, he's not right. Well, what's your. I'll just call your attention to look at. Mr. Vena Klauson page 2811 to 2825. And Mr. Tredway 2971. They called the opponents of club there was supposed to meet. And I've got to be concise. They called the there was supposed to meet in spring of 2012. They called they had an sent an email saying the opponents of cloning were supposed to come meet with executive committee in January. After that meeting the president tells our people you've got a chance here. And we believe that he was sincere and believe that. And a member of the staff calls our people up and says you don't have a chance. Bring it to close. Bring it to close. And from that evidence to jury could conclude it is evidence upon which jury conclude that they bet secretly and rigged the meeting. Even though they have five votes and the committee has 30 votes. Yes. Okay. Okay. We will hear from Mistone. Is that right? Mistone. That's why I've got it. Is that correct? If any, they look you look exasperated to something. That's not the way it is supposed to be. I think it is pretty far from the orders. Okay. May I please the court? Yes. My name is Nancy Stone. I have represented Abraham and Viniclaus and joint venture since the time that the complaint in this case was filed. As Judge Joan acknowledged, AQHA was neither able to convince the jury in this case nor Judge Robinson about those things that they complain about today. Again, this is a case in which there was factually and legally sufficient evidence to support the verdict of a properly. Why don't you tell it how you spread in this argument? Pardon me? How are you spread in this argument? I'm addressing the injunction. Okay. Pardon me? We also have a person that we want to talk about. Move it on. Judge Robinson did not abuse her discretion in entering an injunction following the verdict of a properly instructed jury that made its decision based on legally and factually sufficient evidence

. They called the opponents of club there was supposed to meet. And I've got to be concise. They called the there was supposed to meet in spring of 2012. They called they had an sent an email saying the opponents of cloning were supposed to come meet with executive committee in January. After that meeting the president tells our people you've got a chance here. And we believe that he was sincere and believe that. And a member of the staff calls our people up and says you don't have a chance. Bring it to close. Bring it to close. And from that evidence to jury could conclude it is evidence upon which jury conclude that they bet secretly and rigged the meeting. Even though they have five votes and the committee has 30 votes. Yes. Okay. Okay. We will hear from Mistone. Is that right? Mistone. That's why I've got it. Is that correct? If any, they look you look exasperated to something. That's not the way it is supposed to be. I think it is pretty far from the orders. Okay. May I please the court? Yes. My name is Nancy Stone. I have represented Abraham and Viniclaus and joint venture since the time that the complaint in this case was filed. As Judge Joan acknowledged, AQHA was neither able to convince the jury in this case nor Judge Robinson about those things that they complain about today. Again, this is a case in which there was factually and legally sufficient evidence to support the verdict of a properly. Why don't you tell it how you spread in this argument? Pardon me? How are you spread in this argument? I'm addressing the injunction. Okay. Pardon me? We also have a person that we want to talk about. Move it on. Judge Robinson did not abuse her discretion in entering an injunction following the verdict of a properly instructed jury that made its decision based on legally and factually sufficient evidence. In the exercise of her discretion in connection with granting the injunction, Judge Robinson held an evidentiary hearing on plaintiff's request for a preliminary, for a permanent injunction. At the injunction hearing itself, it became more obvious that there was a need for the court to enter specific orders with regard to rules that needed to be revised. Because even after the successful, we had successfully tried the case to the jury verdict to a jury who had denied all of or had not bought all of the justifications that AQHA brought forward. AQHA still at the injunction hearing was trying to assert that the judge should limit the injunction only to mayors that there should be discriminatory rules and regulations on clones and they're offering that there weren't on other horses. And again, those were the justifications that the jury had already objected to or had rejected. At the conclusion of the hearing when Judge Robinson announced that she was going to enter an injunction requiring AQHA to register clones in their offspring, she requested that AQHA give some input into the language of the order, specifically stating that by doing so, they would not have waived any of their objections on appeal or in connection with any of the judges. So, the judge had the objections that they subsequently made in the trial court to the injunction that would be entered. They chose to do nothing. Two days after the hearing on the injunction, she entered an order, this is document number 136, record on appeal, number 2049. She entered an order specifically requiring AQHA to address each specific proposed change in the rules and regulations and state the requested alternative change to the rules. In response, again, AQHA did nothing. They failed and refused to point out even one problem, one omission, or one conflict in the proposed rules with those that were already in existence. The injunction that was actually entered was narrowly tailored to address the violations found by the jury and also found by the district court and to require AQHA to make revisions to 12 of its existing rules. Those 12 rules had been repeatedly identified by AQHA as being rules that had to be changed in order to accomplish registration of clones. In other words, just abolishing rule 227A would not result in clones and they're off being registered. On three different occasions, AQHA had identified 12 specific rules that it would also need to be changed. Therefore, when Judge Robinson entered the injunction, in this case, she did just that. She set forth specific and for the most part minor changes that needed to be made to many of the rules to provide for the registration of these horses. She exercised her discretion in entering the injunction and ordering revisions to the very rules that AQHA identified would have to be revised to register clones in their offspring. How many clones are in existence at the present clone animals? As of the time of trial, there were 25 cloned quarter horses. There are then all the mayors that brought them to term. Recipient mayors. All of all quarter horses, all elite quarter horses, whether they are born through cloning procedure or any other advanced breeding techniques are all carried by recipient mayors. So it doesn't matter who the mayor is? Well, it does. If you're breeding a style into a clone, whatever horse you're cloning, once you have an embryo, you will put that embryo in a recipient mare, which is a serigant mother will actually carry that baby to birth. Which has been done by AQHA since sometime in the 80s. I don't know the exact date. This may be a silly question, but explain to me why people are cloning these horses if the problem is for a joker certain they can't be members of or can't be registered by the American Quarter Horse Association? Well, at the time that cloning first began, first of all, there was plenty of evidence of trial about the history of accepted breeding techniques by AQHA. And one of them, multiple embryo transfer, was only allowed by AQHA after a lawsuit was filed. So, and furthermore, our clients in this case by the president of AQHA were encouraged that in fact this rule might be changed. And so, it wasn't until after the June behind closed door secret seridepidus meeting took place, then it was taken out from under them, but up until that point in time they were hopeful

. In the exercise of her discretion in connection with granting the injunction, Judge Robinson held an evidentiary hearing on plaintiff's request for a preliminary, for a permanent injunction. At the injunction hearing itself, it became more obvious that there was a need for the court to enter specific orders with regard to rules that needed to be revised. Because even after the successful, we had successfully tried the case to the jury verdict to a jury who had denied all of or had not bought all of the justifications that AQHA brought forward. AQHA still at the injunction hearing was trying to assert that the judge should limit the injunction only to mayors that there should be discriminatory rules and regulations on clones and they're offering that there weren't on other horses. And again, those were the justifications that the jury had already objected to or had rejected. At the conclusion of the hearing when Judge Robinson announced that she was going to enter an injunction requiring AQHA to register clones in their offspring, she requested that AQHA give some input into the language of the order, specifically stating that by doing so, they would not have waived any of their objections on appeal or in connection with any of the judges. So, the judge had the objections that they subsequently made in the trial court to the injunction that would be entered. They chose to do nothing. Two days after the hearing on the injunction, she entered an order, this is document number 136, record on appeal, number 2049. She entered an order specifically requiring AQHA to address each specific proposed change in the rules and regulations and state the requested alternative change to the rules. In response, again, AQHA did nothing. They failed and refused to point out even one problem, one omission, or one conflict in the proposed rules with those that were already in existence. The injunction that was actually entered was narrowly tailored to address the violations found by the jury and also found by the district court and to require AQHA to make revisions to 12 of its existing rules. Those 12 rules had been repeatedly identified by AQHA as being rules that had to be changed in order to accomplish registration of clones. In other words, just abolishing rule 227A would not result in clones and they're off being registered. On three different occasions, AQHA had identified 12 specific rules that it would also need to be changed. Therefore, when Judge Robinson entered the injunction, in this case, she did just that. She set forth specific and for the most part minor changes that needed to be made to many of the rules to provide for the registration of these horses. She exercised her discretion in entering the injunction and ordering revisions to the very rules that AQHA identified would have to be revised to register clones in their offspring. How many clones are in existence at the present clone animals? As of the time of trial, there were 25 cloned quarter horses. There are then all the mayors that brought them to term. Recipient mayors. All of all quarter horses, all elite quarter horses, whether they are born through cloning procedure or any other advanced breeding techniques are all carried by recipient mayors. So it doesn't matter who the mayor is? Well, it does. If you're breeding a style into a clone, whatever horse you're cloning, once you have an embryo, you will put that embryo in a recipient mare, which is a serigant mother will actually carry that baby to birth. Which has been done by AQHA since sometime in the 80s. I don't know the exact date. This may be a silly question, but explain to me why people are cloning these horses if the problem is for a joker certain they can't be members of or can't be registered by the American Quarter Horse Association? Well, at the time that cloning first began, first of all, there was plenty of evidence of trial about the history of accepted breeding techniques by AQHA. And one of them, multiple embryo transfer, was only allowed by AQHA after a lawsuit was filed. So, and furthermore, our clients in this case by the president of AQHA were encouraged that in fact this rule might be changed. And so, it wasn't until after the June behind closed door secret seridepidus meeting took place, then it was taken out from under them, but up until that point in time they were hopeful. They had every reason to believe that the rule would be changed to allow for these horses to be registered. Horses are registered with such advanced breeding techniques now that they freeze embryos, they have been a freezing semen for a long time. So, and they're also produced through a procedure XC which is performed in the same laboratory, and if you weren't a scientist you wouldn't be able to tell the difference between XC procedure and cloning procedure. So, why didn't they exclude the XC or its breed? The evidence of trial was that the reason it wasn't excluded is because it was being advocated by one of the members of the Stuttbrook and Registration Committee, Von Kuhk, who has shown... Well, let me just ask it, doesn't one of either Abraham or your client also breed elite animals? I'm sorry. I thought one of your, one of the two plaintiffs in this case, bred elite quarter horses as well as invested in clones. No, they have no, the testimony, the testimony was that neither one of them had any elite quarter horses except the clones in their offspring, which their offspring, which they're unable to breed. I mean, you know, it's fine to have a lawsuit, but I just have one other practical question. Why your clients are both well healed evidently and to support this cloning enterprise? And why couldn't they just buy an elite quarter horse and go into the breeding business and then get on the committee? As Jason Abraham testified, there weren't any for sale. That the horses that are in the truly elite market, the sale of those horses are few and far between. That was the testimony that Jason Abraham gave. Well, how do you know your guys would get into that market then? Well, they'll get into it if this court affirms the judgment of the lower court because the horses that they have right now, their clones, their clones and their offspring are elite but for the refusal of AQH to register them. Lisa, that's what that's your argument and you're sticking to it. That's my argument. I'm sticking to it. The jury believed it and so did Judge Robinson. Okay. Thank you. Consistent with again. Thank you. Ron, I run out of time. Can you finish up in about a minute, please? Yes. Get some side one minute. Consistent with past president and long time, but stud book and registration committee member Frank Merrill's pronouncement that no judge, no court would tell AQH what to do. AQH has continued to be adamantime just as was recognized by this court in and haggly. As Mr. Munford referred to, the evidence revealed that there were sham procedures to delay decision on the first request for real change so that AQH could shore up its defenses that it identified as red herrings and dead ends and feigned fairness in anticipation of a lawsuit. The specific injunction entered by Judge Robinson was warranted and necessary to prevent the power brokers on the stud book and registration committee in conjunction with AQH from continuing to exclude horses from the elite court of horse market. Thank you, Mr

. They had every reason to believe that the rule would be changed to allow for these horses to be registered. Horses are registered with such advanced breeding techniques now that they freeze embryos, they have been a freezing semen for a long time. So, and they're also produced through a procedure XC which is performed in the same laboratory, and if you weren't a scientist you wouldn't be able to tell the difference between XC procedure and cloning procedure. So, why didn't they exclude the XC or its breed? The evidence of trial was that the reason it wasn't excluded is because it was being advocated by one of the members of the Stuttbrook and Registration Committee, Von Kuhk, who has shown... Well, let me just ask it, doesn't one of either Abraham or your client also breed elite animals? I'm sorry. I thought one of your, one of the two plaintiffs in this case, bred elite quarter horses as well as invested in clones. No, they have no, the testimony, the testimony was that neither one of them had any elite quarter horses except the clones in their offspring, which their offspring, which they're unable to breed. I mean, you know, it's fine to have a lawsuit, but I just have one other practical question. Why your clients are both well healed evidently and to support this cloning enterprise? And why couldn't they just buy an elite quarter horse and go into the breeding business and then get on the committee? As Jason Abraham testified, there weren't any for sale. That the horses that are in the truly elite market, the sale of those horses are few and far between. That was the testimony that Jason Abraham gave. Well, how do you know your guys would get into that market then? Well, they'll get into it if this court affirms the judgment of the lower court because the horses that they have right now, their clones, their clones and their offspring are elite but for the refusal of AQH to register them. Lisa, that's what that's your argument and you're sticking to it. That's my argument. I'm sticking to it. The jury believed it and so did Judge Robinson. Okay. Thank you. Consistent with again. Thank you. Ron, I run out of time. Can you finish up in about a minute, please? Yes. Get some side one minute. Consistent with past president and long time, but stud book and registration committee member Frank Merrill's pronouncement that no judge, no court would tell AQH what to do. AQH has continued to be adamantime just as was recognized by this court in and haggly. As Mr. Munford referred to, the evidence revealed that there were sham procedures to delay decision on the first request for real change so that AQH could shore up its defenses that it identified as red herrings and dead ends and feigned fairness in anticipation of a lawsuit. The specific injunction entered by Judge Robinson was warranted and necessary to prevent the power brokers on the stud book and registration committee in conjunction with AQH from continuing to exclude horses from the elite court of horse market. Thank you, Mr. Stone. The Calhoun will get from here in the world. Thank you, Your Honor. Got a lot to cover so I'm going to try to do it quickly in the time of the lighting. First thing, let me deal with a couple of legal points because they're important. This month, referred to the Hyderville versus ASME case, American Society of Mechanical Engineers from the United States Supreme Court, it does not deal with concerted action. Look at the case carefully, please. It deals with the issue of whether an agent in that case concerted action was not challenged. A competitor had an agent or had a conspirator inside the organization and wrote the rule and it was discovered later. The only question the Supreme Court considered is whether agency law applied to anti-trust law. So it doesn't support his position. On the issue of conspiracy, please consider this as well. You've got to have separate economic interests that are pursued. Their testimony from their witnesses are the board of directors was against cloning. The stud book registry was against cloning. Our members, poll 86% were against. Everybody was consistent. Who are your members? Who are your members? The members, in fact, we did a statistical survey of 3,000, 1,000 responded and they were picked in random. Ironically, what the Apollees changed, it claimed, it wasn't a good study because they weren't breeders. Exactly contrary to the arguments they make now. Let me turn to the breeder argument. Mr. Mumpford is right in one thing but quite wrong in another. The testimony, there was testimony from his clients that all of the stud book registry people were breeders. But in his brief, he tells you that only five were involved in the elite market. That's precisely right. That's what his brief says and that is the case. Now, as to the stud book registry committee absolutely controlling everything that is not true. The stud book registry committee is a standing committee in the organization. It works in conjunction with and reports to the board of directors. It makes reports to the annual meeting

. Stone. The Calhoun will get from here in the world. Thank you, Your Honor. Got a lot to cover so I'm going to try to do it quickly in the time of the lighting. First thing, let me deal with a couple of legal points because they're important. This month, referred to the Hyderville versus ASME case, American Society of Mechanical Engineers from the United States Supreme Court, it does not deal with concerted action. Look at the case carefully, please. It deals with the issue of whether an agent in that case concerted action was not challenged. A competitor had an agent or had a conspirator inside the organization and wrote the rule and it was discovered later. The only question the Supreme Court considered is whether agency law applied to anti-trust law. So it doesn't support his position. On the issue of conspiracy, please consider this as well. You've got to have separate economic interests that are pursued. Their testimony from their witnesses are the board of directors was against cloning. The stud book registry was against cloning. Our members, poll 86% were against. Everybody was consistent. Who are your members? Who are your members? The members, in fact, we did a statistical survey of 3,000, 1,000 responded and they were picked in random. Ironically, what the Apollees changed, it claimed, it wasn't a good study because they weren't breeders. Exactly contrary to the arguments they make now. Let me turn to the breeder argument. Mr. Mumpford is right in one thing but quite wrong in another. The testimony, there was testimony from his clients that all of the stud book registry people were breeders. But in his brief, he tells you that only five were involved in the elite market. That's precisely right. That's what his brief says and that is the case. Now, as to the stud book registry committee absolutely controlling everything that is not true. The stud book registry committee is a standing committee in the organization. It works in conjunction with and reports to the board of directors. It makes reports to the annual meeting. And at the annual meeting, the membership hears what their recommendations are. But the board of directors has a chance to pass on any recommendations and determine either affirmative or negative votes on that. Only the board of directors can speak for the organization and that is the bylaws. Now, the other issue on that I think is, is, is, is, sorry, I'm getting off just one thing here. Can the five control the 30 and is their testimony? Is there opportunity, I guess there might be, is their testimony? No. The only testimony they have is that one of their clients, I think they control them. And then on cross examination said, do you know, are you speculated? And he admitted it was conjecture. stud book registry, people were called. The ones that called said there was no intimidation or anything else. On the secret meeting, I stand by what I said and I ask you to look at their brief in what they refer to. Because it's PX 92. And in PX 92 is an email from the president inviting stud book registry people to attend. As to the stay, we did not open on that and chose not to address it, but I'll address, excuse me, not to stay, the injunction. We got a stay of that injunction pending this appeal. And that I think is the important thing. It's important to note that what happened here. I'm an Instra court, right? Yes, absolutely. And the suggestion in the briefs that we drafted actually the very rules, the court adopted in the injunction is not true. They were drafted by Mr. Holly, who was representing some people who wanted cloning. They were looked at us because we did what a normal organization would do. We decided we'll take a look, see what these things look like so they can be discussed in studies done. We get criticized interestingly, unfairly on the injunction part of having participated and agreed to look through the issue of cloning and decide. Mr. Stone talked about one other thing that again did not come up in the rest of the arguments and certainly didn't come up in the opening discussions. And that was the issue of advanced breeding techniques. Yes, there are a lot of them and there are a lot that have been approved. There are a lot that people on that side have actually sued over to get approved. But the truth of the matter is the difference between cloning and the difference between those techniques is cloning is a creation. Only a creation. Everything else that we have approved is breeding with a sperm and an egg that has an opportunity to advance the breed

. And at the annual meeting, the membership hears what their recommendations are. But the board of directors has a chance to pass on any recommendations and determine either affirmative or negative votes on that. Only the board of directors can speak for the organization and that is the bylaws. Now, the other issue on that I think is, is, is, is, sorry, I'm getting off just one thing here. Can the five control the 30 and is their testimony? Is there opportunity, I guess there might be, is their testimony? No. The only testimony they have is that one of their clients, I think they control them. And then on cross examination said, do you know, are you speculated? And he admitted it was conjecture. stud book registry, people were called. The ones that called said there was no intimidation or anything else. On the secret meeting, I stand by what I said and I ask you to look at their brief in what they refer to. Because it's PX 92. And in PX 92 is an email from the president inviting stud book registry people to attend. As to the stay, we did not open on that and chose not to address it, but I'll address, excuse me, not to stay, the injunction. We got a stay of that injunction pending this appeal. And that I think is the important thing. It's important to note that what happened here. I'm an Instra court, right? Yes, absolutely. And the suggestion in the briefs that we drafted actually the very rules, the court adopted in the injunction is not true. They were drafted by Mr. Holly, who was representing some people who wanted cloning. They were looked at us because we did what a normal organization would do. We decided we'll take a look, see what these things look like so they can be discussed in studies done. We get criticized interestingly, unfairly on the injunction part of having participated and agreed to look through the issue of cloning and decide. Mr. Stone talked about one other thing that again did not come up in the rest of the arguments and certainly didn't come up in the opening discussions. And that was the issue of advanced breeding techniques. Yes, there are a lot of them and there are a lot that have been approved. There are a lot that people on that side have actually sued over to get approved. But the truth of the matter is the difference between cloning and the difference between those techniques is cloning is a creation. Only a creation. Everything else that we have approved is breeding with a sperm and an egg that has an opportunity to advance the breed. Of course, cloning duplicates what we have. And I think that issue is important. As to justification and weighing the benefit if you will between us not voting down the rule on cloning and anti-competitive intent, one thing. And it'll be what I close with. There are good reasons that this organization voted down the suggestion that we redo our rules to admit cloning. One of the things we've been able to do over a long period of time. But in recent years is use scientific DNA evidence to be able to possibly identify any horse if their parentage going back to sires and dams some generations or ever question. That way we take human frailty out of the market. Thraud, deception, simple mistake. We're able, and that's part of the integrity of our breed registry. That can't be done in some horses in cloning. For stallions that will not be available. Their suggestion is, well, you do it any way for twins. You could be seated. And, Shervin. Big one. But. He said it's outside the scope of rebuttal. Okay. Okay. You're on a very briefly. No, I think you, if you're going outside the scope of rebuttal. Yes. You believe I am of that hour sit now. I'm correct. Thank you, sir. Okay. Thank you.

As Abraham, Mrs. American Quarterhorse in Succeedion, and for the American Quarterhorse, we will hear from Mr. Kelton. Thank you, Your Honor. Read registration rules adopted by voluntary nonprofit organizations, or not with the antitrust laws were designed to address. And at Pellance, or Appalise, trying to squeeze them into the antitrust laws resulted in three years, I intend to talk about today. First, of course, for Section 1, you have to have concerted action. But the association spoke with one voice and with one interest. Second, the Appalise had tried to restrict the market to an imprecise definition of the legal order horses that results in boundaries that are so vague as to be meaningless and to fire real world realities. And finally, there's no injury to competition. The association did not control prices and competition remained strong and vigorous. Let me talk briefly about concerted action. As the court knows, the single entity ruled dictates that a single entity cannot conspire with itself. That's the lesson in American needle and copper weld. There are two elements the plaintiffs must prove to get over that. First is that there are separate economic actors who have separate economic interests to advance. And second, equally as important, and what is missing here is that those actors are pursuing their own separate interest rather than that of the association. Well, weren't they? No. Were weren't the so-called elite breeders pursuing their own interests? No, you're honor. And here's, and let me explain why. There are, remember, there are only five people that are considered by the Appalise to be elite breeders on a committee of 30. And the issue is, of course, five couldn't control that issue. So what they say is the five control the rest of the 30. Well, that was my point. You may have five each pursuing his or her own independent interest, but five, you've got to go farther than that. Yes, your honor. That's right. And they admit that their testimony on that is about control is assumption. And they do so specifically. And additionally, the other members were pulled on that. And they said, of course, they weren't controlled. There are other things they bring up, like the Good Old Boy Network. It's one thing to say it. And it has a nefarious tone to it, but it is quite another thing to prove that. They talk about a number of additional things. They say, for example, there was a meeting behind the back of the president and secret in a furtive type of meeting. But the truth of the matter is that didn't actually occur. They refer to Exhibit 92, which is only an email from the president, so they couldn't be conspiring behind his back, two members of the Stubb book committee to meet with the board of directors. And there's no evidence that meeting occurred. And as a result of that, that doesn't help them at all. They claim they're a lot like either American Needle versus the NFL or Nortex, especially physicians. And let me address that legal point, because I think it can be put to rest rather easily. First thing is, and the facts are roughly the same, just change the organization. In the NFL, 32 teams combined together, each of them had their own trademarks and logos that they were going to market as souvenir uniforms and the like. And they wanted to have one manufacturer to do it. So they formed a subsidiary within the NFL to pursue that. They sued their own secret economic interest in doing it. And they did so collectively, only to one purchaser to restrain trade. Of course, that made sense, but that's not us at all. There's no indication that anything like that happened. Interesting, the breed registry was what drove this issue. Additionally, in that regard, it's very important to note here, there's no evidence that separate economic interest were actually pursued. If you look at page 25 to 31 of their brief, you'll see that they don't even take on this issue at all. They don't believe it is an element to overcome the single entity defense. And that's important in this case. I mean, there's no evidence that they were pursuing this. Well, there was testimony from the members that they called to testify to reasons for their voting for the rule. There was no evidence that they pursued anything separately. Well, they, now in their brief, they cite some things about, you know, stud fees going down or something like that, don't they? You're honor they do. And they talk about that perhaps stud fees could go down, perhaps that there could be, some type, there could be more horses in the market, but the issue is they've got to prove that issue to be able to do that and they didn't. The other thing, remember, is on concert of action. Is it this? Well, actually, I mean, you don't have to, actually all you'd have to have is a few stray remarks by people that the jury can infer their pursuing their own economic interest. You're right, I agree with that. And there's no doubt about that. And we were looking at a no evident standard and we obviously have to take that on. And at some point, what I, it seems to me what you have to take on is that you were not able to impress Judge Robinson on this and you weren't able to impress the jury. So it's just harder. It does make it harder. Our point is it never should have gotten to a jury at all because of the lack of evidence on those, on those points that we think are terribly, terribly important. Let me talk about the relevant market because I think that's the big problem in the case. The relevant market here was defined as elite quarter horses. It was described by the witness as tippity top or the best of the best. It's narrowed to a point of absurdity. It also is so imprecise, it blurs the boundaries to the point of non-existence. And it's completely inconsistent with real world realities, which is independently, is your honor held in Dr.'s Hospital, something that will destroy a class. Here's what happened. There is no, no one disagrees that in the total quarter house horse market, there is not vigorous and live competition. So they couldn't limit it there. So they eliminated by their own testimony, 99.5% of the quarter horses, to limit it to an elite group. And here's their theory of shortage. And this is how they got to shortage. This is what they say. Sparm taken from stallion in one taking can breed 1 million mayors. True, by the way. America can only produce a few eggs a year, and typically in an embryonic transfer situation can only produce 2 or 3 embryos a year. Therefore, they claim, this is it. This is the shortage. Their claim is there's more male reproductive material out there than female. That is the shortage. That's always the way that has been though. I think females understand that. Yes, you're honor. And I was excited to make this argument to a mixed court, as a matter of fact. But where is the testimony about there's a shortage in the market of mayors that will give birth to successful offspring? Where's the evidence in the record there's not that the supply? I don't understand what you mean by that. You're honor, they created a shortage to get out of the regular market. That's my only point. And I probably ought not to take that. You're talking about elite mayors. Yes. You're talking about, oh, I see. And why do you need an elite mayor to breed a cloned horse? You don't. Okay. You absolutely don't. The idea is that perhaps you could get more doing it that way. Could you breed an elite horse with a sheep? I assume so. I assume so. Big sheep. Right. But here's the issue. The real problem is you can't define this class. And actually the court's instructions just use elite quarter horse. And it's an imprecise adjective. It is difficult to quantify in way too vague and useful. Dr. Flum who came up with it said these things. And these are quotes from the record. It means alternatively. He said these are synonymous high quality best of the best top drawer aspirational. Well, where where is it in all this issue? Why do we why do we define on quality of an animal? And you know, actually courts have have shied away from defining markets based on quality. What's your what's it? I mean, do you have what did your experts say about all this? Did you have an expert? He says that that one. Yes, we did. It was not that you got doctor. You got to say two things. He said first this is too imprecise to have a direct meaning. And second, he admits there is such a thing or as elite horses that perform better than others. But questions whether a class can be drawn on it. And equally is important questions where this one was drawn. And let me explain that because I think it's important. In a core course, and this was the applies theory was at yearling sales where there are a lot of the lot of yearlings sold. The real truth of the matter is only we ought to consider only 350 horses in a that 175 or mayor's and that's pretty much their class. And you reach that decision based on price. $35,000 and up was initially what Dr. Flom said. So the issue is how do those and but in the input he said is this and it's fascinating. He said all these characteristics I came up with. He actually you're going to hear characteristics and it was in their briefest characteristics. Actually, Dr. Flom said indicators of what would happen that the real truth of the matter is he said the consumers don't care about that. What they really, really care about is the situation where you have a horse that performs well that wins right races or will be able to make money in breeding. That's what the consumer cares about. So the question obviously is going to be a horse's outside his alleged elite market going to be reasonable substitutes for the ones in it. And we know there are from undisputed historic evidence. In the 2011 the top 10 winning quarter horses by money in races. Four came from non elite or would be termed by Dr. Flom, non elite horses. Only three came from the yearling sales in his elite class. We did the same thing for 2010. We did it for all the top 42 horses in 2010 and 11 and the statistics were roughly the same. Their answer to this is one case and it is international boxing club of New York. And in that case, the United States Supreme Court said that a market was properly put together for a market for championship boxing bounce. Not championship boxers by quality. Not champion boxers themselves, but bounce in eight categories. There is a championship belt. There's only one champion at a time decided by a belt that everybody knows, just like the Super Bowl. We know that the Vince Lombardi trophy is going to be on the line. It was precise. They didn't quantify the market by the quality of the boxer. If they had that case would have been analogous, but it's not. And let me say one other. Wait, was this other restraint was in not letting somebody into those bats? Or was this restrained in organizing such that other people couldn't organize competing bouts? Yes, it was where they couldn't organize competing bouts. They got all the venues tied them up and made deals. So only they could. That would be more equivalent to monopolizing the racing, you know, the race tracks. That would be what it would be equivalent to your honor. It would not be equivalent to the horses themselves. No court that we can find at Appleese site none have ever quantified a market based on quality of an animal or a human. Finally, let me just turn briefly to no reasonable unreasonable restraint on trade. I'm going to say two things. First off, they say, well, our hoorses are worthless because they don't get registration. And if they don't get registration, people don't like them. In consolidated metal products, this court in 1988 said a refusal to promote or approve. That has the effect of excluding a product from the market, even when the consumers like the product or accept the approval. Doesn't do it. You got to have more. You got to show that the agency that did that coerced. There's no evidence of coercion here. They don't even suggest that. Of course, I mean part of their argument, I think, is that these clone, these clone horses can't even compete in these top money races, right? Yes, sure. Because they're not registered. That's right. And that's a matter of state action. And we're not claiming immunity. Don't get, don't get me wrong. What we're saying is states do that because they value our registration. We don't encourage that. But remember, this court recently held in Marucci sports that even if there is an exclusion for purposes of an exclusion of a product because of a regulation there, the NCAA took out some bats because they could cause some injury. Even if there's exclusion, that doesn't cause an injury unless you go back and look to see whether. And in that case, there was a shortage, but you even go back and look to see if there is competition with the things that remain in the market and that is true here. Thank you, Mr. Caldwell. Thank you. Thank you. Mr. Monford. May I please the court record my name is with the one foot with me a council table of Nancy Stone from memorable Texas. And Sam Stein from Cherokee, Oklahoma. We have divided our time. I would like to address liability to the extent that's convenient with the court and this stone will address the injunction issued to the extent that that is desirable. If this is an antitrust case, I guess we ought to start with where the money is. Opposing council has not mentioned it. Our clients have horses which the district court has said are for all practical purposes identical to the breeds champions. But they want the association will not register our horses will not register our horses offspring. Where the money is and where the damages were in this case which hasn't been mentioned are in is in breeding of these horses. Well, you client, the jury did exactly what you're client asked him to do when he said this isn't about the money. He did say that but they also had another argument which is very interesting in light of posing councils. Contentions which is their expert said you put on damage of loss of breeding loss of stud fees and loss of sales of yearlings. But you've assumed that the prices are going to stay the same. And under our testimony there's going to be competition in the market and the prices are going to go down. So they said our damage model wasn't any good because we relied on all prices and hadn't said what the new prices were going to be. He says no harm to competition in the trial court they relied on the fact that there was going to be competition to defeat our damage. I accept all that but I mean the fact is you didn't cross appeal lack of damages. No, we didn't. And pleading 140 is the trial judge's opinion on attorney's fees and it talks about how there was injury. Plenty of injury and plenty of benefit to the to the market and to the breed from from our case. But the jury didn't award damages. Yeah, let me just ask you one practical question. Again, you know, your theory about money only goes so far so I'll ask you a practical question. If this were a movie about, you know, Dolly the Dolly the clone torso misjust to or whatever the name is. Why couldn't your guy just create demand for this product by buying off one of his buddies and the good old boy team. Let's have a race. Let's see who the better horse is and you publicize it and you get a huge audience for it because your client is apparently not a poor boy. And then your horse shows his his or her worth and you know, then everybody else in Aqua says, Oh my gosh, we've just got to we've just got to open our arms to these new guys. Are they are they're going to take the market away from all the old fashion horses. That might have been an argument to the jury but it wasn't made to the jury. This case is not about racing. It's about breeding. I understand that. That's how you show that your breed is better than their breeds. Here's the barrier to entry. You want to be in the bear. You want to be in the barrier. No, the barrier to entry. You've got to have an elite quarter horse, okay? And in order to sell breeding rights traditionally in order to get in the market, the barrier to entry recognized in the economic literature is with mayors. They don't ovulate very frequently. It takes up to seven to ten years because you have to buy an elite mayor. You have to maybe put that mayor in competition and you then have to prove that the offspring of that mayor will succeed and are successful. And that's the way you prove that a quarter horse is elite. They didn't mention the characteristics of elite. They're about ten of them and they largely have to do the breeding value. Our people are a threat and let me say breeding value is tremendous. Mr. Wise has a horse, aptly named Corona Cartel. One horse breeds 88 mayors in one year at $35,000 a piece, stud piece. That's $3 million in one year from one horse for stud piece. Now Mr. Wise may be a volunteer when he serves on these committees and makes these rules. But he's certainly got a strong financial interest. You know, I'm willing to accept all that but getting back to the issues here. The first one that they raised is that there's no concerted action and it seemed to me. I mean, I read through your brief and where is the evidence that these five elite horse owners control the committee of 30 and then that committee of 30 controlled the board. I mean, I just think that's a, I'd like to hear that evidence. First of all, a clerk, they, they, their brief is on this, they're opening brief is worthless. They don't talk about their own witnesses. Mr. Marell, Mr. Wise say that all 30 or 28 of the people are breeders. All eight of the members of the stud book committee who testified in this case own elite horses and are breeders. But I mean, naturally when you're talking about the characteristics of the breed, this is an organization of a quarter more than a quarter million people worldwide. Is it not? Something, yes. And so, that's, it stands to reason that the committee that's going to determine the characteristics of the breed is going to have more breeders on it rather than the person who has a little, you know, weekend farm and bellville with a registered quarter horse. So, I'm not, I don't see that that in itself. That's why you've got an error in your market, right? The, first of all, the, the evidence is that the stud book committee, the, the associations given this whole thing to the stud book committee, which is a bunch of breeders. If it doesn't get out of the stud book committee, it doesn't even go to anybody else. And they successfully killed it through sham procedures for four years. And the evidence on the, on not going to the board of directors is what evidence do you have? I mean, how? Did you have evidence about every one of those 30 members conspiring or a majority or voting majority? 13 issues. Number one, do they have independent economic interests? I believe we've established. Well, let's just say that's a possibility, but they're, but you're defining an elite market. And that's only at most five members out of a 30 member committee. I mean, the rest of it may be ranchers for all I know. Your honor, Carol Rose, who testified as a lead breeder of performance horses, Mike Jennings owns Mike Cap, last chapter. He breeds 150 mayors a year. John Schroeder bleeds pleasure horses, not all of them are elite, but she owns a horse named Blazing Hot, who's a delete horse. Dwayne Walker has registered 1700 horses with the AQHA. All of these people are on that committee. We have an octopus diagram in the record excerpts. They're not off-crowing 16. But your client says that he's being excluded from registration, but his damages have to do with the elite market, the elite sub-market. And therefore, I had the misimpression perhaps that the restraint of trade had to be tied to an elite sub-market. Will that wrong? We can't get in the market at all. I know you can't get in the market at all, but if the market, if the market is everybody from Kingdom come, then you can breed just as well as they can, whether you're registered or not. And if you've got a superior mark, a superior product, I don't see how you're excluded from buying a marin and letting it carry your clone product to term. That does bring in the issue of state regulation. But just answer me this, Mr. Munford, to prove, this is not a per se violation, it's a violation of the rule of reason. You have to have a product market. Your product market was the market for elite quarter horses. More and more particularly the breeding of elite courses. That's right. That's right. And by your definition, my understanding, at least this is the way I read your brief, you were focusing on these five big bad guys, the good old boys, who remember often on, not all of them all at the same time. Even perhaps often on for several years of the 30 member committee. So you've got four members of a 30 member committee. I would call your attention to exhibit P147, which is the Oxpich chart. It's in record excerpts. It talks about 16 people, all of whom are tied to heritage place auctions. And I would also tell you attention to the testimony of Mr. Merrill and Mr. Wise as to all 30, or almost all 30, of the people being breeders. And there are denials that they're not occasionally that they're not all elite breeders. But everyone on who testified has an elite horse and breeds it. Eight on them. So if you please explain to me the conspiracy theory, I mean it just seemed to me that the association members are, you know, are some aligned. I mean they're not competitors of the association. The interest may very well be the same as the association. So how do you get this conspiracy between the association and the members? The test under American needle is whether they have an independent economic interest. The interrogatory to the jury was, do they have an economic interest separate from that of the firm itself? The Court of Horse Association's interest is in having more members, more horses registering horses. But they're not competitors with the association, but the Court of Association is not a competitor of the association members, that right? No, it's like, you know, Justice Stephen talks about an American needle. The association is being used by people who are competitors of the plaintiff to pursue their own individual interest, which are not the interests of the association. I would cite the Court not only to American needle, but to the hydro level case, where a standard setting organization was used by two employees of competitors. I would cite the Court to Allied Tube, which is a spring court case, where they said that the process had been biased by members. And American needle in North Texas say the test is who controls. And the jury could find that they control. So what you're saying is that you have a bunch of breeders, and you're saying that in this committee, there were, of course, in this organization, with a quarter million people, there's going to be the whole 99.9% of the range of quarter horses from nags and old ones on their way to the glue shop to the elite crowd, right? And naturally, it's not, I mean, this is probably true in the Poodle Association, and that's why we have an Amicus breed from seven different other horse associations. That the breeders... That's usually in there too, yeah. Exactly. So, you know, all of those are vulnerable. Every time they make a change in their breed, I mean, suppose this change was, as it was a few years ago, we don't want so much white on the, you know, on the snout of the horse. That's a very important question. Because any of that excludes somebody, right? And anybody can make exactly the argument that you're making. No. Okay. Wonderful question, but I don't draw that conclusion. These associations have the authority to define the breed. They can define what a quarter horse is. And for example, with the white rule, if they have a white rule, and there's one horse out there who doesn't get registered because of the white rule, there's no effect on competition. Let me say, don't, if you, there's a lot of questions that we all have here, and answer the questions, and don't worry, we'll give you a little time to make an additional argument if you miss some of the points you want to make. So, everybody can just relax a little bit, and not worry about not making your points off, but we. As I said, the market is the market, elite quarter horses, but in particular with our damage model for stud fees and yearlings that would have been yielded. Now, under the injury instructions and the law, the first thing you do is you look for in elasticity of demand, and is demand responsive to price. And we have put before the court, both in record excerpts and a few additional pages. So material from P92, which is our experts report. Are you trying to shut me in? And if I could give the court any citations, it would be 2841, 3275, and exhibit P89, page 31. What those pages say is that the number of elite horses, elite quarter horses, is very small. One witness says, well, Mr. Oathlin, when he asked the question, said, you're talking about 100, not 200, not 1000, right? The witness says yes. Another witness asks, how many elite mayors are there? He says, well, they're 50 blue hens, they call them, and a few hundred that are good. The Court of Horse Association itself identifies 45 stayans that breed more than 100 a year, which is another criterion of breeding days. From the point of view of stallions or mayors, I don't understand. It's considered, if a stallion is bred to more than 100 raiders a year, and of course all of this is artificial. They haven't used traditional methods in many years. Right. Then that's one of our experts characteristics as elite, but the association itself keeps those statistics. How many stallions breed that much? The association itself publishes lists of horses by the value of their offspring. How did their offspring do in racing? They publish those lists. That's one of our criteria of elite. They know who these horses are. There's no denial that the horses we name in this testimony were elite. Now, let's go to the market. The market. This is something I haven't seen in any case. This is a chart of any last test of demand, which is what tells you whether there's a separate market or not. This is a chart for yearlings. That was one of our damage people. What it shows is the demand for the horses is very sensitive to price for the first 95% so. Then at the top, it's very inelastic. Their expert, Mr. which is the test for a separate market, you're not going to increase these kind of horses is not going to change the price of people. Their expert, Mr. Ugone, says this chart is right. He testifies there is a market for elite quota horses. Our expert said that if you want to pick a point where it turns, it's about $35,000, which is the top 5% of these yearlings and it's a selective group. Let's assume that's the market. I'm willing to assume that's the market. Although, again, do you have a single case where animals or humans have ever been held to be a sub market? Never held to have a case where they were. I don't know, I get it. I'm willing to have precedent, they have no precedent. Okay, but aside from that, if that's the relevant market, then you have to show that the conspirators who are in the relevant market had were the ones who excluded you from that market. And this record is full of that evidence because these people set up the sham procedure through which they... I had two minutes more to each side. But again, you've got to assume there are probably some breeders in that that don't breed elite quota horses. And therefore, it gets back to, let's say you have an association of steel manufacturers and you've got a group of them within the standard setting. And a few of them are produced the most high-test specialty steel in the world. And they define their product in certain ways. But they don't control the standards committee because they don't have the votes. That brings in Consolidate Mow, which is helpful. And Footnote 21 and Consolidated Metal notices in that court that in that case, the standards were not a matter of law. As they were in high to high level. And as they are in this case, they in their brief have listed all the state staffutes that give them market power. Furthermore, in the Consolidated Metal case, at page 295, the court specifically noted that the committee was composed of users, not competitors. One final word about international boxing, which we believe is very much on point. In this case, as well as the other price cases, home foods, market, Geneva, Linux, and so forth. Here's the analogy. You have a leak quarter horse. There is a market for stud fees and for yearly. And then those yearlings go out in the world and do whatever they do. We say that the market for stud fees and yearlings is inelastic. And we have shown an elite market of a few hundred horses. And they are threatened by the fact that, for example, 300 horses have been gene banked possible future clothing. In the international boxing case, what was the measure that the court looked to define the market? It was not the prices paid to the competitors. Just like we're not talking about the prices, the horses so much. It was the prices paid for the tickets to the competition. Just like we're talking about the prices paid for the breeding rights to these horses. It did not matter whether the fight ended up being a good one or not. The market was defined by the ticket price. And in this case, the market is defined by the price of the breeding rights and stud fees. And even if some of those horses don't go off in windrises, it doesn't matter. That is part of the barrier to entry that we want to break down. We do not want to race these horses. Nobody's preventing you from breeding them. But we can't register them. You can breed them all you want. And you can create your own market because somebody, I mean, the only way, in other words, the only way they prove themselves is if they race and win a bunch of money. They can't race. Of course they can race. You put them on a race track and you race them. You can breed five or six of them and you can race them and see what happens. Judge John Staten law says we can't race them. And what law says you, that doesn't mean you're foreclosed from every state track in the country does it. Look at the list in their in their in their in their breed. You go to say we can't race these horses because they're not registered in the court of horses. Let me, I just saw. And and happily, if I may make close with just a reference to precedent. And happily this court said this court said that without registration these horses are virtually worthless. Without registration in American court of horse is virtually worthless. This court said this test was did the people who made the decision have an independent economic interest, independent stake in the illegal acts. We proved that it said that in this case they were acting in the best in association, interest in association. We proved that they're justification for shams. They did have the secret meeting. The people were called to meet with the executive committee. What's that email that I mean that is he right about but that's not. No, no, he's not right. Well, what's your. I'll just call your attention to look at. Mr. Vena Klauson page 2811 to 2825. And Mr. Tredway 2971. They called the opponents of club there was supposed to meet. And I've got to be concise. They called the there was supposed to meet in spring of 2012. They called they had an sent an email saying the opponents of cloning were supposed to come meet with executive committee in January. After that meeting the president tells our people you've got a chance here. And we believe that he was sincere and believe that. And a member of the staff calls our people up and says you don't have a chance. Bring it to close. Bring it to close. And from that evidence to jury could conclude it is evidence upon which jury conclude that they bet secretly and rigged the meeting. Even though they have five votes and the committee has 30 votes. Yes. Okay. Okay. We will hear from Mistone. Is that right? Mistone. That's why I've got it. Is that correct? If any, they look you look exasperated to something. That's not the way it is supposed to be. I think it is pretty far from the orders. Okay. May I please the court? Yes. My name is Nancy Stone. I have represented Abraham and Viniclaus and joint venture since the time that the complaint in this case was filed. As Judge Joan acknowledged, AQHA was neither able to convince the jury in this case nor Judge Robinson about those things that they complain about today. Again, this is a case in which there was factually and legally sufficient evidence to support the verdict of a properly. Why don't you tell it how you spread in this argument? Pardon me? How are you spread in this argument? I'm addressing the injunction. Okay. Pardon me? We also have a person that we want to talk about. Move it on. Judge Robinson did not abuse her discretion in entering an injunction following the verdict of a properly instructed jury that made its decision based on legally and factually sufficient evidence. In the exercise of her discretion in connection with granting the injunction, Judge Robinson held an evidentiary hearing on plaintiff's request for a preliminary, for a permanent injunction. At the injunction hearing itself, it became more obvious that there was a need for the court to enter specific orders with regard to rules that needed to be revised. Because even after the successful, we had successfully tried the case to the jury verdict to a jury who had denied all of or had not bought all of the justifications that AQHA brought forward. AQHA still at the injunction hearing was trying to assert that the judge should limit the injunction only to mayors that there should be discriminatory rules and regulations on clones and they're offering that there weren't on other horses. And again, those were the justifications that the jury had already objected to or had rejected. At the conclusion of the hearing when Judge Robinson announced that she was going to enter an injunction requiring AQHA to register clones in their offspring, she requested that AQHA give some input into the language of the order, specifically stating that by doing so, they would not have waived any of their objections on appeal or in connection with any of the judges. So, the judge had the objections that they subsequently made in the trial court to the injunction that would be entered. They chose to do nothing. Two days after the hearing on the injunction, she entered an order, this is document number 136, record on appeal, number 2049. She entered an order specifically requiring AQHA to address each specific proposed change in the rules and regulations and state the requested alternative change to the rules. In response, again, AQHA did nothing. They failed and refused to point out even one problem, one omission, or one conflict in the proposed rules with those that were already in existence. The injunction that was actually entered was narrowly tailored to address the violations found by the jury and also found by the district court and to require AQHA to make revisions to 12 of its existing rules. Those 12 rules had been repeatedly identified by AQHA as being rules that had to be changed in order to accomplish registration of clones. In other words, just abolishing rule 227A would not result in clones and they're off being registered. On three different occasions, AQHA had identified 12 specific rules that it would also need to be changed. Therefore, when Judge Robinson entered the injunction, in this case, she did just that. She set forth specific and for the most part minor changes that needed to be made to many of the rules to provide for the registration of these horses. She exercised her discretion in entering the injunction and ordering revisions to the very rules that AQHA identified would have to be revised to register clones in their offspring. How many clones are in existence at the present clone animals? As of the time of trial, there were 25 cloned quarter horses. There are then all the mayors that brought them to term. Recipient mayors. All of all quarter horses, all elite quarter horses, whether they are born through cloning procedure or any other advanced breeding techniques are all carried by recipient mayors. So it doesn't matter who the mayor is? Well, it does. If you're breeding a style into a clone, whatever horse you're cloning, once you have an embryo, you will put that embryo in a recipient mare, which is a serigant mother will actually carry that baby to birth. Which has been done by AQHA since sometime in the 80s. I don't know the exact date. This may be a silly question, but explain to me why people are cloning these horses if the problem is for a joker certain they can't be members of or can't be registered by the American Quarter Horse Association? Well, at the time that cloning first began, first of all, there was plenty of evidence of trial about the history of accepted breeding techniques by AQHA. And one of them, multiple embryo transfer, was only allowed by AQHA after a lawsuit was filed. So, and furthermore, our clients in this case by the president of AQHA were encouraged that in fact this rule might be changed. And so, it wasn't until after the June behind closed door secret seridepidus meeting took place, then it was taken out from under them, but up until that point in time they were hopeful. They had every reason to believe that the rule would be changed to allow for these horses to be registered. Horses are registered with such advanced breeding techniques now that they freeze embryos, they have been a freezing semen for a long time. So, and they're also produced through a procedure XC which is performed in the same laboratory, and if you weren't a scientist you wouldn't be able to tell the difference between XC procedure and cloning procedure. So, why didn't they exclude the XC or its breed? The evidence of trial was that the reason it wasn't excluded is because it was being advocated by one of the members of the Stuttbrook and Registration Committee, Von Kuhk, who has shown... Well, let me just ask it, doesn't one of either Abraham or your client also breed elite animals? I'm sorry. I thought one of your, one of the two plaintiffs in this case, bred elite quarter horses as well as invested in clones. No, they have no, the testimony, the testimony was that neither one of them had any elite quarter horses except the clones in their offspring, which their offspring, which they're unable to breed. I mean, you know, it's fine to have a lawsuit, but I just have one other practical question. Why your clients are both well healed evidently and to support this cloning enterprise? And why couldn't they just buy an elite quarter horse and go into the breeding business and then get on the committee? As Jason Abraham testified, there weren't any for sale. That the horses that are in the truly elite market, the sale of those horses are few and far between. That was the testimony that Jason Abraham gave. Well, how do you know your guys would get into that market then? Well, they'll get into it if this court affirms the judgment of the lower court because the horses that they have right now, their clones, their clones and their offspring are elite but for the refusal of AQH to register them. Lisa, that's what that's your argument and you're sticking to it. That's my argument. I'm sticking to it. The jury believed it and so did Judge Robinson. Okay. Thank you. Consistent with again. Thank you. Ron, I run out of time. Can you finish up in about a minute, please? Yes. Get some side one minute. Consistent with past president and long time, but stud book and registration committee member Frank Merrill's pronouncement that no judge, no court would tell AQH what to do. AQH has continued to be adamantime just as was recognized by this court in and haggly. As Mr. Munford referred to, the evidence revealed that there were sham procedures to delay decision on the first request for real change so that AQH could shore up its defenses that it identified as red herrings and dead ends and feigned fairness in anticipation of a lawsuit. The specific injunction entered by Judge Robinson was warranted and necessary to prevent the power brokers on the stud book and registration committee in conjunction with AQH from continuing to exclude horses from the elite court of horse market. Thank you, Mr. Stone. The Calhoun will get from here in the world. Thank you, Your Honor. Got a lot to cover so I'm going to try to do it quickly in the time of the lighting. First thing, let me deal with a couple of legal points because they're important. This month, referred to the Hyderville versus ASME case, American Society of Mechanical Engineers from the United States Supreme Court, it does not deal with concerted action. Look at the case carefully, please. It deals with the issue of whether an agent in that case concerted action was not challenged. A competitor had an agent or had a conspirator inside the organization and wrote the rule and it was discovered later. The only question the Supreme Court considered is whether agency law applied to anti-trust law. So it doesn't support his position. On the issue of conspiracy, please consider this as well. You've got to have separate economic interests that are pursued. Their testimony from their witnesses are the board of directors was against cloning. The stud book registry was against cloning. Our members, poll 86% were against. Everybody was consistent. Who are your members? Who are your members? The members, in fact, we did a statistical survey of 3,000, 1,000 responded and they were picked in random. Ironically, what the Apollees changed, it claimed, it wasn't a good study because they weren't breeders. Exactly contrary to the arguments they make now. Let me turn to the breeder argument. Mr. Mumpford is right in one thing but quite wrong in another. The testimony, there was testimony from his clients that all of the stud book registry people were breeders. But in his brief, he tells you that only five were involved in the elite market. That's precisely right. That's what his brief says and that is the case. Now, as to the stud book registry committee absolutely controlling everything that is not true. The stud book registry committee is a standing committee in the organization. It works in conjunction with and reports to the board of directors. It makes reports to the annual meeting. And at the annual meeting, the membership hears what their recommendations are. But the board of directors has a chance to pass on any recommendations and determine either affirmative or negative votes on that. Only the board of directors can speak for the organization and that is the bylaws. Now, the other issue on that I think is, is, is, is, sorry, I'm getting off just one thing here. Can the five control the 30 and is their testimony? Is there opportunity, I guess there might be, is their testimony? No. The only testimony they have is that one of their clients, I think they control them. And then on cross examination said, do you know, are you speculated? And he admitted it was conjecture. stud book registry, people were called. The ones that called said there was no intimidation or anything else. On the secret meeting, I stand by what I said and I ask you to look at their brief in what they refer to. Because it's PX 92. And in PX 92 is an email from the president inviting stud book registry people to attend. As to the stay, we did not open on that and chose not to address it, but I'll address, excuse me, not to stay, the injunction. We got a stay of that injunction pending this appeal. And that I think is the important thing. It's important to note that what happened here. I'm an Instra court, right? Yes, absolutely. And the suggestion in the briefs that we drafted actually the very rules, the court adopted in the injunction is not true. They were drafted by Mr. Holly, who was representing some people who wanted cloning. They were looked at us because we did what a normal organization would do. We decided we'll take a look, see what these things look like so they can be discussed in studies done. We get criticized interestingly, unfairly on the injunction part of having participated and agreed to look through the issue of cloning and decide. Mr. Stone talked about one other thing that again did not come up in the rest of the arguments and certainly didn't come up in the opening discussions. And that was the issue of advanced breeding techniques. Yes, there are a lot of them and there are a lot that have been approved. There are a lot that people on that side have actually sued over to get approved. But the truth of the matter is the difference between cloning and the difference between those techniques is cloning is a creation. Only a creation. Everything else that we have approved is breeding with a sperm and an egg that has an opportunity to advance the breed. Of course, cloning duplicates what we have. And I think that issue is important. As to justification and weighing the benefit if you will between us not voting down the rule on cloning and anti-competitive intent, one thing. And it'll be what I close with. There are good reasons that this organization voted down the suggestion that we redo our rules to admit cloning. One of the things we've been able to do over a long period of time. But in recent years is use scientific DNA evidence to be able to possibly identify any horse if their parentage going back to sires and dams some generations or ever question. That way we take human frailty out of the market. Thraud, deception, simple mistake. We're able, and that's part of the integrity of our breed registry. That can't be done in some horses in cloning. For stallions that will not be available. Their suggestion is, well, you do it any way for twins. You could be seated. And, Shervin. Big one. But. He said it's outside the scope of rebuttal. Okay. Okay. You're on a very briefly. No, I think you, if you're going outside the scope of rebuttal. Yes. You believe I am of that hour sit now. I'm correct. Thank you, sir. Okay. Thank you