Case number 13-1198, James Harry Greer at L, a petitioner versus United States Department of Housing and Urban Development. Mr. Bell, good to share today's I'm checking to make sure it was still morning. Good morning. May I please the court? I'm James Bell on behalf of James Greer and Manchell Gardens East in the appeal in which Mr. Greer and Manchell Garden are the petitioner. I suppose we probably find ourselves in a situation that's not unusual here in the DC Circuit which is we have an administrative agency that reviewed the decision of an administrative law judge and took all of the parts of the decision from the administrative law judge which were in their favor and kept them. Let's call all the portions of the decision that were in favor of my client and discard it. Before we get to that can we establish jurisdiction and your reply brief says there's a certificate of service and the only date contained on it was May 29 in which case if that's key you're in. Is that certificate of service in the record? I believe it's part of the appendix round but I haven't specifically laid hands on it in anticipation of today
. Do you know where in the records? Could you give us a site? I do not if I did not cite it but I can certainly I mean as soon as I leave here I could identify where it is or provide a copy if it's not in the appendix. I didn't realize that this... Well we we made a lot of attention to jurisdictional issues. Yes you're on it. I didn't mean to throw you off Cowdwell. Well and with respect to this I'm not sure whether whether we can stipulate as to the two differences or not but my understanding of the paperwork without having laid eyes on it in anticipation of this because I wrote I did write the brief of myself was that the the order itself was marked the 28th there was no indication on the 28th as to what was done with it. There was no indication that it had been signed with the Secretary of whatever seal that that doesn't he uses when he's acting for the Secretary
. There's no indication in any way that it was promulgated to the public or put up on the housing and urban development website. The only thing that we do know for sure is that they made service of this document dated the following day. I believe my client received it some days after that but in the in the interest of trying to comport with the case law we went ahead and used that date of the 29th. When respected the case law the opponents have signed some cases which stem for the proposition that there may be situations where that date the 28th maybe the controlling date but what we found here in the DC circuit with respect to any statute that had similar language that being the entry of the order being what was key. They all seem to break it down into three separate components which it's not clear whether courts have anticipated all happen simultaneously. But those three things being the signing of the order, the promulgating of the order and the service of the order. And here one thing that we know for certain is the service of the order and since it's part of what courts have considered in terms of the entry of the order before and it couldn't occur before that we argue of course that 20 days from the date of service is appropriate because the order could not be entered under the definition that's been used under every statute that we looked at that has entry as the starting date for the appeal time. And that is our argument. We respect to the document is are we agreed that that's what it says? The document that we don't have in front of us the 28th is the date on it and the 29th is the date that it says it was served
. Was that correct? I'm sorry we have we have agreement among council that yes it does say May 29th is the yes. When you're relying on the date on the document in a court it would be a good idea if you had that document. I agreed you're on an eye follow guys. Are there other other other issues that your honor feels I should address before the merits? Not unless new matters raised on that by the government. I suppose that there are two other preliminary issues that were raised in the brief of of our opponents that being a failure to raise some of the issues in our appeal on the record below in the briefing I have pointed out the places in in prior proceedings where those issues were all raised especially in front of the design for the the design for the secretary and so with respect to that argument we believe that it lacks merit. As to the as to the portions of the argument on the merits the as as your owners are aware the original decision by the ALJ was for initially for numbers that match the numbers that the design has reinstated 1.262 million and an additional 262,500 dollars with with respect to those numbers the ALJ reduced them on two grounds one the ability to pay of my client which despite some issues with accounting and the testimony of my client there was some agreement about the financial condition of my client and MGE during the hearing before the ALJ as a result he reduced that 1.262 down to 450,000 and the other number stayed the number that was jointly and severely available between Mr. Greer and MGE state steady at 262
.5. Then in addition to making the reduction for the ability to pay which of course is a factor of failure applied under under the criteria for assessing civil monocanletes he moved the further reduction based on what he claimed was as justice requires and that reduction was an additional 25% bringing the total of the first number down to 196,875 and the second number down to 337,500 dollars. He did that because he claimed over a series of exclamations which are on page 6 and 7 of our brief bulleted and I believe that we've captured each and every one from the opinion that had engaged in significant malfeasance and that it had engaged in malicious prosecution with respect to seeking these particular monocanletes against my client. He justified in the record what the reason why I was both sorry he justified in the record what the reason he was for that and he based it upon being able to sit and watch the testimony of various government witnesses. He and no one else in the history of the world ever will see what those government witnesses had to say with the look on their faith, et cetera. And as we've submitted in the briefs, I mean, this is one of the great engines of truth telling is the ability to sit and watch a witness and see if perhaps they're saying exactly the opposite thing that their words say. Now, unfortunately, the Designee went back, looked at some of the testimony of a single government witness and determined based on what he read, just the words alone, that her words could be interpreted a different way that her words could be interpreted. I mean, that's not a credibility. A different way
. Finding right. Well, I suppose it wouldn't be a credibility finding in a vacuum. I understand that except it accepts the proposition that all her words were credible, just consistent with the AOJ said, but that taken as a whole, they mean something different from what the AOJ said. I suppose you're on that. That is one way that you could view that. You could also, there's no indication that there was an equal comparison at any time, that there was any belief on the part of the AOJ that what she said was credible. In fact, there are a lot of statements in the record that suggest that the AOJ, the only person to see her testify, believe that what she said was incredible and said that about a number of government witnesses, which is how he came to the conclusion that he should, in fact, reduce this in the interest of justice because of the misbehavior of HUD. But don't we generally afford deference to the facts found by an agency, even if the agency is making the facts based on documentary evidence as opposed to testimony? Well, your Honor, my understanding is that, of course, that's the case. I mean, we have created a world in which administrative law exists, and if there were not some deference to it, then the system would break down
. However, even in a Judith Kutief court law, of City of Besmir, I think I'm right, the Supreme Court in City of Besmir said that the appellate courts would defer to the trial courts, for the bucket decisions, even if they were based on documents. Yes, Your Honor. With respect to this, there was great deference shown to whomever it was that got an opportunity to observe those roles. I'm saying, though, even if they didn't get an opportunity, if the fact founders acting on documentary evidence, we could have heard the fact founder. And that would make my case stronger, and I thank you. The case law specifically with respect to this kind of facts, what you're missing, and what I'm asking you is, don't weigh out deference to the agency. Oh, well, yes, Your Honor. We also owe deference to the agency. The problem is that the courts have decided what level of deference is owed to the agency in a situation where they are disregarding the testimonial evidence based upon watching and making credibility determinations, and that requires heightened scrutiny
. That requires an explanation of all the reasons that the Secretary of State's Agnium in this instance said, you know what, even though there was this discussion about what was seen and how he didn't believe the witnesses, and what this particular witness said, and herp credibility, the designate in our case doesn't go through and say, oh, here are all the reasons why HUD didn't actually engage in any malfeasance. It says, well, here's one witness out of all of them that he said that he listened to and came to the conclusion that he had seen this malfeasance. Here's one witness, and we're going to disregard what she says, not because of any issue of credibility, because she's not in front of me, but because I think that her words could be read a different way. That's not heightened scrutiny, and that's not even a good explanation. The good explanation is, if I read it this way, he pays a lot more penalties. We get rid of all the parts of this decision, we don't like it, and we get to keep the parts that we do. No difference was given to the only human being that got an opportunity to sit in that room and look at those people in the eye, look at those people in the eye, and when he did it, he made the determination that some of them were lying, that what some of them were saying was malicious, and that as a result, that it should be colored, that that HUD should be tarred and feathered with the truthfulness or lack thereof of its witnesses. And that didn't make it through the designee's opinion. And so while I admit that some differences required to what the designee did, this court is not required to follow the arbitrary and capricious actions of the designee in totally disregarding the only individual who was able to see the testimony of evidence, which has case law since the early English times has shown as one of the greatest forces for dividing truth
. I see that my time is up. Okay, thank you. Good afternoon. This way it pays the court in 180 for the respondent HUD. Now, as long as I first addressed the matter of jurisdiction in this case, the statute defined judicial review here provides an agency that an individual, a petitioner, has found a petition for review within 20 days of entry of an agency's decision. Now, let the government be clear up front. We brought this to the court's attention because we believe this appeal period to be jurisdictional. This court has not addressed entry. This court has not addressed what entry of an agency's decision means
. Anjee Probe, which my colleague has cited, is a decision citing a Hobbs Act's judicial review provision, which specifically mandates that an agency provide notice upon issuance of an order. And so, in that case, when this court defined entry to mean signed, sealed, and served, it was describing three separate events that all happened on the same date as mandated by the statute. This court has not addressed. What did the agency do here that constituted entry within the terms of the state? That constituted the White Liner? The constituted entry. Actually, we believe that the actual date that the decision was signed, which is now 20-Auth 2013, which was 21 days before the petition for review as filed. Those they had not served it on the party until 10 days later, would they just have had 10 days in which appeal for an order? No, no, of course, practically speaking, I don't believe that happens, but according to other government's construction of this, yes, it would be 10 days. The agency can control the time within which the affected party can appeal simply by when it serves. The agency does. The agency has been
... It was just not 10 days later, you'd only have one day in which to... You know, certainly, you know, we get into territory where you'd be bringing potential due process concerns with other very serious practical considerations. And I recognize the government recognizes that there are other reasonable interpretations of the statute. Again, we've got this to the court's attention because we believe this to be jurisdictional, but it was worth noting that in the eighth circuit case of the government's side, it was interpreting order and specific... Well, as soon as it is jurisdictional, which it may well be, and there's so many it is jurisdictional, which it may well be, we still have to decide what entry means for purposes of that jurisdictional state. There's no question here on it, and it's for that purpose that we rely on the carrier decision-mediate circuit. In that case, this established service as a distinct function from the actual date of an order. You know, in the entry report, we're trying to turn it correct. The question we follow, Energy CROB, you said there are other things lurking in the Hobbes Act, but it looks to me at the passage which says what has to be done, just relies on the word entry. Well, the main methodology probe is distinguishable because in that case, signed, served, signed, sealed, and served will always happen on the same day. So the court was not in fact confronted with the problem of how to define entry when you have a decision day to land day and served on another. And that is the problem that this panel is confronted with, and we believe there's no guidance, but we do believe that the agency's construction, which is that entry is the date a decision assigned, is the moral valid construction
.. Well, as soon as it is jurisdictional, which it may well be, and there's so many it is jurisdictional, which it may well be, we still have to decide what entry means for purposes of that jurisdictional state. There's no question here on it, and it's for that purpose that we rely on the carrier decision-mediate circuit. In that case, this established service as a distinct function from the actual date of an order. You know, in the entry report, we're trying to turn it correct. The question we follow, Energy CROB, you said there are other things lurking in the Hobbes Act, but it looks to me at the passage which says what has to be done, just relies on the word entry. Well, the main methodology probe is distinguishable because in that case, signed, served, signed, sealed, and served will always happen on the same day. So the court was not in fact confronted with the problem of how to define entry when you have a decision day to land day and served on another. And that is the problem that this panel is confronted with, and we believe there's no guidance, but we do believe that the agency's construction, which is that entry is the date a decision assigned, is the moral valid construction. And again, it's worth noting that as the air circuit pointed out, service is a distinct function, and Congress specifically knows how to direct service as the relevant event for commencing appeal period as it does in other circumstances, such as, for instance, Title VII. But again, we believe this petition can be readily denied on the merits and we're happy to turn to those. You ever would hate to do that unless we have jurisdiction? That is correct, Your Honor. We believe the court does not. But again, this is not an issue. This court is not defined entering this context and believe signed is a more reasonable construction of entry than the date a decision has served. Now, turn to the section 236 program. It very specifically and clearly provides only three mechanisms for termed payment and insurance contract, pre-payment of a mortgage, transfer of a mortgage to HUD, or to a voluntary termination of a mortgage. None of these things happened here
. And again, it's worth noting that as the air circuit pointed out, service is a distinct function, and Congress specifically knows how to direct service as the relevant event for commencing appeal period as it does in other circumstances, such as, for instance, Title VII. But again, we believe this petition can be readily denied on the merits and we're happy to turn to those. You ever would hate to do that unless we have jurisdiction? That is correct, Your Honor. We believe the court does not. But again, this is not an issue. This court is not defined entering this context and believe signed is a more reasonable construction of entry than the date a decision has served. Now, turn to the section 236 program. It very specifically and clearly provides only three mechanisms for termed payment and insurance contract, pre-payment of a mortgage, transfer of a mortgage to HUD, or to a voluntary termination of a mortgage. None of these things happened here. Petitioners did not voluntarily terminate their mortgage because they actually requested HUD approval for their termination and that request was denied. They did not pay the mortgage. They instead created a mother entity illegally secured funds from their own reserve for replacement fund and took out a loan. It transferred that mortgage to the entity that they created and at no time did they seek let alone obtain HUD approval during that process. So, one of them, there's no question as to liability under section 236. Under the section 8 program, liability is even more clear. Petitioners in this regard appeared to misunderstand that they were under all times a statutory and regulatory obligation to provide one year's notice before either terminating their housing assistance contract or raising rents on any of their subsidized tenants. And they do not dispute that they did not satisfy that requirement. As for rent, they specifically referred to the overall payment that they did not increase
. Petitioners did not voluntarily terminate their mortgage because they actually requested HUD approval for their termination and that request was denied. They did not pay the mortgage. They instead created a mother entity illegally secured funds from their own reserve for replacement fund and took out a loan. It transferred that mortgage to the entity that they created and at no time did they seek let alone obtain HUD approval during that process. So, one of them, there's no question as to liability under section 236. Under the section 8 program, liability is even more clear. Petitioners in this regard appeared to misunderstand that they were under all times a statutory and regulatory obligation to provide one year's notice before either terminating their housing assistance contract or raising rents on any of their subsidized tenants. And they do not dispute that they did not satisfy that requirement. As for rent, they specifically referred to the overall payment that they did not increase. But what they needed to not increase was the tenant-specific payments. So, under both the section 236 and section 8 programs, we believe liability here is clear. Now, terminating penalties only first note that both agency decision makers here agreed as to the egregiousness and the extent of petitioners' violations and that those violations warranted penalties at least as high as those requested by HUD. Now, the ARLJ in fact, initially awarded a penalty of $2.3 million before later reducing that penalty based on the two factors my colleague has pointed out, ability to pay and such other matters as just as may require, under which the agency, under which the ARLJ addressed bad faith, what he perceived to be bad faith on HUDs part. Now, looking at the ability to pay a factor, it's first important to note that this is an affirmative defense. So, petitioners need to establish this. That is an especially important fact when you consider that petitioners do not dispute that they have never submitted any evidence of their finances. Under those circumstances, the Secretary does need a decision here simply recognized that you cannot invoke and establish the affirmative defense of ability to pay while not disclosing any of your financial details
. But what they needed to not increase was the tenant-specific payments. So, under both the section 236 and section 8 programs, we believe liability here is clear. Now, terminating penalties only first note that both agency decision makers here agreed as to the egregiousness and the extent of petitioners' violations and that those violations warranted penalties at least as high as those requested by HUD. Now, the ARLJ in fact, initially awarded a penalty of $2.3 million before later reducing that penalty based on the two factors my colleague has pointed out, ability to pay and such other matters as just as may require, under which the agency, under which the ARLJ addressed bad faith, what he perceived to be bad faith on HUDs part. Now, looking at the ability to pay a factor, it's first important to note that this is an affirmative defense. So, petitioners need to establish this. That is an especially important fact when you consider that petitioners do not dispute that they have never submitted any evidence of their finances. Under those circumstances, the Secretary does need a decision here simply recognized that you cannot invoke and establish the affirmative defense of ability to pay while not disclosing any of your financial details. Now, trying to the such other matters as justice may require finding, your owners frankly in this respect, we believe the ARLJ's decision was a bit peculiar. What the ARLJ has said was that the agency could not pick a specific amount that would force the petitioners out of business, and yet the assumption being that that was in a amount that they chose as a target. And yet, the exact and only testimonial evidence that they cited for that was an answer to the question of why did HUD reduce the penalty of one specific count from $25,000 to $15,000? That's something that the ARLJ never considered. It is very clear, and the Secretary of the does need to clear this up, and to be clear, that is the decision that this Court is reviewing. As Judge Centele pointed out, it is the Secretaryal does need a decision that is on review for this Court, that is on substantial evidence or arbitrary in the purposes review. The Secretaryal does need vacated both of the reductions that were applied by the ARLJ and said that the ARLJ clearly misunderstood that testimony is establishing that HUD was reducing its penalty request based on the value of petitioner's property. It is also worth noting that the ARLJ himself described the shared raisins of petitioner's scheme, and that it also strongly supports the size of the penalty as an answer to deter other would-be violators. Petitioner Greer believed he had found loophole and HUD regulations that would allow him to use them onto a garden's these project for his own purposes. Had he succeeded, others would surely have attempted to follow his example
. Now, trying to the such other matters as justice may require finding, your owners frankly in this respect, we believe the ARLJ's decision was a bit peculiar. What the ARLJ has said was that the agency could not pick a specific amount that would force the petitioners out of business, and yet the assumption being that that was in a amount that they chose as a target. And yet, the exact and only testimonial evidence that they cited for that was an answer to the question of why did HUD reduce the penalty of one specific count from $25,000 to $15,000? That's something that the ARLJ never considered. It is very clear, and the Secretary of the does need to clear this up, and to be clear, that is the decision that this Court is reviewing. As Judge Centele pointed out, it is the Secretaryal does need a decision that is on review for this Court, that is on substantial evidence or arbitrary in the purposes review. The Secretaryal does need vacated both of the reductions that were applied by the ARLJ and said that the ARLJ clearly misunderstood that testimony is establishing that HUD was reducing its penalty request based on the value of petitioner's property. It is also worth noting that the ARLJ himself described the shared raisins of petitioner's scheme, and that it also strongly supports the size of the penalty as an answer to deter other would-be violators. Petitioner Greer believed he had found loophole and HUD regulations that would allow him to use them onto a garden's these project for his own purposes. Had he succeeded, others would surely have attempted to follow his example. The penalty in the pose on these petitioners should dissuade others from making such an attempt. Now, that finding of the ARLJ came in the context of the deterrence factor, which is one of the several regulatory factors that both agency decision-makers took into account in this case. That factors, that balancing, is entitled to great discretion by this Court, and we believe the ARLJ's decision himself recognized the egregiousness of petitioner's violations, the Secretary simply corrected a couple of the reductions and returned the amount to the appropriate $1.47 million. If there are no further questions, we ask that the Court deny the petition for review. Thank you. Mr. Bell had no time left, but we'll give you a moment of rebelling time. Thank you, Judge Brown
. The penalty in the pose on these petitioners should dissuade others from making such an attempt. Now, that finding of the ARLJ came in the context of the deterrence factor, which is one of the several regulatory factors that both agency decision-makers took into account in this case. That factors, that balancing, is entitled to great discretion by this Court, and we believe the ARLJ's decision himself recognized the egregiousness of petitioner's violations, the Secretary simply corrected a couple of the reductions and returned the amount to the appropriate $1.47 million. If there are no further questions, we ask that the Court deny the petition for review. Thank you. Mr. Bell had no time left, but we'll give you a moment of rebelling time. Thank you, Judge Brown. Just one with respect to the eighth circuit case, which I believe is the U.S. Department of Agriculture versus Kelly, that was mentioned as a potential ground for the idea that, that entry might mean something different. I read that case to say that the statutory language was filed within 30 days from the date of such order. And so the issue of entry, at least in our estimation, was not involved in that case, and thus it's not. I should have asked the Posing Council for this, but is this filed anywhere going back to the entry question? Is this the decision of the designation filed somewhere on the date stamp? We were unable to find it. Do you know Council, I'll ask the government. No, you don't believe it today. It is not
. Just one with respect to the eighth circuit case, which I believe is the U.S. Department of Agriculture versus Kelly, that was mentioned as a potential ground for the idea that, that entry might mean something different. I read that case to say that the statutory language was filed within 30 days from the date of such order. And so the issue of entry, at least in our estimation, was not involved in that case, and thus it's not. I should have asked the Posing Council for this, but is this filed anywhere going back to the entry question? Is this the decision of the designation filed somewhere on the date stamp? We were unable to find it. Do you know Council, I'll ask the government. No, you don't believe it today. It is not. So the many of entry is not real evident. That's that's three year honor. With respect to the rest, I would just close with pointing the court back to pages 67 and 8, where I've laid out again the, the ALG findings of various kinds of mouthies and against HUD. You know, with respect to the position that my client has done wrong and there should be civil penalties, that's not what we've argued in this appeal. We haven't argued that my client is a saying to her that this was a perfect scenario. What we've argued is that someone who was a neutral sat down, looked at the behavior of both parties, and found both parties to have done some pretty awful things. And as a result, crafted a civil money penalty that reflected that. And then a civil money penalty was retooled in order to only show the things that we're talking about, which is that my client did, at least according to the ALJ and the designee, some things that for which he should have suffered money penalties. We just like to see a return to the ALJ's opinion, which reflects both my client's ability to pay, which as elucidated in the briefs is actually based both on stipulations that the parties made during that trial and information that they that they had handy
. So the many of entry is not real evident. That's that's three year honor. With respect to the rest, I would just close with pointing the court back to pages 67 and 8, where I've laid out again the, the ALG findings of various kinds of mouthies and against HUD. You know, with respect to the position that my client has done wrong and there should be civil penalties, that's not what we've argued in this appeal. We haven't argued that my client is a saying to her that this was a perfect scenario. What we've argued is that someone who was a neutral sat down, looked at the behavior of both parties, and found both parties to have done some pretty awful things. And as a result, crafted a civil money penalty that reflected that. And then a civil money penalty was retooled in order to only show the things that we're talking about, which is that my client did, at least according to the ALJ and the designee, some things that for which he should have suffered money penalties. We just like to see a return to the ALJ's opinion, which reflects both my client's ability to pay, which as elucidated in the briefs is actually based both on stipulations that the parties made during that trial and information that they that they had handy. And on the reduction relating to the malfeasance of HUD, which the ALJ explains pretty well for himself. All right. Thank you, Mr. Bell. The case will be submitted.
Case number 13-1198, James Harry Greer at L, a petitioner versus United States Department of Housing and Urban Development. Mr. Bell, good to share today's I'm checking to make sure it was still morning. Good morning. May I please the court? I'm James Bell on behalf of James Greer and Manchell Gardens East in the appeal in which Mr. Greer and Manchell Garden are the petitioner. I suppose we probably find ourselves in a situation that's not unusual here in the DC Circuit which is we have an administrative agency that reviewed the decision of an administrative law judge and took all of the parts of the decision from the administrative law judge which were in their favor and kept them. Let's call all the portions of the decision that were in favor of my client and discard it. Before we get to that can we establish jurisdiction and your reply brief says there's a certificate of service and the only date contained on it was May 29 in which case if that's key you're in. Is that certificate of service in the record? I believe it's part of the appendix round but I haven't specifically laid hands on it in anticipation of today. Do you know where in the records? Could you give us a site? I do not if I did not cite it but I can certainly I mean as soon as I leave here I could identify where it is or provide a copy if it's not in the appendix. I didn't realize that this... Well we we made a lot of attention to jurisdictional issues. Yes you're on it. I didn't mean to throw you off Cowdwell. Well and with respect to this I'm not sure whether whether we can stipulate as to the two differences or not but my understanding of the paperwork without having laid eyes on it in anticipation of this because I wrote I did write the brief of myself was that the the order itself was marked the 28th there was no indication on the 28th as to what was done with it. There was no indication that it had been signed with the Secretary of whatever seal that that doesn't he uses when he's acting for the Secretary. There's no indication in any way that it was promulgated to the public or put up on the housing and urban development website. The only thing that we do know for sure is that they made service of this document dated the following day. I believe my client received it some days after that but in the in the interest of trying to comport with the case law we went ahead and used that date of the 29th. When respected the case law the opponents have signed some cases which stem for the proposition that there may be situations where that date the 28th maybe the controlling date but what we found here in the DC circuit with respect to any statute that had similar language that being the entry of the order being what was key. They all seem to break it down into three separate components which it's not clear whether courts have anticipated all happen simultaneously. But those three things being the signing of the order, the promulgating of the order and the service of the order. And here one thing that we know for certain is the service of the order and since it's part of what courts have considered in terms of the entry of the order before and it couldn't occur before that we argue of course that 20 days from the date of service is appropriate because the order could not be entered under the definition that's been used under every statute that we looked at that has entry as the starting date for the appeal time. And that is our argument. We respect to the document is are we agreed that that's what it says? The document that we don't have in front of us the 28th is the date on it and the 29th is the date that it says it was served. Was that correct? I'm sorry we have we have agreement among council that yes it does say May 29th is the yes. When you're relying on the date on the document in a court it would be a good idea if you had that document. I agreed you're on an eye follow guys. Are there other other other issues that your honor feels I should address before the merits? Not unless new matters raised on that by the government. I suppose that there are two other preliminary issues that were raised in the brief of of our opponents that being a failure to raise some of the issues in our appeal on the record below in the briefing I have pointed out the places in in prior proceedings where those issues were all raised especially in front of the design for the the design for the secretary and so with respect to that argument we believe that it lacks merit. As to the as to the portions of the argument on the merits the as as your owners are aware the original decision by the ALJ was for initially for numbers that match the numbers that the design has reinstated 1.262 million and an additional 262,500 dollars with with respect to those numbers the ALJ reduced them on two grounds one the ability to pay of my client which despite some issues with accounting and the testimony of my client there was some agreement about the financial condition of my client and MGE during the hearing before the ALJ as a result he reduced that 1.262 down to 450,000 and the other number stayed the number that was jointly and severely available between Mr. Greer and MGE state steady at 262.5. Then in addition to making the reduction for the ability to pay which of course is a factor of failure applied under under the criteria for assessing civil monocanletes he moved the further reduction based on what he claimed was as justice requires and that reduction was an additional 25% bringing the total of the first number down to 196,875 and the second number down to 337,500 dollars. He did that because he claimed over a series of exclamations which are on page 6 and 7 of our brief bulleted and I believe that we've captured each and every one from the opinion that had engaged in significant malfeasance and that it had engaged in malicious prosecution with respect to seeking these particular monocanletes against my client. He justified in the record what the reason why I was both sorry he justified in the record what the reason he was for that and he based it upon being able to sit and watch the testimony of various government witnesses. He and no one else in the history of the world ever will see what those government witnesses had to say with the look on their faith, et cetera. And as we've submitted in the briefs, I mean, this is one of the great engines of truth telling is the ability to sit and watch a witness and see if perhaps they're saying exactly the opposite thing that their words say. Now, unfortunately, the Designee went back, looked at some of the testimony of a single government witness and determined based on what he read, just the words alone, that her words could be interpreted a different way that her words could be interpreted. I mean, that's not a credibility. A different way. Finding right. Well, I suppose it wouldn't be a credibility finding in a vacuum. I understand that except it accepts the proposition that all her words were credible, just consistent with the AOJ said, but that taken as a whole, they mean something different from what the AOJ said. I suppose you're on that. That is one way that you could view that. You could also, there's no indication that there was an equal comparison at any time, that there was any belief on the part of the AOJ that what she said was credible. In fact, there are a lot of statements in the record that suggest that the AOJ, the only person to see her testify, believe that what she said was incredible and said that about a number of government witnesses, which is how he came to the conclusion that he should, in fact, reduce this in the interest of justice because of the misbehavior of HUD. But don't we generally afford deference to the facts found by an agency, even if the agency is making the facts based on documentary evidence as opposed to testimony? Well, your Honor, my understanding is that, of course, that's the case. I mean, we have created a world in which administrative law exists, and if there were not some deference to it, then the system would break down. However, even in a Judith Kutief court law, of City of Besmir, I think I'm right, the Supreme Court in City of Besmir said that the appellate courts would defer to the trial courts, for the bucket decisions, even if they were based on documents. Yes, Your Honor. With respect to this, there was great deference shown to whomever it was that got an opportunity to observe those roles. I'm saying, though, even if they didn't get an opportunity, if the fact founders acting on documentary evidence, we could have heard the fact founder. And that would make my case stronger, and I thank you. The case law specifically with respect to this kind of facts, what you're missing, and what I'm asking you is, don't weigh out deference to the agency. Oh, well, yes, Your Honor. We also owe deference to the agency. The problem is that the courts have decided what level of deference is owed to the agency in a situation where they are disregarding the testimonial evidence based upon watching and making credibility determinations, and that requires heightened scrutiny. That requires an explanation of all the reasons that the Secretary of State's Agnium in this instance said, you know what, even though there was this discussion about what was seen and how he didn't believe the witnesses, and what this particular witness said, and herp credibility, the designate in our case doesn't go through and say, oh, here are all the reasons why HUD didn't actually engage in any malfeasance. It says, well, here's one witness out of all of them that he said that he listened to and came to the conclusion that he had seen this malfeasance. Here's one witness, and we're going to disregard what she says, not because of any issue of credibility, because she's not in front of me, but because I think that her words could be read a different way. That's not heightened scrutiny, and that's not even a good explanation. The good explanation is, if I read it this way, he pays a lot more penalties. We get rid of all the parts of this decision, we don't like it, and we get to keep the parts that we do. No difference was given to the only human being that got an opportunity to sit in that room and look at those people in the eye, look at those people in the eye, and when he did it, he made the determination that some of them were lying, that what some of them were saying was malicious, and that as a result, that it should be colored, that that HUD should be tarred and feathered with the truthfulness or lack thereof of its witnesses. And that didn't make it through the designee's opinion. And so while I admit that some differences required to what the designee did, this court is not required to follow the arbitrary and capricious actions of the designee in totally disregarding the only individual who was able to see the testimony of evidence, which has case law since the early English times has shown as one of the greatest forces for dividing truth. I see that my time is up. Okay, thank you. Good afternoon. This way it pays the court in 180 for the respondent HUD. Now, as long as I first addressed the matter of jurisdiction in this case, the statute defined judicial review here provides an agency that an individual, a petitioner, has found a petition for review within 20 days of entry of an agency's decision. Now, let the government be clear up front. We brought this to the court's attention because we believe this appeal period to be jurisdictional. This court has not addressed entry. This court has not addressed what entry of an agency's decision means. Anjee Probe, which my colleague has cited, is a decision citing a Hobbs Act's judicial review provision, which specifically mandates that an agency provide notice upon issuance of an order. And so, in that case, when this court defined entry to mean signed, sealed, and served, it was describing three separate events that all happened on the same date as mandated by the statute. This court has not addressed. What did the agency do here that constituted entry within the terms of the state? That constituted the White Liner? The constituted entry. Actually, we believe that the actual date that the decision was signed, which is now 20-Auth 2013, which was 21 days before the petition for review as filed. Those they had not served it on the party until 10 days later, would they just have had 10 days in which appeal for an order? No, no, of course, practically speaking, I don't believe that happens, but according to other government's construction of this, yes, it would be 10 days. The agency can control the time within which the affected party can appeal simply by when it serves. The agency does. The agency has been... It was just not 10 days later, you'd only have one day in which to... You know, certainly, you know, we get into territory where you'd be bringing potential due process concerns with other very serious practical considerations. And I recognize the government recognizes that there are other reasonable interpretations of the statute. Again, we've got this to the court's attention because we believe this to be jurisdictional, but it was worth noting that in the eighth circuit case of the government's side, it was interpreting order and specific... Well, as soon as it is jurisdictional, which it may well be, and there's so many it is jurisdictional, which it may well be, we still have to decide what entry means for purposes of that jurisdictional state. There's no question here on it, and it's for that purpose that we rely on the carrier decision-mediate circuit. In that case, this established service as a distinct function from the actual date of an order. You know, in the entry report, we're trying to turn it correct. The question we follow, Energy CROB, you said there are other things lurking in the Hobbes Act, but it looks to me at the passage which says what has to be done, just relies on the word entry. Well, the main methodology probe is distinguishable because in that case, signed, served, signed, sealed, and served will always happen on the same day. So the court was not in fact confronted with the problem of how to define entry when you have a decision day to land day and served on another. And that is the problem that this panel is confronted with, and we believe there's no guidance, but we do believe that the agency's construction, which is that entry is the date a decision assigned, is the moral valid construction. And again, it's worth noting that as the air circuit pointed out, service is a distinct function, and Congress specifically knows how to direct service as the relevant event for commencing appeal period as it does in other circumstances, such as, for instance, Title VII. But again, we believe this petition can be readily denied on the merits and we're happy to turn to those. You ever would hate to do that unless we have jurisdiction? That is correct, Your Honor. We believe the court does not. But again, this is not an issue. This court is not defined entering this context and believe signed is a more reasonable construction of entry than the date a decision has served. Now, turn to the section 236 program. It very specifically and clearly provides only three mechanisms for termed payment and insurance contract, pre-payment of a mortgage, transfer of a mortgage to HUD, or to a voluntary termination of a mortgage. None of these things happened here. Petitioners did not voluntarily terminate their mortgage because they actually requested HUD approval for their termination and that request was denied. They did not pay the mortgage. They instead created a mother entity illegally secured funds from their own reserve for replacement fund and took out a loan. It transferred that mortgage to the entity that they created and at no time did they seek let alone obtain HUD approval during that process. So, one of them, there's no question as to liability under section 236. Under the section 8 program, liability is even more clear. Petitioners in this regard appeared to misunderstand that they were under all times a statutory and regulatory obligation to provide one year's notice before either terminating their housing assistance contract or raising rents on any of their subsidized tenants. And they do not dispute that they did not satisfy that requirement. As for rent, they specifically referred to the overall payment that they did not increase. But what they needed to not increase was the tenant-specific payments. So, under both the section 236 and section 8 programs, we believe liability here is clear. Now, terminating penalties only first note that both agency decision makers here agreed as to the egregiousness and the extent of petitioners' violations and that those violations warranted penalties at least as high as those requested by HUD. Now, the ARLJ in fact, initially awarded a penalty of $2.3 million before later reducing that penalty based on the two factors my colleague has pointed out, ability to pay and such other matters as just as may require, under which the agency, under which the ARLJ addressed bad faith, what he perceived to be bad faith on HUDs part. Now, looking at the ability to pay a factor, it's first important to note that this is an affirmative defense. So, petitioners need to establish this. That is an especially important fact when you consider that petitioners do not dispute that they have never submitted any evidence of their finances. Under those circumstances, the Secretary does need a decision here simply recognized that you cannot invoke and establish the affirmative defense of ability to pay while not disclosing any of your financial details. Now, trying to the such other matters as justice may require finding, your owners frankly in this respect, we believe the ARLJ's decision was a bit peculiar. What the ARLJ has said was that the agency could not pick a specific amount that would force the petitioners out of business, and yet the assumption being that that was in a amount that they chose as a target. And yet, the exact and only testimonial evidence that they cited for that was an answer to the question of why did HUD reduce the penalty of one specific count from $25,000 to $15,000? That's something that the ARLJ never considered. It is very clear, and the Secretary of the does need to clear this up, and to be clear, that is the decision that this Court is reviewing. As Judge Centele pointed out, it is the Secretaryal does need a decision that is on review for this Court, that is on substantial evidence or arbitrary in the purposes review. The Secretaryal does need vacated both of the reductions that were applied by the ARLJ and said that the ARLJ clearly misunderstood that testimony is establishing that HUD was reducing its penalty request based on the value of petitioner's property. It is also worth noting that the ARLJ himself described the shared raisins of petitioner's scheme, and that it also strongly supports the size of the penalty as an answer to deter other would-be violators. Petitioner Greer believed he had found loophole and HUD regulations that would allow him to use them onto a garden's these project for his own purposes. Had he succeeded, others would surely have attempted to follow his example. The penalty in the pose on these petitioners should dissuade others from making such an attempt. Now, that finding of the ARLJ came in the context of the deterrence factor, which is one of the several regulatory factors that both agency decision-makers took into account in this case. That factors, that balancing, is entitled to great discretion by this Court, and we believe the ARLJ's decision himself recognized the egregiousness of petitioner's violations, the Secretary simply corrected a couple of the reductions and returned the amount to the appropriate $1.47 million. If there are no further questions, we ask that the Court deny the petition for review. Thank you. Mr. Bell had no time left, but we'll give you a moment of rebelling time. Thank you, Judge Brown. Just one with respect to the eighth circuit case, which I believe is the U.S. Department of Agriculture versus Kelly, that was mentioned as a potential ground for the idea that, that entry might mean something different. I read that case to say that the statutory language was filed within 30 days from the date of such order. And so the issue of entry, at least in our estimation, was not involved in that case, and thus it's not. I should have asked the Posing Council for this, but is this filed anywhere going back to the entry question? Is this the decision of the designation filed somewhere on the date stamp? We were unable to find it. Do you know Council, I'll ask the government. No, you don't believe it today. It is not. So the many of entry is not real evident. That's that's three year honor. With respect to the rest, I would just close with pointing the court back to pages 67 and 8, where I've laid out again the, the ALG findings of various kinds of mouthies and against HUD. You know, with respect to the position that my client has done wrong and there should be civil penalties, that's not what we've argued in this appeal. We haven't argued that my client is a saying to her that this was a perfect scenario. What we've argued is that someone who was a neutral sat down, looked at the behavior of both parties, and found both parties to have done some pretty awful things. And as a result, crafted a civil money penalty that reflected that. And then a civil money penalty was retooled in order to only show the things that we're talking about, which is that my client did, at least according to the ALJ and the designee, some things that for which he should have suffered money penalties. We just like to see a return to the ALJ's opinion, which reflects both my client's ability to pay, which as elucidated in the briefs is actually based both on stipulations that the parties made during that trial and information that they that they had handy. And on the reduction relating to the malfeasance of HUD, which the ALJ explains pretty well for himself. All right. Thank you, Mr. Bell. The case will be submitted