Legal Case Summary

Councillor, you may proceed. May it please the Court, Jennifer Johnak of Johnak Pugh, representing a pellant John Resmer? This case is about a bank that has admitted selling products that it knew. Councillor, can I ask you to pull the microphone down a little bit so that we can get better audio? Sure. Is that better? That's much better. Thank you. Okay. This case is about a bank that has admitted to selling illegal products. Products it knew were illegal over a period of six years to at least 83 different customers. Mr. Resner wound up being one of those customers. The bank has admitted that the documentation that it created and executed for its products were misleading. No dispute that it never told Resner this. It has also admitted to conspiring with fiduciaries of the customers, including Mr. Resner. And that conspiracy, which included kickbacks and bribes to Mr. Resner's attorneys, helped induce him and other customers to purchase these illegal products. Why did the bank partake in this scheme and incur criminal liability as a result? The answer is simple, money. On Mr. Resner's transactional loan, Mr. Diorgio from the bank described these as highly profitable

. On Mr. Resner's transaction, its return on economic capital was 3681%. The market that the bank had for these products was not the government. The bank made no money from the government. The bank only made money by pitching and inducing people just like Mr. Resner to buy it. That is how they made their money. That's how they got millions and millions in fees. They did not see Mr. Resner as a co-conspirator. They saw him as a mark. And that is why if you look at the internal documents, which are filled with communications that are very friendly in nature with their co-conspirators, by contrast, they laugh at Mr. Resner. They refer to him as the jerky investor and his idiot advisor. HVB now claims that it should have no responsibility as a matter of law for what it did. It should have no responsibility to Mr. Resner for any of the millions and fees that he paid under either the UCL or RICO. We submit that the district court airs with respect to both of these claims. On the RICO claim, the district court dismissed Mr

. Resner's RICO claim, believing that the first panel from this court had held that Mr. Resner was not directly injured. We disagree that the law of mandate, the rule of mandate and the law of the case compelled that conclusion. Even- Let me ask you that. What would be left of Resner, we'll call it Resner 1. If the district court was wrong. In other words, what Resner 1 basically said is that the United States, not Resner, was the median victim of this fraud and the United States is better situated to sue. And now he's back here basically making the same argue. Your Honor, a few points that I would make in response to that. The first is that the prior panel didn't even have before it this same issue. The rule of mandate and law of the case only applies in the procedural posture. You have to take that into consideration. In Resner 1, as you call it, Resner was up on emotion for summary judgment in his favor. There is no case in the country that has ever held that reversal of a summary judgment that emotion in your favor means that your case gets dismissed against you. No, but the law, whether you call it the mandate or the law of the case, the law of the case that came out of Resner 1 is quite clear about causation in the link and whether Resner is injured under, can be legally injured under this year. So it's not a question of, I understand, he lost his motion that bank didn't win its motion, but the legal principle here doesn't go away. Your Honor, I would contend that that still isn't what the first panel said, because what it said is it had to draw inferences in Mr. Resner's favor and what it said is that he cannot, he cannot piggyback on a claim of fraud on the government and use that alone to say, aha, he has to show fraud on himself. So the court was looking at Hennie and looking at some other cases to determine who is directly injured

. Right. Did you change your allegations after Resner 1? We certainly put in a lot more evidence, Your Honor. No, I mean, what Resner 1 says, one of quote, here Resner alleges that a third party in the United States was directly injured by HPB's fraudulent activity. And it goes on to say it was the United States and was tax revenue. Resner's asserted entry only indirectly resulted from the fraudulent activity in the United States. So basically said you alleged in your complaint initially that the fraud was against the United States. Did you change that allegation on remand? Your Honor, we did amend our complaint. And what part of the amendment do you think then takes it out of Resner 1? Well, we amended our complaint to show the numerous ways in which HPB's fraud against him caused him $4 million in economic injury. I would further say that if this panel were to construe Resner 1 as for closing a plaintiff that has paid millions of dollars in fees directly to the party that is the defendant, that there is no case like that, then under the Jeffries would be standard. It would work a manifest injustice. It doesn't matter who HPB intended to defraud under male and wire fraud statutes. If you look at the SHITC case from the Ninth Circuit, if you look at the Y's case from the eighth Circuit, all that's needed for male and wire fraud is an intent to defraud and males and wires taken in furtherance of that scheme. In this case, it is undisputed that there is an intent to defraud and that there were males and wires with Resner's own transaction using the monies that he paid for this in furtherance of that scheme. The bridge case is exactly on point. It doesn't matter that the defendant's tried to defraud the county. It was foreseeable and the plaintiff's sucker direct injury. Here we have exactly that. The fact that they were, whether they intended primarily to defraud the government or someone else, doesn't matter. Resner gets trapped in that web and injured by the very predicate acts that we've argued

. So Resner, I'll see you to say, go ahead. I'm looking at the opinion. It says, Resner argues that HPB is defrauding the U.S. through cards caused this injury. Is he still alleging that? I'm sorry. I'm sorry. Could you read the question? Resner argues that HPB is defrauding of the U.S. through cards. Facility caused this injury. And that is where we have tried to clarify that. I'm the amended complaint that we filed, Your Honor. What we have put in that amended complaint is that HPB is fraud against Resner caused this injury. And indeed, that's the only thing that makes sense because HPB doesn't make money from the government. HPB only makes money from people like Mr. Resner. And there are a number of cases from circuits around the country that talk about the fact that even if there are multiple victims, even if there's a primary victim and a secondary victim, you can have multiple victims under Rico. Indeed, if you look at the face of the statute, it contemplates that

. There are different provisions for private rights of action and the consequences of a criminal conviction. So your amendment is a Rico amendment? Yes, we did amend the Rico. You want to talk about the plural evidence rule issue? Yes, Your Honor. First of all, we believe that the district court aired because the plural evidence rule on which it relied has been overturned. River Island, the Supreme, California Supreme Court unanimously held that it's note that that principle is no longer good law. In this case, the reason why it might be relevant in this case is because the case was still pending. Typically, retroactivity is not inferred, right? Yes, Your Honor. The case law has been overturned. But in addition, even without River Island, we believe the district court aired. And the reason we believe it is because if you look at the district court's logic, it points to Sussex, for example, an unpublished decision from this panel. In Sussex, the sole issue is whether there was an oral promise at variance with a term in the contract. Here, our case is much broader than that. We're not saying that every single thing was legitimate, just this one oral promise that contradicted the provision and the agreement. We are saying that the integrated documents themselves contain firmness representations and material omissions such as commercial bribery, such as the silly opinion, such as the clear intent to cast this as a long-term loan that is legal and lawful. There are a number of California cases that make it clear that that satisfies the fraudulent prong. In addition, we believe that it is very clear from HVB's admissions in this case and the undisputed evidence that we have put in that HVB, what HVB did was unfair. What it did was unlawful. I'd like to reserve the rest of my time for a bottle of your own. You may do so, Council

. We'll hear from the bank. May I please the Court, Mark Restler, on behalf of HVB? Your honours, if I could start with respect to the RICO issue and borrow from the Great Legal Sage Yogi Barra, this is truly deja vu all over again. We were in this courtroom four years ago in Resner 1 when this Court emphatically ruled as matter of law that there was no RICO standing by this appellant because there was no proximate cause. That was this Court's mandate for the standing. You just said there was no proximate cause. Well, it did say that Mr. Resner, laped standing, had not met the standard requirements in the proximate cause requirements because it was the United States who was the most immediate, the most direct victim of this scheme. Right, and that was not an issue you raised in a prior appeal. I just read your brief. But that was the Court's rule. What I know was, I'm just saying, yes, raise that. It's not quite deja vu all over again. That was the issue on the certain position that they filed. Right? The issue on the certain position, Your Honor, is that in the certain petition, Resner maintained as he's maintained at every level throughout this litigation that this was a fraud by HPB on the United States. So this really is the same old, same old. This appellant has always pursued in six years of litigation the notion that the fraud on a resner and the fraud on the U.S. is part of a unified Rico scheme. There's nothing new

. And in fact, right, let's have to resner one. I mean, I just want to get down to what we're talking about here. After resner one is obvious that they can't, resner cannot rely on the harm to the United States who's the established proximate cause. So now they come back and they say, listen, we're amending, we're taking the United States out of it and we are alleging direct harm now. Now, what's prohibited about that on resner one? Because that's exactly what resner did in resner one that the Court rejected. That was the Court's mandate. All of the arguments that this was a scheme to defraud may were before this Court. They were before the district court. They were in the proposed jury instructions. They were before this Court out of heel. They were before the dining circuit in connection with Resner's unsuccessful petition for rehearing on bond and they were before the Supreme Court. But I understand what what Resner was alleging then. But here, I mean, in fact, it says, Resner alleges that the harm to the United States is sufficient proximate cause. And the Resner one said, no. So now on remand, they say, what we want to change our theory. What's wrong with them? Your Honor, first of all, they didn't change their theory. It was always the same theory. But they say they didn't change it. If we assume that they did change their theory, rescue Dakota and waiver absolutely bar this doover, this repackaging of claims

. Again, years and years of litigation. Again, I guess I don't understand your rescue Dakota claim. You can't have rescued Dakota in the same case. Your Honor, Resner assuming that he pursued a different theory below that he was trying to piggyback on each of these fraud against the United States. He comes up to the Ninth Circuit and the Ninth Circuit states, no, you're not the most immediate, you're not the most direct victim. And Ninth Circuit reverses, reverses, doesn't vacate. vacates with respect to UCL, but reverses the decision of the district court. It sends it back down to the district court. And his Honorary District Court did what he was required to do. He dismissed the Rico claim because of the Ninth Circuit's mandate finding that in this particular fraud scheme there was only one victim. And I'm seeing how you can read a mandate into the reversal of the grant of summary judgment. Typically, all that means is that you have to go to trial. But your Honor, the Ninth Circuit's opinion in Resner-Won was a finding as a matter of law that this plaintiff cannot bring a Rico claim because the United States not this plaintiff was the most direct victim. That doesn't mean contrary to my colleague's suggestion that there can never be multiple victims in a Rico case. All it means is that with respect to this very unique set of facts where tax payers eagerly sought out tax shelters to defraud the U.S. of tax revenue. And this particular unique situation, the Ninth Circuit held that only the United States was the most immediate and most direct victim. And that means, yes, there's no Rico-based relief for tax payers, including Mr

. Resner, in this situation. Well, well, oh, and then just, okay, starting a district court of Resner-Won, the district court said there's no more direct victim than the plaintiff. There's no individual entity that's better situated than plaintiff. And that's the decision that was reversed on appeal, right? The decision that was reversed on appeal was yes. Yes, the statement that there was no better direct person than Mr. Resner. The trial court granted some re-judgment to Mr. Resner as a Rico-plaintiff and this court reversed that. And before the court, that was a district court order. It gets reversed. It goes back down. And the argument they made below was there's no more direct victim than himself. Is there a different argument that they've made by amendment now? No, in your honor, this is what's so critical. In Resner's brief, in Resner-Won, he said there can seriously be a more direct victim of HVB's fraud on the U.S. than me. This is exactly what was before the court four years ago in Resner-Won. This is exactly what he said in his cert petition to the U.S

. Supreme Court. It's exactly what he said when he saw it a re-hearing on bomb. He said over and over, I'm the most direct victim. And this circuit rejected that. Right. It's except that, you know, the problem with Resner-Won and the briefing is that this was not an issue presented to the court directly. The court raised it on a phone, which we can. And then there was a response. It was hard to fault parties for what they briefed or didn't brief when the court is raising an issue. I mean, the way I read it, it just said, you can't rely on harm to the United States to show the proximate context. Well, you're on the right. I would submit that it was more than that. It was not this plaintiff and similarly situated taxpayers do not have standing on a re-go. And in fact, the HVB did say similar and situated taxpayers. I'm sorry, Your Honor. Did the opinion ever say similar and situated taxpayers? It didn't, but it described the fraud as singularly a fraud on the United States to cheat the U.S. out of tax dollars. And Hemi, we would submit, addresses this very issue. Hemi says that plaintiffs can't do what Mr. Resner was trying to do here, namely, they can't plead their way around weak of standing requirements to circumvent proximate cause requirements. That's one of the things that Hemi says, and we would submit that exactly what Mr. Resner is trying to do. Yes, the Ninth Circuit did bring up the standing issue four years ago, but that was the court ruling, and under the law of mandate or law of the case, we would submit his honor at the trial court did exactly what he needed to do. Councillor, I assume you were referring then to this passage. It looks like it's on page 873. There is notice of you that HVB defrauded the United States through cards. We hold, however, that HVB's fraudulent activity toward the United States did not cause Resner's injuries. Is that the crux of your- Yes, it is. It is. It is that. And what's so notable here is HVB pleaded guilty pursuant to a deferred prosecution agreement and paid $29 million in restitution fees to the U.S. government, the U.S. attorney's office in the Southern District investigated and made HVB plead guilty. But no restitution was forthcoming to people like Mr. Resner and the taxpayers who so eagerly sought these tax scams

. Hemi says that plaintiffs can't do what Mr. Resner was trying to do here, namely, they can't plead their way around weak of standing requirements to circumvent proximate cause requirements. That's one of the things that Hemi says, and we would submit that exactly what Mr. Resner is trying to do. Yes, the Ninth Circuit did bring up the standing issue four years ago, but that was the court ruling, and under the law of mandate or law of the case, we would submit his honor at the trial court did exactly what he needed to do. Councillor, I assume you were referring then to this passage. It looks like it's on page 873. There is notice of you that HVB defrauded the United States through cards. We hold, however, that HVB's fraudulent activity toward the United States did not cause Resner's injuries. Is that the crux of your- Yes, it is. It is. It is that. And what's so notable here is HVB pleaded guilty pursuant to a deferred prosecution agreement and paid $29 million in restitution fees to the U.S. government, the U.S. attorney's office in the Southern District investigated and made HVB plead guilty. But no restitution was forthcoming to people like Mr. Resner and the taxpayers who so eagerly sought these tax scams. The only restitution that the DOJ paid was to the most immediate, the most direct victim of this scheme in this circuit's view, mainly the U.S. Treasury. Because- Well, let me just stop. I hear his argument. What about me? I paid all these fees, right? How could I not be a direct victim? But you're saying that you can't get that under Rico. That's exactly right, Your Honor. But the criminal has- And that's what this Court decided that for this unique Rico situation, this unique set of facts, Rico is not appropriate. There can't be Rico-based relief because some schemes have immediate and direct victims. And here, when you're talking about taxpayers who were paying 147 percent rates of interest and $4 million of upfront fees to secure a $7 million loan, it's such an irrational investment decision, this Court held the immediate direct victim is the United States because this was first informed us the scheme intended to defraud the United States out of tax dollars. And that's why no taxpayer anywhere received restitution with respect to any of these tax shelters, the restitution. What the DOJ decided to do has nothing to do with the civil suit. You agree with that? I mean, it's not binding anybody. I take your point. I do agree with that, Your Honor. But I do believe that that was part of the- part of this Court's analysis in finding that Rezner-Latz Rico standing and that Rico relief is not available in this kind of a situation. Where do you find that? I think that would drove the Ninth Circuit to say this was a scheme intended to deprive the United States out of tax revenue. This wasn't a scheme to drive Rezner out of fees. Well, that's not part of the opinion

. The only restitution that the DOJ paid was to the most immediate, the most direct victim of this scheme in this circuit's view, mainly the U.S. Treasury. Because- Well, let me just stop. I hear his argument. What about me? I paid all these fees, right? How could I not be a direct victim? But you're saying that you can't get that under Rico. That's exactly right, Your Honor. But the criminal has- And that's what this Court decided that for this unique Rico situation, this unique set of facts, Rico is not appropriate. There can't be Rico-based relief because some schemes have immediate and direct victims. And here, when you're talking about taxpayers who were paying 147 percent rates of interest and $4 million of upfront fees to secure a $7 million loan, it's such an irrational investment decision, this Court held the immediate direct victim is the United States because this was first informed us the scheme intended to defraud the United States out of tax dollars. And that's why no taxpayer anywhere received restitution with respect to any of these tax shelters, the restitution. What the DOJ decided to do has nothing to do with the civil suit. You agree with that? I mean, it's not binding anybody. I take your point. I do agree with that, Your Honor. But I do believe that that was part of the- part of this Court's analysis in finding that Rezner-Latz Rico standing and that Rico relief is not available in this kind of a situation. Where do you find that? I think that would drove the Ninth Circuit to say this was a scheme intended to deprive the United States out of tax revenue. This wasn't a scheme to drive Rezner out of fees. Well, that's not part of the opinion. That's just his speculation. Well, Your Honor, this Court said we hold that HBB's fraudulent activity toward the United States did not cause Rezner's injury. I think that can only be taken to mean that Rezner is not the victim. Here, the victim was the United States. Now, it might be different for a fraud claim and Rezner and HBB settled his fraud claim, but Rico has unique pleading, standing, and proximate cause requirements. We know that from Hammy and from Anza. There was no cross-motion for summary judgment in this case. That's correct, Your Honor. There was not. Prior counsel did not bring a cross-motion for summary judgment. If I can, and I would also note, Your Honor, that with respect to the merits of the Rico situation, Mr. Rezner used the same evidence that was rejected four years ago. For example, HBB's admissions in the deferred prosecution agreement. Yes, HBB admitted engaged in wire fraud. It did. And in admitted engaged in mail fraud, it did. But those admissions said we did that to deferred the United States. So those were admissions of mail and wire fraud against the direct victim, the U.S

. That's just his speculation. Well, Your Honor, this Court said we hold that HBB's fraudulent activity toward the United States did not cause Rezner's injury. I think that can only be taken to mean that Rezner is not the victim. Here, the victim was the United States. Now, it might be different for a fraud claim and Rezner and HBB settled his fraud claim, but Rico has unique pleading, standing, and proximate cause requirements. We know that from Hammy and from Anza. There was no cross-motion for summary judgment in this case. That's correct, Your Honor. There was not. Prior counsel did not bring a cross-motion for summary judgment. If I can, and I would also note, Your Honor, that with respect to the merits of the Rico situation, Mr. Rezner used the same evidence that was rejected four years ago. For example, HBB's admissions in the deferred prosecution agreement. Yes, HBB admitted engaged in wire fraud. It did. And in admitted engaged in mail fraud, it did. But those admissions said we did that to deferred the United States. So those were admissions of mail and wire fraud against the direct victim, the U.S. Treasury, not against Mr. Rezner. It might be, we turn to that parole evidence rule. I don't mean to interrupt, but you're running out of time. River Island seems to have changed things. What's your response? My response is that River Island speaks to parole evidence, but the input of the Sussex opinion is reasonable reliance. This Court held the Sussex that no party entering into these kinds of tax transactions can rely on a representation that this is a long-term loan. Rezner now says, well, that was only one, a narrow sliver in this constellation of many misrepresentations. But the key is the duration of the loan is central to the entire card scheme, because it only makes economic sense. It's only a transaction with economic substance if it's a 30-year loan. As soon as it ceases to be a 30-year loan, and indeed can become a one-year loan, then you find yourselves in a situation that Rezner was in paying $4 million in upfront fees for a $7 million loan that was fully collateralized, by the way, to the tune of 147 percent rate of interest, all to replace a loan that he had that was charging only 5 percent interest. In other words, once the loan duration of the loan collapses, cards is necessarily a sham transaction designed solely to defer all the United States. And Sussex effectively stands for the proposition that Mr. Rezner knew that, that any person entering this agreement knew that, because there was a provision plain as day, that Mr. Rezner has admitted to reading in which HVB said, we can terminate this loan on the first year anniversary or any year thereafter. That's long, Mr. Rezner found himself hanging out, landage 147 percent rate of interest, which he knew was ridiculous. No rational person would do that. And what's key in Sussex as well, this Court said it's particularly unreasonable for a person to rely when they're sophisticated and experienced

. Treasury, not against Mr. Rezner. It might be, we turn to that parole evidence rule. I don't mean to interrupt, but you're running out of time. River Island seems to have changed things. What's your response? My response is that River Island speaks to parole evidence, but the input of the Sussex opinion is reasonable reliance. This Court held the Sussex that no party entering into these kinds of tax transactions can rely on a representation that this is a long-term loan. Rezner now says, well, that was only one, a narrow sliver in this constellation of many misrepresentations. But the key is the duration of the loan is central to the entire card scheme, because it only makes economic sense. It's only a transaction with economic substance if it's a 30-year loan. As soon as it ceases to be a 30-year loan, and indeed can become a one-year loan, then you find yourselves in a situation that Rezner was in paying $4 million in upfront fees for a $7 million loan that was fully collateralized, by the way, to the tune of 147 percent rate of interest, all to replace a loan that he had that was charging only 5 percent interest. In other words, once the loan duration of the loan collapses, cards is necessarily a sham transaction designed solely to defer all the United States. And Sussex effectively stands for the proposition that Mr. Rezner knew that, that any person entering this agreement knew that, because there was a provision plain as day, that Mr. Rezner has admitted to reading in which HVB said, we can terminate this loan on the first year anniversary or any year thereafter. That's long, Mr. Rezner found himself hanging out, landage 147 percent rate of interest, which he knew was ridiculous. No rational person would do that. And what's key in Sussex as well, this Court said it's particularly unreasonable for a person to rely when they're sophisticated and experienced. Mr. Rezner created and founded the company that ultimately became Facebook. And this entire transaction was driven by his desire to sell Yahoo Stop. He received $100 million worth of Yahoo Stop for the sale of this company. And he sold $30 million worth of that stock and tried to pay zero in taxes by entering into cards with his eyes wide open. HVB's admissions all relate to wire fraud and mail fraud with respect to the U.S. government, not with respect to Mr. Rezner. Also, Mr. Rezner, knowingly assumed joint sever liability for a $47 million loan that was created on behalf of a shell company, sold for the purpose of this transaction whose two members were a British housewife and a British accountant, neither of whom Mr. Rezner knew or had never met. And that's because this was all part of the scam that he went into knowingly to pay zero taxes on a $30 million transaction. Thank you, Counsel. Your time has expired. Mr. Rezner, you have some reserved time. Yes, Your Honor. First, I'd like to respond to some of the points my opposing counsel made

. Mr. Rezner created and founded the company that ultimately became Facebook. And this entire transaction was driven by his desire to sell Yahoo Stop. He received $100 million worth of Yahoo Stop for the sale of this company. And he sold $30 million worth of that stock and tried to pay zero in taxes by entering into cards with his eyes wide open. HVB's admissions all relate to wire fraud and mail fraud with respect to the U.S. government, not with respect to Mr. Rezner. Also, Mr. Rezner, knowingly assumed joint sever liability for a $47 million loan that was created on behalf of a shell company, sold for the purpose of this transaction whose two members were a British housewife and a British accountant, neither of whom Mr. Rezner knew or had never met. And that's because this was all part of the scam that he went into knowingly to pay zero taxes on a $30 million transaction. Thank you, Counsel. Your time has expired. Mr. Rezner, you have some reserved time. Yes, Your Honor. First, I'd like to respond to some of the points my opposing counsel made. The first is the issue of direct injury. As Judge Thomas has noted, this issue was not only not briefed, but this issue was explicitly waived by HVB and its reply brief. It was, therefore, not before the Court. Waved in the reply brief before the Court and Rezner won, is that what you're saying? Correct. In addition, what I would say in that, what did they say in the reply brief? They actually have a section that talks about how they're not disputing the issue of direct injury. It was explicitly waived. Right. Well, that didn't matter to the Court. No. But, Your Honor, I would posit that given what was before the Court, which has to draw all inferences in HVB's favor, HVB characterized this as they're trying to use our admissions of fraud against the government to claim an, you know, to claim that we've defrauded them. So if you look at the language of the prior Court's decision, it all says towards the United States, fraud on the United States. Nowhere does it say HVB's illegal conduct cannot approximately cause Rezner's injury. And that makes sense because that would go against every other case out there. In Henney, the reason why that plaintiff wasn't a directly injured is because the injury, the economic harm, was contingent on the actions of third or fourth parties. We don't have that here. Whether Rezner took a tax deduction or not, he's paid $4 million in fees. There is no case that finds that this is not a direct injury. And it also would make no sense in the, in the RICO language that contemplates having multiple victims. Therefore, we contend that the prior panel did not mean this

. The first is the issue of direct injury. As Judge Thomas has noted, this issue was not only not briefed, but this issue was explicitly waived by HVB and its reply brief. It was, therefore, not before the Court. Waved in the reply brief before the Court and Rezner won, is that what you're saying? Correct. In addition, what I would say in that, what did they say in the reply brief? They actually have a section that talks about how they're not disputing the issue of direct injury. It was explicitly waived. Right. Well, that didn't matter to the Court. No. But, Your Honor, I would posit that given what was before the Court, which has to draw all inferences in HVB's favor, HVB characterized this as they're trying to use our admissions of fraud against the government to claim an, you know, to claim that we've defrauded them. So if you look at the language of the prior Court's decision, it all says towards the United States, fraud on the United States. Nowhere does it say HVB's illegal conduct cannot approximately cause Rezner's injury. And that makes sense because that would go against every other case out there. In Henney, the reason why that plaintiff wasn't a directly injured is because the injury, the economic harm, was contingent on the actions of third or fourth parties. We don't have that here. Whether Rezner took a tax deduction or not, he's paid $4 million in fees. There is no case that finds that this is not a direct injury. And it also would make no sense in the, in the RICO language that contemplates having multiple victims. Therefore, we contend that the prior panel did not mean this. And even if it's construed to mean that, they simply got it wrong. Well, if they got it wrong, there's nothing we can do about that. That's not true, Your Honor. Under Jeffries V. Wood, law of the case is something that's discretionary. Rule of mandate does not, is not binding on this panel. If they got it wrong, is it true? If there's, if to avoid a manifest injustice under Jeffries V. Wood. But rule of hand. Well, Jeffries actually went the other way. Your Honor, I would also like to address a few other points that my opposing counsel made. He talked about why didn't Rezner try to claim restitution. If you look at 28 CFR 9.8B, actually a plaintiff like Mr. Rezner is required to pursue a private right of action first. So that is exactly what we're doing. Secondly, RICO contemplates different sets of damages for criminal and civil conduct. It's, it apportions the pie differently, which shows that it's not supposed to be part of the same pie. My opposing counsel has talked about what drove the Ninth Circuit

. And even if it's construed to mean that, they simply got it wrong. Well, if they got it wrong, there's nothing we can do about that. That's not true, Your Honor. Under Jeffries V. Wood, law of the case is something that's discretionary. Rule of mandate does not, is not binding on this panel. If they got it wrong, is it true? If there's, if to avoid a manifest injustice under Jeffries V. Wood. But rule of hand. Well, Jeffries actually went the other way. Your Honor, I would also like to address a few other points that my opposing counsel made. He talked about why didn't Rezner try to claim restitution. If you look at 28 CFR 9.8B, actually a plaintiff like Mr. Rezner is required to pursue a private right of action first. So that is exactly what we're doing. Secondly, RICO contemplates different sets of damages for criminal and civil conduct. It's, it apportions the pie differently, which shows that it's not supposed to be part of the same pie. My opposing counsel has talked about what drove the Ninth Circuit. But that isn't, speculating as to the motives of what drove the first panel is not law of the case or rule of mandate. Lastly, Councillor, should we begin to anything, into the Rezner 1 context that there was no motion for summary judgment filed on your side? In Rezner 1, we believe that that's critical, the fact that we had moved for summary judgment and we were moving on the very same. No, there weren't conflicting motions for summary judgment as my point. No, Your Honor, because if you look at the history, they actually brought, I don't remember how many, but numerous motions to dismiss by that point. Lastly, I would like to talk about Mr. Rezner's reasonable reliance. That was the entire thing that was briefed. And that ruling by the Court, the District Court actually was not addressed or disturbed by the prior panels ruling in Rezner 1. The reality is that it was reasonable for Mr. Rezner to rely. First of all, he doesn't have to establish reliance under bridge and under the various UCL cases where there is unlawful conduct. Mr. Rezner says that all of the requests for admission just have to do with the DPA, but they don't. I actually went back and looked at the RFA admissions, which are binding. And those talk about admit that you transmitted or delivered funds belonging to Rezner 2-Sidley in connection with Rezner's card facility. Admit that you knew at the time you received proceeds in connection with Rezner's card facilities that those funds were derived from unlawful conduct. Admit, and that time period is before he even files a tax return. But I just understand he's there's no continuing fraud case correct, that's out of the case. That's correct, Your Honor

. But that isn't, speculating as to the motives of what drove the first panel is not law of the case or rule of mandate. Lastly, Councillor, should we begin to anything, into the Rezner 1 context that there was no motion for summary judgment filed on your side? In Rezner 1, we believe that that's critical, the fact that we had moved for summary judgment and we were moving on the very same. No, there weren't conflicting motions for summary judgment as my point. No, Your Honor, because if you look at the history, they actually brought, I don't remember how many, but numerous motions to dismiss by that point. Lastly, I would like to talk about Mr. Rezner's reasonable reliance. That was the entire thing that was briefed. And that ruling by the Court, the District Court actually was not addressed or disturbed by the prior panels ruling in Rezner 1. The reality is that it was reasonable for Mr. Rezner to rely. First of all, he doesn't have to establish reliance under bridge and under the various UCL cases where there is unlawful conduct. Mr. Rezner says that all of the requests for admission just have to do with the DPA, but they don't. I actually went back and looked at the RFA admissions, which are binding. And those talk about admit that you transmitted or delivered funds belonging to Rezner 2-Sidley in connection with Rezner's card facility. Admit that you knew at the time you received proceeds in connection with Rezner's card facilities that those funds were derived from unlawful conduct. Admit, and that time period is before he even files a tax return. But I just understand he's there's no continuing fraud case correct, that's out of the case. That's correct, Your Honor. That's correct, Your Honor. We have the UCL on the refill that we put. That's correct, Your Honor. We were trying to make things simple by means of a stipulated judgment to put this on a peel last time because we were told the only issue was that of reasonable reliance. I'd like to make one last point, which is that if you look at the UCC, which is codified in New York 1-208 in California, commercial code 1309, there's actually UCC provision that requires a lender to act in good faith if there's a termination clause. Thank you, Counsel. Your time has expired. Thank you. The case just argued will be submitted for decision.

Councillor, you may proceed. May it please the Court, Jennifer Johnak of Johnak Pugh, representing a pellant John Resmer? This case is about a bank that has admitted selling products that it knew. Councillor, can I ask you to pull the microphone down a little bit so that we can get better audio? Sure. Is that better? That's much better. Thank you. Okay. This case is about a bank that has admitted to selling illegal products. Products it knew were illegal over a period of six years to at least 83 different customers. Mr. Resner wound up being one of those customers. The bank has admitted that the documentation that it created and executed for its products were misleading. No dispute that it never told Resner this. It has also admitted to conspiring with fiduciaries of the customers, including Mr. Resner. And that conspiracy, which included kickbacks and bribes to Mr. Resner's attorneys, helped induce him and other customers to purchase these illegal products. Why did the bank partake in this scheme and incur criminal liability as a result? The answer is simple, money. On Mr. Resner's transactional loan, Mr. Diorgio from the bank described these as highly profitable. On Mr. Resner's transaction, its return on economic capital was 3681%. The market that the bank had for these products was not the government. The bank made no money from the government. The bank only made money by pitching and inducing people just like Mr. Resner to buy it. That is how they made their money. That's how they got millions and millions in fees. They did not see Mr. Resner as a co-conspirator. They saw him as a mark. And that is why if you look at the internal documents, which are filled with communications that are very friendly in nature with their co-conspirators, by contrast, they laugh at Mr. Resner. They refer to him as the jerky investor and his idiot advisor. HVB now claims that it should have no responsibility as a matter of law for what it did. It should have no responsibility to Mr. Resner for any of the millions and fees that he paid under either the UCL or RICO. We submit that the district court airs with respect to both of these claims. On the RICO claim, the district court dismissed Mr. Resner's RICO claim, believing that the first panel from this court had held that Mr. Resner was not directly injured. We disagree that the law of mandate, the rule of mandate and the law of the case compelled that conclusion. Even- Let me ask you that. What would be left of Resner, we'll call it Resner 1. If the district court was wrong. In other words, what Resner 1 basically said is that the United States, not Resner, was the median victim of this fraud and the United States is better situated to sue. And now he's back here basically making the same argue. Your Honor, a few points that I would make in response to that. The first is that the prior panel didn't even have before it this same issue. The rule of mandate and law of the case only applies in the procedural posture. You have to take that into consideration. In Resner 1, as you call it, Resner was up on emotion for summary judgment in his favor. There is no case in the country that has ever held that reversal of a summary judgment that emotion in your favor means that your case gets dismissed against you. No, but the law, whether you call it the mandate or the law of the case, the law of the case that came out of Resner 1 is quite clear about causation in the link and whether Resner is injured under, can be legally injured under this year. So it's not a question of, I understand, he lost his motion that bank didn't win its motion, but the legal principle here doesn't go away. Your Honor, I would contend that that still isn't what the first panel said, because what it said is it had to draw inferences in Mr. Resner's favor and what it said is that he cannot, he cannot piggyback on a claim of fraud on the government and use that alone to say, aha, he has to show fraud on himself. So the court was looking at Hennie and looking at some other cases to determine who is directly injured. Right. Did you change your allegations after Resner 1? We certainly put in a lot more evidence, Your Honor. No, I mean, what Resner 1 says, one of quote, here Resner alleges that a third party in the United States was directly injured by HPB's fraudulent activity. And it goes on to say it was the United States and was tax revenue. Resner's asserted entry only indirectly resulted from the fraudulent activity in the United States. So basically said you alleged in your complaint initially that the fraud was against the United States. Did you change that allegation on remand? Your Honor, we did amend our complaint. And what part of the amendment do you think then takes it out of Resner 1? Well, we amended our complaint to show the numerous ways in which HPB's fraud against him caused him $4 million in economic injury. I would further say that if this panel were to construe Resner 1 as for closing a plaintiff that has paid millions of dollars in fees directly to the party that is the defendant, that there is no case like that, then under the Jeffries would be standard. It would work a manifest injustice. It doesn't matter who HPB intended to defraud under male and wire fraud statutes. If you look at the SHITC case from the Ninth Circuit, if you look at the Y's case from the eighth Circuit, all that's needed for male and wire fraud is an intent to defraud and males and wires taken in furtherance of that scheme. In this case, it is undisputed that there is an intent to defraud and that there were males and wires with Resner's own transaction using the monies that he paid for this in furtherance of that scheme. The bridge case is exactly on point. It doesn't matter that the defendant's tried to defraud the county. It was foreseeable and the plaintiff's sucker direct injury. Here we have exactly that. The fact that they were, whether they intended primarily to defraud the government or someone else, doesn't matter. Resner gets trapped in that web and injured by the very predicate acts that we've argued. So Resner, I'll see you to say, go ahead. I'm looking at the opinion. It says, Resner argues that HPB is defrauding the U.S. through cards caused this injury. Is he still alleging that? I'm sorry. I'm sorry. Could you read the question? Resner argues that HPB is defrauding of the U.S. through cards. Facility caused this injury. And that is where we have tried to clarify that. I'm the amended complaint that we filed, Your Honor. What we have put in that amended complaint is that HPB is fraud against Resner caused this injury. And indeed, that's the only thing that makes sense because HPB doesn't make money from the government. HPB only makes money from people like Mr. Resner. And there are a number of cases from circuits around the country that talk about the fact that even if there are multiple victims, even if there's a primary victim and a secondary victim, you can have multiple victims under Rico. Indeed, if you look at the face of the statute, it contemplates that. There are different provisions for private rights of action and the consequences of a criminal conviction. So your amendment is a Rico amendment? Yes, we did amend the Rico. You want to talk about the plural evidence rule issue? Yes, Your Honor. First of all, we believe that the district court aired because the plural evidence rule on which it relied has been overturned. River Island, the Supreme, California Supreme Court unanimously held that it's note that that principle is no longer good law. In this case, the reason why it might be relevant in this case is because the case was still pending. Typically, retroactivity is not inferred, right? Yes, Your Honor. The case law has been overturned. But in addition, even without River Island, we believe the district court aired. And the reason we believe it is because if you look at the district court's logic, it points to Sussex, for example, an unpublished decision from this panel. In Sussex, the sole issue is whether there was an oral promise at variance with a term in the contract. Here, our case is much broader than that. We're not saying that every single thing was legitimate, just this one oral promise that contradicted the provision and the agreement. We are saying that the integrated documents themselves contain firmness representations and material omissions such as commercial bribery, such as the silly opinion, such as the clear intent to cast this as a long-term loan that is legal and lawful. There are a number of California cases that make it clear that that satisfies the fraudulent prong. In addition, we believe that it is very clear from HVB's admissions in this case and the undisputed evidence that we have put in that HVB, what HVB did was unfair. What it did was unlawful. I'd like to reserve the rest of my time for a bottle of your own. You may do so, Council. We'll hear from the bank. May I please the Court, Mark Restler, on behalf of HVB? Your honours, if I could start with respect to the RICO issue and borrow from the Great Legal Sage Yogi Barra, this is truly deja vu all over again. We were in this courtroom four years ago in Resner 1 when this Court emphatically ruled as matter of law that there was no RICO standing by this appellant because there was no proximate cause. That was this Court's mandate for the standing. You just said there was no proximate cause. Well, it did say that Mr. Resner, laped standing, had not met the standard requirements in the proximate cause requirements because it was the United States who was the most immediate, the most direct victim of this scheme. Right, and that was not an issue you raised in a prior appeal. I just read your brief. But that was the Court's rule. What I know was, I'm just saying, yes, raise that. It's not quite deja vu all over again. That was the issue on the certain position that they filed. Right? The issue on the certain position, Your Honor, is that in the certain petition, Resner maintained as he's maintained at every level throughout this litigation that this was a fraud by HPB on the United States. So this really is the same old, same old. This appellant has always pursued in six years of litigation the notion that the fraud on a resner and the fraud on the U.S. is part of a unified Rico scheme. There's nothing new. And in fact, right, let's have to resner one. I mean, I just want to get down to what we're talking about here. After resner one is obvious that they can't, resner cannot rely on the harm to the United States who's the established proximate cause. So now they come back and they say, listen, we're amending, we're taking the United States out of it and we are alleging direct harm now. Now, what's prohibited about that on resner one? Because that's exactly what resner did in resner one that the Court rejected. That was the Court's mandate. All of the arguments that this was a scheme to defraud may were before this Court. They were before the district court. They were in the proposed jury instructions. They were before this Court out of heel. They were before the dining circuit in connection with Resner's unsuccessful petition for rehearing on bond and they were before the Supreme Court. But I understand what what Resner was alleging then. But here, I mean, in fact, it says, Resner alleges that the harm to the United States is sufficient proximate cause. And the Resner one said, no. So now on remand, they say, what we want to change our theory. What's wrong with them? Your Honor, first of all, they didn't change their theory. It was always the same theory. But they say they didn't change it. If we assume that they did change their theory, rescue Dakota and waiver absolutely bar this doover, this repackaging of claims. Again, years and years of litigation. Again, I guess I don't understand your rescue Dakota claim. You can't have rescued Dakota in the same case. Your Honor, Resner assuming that he pursued a different theory below that he was trying to piggyback on each of these fraud against the United States. He comes up to the Ninth Circuit and the Ninth Circuit states, no, you're not the most immediate, you're not the most direct victim. And Ninth Circuit reverses, reverses, doesn't vacate. vacates with respect to UCL, but reverses the decision of the district court. It sends it back down to the district court. And his Honorary District Court did what he was required to do. He dismissed the Rico claim because of the Ninth Circuit's mandate finding that in this particular fraud scheme there was only one victim. And I'm seeing how you can read a mandate into the reversal of the grant of summary judgment. Typically, all that means is that you have to go to trial. But your Honor, the Ninth Circuit's opinion in Resner-Won was a finding as a matter of law that this plaintiff cannot bring a Rico claim because the United States not this plaintiff was the most direct victim. That doesn't mean contrary to my colleague's suggestion that there can never be multiple victims in a Rico case. All it means is that with respect to this very unique set of facts where tax payers eagerly sought out tax shelters to defraud the U.S. of tax revenue. And this particular unique situation, the Ninth Circuit held that only the United States was the most immediate and most direct victim. And that means, yes, there's no Rico-based relief for tax payers, including Mr. Resner, in this situation. Well, well, oh, and then just, okay, starting a district court of Resner-Won, the district court said there's no more direct victim than the plaintiff. There's no individual entity that's better situated than plaintiff. And that's the decision that was reversed on appeal, right? The decision that was reversed on appeal was yes. Yes, the statement that there was no better direct person than Mr. Resner. The trial court granted some re-judgment to Mr. Resner as a Rico-plaintiff and this court reversed that. And before the court, that was a district court order. It gets reversed. It goes back down. And the argument they made below was there's no more direct victim than himself. Is there a different argument that they've made by amendment now? No, in your honor, this is what's so critical. In Resner's brief, in Resner-Won, he said there can seriously be a more direct victim of HVB's fraud on the U.S. than me. This is exactly what was before the court four years ago in Resner-Won. This is exactly what he said in his cert petition to the U.S. Supreme Court. It's exactly what he said when he saw it a re-hearing on bomb. He said over and over, I'm the most direct victim. And this circuit rejected that. Right. It's except that, you know, the problem with Resner-Won and the briefing is that this was not an issue presented to the court directly. The court raised it on a phone, which we can. And then there was a response. It was hard to fault parties for what they briefed or didn't brief when the court is raising an issue. I mean, the way I read it, it just said, you can't rely on harm to the United States to show the proximate context. Well, you're on the right. I would submit that it was more than that. It was not this plaintiff and similarly situated taxpayers do not have standing on a re-go. And in fact, the HVB did say similar and situated taxpayers. I'm sorry, Your Honor. Did the opinion ever say similar and situated taxpayers? It didn't, but it described the fraud as singularly a fraud on the United States to cheat the U.S. out of tax dollars. And Hemi, we would submit, addresses this very issue. Hemi says that plaintiffs can't do what Mr. Resner was trying to do here, namely, they can't plead their way around weak of standing requirements to circumvent proximate cause requirements. That's one of the things that Hemi says, and we would submit that exactly what Mr. Resner is trying to do. Yes, the Ninth Circuit did bring up the standing issue four years ago, but that was the court ruling, and under the law of mandate or law of the case, we would submit his honor at the trial court did exactly what he needed to do. Councillor, I assume you were referring then to this passage. It looks like it's on page 873. There is notice of you that HVB defrauded the United States through cards. We hold, however, that HVB's fraudulent activity toward the United States did not cause Resner's injuries. Is that the crux of your- Yes, it is. It is. It is that. And what's so notable here is HVB pleaded guilty pursuant to a deferred prosecution agreement and paid $29 million in restitution fees to the U.S. government, the U.S. attorney's office in the Southern District investigated and made HVB plead guilty. But no restitution was forthcoming to people like Mr. Resner and the taxpayers who so eagerly sought these tax scams. The only restitution that the DOJ paid was to the most immediate, the most direct victim of this scheme in this circuit's view, mainly the U.S. Treasury. Because- Well, let me just stop. I hear his argument. What about me? I paid all these fees, right? How could I not be a direct victim? But you're saying that you can't get that under Rico. That's exactly right, Your Honor. But the criminal has- And that's what this Court decided that for this unique Rico situation, this unique set of facts, Rico is not appropriate. There can't be Rico-based relief because some schemes have immediate and direct victims. And here, when you're talking about taxpayers who were paying 147 percent rates of interest and $4 million of upfront fees to secure a $7 million loan, it's such an irrational investment decision, this Court held the immediate direct victim is the United States because this was first informed us the scheme intended to defraud the United States out of tax dollars. And that's why no taxpayer anywhere received restitution with respect to any of these tax shelters, the restitution. What the DOJ decided to do has nothing to do with the civil suit. You agree with that? I mean, it's not binding anybody. I take your point. I do agree with that, Your Honor. But I do believe that that was part of the- part of this Court's analysis in finding that Rezner-Latz Rico standing and that Rico relief is not available in this kind of a situation. Where do you find that? I think that would drove the Ninth Circuit to say this was a scheme intended to deprive the United States out of tax revenue. This wasn't a scheme to drive Rezner out of fees. Well, that's not part of the opinion. That's just his speculation. Well, Your Honor, this Court said we hold that HBB's fraudulent activity toward the United States did not cause Rezner's injury. I think that can only be taken to mean that Rezner is not the victim. Here, the victim was the United States. Now, it might be different for a fraud claim and Rezner and HBB settled his fraud claim, but Rico has unique pleading, standing, and proximate cause requirements. We know that from Hammy and from Anza. There was no cross-motion for summary judgment in this case. That's correct, Your Honor. There was not. Prior counsel did not bring a cross-motion for summary judgment. If I can, and I would also note, Your Honor, that with respect to the merits of the Rico situation, Mr. Rezner used the same evidence that was rejected four years ago. For example, HBB's admissions in the deferred prosecution agreement. Yes, HBB admitted engaged in wire fraud. It did. And in admitted engaged in mail fraud, it did. But those admissions said we did that to deferred the United States. So those were admissions of mail and wire fraud against the direct victim, the U.S. Treasury, not against Mr. Rezner. It might be, we turn to that parole evidence rule. I don't mean to interrupt, but you're running out of time. River Island seems to have changed things. What's your response? My response is that River Island speaks to parole evidence, but the input of the Sussex opinion is reasonable reliance. This Court held the Sussex that no party entering into these kinds of tax transactions can rely on a representation that this is a long-term loan. Rezner now says, well, that was only one, a narrow sliver in this constellation of many misrepresentations. But the key is the duration of the loan is central to the entire card scheme, because it only makes economic sense. It's only a transaction with economic substance if it's a 30-year loan. As soon as it ceases to be a 30-year loan, and indeed can become a one-year loan, then you find yourselves in a situation that Rezner was in paying $4 million in upfront fees for a $7 million loan that was fully collateralized, by the way, to the tune of 147 percent rate of interest, all to replace a loan that he had that was charging only 5 percent interest. In other words, once the loan duration of the loan collapses, cards is necessarily a sham transaction designed solely to defer all the United States. And Sussex effectively stands for the proposition that Mr. Rezner knew that, that any person entering this agreement knew that, because there was a provision plain as day, that Mr. Rezner has admitted to reading in which HVB said, we can terminate this loan on the first year anniversary or any year thereafter. That's long, Mr. Rezner found himself hanging out, landage 147 percent rate of interest, which he knew was ridiculous. No rational person would do that. And what's key in Sussex as well, this Court said it's particularly unreasonable for a person to rely when they're sophisticated and experienced. Mr. Rezner created and founded the company that ultimately became Facebook. And this entire transaction was driven by his desire to sell Yahoo Stop. He received $100 million worth of Yahoo Stop for the sale of this company. And he sold $30 million worth of that stock and tried to pay zero in taxes by entering into cards with his eyes wide open. HVB's admissions all relate to wire fraud and mail fraud with respect to the U.S. government, not with respect to Mr. Rezner. Also, Mr. Rezner, knowingly assumed joint sever liability for a $47 million loan that was created on behalf of a shell company, sold for the purpose of this transaction whose two members were a British housewife and a British accountant, neither of whom Mr. Rezner knew or had never met. And that's because this was all part of the scam that he went into knowingly to pay zero taxes on a $30 million transaction. Thank you, Counsel. Your time has expired. Mr. Rezner, you have some reserved time. Yes, Your Honor. First, I'd like to respond to some of the points my opposing counsel made. The first is the issue of direct injury. As Judge Thomas has noted, this issue was not only not briefed, but this issue was explicitly waived by HVB and its reply brief. It was, therefore, not before the Court. Waved in the reply brief before the Court and Rezner won, is that what you're saying? Correct. In addition, what I would say in that, what did they say in the reply brief? They actually have a section that talks about how they're not disputing the issue of direct injury. It was explicitly waived. Right. Well, that didn't matter to the Court. No. But, Your Honor, I would posit that given what was before the Court, which has to draw all inferences in HVB's favor, HVB characterized this as they're trying to use our admissions of fraud against the government to claim an, you know, to claim that we've defrauded them. So if you look at the language of the prior Court's decision, it all says towards the United States, fraud on the United States. Nowhere does it say HVB's illegal conduct cannot approximately cause Rezner's injury. And that makes sense because that would go against every other case out there. In Henney, the reason why that plaintiff wasn't a directly injured is because the injury, the economic harm, was contingent on the actions of third or fourth parties. We don't have that here. Whether Rezner took a tax deduction or not, he's paid $4 million in fees. There is no case that finds that this is not a direct injury. And it also would make no sense in the, in the RICO language that contemplates having multiple victims. Therefore, we contend that the prior panel did not mean this. And even if it's construed to mean that, they simply got it wrong. Well, if they got it wrong, there's nothing we can do about that. That's not true, Your Honor. Under Jeffries V. Wood, law of the case is something that's discretionary. Rule of mandate does not, is not binding on this panel. If they got it wrong, is it true? If there's, if to avoid a manifest injustice under Jeffries V. Wood. But rule of hand. Well, Jeffries actually went the other way. Your Honor, I would also like to address a few other points that my opposing counsel made. He talked about why didn't Rezner try to claim restitution. If you look at 28 CFR 9.8B, actually a plaintiff like Mr. Rezner is required to pursue a private right of action first. So that is exactly what we're doing. Secondly, RICO contemplates different sets of damages for criminal and civil conduct. It's, it apportions the pie differently, which shows that it's not supposed to be part of the same pie. My opposing counsel has talked about what drove the Ninth Circuit. But that isn't, speculating as to the motives of what drove the first panel is not law of the case or rule of mandate. Lastly, Councillor, should we begin to anything, into the Rezner 1 context that there was no motion for summary judgment filed on your side? In Rezner 1, we believe that that's critical, the fact that we had moved for summary judgment and we were moving on the very same. No, there weren't conflicting motions for summary judgment as my point. No, Your Honor, because if you look at the history, they actually brought, I don't remember how many, but numerous motions to dismiss by that point. Lastly, I would like to talk about Mr. Rezner's reasonable reliance. That was the entire thing that was briefed. And that ruling by the Court, the District Court actually was not addressed or disturbed by the prior panels ruling in Rezner 1. The reality is that it was reasonable for Mr. Rezner to rely. First of all, he doesn't have to establish reliance under bridge and under the various UCL cases where there is unlawful conduct. Mr. Rezner says that all of the requests for admission just have to do with the DPA, but they don't. I actually went back and looked at the RFA admissions, which are binding. And those talk about admit that you transmitted or delivered funds belonging to Rezner 2-Sidley in connection with Rezner's card facility. Admit that you knew at the time you received proceeds in connection with Rezner's card facilities that those funds were derived from unlawful conduct. Admit, and that time period is before he even files a tax return. But I just understand he's there's no continuing fraud case correct, that's out of the case. That's correct, Your Honor. That's correct, Your Honor. We have the UCL on the refill that we put. That's correct, Your Honor. We were trying to make things simple by means of a stipulated judgment to put this on a peel last time because we were told the only issue was that of reasonable reliance. I'd like to make one last point, which is that if you look at the UCC, which is codified in New York 1-208 in California, commercial code 1309, there's actually UCC provision that requires a lender to act in good faith if there's a termination clause. Thank you, Counsel. Your time has expired. Thank you. The case just argued will be submitted for decision